Mar 12, 2014

Hunting for the penalty rates evidence proves a tricky task

The evidence for the impact of penalty rates on the hospitality sector proves surprisingly hard to find. But there are some important clues ...

Bernard Keane — Politics editor

Bernard Keane

Politics editor

Despite what is now an extended period of moderate, indeed historically low, wages growth, Australian workers are again being told they are paid too much. But while the call for wages cuts has come from some business figures and Wall Street bank economists, the government itself has been more wary.

As Crikey has previously noted, Prime Minister Abbott has been at pains to say he does not support wage cuts per se, but has focused instead on workplace conditions and loadings. In his haste to do so, he was caught out making stuff up about SPC Ardmona’s workers. But increasingly, the Coalition focus has been on penalty rates for work outside normal business hours and in particular on weekends.

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10 thoughts on “Hunting for the penalty rates evidence proves a tricky task

  1. MJPC

    This whole penalty rate argument is a con. The LNP (and their willing allies in business) have focused on the hospitality sector (particularly food/drink) because it is an easy hit. Large casual and part time workforce, often school children doing menial jobs, low unionism; they’ll cop it sweat.
    So, they will sacrifice their rates for a few dollars more and that’s one domino to fall.
    We can also look forward to none of those weekend surcharges on restaurant
    Next it will be the federal public service, can’t have the public service at an advantage over the ordinary worker and, besides the PS are a bunch of bludgers; another domino falls. Then it will be state PS workers turn , a bit harder to deal with as they are the people who look after the society; Nurses, firemen, Police, Ambo’s etc. I would’nt want to be a politician attending hospital when they have just screwed the staff over wages.
    Penalty rates are 30% of staff wages on full time work on a normal shift roster; for instance it enough that Nurses have often to look after society’s problems, but at a reduced pay. I guess there are always 457 visa staff from Africa or some other third world country.

  2. klewso

    re what Abbott says/craps – he also has a Senate election coming up in WA, and stands to lose 33% of those winnings made last throw of the dice.

  3. Kevin

    Working permanent-part time . I earn only $400 per fortnight more than the ‘dole’, and that includes afternoon/night/ weekend work. Taking away penalty rates will severely impact on my ability to pay rent, health insurance, utilities let alone food.
    This neocon obsession with kicking the lowest paid is counterproductive at best, and will remove any incentive to work all together.
    After all wasn’t our current PM the one who went crying to Rudd asking for more money, after loosing the 2007 election, about not having enough money to live on a lowly opposition back benches wage?

    Maybe all the numpties who voted this vile government in, will realise they have been taken for a ride?

  4. Crew.Doug

    Bernard, I’m struggling to see why you chose the hospitality sector to illustrate your point on penalty rates. Maybe it’s different in Canberra, but in the inner west of Sydney you’d be lucky to find 5% of restaurants or cafes that paid the award wage, let alone penalty rates. Cash in hand is what is offered and accepted.

  5. Jimmyhaz

    I think that in the end, it boils down to one simple question.

    What is the role of government, to ensure business profits, or to ensure the wellbeing of its constituents?

    If it is the first, scrap penalty rates, if the latter, keep them in place.

    There is, of course, some wiggle room here, but given that percentage of business earnings going to wages are at record lows, its hard to argue that it is penalty rates that are impacting upon the private sector’s sluggish recovery. (It’s lack of government spending, but don’t tell the LNP.)

  6. Nicola Heath

    I worked in hospitality for years & it was rare to find an employer who paid anything but cash in hand, which means the discussion about the effect of penalty rates on the industry tells only half the story.

  7. Jill Baird

    Kevin, why do you need to pay health insurance?

  8. mikeb

    I have 3 kids and all 3 work penalty hours. 1 of them is paid partly cash in hand but the other 2 are strictly paid by the book. The penalty rates compensate them for being basically “at call” and not just the odd hours. Just this weekend a fishing trip was cancelled with an hours notice because of a late call by the employer. She could have refused to work but that tends to not go down well in the long term. Penalty rates if nothing else encourages the employer to be judicious in their demands. If it was open slather then no time would be sacred.

  9. Kevin

    @Jill Baird, do you have perfect teeth, vision and hearing? The cost of dental care and optical is enough to justify paying for health. BTW I am not young, my parents relied on the public dental system of the late sixties/ early seventies, which has resulted in every remaining tooth in my head having a filling, which require maintenance. My vision is failing, requiring specialist treatment.
    If you don’t believe in private health care, that’s fine and your opinion.

  10. Observation

    This is Abbott attacking low paid workers. You dont see any reforms for bonus payments to CEO’s etc. They have their eyes fixed on attacking unions and what they represent at any cost, which is of course penalty rates which the unions fought for and won.

    Its a typical Abbott shot in the engine room policy from deep in the conservative magazine. A policy that is in their DNA and will push to implement at any cost. Divide and conquer the low income and public service sector. This will be the result of many of the effected being on a work for the dole scheme.

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