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Lawyers divided over penalty rates decision

A CEO and an employment law principal of two separate Australian law firm have voiced opposite opinions following yesterday's penalty rates decision. 

user iconEmma Musgrave 24 February 2017 Corporate Counsel
Penalty rates
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Yesterday, the Fair Work Commission handed down its highly anticipated decision in the penalty rates case.

The decision will see the reduction of Sunday penalty rates in the retail industry from 200 per cent to 150 per cent for permanent staff and 175 per cent for casuals.

It will also reduce Sunday penalty rates in the hospitality industry from 175 per cent to 150 per cent for permanent staff only; reduce Sunday penalty rates in the fast food industry from 150 per cent to 125 per cent for permanent staff and 175 per cent to 150 per cent for casual staff; and reduce public holiday penalty rates from 250 per cent to 225 per cent across the hospitality, retail fast food and pharmacy industries.


Upon the decision being handed down, Nigel Ward, CEO of Australian Business Lawyers & Advisors (ABLA) said, “This was a colossal case which will have far-reaching consequences for the industrial relations system and economy more broadly.”

Mr Ward and his Sydney-headquartered firm represented the Australian Chamber, NSW Business Chamber and Australian Business Industrial in the matter. He commented on the significance of this decision.

“The Commission’s consideration of over 130 lay witnesses and more than 6,000 public submissions demonstrates that all parties have had their positions properly considered," Mr Ward said.

"While the decision’s realignment of Sunday penalty rates in the affected industries will be welcomed by all employers, the real message is that the decision shows that the Fair Work Commission is prepared to reassess historical norms if a merit-based case demonstrates a need for change.

"ABLA is very proud to have taken a lead role in this important and public industrial case.”

Although Maurice Blackburn employment law principal Josh Bornstein suggested he was strongly opposed to the outcome.

The firm issued a statement following yesterday's announcement saying the decision will leave "thousands of Australians worse off and drive a further wedge in the two class economy for working people".

Mr Bornstein said "many Australian workers were reliant on penalty rates to make ends meet, and the impacts for lower paid workers in particular from today’s decision would be significant".

“Already in Australia workers are experiencing record low wage growth, and [yesterday's] decision to cut Sunday and holiday penalty rates for some of the country’s lowest paid workers is likely to exacerbate the growing economic problems of wage inequality, insufficient tax revenue and sluggish demand,” he noted.

“There are regular reports of the lowest paid workers in the country being forced onto sham contracts or being underpaid through other precarious work arrangements. [Yesterday's] decision will further disappoint these workers."

Mr Bornstein also called out the federal government, who he said has been "missing in action" on this debate and appeared "happy to allow the country to sleepwalk further into a two class economy when now, more than ever, we need action and leadership to address wage inequality".

“Maurice Blackburn stands with the union movement in supporting better outcomes for all working Australians and more enlightened government policy," he added.

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