Supermarkets and retailers are pushing for penalty rates to be replaced with a flat pay rise.(Kinga Krzeminska)
The federal government has weighed into a growing row triggered by a supermarket and retailer push to scrap penalty rates, arguing doing so would leave tens of thousands of workers worse off.
In a submission to a Fair Work Commission review, the Australian Retailers Association (ARA) has proposed allowing some staff to opt out ofpenalty rates, overtime, some allowances and rostering arrangements in favour of a 25 per cent pay rise.
The review is looking specifically at the General Retail Industry Award and was prompted by the large number of submissions to the broader modern awards review the former minister Tony Burke requested.
Coles, Woolworths, Kmart and Costco last month joined the push, which would apply to level four to six roles, where employees earn between $53,670 and $61,958.
Employment and Workplace Relations Minister Murray Watt will today take the rare step of filing a submission opposing that, arguing it risks entitlements for some of the 353,200 employees covered by the country's most common award.
We're hardly going to stand by when we see big business representatives, some of the biggest retailers in the country like Coles and Woolies, try to slash the penalty rates of some of the lowest-paid workers in the country, he told the ABC's News Breakfast.
The proposal from the ARA, if agreed upon, would mean retail workers in assistant managerial roles and above could choose to not beprotected by maximum daily hours provisions.
If they agreed to the pay rise or salary absorption offer, staff would also forego their right to consecutive days off and they wouldn't be covered by the right to disconnect. They'd also waive their right to meal breaks.
Senator Watt said the trade off could mean thousands of workers would lose entitlements despite earning significantly less than the average weekly wage.
If employers, workers and unions want to negotiate changes around hours and conditions ... that's fine and that's allowed under the enterprise bargaining system. But it shouldn't be allowed under the award provisions, he said.
Awards are supposed to be a safety net to protect all workers. They should not be varied to remove crucial entitlements like penalty rates for low-paid workers.
He said the government's submission would be in keeping with Labor's commitment to ensure wages don't go backwards.
Murray Watt said scrapping penalty rates could leave retail and supermarket workers worse off.(ABC News: Matt Roberts)
The government's submission echoes the concerns of the Shop, Distributive and Allied Employees' Association (SDA), which said the ARA's submission was an attack that could reduce the take-home pay of tens of thousands of hard-working retail managers.
The union's national secretary Gerard Dwyer labelled the proposal a gratuitous and nasty attack on the rights of hundreds of thousands of workers.
A 25 per cent buyout might buy administrative ease, but it doesn't provide fairness and it doesn't provide adequate compensation for the hours that people would do, he said.
Senator Watt said if successful, the move could open the door to other industries seeking to unwind penalty rates.
There's a principle here which is weekends matter. Weekends are when we gather with our families, when people have weddings, when we have grand finals of football matches, and the people who feed us and clothe us on weekends deserve to be rewarded for that.
In its 1,083-page submission to the commission, the ARA said the current award terms don't provide a fair and relevant minimum safety net of conditions.
It argued a lack of flexibility and rigid restrictions were hindering productivity and creating operational inefficiencies.
In a statement ahead of the government's intervention, ARA's chief industry officer Fleur Brown accused unions of running a misinformation campaign.
There is no proposal to remove penalty rates, overtime or paid breaks from the award, she said.
What the ARA has proposed is that managers can opt in to a pay increase if they select the voluntary salary absorption option. This will only apply to employees that agree to it.
The association has also proposed broader changes to allow all workers to negotiate split-shifts across four days rather than five-day weeks and to finish early rather than taking lunch breaks.
Senator Watt said this was an attempt by big business to change ... the safety floor that is supposed to provide minimum rates and conditions for workers... Even if these workers agreed to this individually with the 25 per cent pay rise on offer, they would still be paid significantly below average weekly earnings.
Today's intervention also marks the latest move from the federal government scrutinising the sector after it last year increased funding to the regulator and held a parliamentary inquiry focused on allegations of price gouging.
The matter is listed for hearings next month.
https://www.abc.net.au/news/2025-02-21/supermarket-push-to-scrap-penalty-rates-opposed-by-government/104962994
