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Let's All Calm Down And Have A Rational Chat About Penalty Rates

What is it about time on Sunday that makes it worth more than Saturday?

24/02/2017 11:44 AM AEDT | Updated 24/02/2017 11:44 AM AEDT
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"What I want to know is, if your staff are getting paid less, why am I paying the same?"

Any time someone gets told they're going to have to work more hours for the same amount of money, there's a tendency to cry havoc and let slip the dogs of war.

So there was understandable rage yesterday when the Fair Work Commission announced that workers in the retail, fast food, hospitality and pharmacy industries would have their Sunday rates cut.

But, as with any complex issue, there's more than one side to this story.

First, and let's get this out of the way, some clever wags have taken to social media to ask why Parliament doesn't sit on Sundays if it's the same as other days.

It's a reasonable question, except it doesn't apply here at all.

I spent four years in the UK working in hospitality, where not only are you paid minimum wage, there is zero award. So whether you were slogging it out on a typical Wednesday afternoon, at 2 am on a Sunday, or all day on Christmas, you got paid the same. Which, again, was the absolute legal minimum.

It was a shitty way to make a crust, and if it is ever even considered a possibility here in Australia, I'll be militant about fighting it.

But that's not what happened on Thursday.

Instead, Sundays and Public Holidays are being brought back to the same penalty rate as Saturdays, because -- and, be honest here -- what's the difference between those two days?

People absolutely deserve to be paid more on the weekend -- that's when everyone else gets time off, and there should be a financial incentive to spend time behind a cash register rather than with loved ones.

But, other than 'because that's just how it's always been', what is it about time on Sunday that makes it worth more than Saturday?

That's a question the Fair Work Commission apparently couldn't answer.

Happy Mondays

Speaking on Triple J's Hack program on Thursday, the Shadow Minister for Employment and Workplace Relations, Brendan O'Connor, decried the plight of your standard retail worker's future Sundays, saying, "If they're working a seven-and-a-half-hour shift, they'll have to work a ten-hour shift just to get the same money. It's an outrage."

And fair enough, those extra two-and-a-half hours for the same dosh does seem like a scam. Until you consider the person who's getting up for work on Monday morning. Because that person has to put in 15 hours to earn that wage.

What's more, experience tells me that Monday morning is the worst shift of the week.

I picked up glasses in a Newcastle pub to support myself through uni, and on the odd Sunday I worked a few (well-paid) hours, the standard rules went out the window. The usually fastidious, hour-long clean-down of the bar was instead a five-minute, spit-and-polish effort, and while wine glasses were ordinarily meticulously polished, on Sundays they were racked and stacked for the Monday staff to deal with.

"I'm not paying you double-time to clean," was the owner's attitude.

Yay for Mum and Dad!

Which brings me to the other side of this argument. The Australian Small Business and Family Enterprise Ombudsman, Kate Carnell, described the rate cut as "a shot in the arm for small business".

Ms Carnell pointed out that big businesses such as supermarkets and fast-food chains have already done deals over penalty rates via Enterprise Bargaining Agreements, so this was a case of evening the playing field.

"The only people who have been forced to pay the higher wages on Sundays are mum and dad small business owners," Ms Carnell said.

Ms Carnell hit the "mum and dad small business owners" angle hard throughout the day, but it's one of those classic lines -- like when politicians say they're doing "the right thing by Australian families" -- which sounds like bullshit to someone who actually works in one of these businesses.

Sure, your standard café, boutique or pharmacy isn't making the $407 million that Wesfarmers -- owners of Coles -- posted in profits last year.

But here's the thing about the Small Business Ombudsman: the office represents businesses of up to 100 employees. And if your mum and dad have 10 employees -- never mind 100 -- it's probably fair to assume they aren't struggling to feed the family.

Small business owners have paid penalty rates until now and kept themselves afloat, in fact, according to Ms Carnell, "latest figures show the number of small businesses in Australia is on the rise; so too the number of people they're employing."

So, if we've got more small businesses, they're employing more people, and as of July those people will receive a smaller wage, doesn't that equate to small businesses' profits going up?

Who's supposed to be benefitting?

According to the Ombudsman, small businesses that do open at present on Sundays are "basically providing a community service" (seriously, that's a direct quote), so the rate cut is probably the answer to Australia's every problem:

"Small businesses will be able to trade longer, which means their staff will be given more hours, while communities will benefit from the increased economic activity it will generate; particularly in our rural and regional areas."

Amen.

Except, I dunno, maybe "staff will be given more hours" for the same pay is a crappy deal for the staff. And while "businesses will be able to trade longer", any astute entrepreneur knows that staying open for more hours to make the same amount of money doesn't make sense financially.

So where Ms Carnell says that "small businesses will be able to trade longer", maybe what she means is "small businesses will make more money".

And there's nothing wrong with that. But businesses making more money by slashing wages aren't increasing economic activity, it's robbing Peter to pay Paul.

My horse in the race

While my retail and hospitality roots mean I wanted to side with the people who are losing out on penalty rates, the question I really wanted answering was: what's in it for me? And I suspect it's the question most Australians are asking. Because if a business slashes its wages, it follows that their prices will go down.

Instead, both the Australian Retailers Association and the Australian Hotels Association cited the chance to stay open for longer hours on a Sunday -- and therefore offer more hours for young Australians to work -- being the payoff for this decision.

This was how John Howard lost the Work Choices issue -- he focussed on small businesses having more money to hire people. But with the unemployment rate holding steady at 5.7 percent, most Aussies don't want to be hired, because they've already got a job.

What they want is for things to be cheaper. And that's the golden opportunity that's being missed here.

I honestly don't care if a café is open for a few more hours on a Sunday. I don't spent my weekends lamenting the fact I didn't end up with a thinner wallet. What I want to know is, if your staff are getting paid less, why am I paying the same?

Because if prices don't change at the front end, then it's not just the people working Sundays who are getting screwed, so too is anyone who's not a "mum and dad small business owner".

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