21/12/2015 3:11 PM AEDT | Updated 15/07/2016 12:51 PM AEST

Turnbull Government Advised To Jettison Sunday Penalty Rates

Video by: Emily Verdouw

CANBERRA -- Unions claim 2 million of Australia's lowest paid workers are bracing for a pay cut following the release of the Productivity Commission's final report into workplace relations and are calling for the Turnbull Government to reject any future cut to penalty rates.

Instead, Employment Minister Michaelia Cash has ruled out any Turnbull Government role in changing Australian penalty rates, saying it would be like the government setting interest rates.

In its final report into workplace relations that will inform government thinking ahead of the next year's election, the Productivity Commission has echoed its draft report in recommending cutting Sunday penalty rates, but only for retail and hospitality workers.

The Commission did not recommend any changes to overtime penalty rates, night penalty rates or shift loadings, no changes to the penalty rates of nurses, teachers or emergency service workers.

Bringing a single weekend penalty rate would be up to the Fair Work Commission.

“Government does not have a role in determining penalty rates,” Cash told reporters in Perth.

“It's like asking the Government to set interest rates.

“It is not something you want your Government doing. You want that left to an independent body and that is the position of the Government."

But unions covering the retail and hospitality sector claim 2 million workers are now facing a pay cut.

"These are the workers that can least afford it and don't deserve it " said David McElrea from United Voice NSW.

"This is the Government's own report. It is not good enough, as we have heard from them today, for them to try and hide behind the Productivity Commission and the Fair Work Commission.

"That is why today, we are calling on Malcolm Turnbull to come out, reject this report and refuse to reduce the wages and the weekend rates and the penalty rates of Australian workers."

Labor’s employment spokesman Brendan O’Connor also wants the Prime Minister to declare his position.

“Let's be very clear about this,” he told reporters in Melbourne.

“If the Government, if Malcolm Turnbull and this Government, does not want to support cutting penalty rates, then they can reject the recommendation of the Productivity Commission today.

“The framework was written by the Government by ministers by this Government. This is not a reflection on the Productivity Commission.”

The Employment Minister has announced she will be consulting on the recommendations in 2016 by holding a series of round table discussions with employees, employers, unions, social welfare groups and women's groups.

The Government has promised it will seek a mandate for any changes to the workplace relations framework at the next election.

“That is what we promised and we intend to keep that promise,” Cash said.

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