‘Badly drafted’ penalty rates bill will ‘tie’ the FWC’s hands

Employers have hit out at the first major piece of workplace legislation put forward by the Albanese government, calling the amendments “unnecessary”.

Prime Minister Anthony Albanese and Minister for Employment and Workplace Relations Amanda Rishworth have launched one of their biggest election campaign promises into the parliamentary arena, introducing legislation to enshrine penalty rates last Thursday (24 July).

“Our number one focus is continuing to deliver cost-of-living relief to Australians,” said Albanese.

“Protecting penalty rates for millions of workers is an important part of that – making sure Australians can earn more and keep more of what they earn.”

Rishworth claimed that the legislation will protect around 2.6 million award-reliant workers.

“If you rely on the modern award safety net and work weekends, public holidays, early mornings or late nights, you deserve to have your wages protected,” said Rishworth.

“This legislation will prevent award variations from reducing or removing penalty and overtime rates. It will ensure the wages of around 2.6 million modern award-reliant workers are protected.

“Millions of hard-working Australians rely on penalty rates and overtime rates to keep their heads above water, which is why this bill is so critical and should receive the support of both the opposition and the Greens.”

The Australian Retailers Association (ARA), who in a roundabout way were the catalysts behind the formulation of this legislation, slammed the government’s attempt at enshrining penalty rates.

At the beginning of the year, a Woolworths-, Coles-, Kmart-, and Costco-backed ARA application to the Fair Work Commission, launched an employer, union stand-off. The application, according to the ARA, sought to impose amendments to the General Retail Industry Award 2020 (GRIA).

Unions claimed that one of the 17 proposed amendments within the application was to strip any worker earning $53,670 and above on the retail award of their penalty rates.

The ARA claimed that the proposed application merely aimed to create clarity and dissuade confusion in relation to the award. However, union outrage seemingly spurred the Labor government – which was on the campaign trail – into promising the enshrinement of such a penalty, much to the dismay of the ARA and other employer groups.

“Australia’s largest retailers find [the GRIA] difficult to navigate. Our smallest retailers find it near[ly] impossible to interpret. Importantly, it fails employers and employees alike,” said ARA chief executive Chris Rodwell.

“The decision also runs contrary to the government’s stated ambitions to lift productivity in this term of government, dampening expectations and putting the conversation on labour productivity in reverse.

“That’s a serious problem, given Australia’s industrial relations environment fundamentally fails to support business investment and entrepreneurship. Improvements in living standards will be elusive if we don’t face this problem.”

Australian Industry Group (Ai Group) chief executive Innes Willox argued that the legislation was “badly drafted” and would further “reduce avenues” to address the nation’s flailing productivity woes.

“The penalty rates bill looks to implement unnecessary amendments that will neuter the Fair Work Commission’s ability to be the independent umpire, and will provide less flexibility when Australian workers want more.

“This is badly drafted legislation that is going to make it harder for employers to employ people who want to work when it suits them.

“It will reduce avenues for lifting productivity when we are about to convene a roundtable on how to lift it.”

Willox claimed that the bill could tie the Fair Work Commission’s hands when it comes to addressing discrepancies within the award system that negatively affect both employees and employers.

“The government should be encouraging the commission to consider how it can simplify and improve our notoriously outdated and unworkable award system. Sadly, this bill instead proposes to tie the commission’s hands,” he said.

“The government should be actively working to improve the minefield of technicalities and complexities that our award system has become. Instead, it is moving to set the current provisions in stone.”

Australian Chamber of Commerce and Industry (ACCI) acting CEO David Alexander echoed Willox’s sentiment.

“This change is a backwards step and out of touch with the realities of a modern economy,” Alexander said.

“Employees want choice, and flexibility and that needs to be at the heart of any workplace proposals. Business needs that agility to survive, especially small businesses [that] already struggle with a complex and archaic system underpinned by an act [that] is over 1,600 pages long.

“Tying Australian businesses up in knots around workplace systems has the effect of strangling growth – and that means [fewer] jobs and lower wages.

“This bill is at odds with the government’s plans to improve productivity, and instead injects more rigidity and complexity into the Fair Work laws.”