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Understanding the FWC penalty decision – Part 1

01 Mar 2017

Topics

  • Employment Law

Who is Affected by the Fair Work Commission Ruling on Penalties?

On 23 February 2017 the Fair Work Commission (‘FWC’) handed down a decision to make amendments to a number of awards that will reduce the weekend penalty rates paid to employees working in the hospitality, fast food, retail and pharmaceutical industries in Australia. Emily Shoemark and Caitlin Meers have prepared 2 blogs to clarify the decision.

The first blog post covers:

  1. Who is affected?
  2. What are the changes?
  3. When will the changes occur?

The second post covers why the decision occurred. You can find that post here.

Who is affected?

Full- time, part-time and casual employees working in the following industries, and employed under the following modern awards:

  • Fast food – Fast Food Industry Award 2010
  • General Retail – General Retail Industry Award 2010
  • Hospitality – Restaurant Industry Award 2010; Hospitality Industry (General) Award 2010
  • Pharmacy – Pharmacy Industry Award 2010
  • Registered and Licensed Clubs – Registered and Licensed Club Award 2010

The FWC will now make individual determinations to vary each of these modern awards to implement the changes to weekend penalty rates.
Submissions were also made in relation to the Hair and Beauty and Restaurant industries however those proposed changes were dropped by the relevant employer groups prior to the final decision by the FWC.

What are the changes?

The table below outlines the current and proposed penalty rates (in red) as a percentage of the base rate of pay.

For example, if you are a full-time employee in the restaurant industry and rostered to work on Sundays, under the proposed changes you would receive 125% of your base rate, instead of the 150% you may receive now.

Please note that the rates may be affected by other agreements you may have in place with your employer including the individual flexibility arrangements and Enterprise Agreements.

When will the changes occur?

The Fair Work Commission has indicated that the FWC penalty decision changes should be implemented within the next 12 months. Changes to Sunday rates may be phased in in smaller increments, to allow employees to adjust.

How did the decision come about?

Please have a look at our associated blog post here to learn more about this landmark decision.

Where can I find the full decision?

You can find the full decision here.

What now?

If you have any questions or concerns about your penalty rate entitlements or any other employment issues, please contact Emily Shoemark and Caitlin Meers in our Employment Team on (02) 6285 8000 or by email to discuss. You can find out more about our employment law work here.