Written by Charles Watson of WorkForce Guardian, used here with permission.
As part of the four-yearly review of modern awards under the Fair Work Act 2009, the Fair Work Commission has been reviewing penalty rates in a number of awards in the hospitality and retail sectors. As a result of that process the Fair Work Commission has recently handed down a decision relating to the General Retail Industry Award 2010 that will likely have some effect on your business.
Having heard applications to reduce casual employee Sunday shiftwork penalties and an application to increase casual penalties for weekday evening work, the Commission delivered its decision which appears as an outcome of swings and roundabouts. The incoming changes to the Award are effective from 1 November 2018 and outlined as follows:
Casual evening and Saturday penalty rates
- A casual employee must be paid an additional 15% penalty payment for all work performed on a Saturday (previously 10%).
- A casual employee must be paid an additional 5% penalty payment for hours worked after 6 pm Monday to Friday (not previously applicable to casual employees).
- A casual employee who is a shift worker, and works on a Sunday, will have their shiftwork penalty reduced from 225% to 220% (inclusive of casual loadings).
- A full-time or part-time employee who is a shift worker, and works on a Sunday, will have their shiftwork penalty rate reduced from 200% to 195%.
Further annual changes
As part of the decision, a transitional process was also determined upon that will increase casual Saturday penalty rates annually by 5% per year until 2020, when that rate will reach 25%, along with weekday evening penalty rates by 5% per year until 2021, when those rates will also reach 25%.
Additionally, a transitional process will annually reduce Sunday shift worker penalty rates until 2020 where the permanent shift worker Sunday penalty rate will have reduced to 175% and the casual shift worker penalty rate will be reduced to 200%.
In addition to the recent inclusion of a casual conversion clause into the General Retail Industry Award, this decision requires the business to consider the implications of the incoming amendments. Businesses who have employees working on the days and or under those arrangements as outlined should make the appropriate alterations to the penalty rates of pay for their casual employees effective from Thursday, 1 November 2018.