Bill Shorten to save Sunday penalty rates

James Pearson, the CEO of the Australian Chamber of Commerce and Industry, reacts to Bill Shorten’s pledge to ignore the decision of the Fair Work Commission to gradually cut Sunday penalty rates

Introduction – Bill Shorten to save Sunday penalty rates

Ross Greenwood: Welcome back to money news right here in Australia, just a bit of breaking news out of the Greens. There has been a situation where there has been a push for Lee Rhiannon, who’s the hard left member of the Greens to be suspended. Now, a meeting of the Greens is just taking place, and she has been suspended after claims that she had sort to undermine negotiations, in regards to the passage of the Gonski education reforms, Gonski 2.0 through the parliament.

The time that she was making criticisms and also authorized a pamphlet, urging voters to oppose the government’s funding for education. It came at the same time that her key colleagues were trying to do a deal with the education minister Simon Birmingham. In other words, she’d gone against the party line. What’s happened as a result of that is, she has been temporary suspended from the party room. We’ll just wait and see what happens next, in regards to the controversial senator.

Anyway, something else that is also controversial, and certainly will play a part in the lead-up to the next federal election, is the Bill Shorten the opposition leader. Now says that if the Labor government is formed after the next election, and he is prime minister that he will fully restore waken penalty rates for those people in the hospitality and retail sectors. As we know from July 1 this year, the Sunday penalty rates, in particular, will be cut as a part of a decision by the Fair Work Commission.

We only have to go back last year, when he was put under pressure by my colleague Neil Mitchell about this basic decision. Whether it would follow the Fair Work Commission, which was basically an organization that he helped to create himself. It is the independent umpire whether it would abide by its decision. Here’s how that conversation went.

Interview – James Pearson: Chief executive of the Australian Chamber of Commerce and Industry.


Neil Mitchell: Will you accept their findings given this is an independent body, assessing penalty rates for Sunday? If you’re prime minister, will you accept them?

Bill Shorten: Yes.

Neil Mitchell: Even if they reduce Sunday penalty rates?

Bill Shorten: Well, I’ve said I’ll accept the independent tribunal.

Ross Greenwood: Yes, actually no is the answer. Because no is actually the answer now, because Labor will fully restore waken penalty rates if we win the next election. Shorten well as they say comes in from July first. Some people who receive those penalty rates are not happy that they’re getting clipped. To compensate, the Fair Work Commission has given an above-inflation increase in the minimum wage. Let’s go to James Pearson, the chief executive of the Australian Chamber of Commerce and Industry.

James Pearson, this is going to be an election issue, there is nothing surer. Is it a situation where employers that are currently getting a benefit from these cuts in Sunday penalty rates, that they can bank them at this stage?

James Pearson: Well, that’s the point isn’t it, Ross? We all stand the opposition’s plan to overturn the penalty rates reduction, is actually risk swaying small businesses not knowing where they stand. You and I and your listeners I’m sure know that when there is uncertainty for businesses, it means they’ll hold off an investing. They’ll hold off in taking risks, they’ll hold off in employing more Australians and offering people morale.

We are very disappointed in the position that the opposition leader has taken. Employers didn’t get everything we wanted in the Fair Work Commission’s decisions on penalty rates, but we’ve accepted the independent umpire’s decision, and they were modest reductions. Then the Fair Work Commission has come out with a transitional plan, to phase in these penalty rates reductions over four years. Again not as quickly as employers would have wanted to stimulate job creation, but again we’ll respect the independent umpire’s decision–

Ross Greenwood: Shouldn’t people be screaming the word cleaner vent every time Bill Shorten says this? Because as a union leader, he was prepared to trade away his own workers’ penalty rates with big companies, and also to make certain that his own union got certain benefits out of it as well. I would have thought this is the ultimate in hypocrisy.

James Pearson: Well, if you are talking about the ultimate in hypocrisy, let’s have a look at the union campaign at the moment. They’re trying to whip out fear, for everyone who works in retail and hospitality on a Sunday, and the wider community. They’re talking about massive cuts to penalty rates, but on the reality, we’ll be very desperate. Now, because of the increase in award wages which you mentioned already in your introduction, most people who work on Sundays in retail and hospitality will actually see an increase in their pay package from the first of July onwards, even with the new penalty rates.

In fact, people are going to be going home with more not less money come next weekend.

Ross Greenwood: I would have also thought, given that those unions have been prepared to trade away the penalty rates, so big business– you mention small business early, its small business that’s affectedIt’sts just small mom and dad shop around the place. It is really knocked about by these penalty rates, because many of the big retailers that they have to try and compete with, they don’t have penalty rates. They’ve already under a deal that they’ve done with the union, in doing an enterprise by the agreement already got rid of them.

James Pearson: Those small businesses don’t have that luxury. They are utterly dependent on what the Fair Work Commission decides in terms of award wages. That’s why they were so supportive of the Fair Work Commission’s decision to make modest reductions in Sunday penalty rates, to bring them down towards but not even level with Saturday rates, which was still much more generous than any other day of the week. Yes, this leaves more business in a very difficult position.

The opposition’s plan to overturn the penalty rates reductions risks leaving those small businesses men and women simply not knowing where they’re going to stand.

Ross Greenwood: Okay. If I can look at the hypocrisy of this argument, if I can figure out that there is actually almost a double standard here from the union’s argument, and also from the opposition, and the Labor Party, Bill Shorten’s argument if you like. Why is it that they owe government and indeed employer bodies cannot basically annunciate that particular hypocrisy, as loudly and as vigorously as what they can?

Jame Pearson: Well, that’s what I’m doing this evening. Because with the changes due to take effect from next weekend, we think it’s time the union movement came clean. This is a deliberate campaign of misinformation, and my job and that of other employer representatives who we work very closely with is to do just that. Make the point and make it time and time again that the union movement, with the support of the IOP, is actually spreading this information, and it’s putting in place the plan which if enacted would mean small businesses would be left not knowing where they stand.

At the same time as most workers on penalty rates in retail and hospitality, are actually going to see an increase not a decrease in their pay from next week.

Ross Greenwood: The problem is there seem to be a whole bunch bitter at doing it James, that’s the problem.

James Pearson: Ouch. Look, we are working as hard as we can. Let’s recognize that there are hundreds of thousands even millions of employers, mainly small businesses around the country. We are doing everything we can with them to get the message out there. The fact is that most business people particularly small business people are so busy working not just 9:00 to 5:00, working pretty well every day of the week to keep the doors open, to keep people employed. Often they’re actually paying their employees more than they pay themselves. They don’t have the time to go out there and run campaigns. That’s our job with them, and we’ll keep doing it the best we can, but we’re also strong believers that in the end of the day the truths, the facts will come through.

Ross Greenwood: There you go. James Pearson is the chief executive of this trade and chamber of commerce and industry. Trust trying to put her there– that there is genuine hypocrisy in the arguments of Bill Shorten, and also of the Australian union movement rIt’st now. Its not that they get everything wrong or all that type of thing, and certainly some people on penalty rates would like to keep them on top of thing, but understand this is going to be a massive political campaign going to the next election.

Right now, according to my observation, at least anyway, there seems to be more noise about the poor people who are losing it. They have Bill Shorten gets on the front foot. Of course, he is in front politically. This compared with the common sense approach, which is laying on the unions who have prepared the trade it away. Bill Shorten was prepared to trade away penalty rates, now they’re the great defenders of penalty rates. Struck me, I don’t know. James thanks for your time.

James Pearson: Thanks, Ross.


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