The Productivity Commission is arguing for penalty rates to be slashed in a draft report released today.

Their recommendation penalty rates be cut is only one of a raft of reforms proposed by the commission that will radically transform the Australian workplace.

The Commission believes the recent turbulence (decline in resources sector, weakening Aussie dollar, and near flat lining investment) within the Australian economy as factors contributing to their recommendations.

Productivity Commission Chair, Peter Harris said, “Set many years ago to deter weekend work, these rates now just deter weekend services that as a society we increasingly want.

“This is particularly so for the café, hospitality, entertainment, restaurant, and retailing industries.”

Mr Harris argued that working night shifts are far more taxing than working weekends, and yet “the penalty rates are set the other way around.”

He also argued that there was no difference between working on Saturdays and Sundays, so the pay rates should be the same for both (not that he meant raising the penalty rates of Saturday to those of Sunday).

Dave Oliver, from the Australian Council of Trade Unions, was outraged at the proposed changes. He argued that reducing weekend penalty rates was nothing less than forcing a pay cut on thousands of Australians. He threatened to make penalty rates an election issue.

 “Unions will fight any move to cut penalty rates, the minimum wage and rights at work,’’ Mr Oliver said.

“If the Abbott Government wants to make rights at work an election issue — bring it on.”

Mr Abbott has already announced his intention to put changes to the current penalty rates to the people at the next election. He believes the current awards are stifling job growth.

Leader of the Opposition, Bill Shorten ridiculed the commission’s report as “A new front in the war against fairness.”



The Australian Retailers Association were rubbing their hands in glee at the announcement. They backed the report by saying the retail industry’s growth must be supported by cuts to penalty rates.

Martin Ferguson, Chairman of Tourism Accommodation Australia, concurred. His industry, he said, was being hamstrung by “unrealistic (penalty rates) which put a dampener on employment.”

Also on the Commission’s hit-list are the current unfair dismissal laws – giving greater power to businesses to sack workers; and changes to enterprise agreements – to address the power imbalance between unions and small business owners; and greater safeguards for migrant workers.

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