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Stepping through the penalty rates minefield

The Productivity Commission released its Workplace Relations Framework report on December 21, 2015.
Among its finding, the report calls for Sunday penalty rates for cafes, hospitality, entertainment, restaurants and retailing to be aligned with Saturday pay rates.
The commission, however, found that, overall, penalty and overtime rates should be maintained, including on public holidays.
The commission says a shift in “social trends and community norms” has altered the “historically distinctive role of Sundays as a time when people did not shop or engage in other consumer-oriented activities … these changes have undermined the original basis for regulated penalty rates in these industries.”
This holiday season has been a busy one in Yamba; businesses have had to manage staffing and opening hours, not only on Sundays but public holidays, particularly over Christmas when there was an extra holiday for Boxing Day – penalty rates were paid for both Saturday December 26 and Monday 28.
The Independent caught up with the owners of Irons and Craig, Antony Perring and David Barnier, who explained how they managed their cafe’s staff.
Mr Perring said their main objective was to maintain “the sustainability of the business so we can maintain the sustainability of our workforce.
“To do that you’ve got to weigh up how important it is to be open and servicing customers, particularly tourists, because it’s important for Yamba to have a thriving hospitality sector, so they want to come back.
“Our strategy over the break was to run a tight menu for limited hours on the public holidays so we could be open.
“…We would have loved to have opened eight or nine hours on a public holiday … but it’s just not financially viable.”
Independent: How do you manage your weekly staff rosters?
Antony Perring: If you’re rostered on for a shift, you’ve got a guaranteed minimum that you’re going to be working.
David Barnier: We stick to the rules (we might send someone home early for example); but you’ve still got to pay a minimum number of hours.
AP: We’re honest with our team. If we think it might be slowing down … as it does after the two peak weeks through the Christmas season …, we share the pain in the way the cuts might work.
… It’s about making sure we’re transparent and communicative with everybody. We know [for example] next week’s going to be quieter, the week after is going to be quieter again. Everybody is up to date … and knows what is going to happen.
I: What is your opinion on the flagged changes to Sunday penalty rates?
AP: It’s really difficult, the discussion around penalty rates, because there’s an inherent assumption of fairness that leans on the side of employees, particularly casual employees.
…I don’t think there is enough consideration given to the people who use the services on Sundays and public holidays. A lot of people who are anti changes to penalty rates are quite happy to go out to lunch on a Sunday, or quite happy to go … shopping … on a public holiday, where they don’t actually realise it’s costing the business owner up to two and a half times more.
… There’s a weird disconnect in the public’s perception.
D: It [comes] … to a point where we need to consider: do we open or do we actually shut one of these days; but the problem is: if we do, we have to get rid of staff.
…The truth is there is no simple answer … there are a lot of things that drive the need for penalty rates and there are a lot of social issues to be considered: expensive housing, the cost of living is too high [for example].
I: If it were up to you, what kind of changes would you consider making?
A: Lift the minimum wage and drop penalty rates, so there is no differentiation between the person lucky enough to get a Sunday shift and a person who works on Tuesdays. There is a disparity there already, because if you’re … a single mum [for example] and you can only do Tuesday afternoons, I’ll only pay you [the minimum casual wage] $23.09 an hour. I’d love to have you on Sunday, but you’re unavailable.
At the heart of Messrs Perring’s and Barnier’s workplace philosophy, however, is the creation of a “stable environment”.
“People don’t like change,” Mr Barnier said, “so if we’ve got the same core staff that were here the last time you were in town, you will feel more comfortable, familiar – that’s a key part of what our business is about.”

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