Penalty rates cut hits those who can afford it least


The Fair Work Commission (FWC) handed down its decision in the long-running penalty rates case last week, effectively delivering a pay cut for almost 700,000 Australian workers.

Hospitality, restaurant, fast food, retail and pharmacy workers will have their Sunday penalty rates cut between 12% and 25%. Public holiday pay was also slashed by up to 10%.

This decision will hit those who can least afford it the hardest - the average worker in accommodation and food services earns $524 a week and those in the retail trade earn just $687 - well below the average of $1163 per week for all Australian workers.

penalty rates

People who have to spend time work on the weekend away from their friends and loved ones, and give up time with their kids just to make ends meet are no longer going to receive fair financial compensation.

The ramifications of the decision are still being worked through, as well as the timeframe for its implementation, but some workers stand to lose $6000 a year. At a time when pay growth is at an all-time low and household budgets are already stretched to the limit, it's crystal clear that this cut is going to have a big impact.

Not only will hundreds of thousands of already low-paid workers suffer, there is growing concern from economists that the flow-on effects to the economy at large could be disastrous.

There is hope for affected workers: while the FWC may have cut rates, Federal Parliament can step in and ensure no workers take home pay is affected. The Labor Party and the Greens have already pledged their support, it's just up to the Prime Minister and the Coalition to act to protect workers and safeguard the economy.

Unions also play a critical role in ensuring workers get the best possible pay and conditions. If you're not sure which union covers your job, visit


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