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Transition for Sunday penalty rates still undecided

March 12, 2017

The NRA is dedicated to keeping members informed of any changes that are likely to affect their businesses following the recent penalty rates decision made by the Fair Work Commission.

The changes to public holiday penalty rates will take effect on 1 July 2017 and the variation of the early morning and late night loadings in the restaurant and fast food awards will take effect late March 2017.

A decision has yet to be made in regards to how or when the new Sunday penalty rates will be implemented.

The Fair Work Commission concluded in its decision that “appropriate transitional arrangements are necessary to mitigate the hardship caused to employees who work on Sundays”.

“Many of these employees earn just enough to cover weekly living expenses, saving money is difficult and unexpected expenses produce considerable financial distress.

“If ‘take home pay orders’ are an available option, then they may mitigate the effects of a reduction in Sunday penalty rates.”

But the Commission said it “did not favour any general ‘red circling’ term that would preserve the current Sunday penalty rates for all existing employees”.

It was likely there would be at least two annual adjustments, but not more than five.

Prime Minister Malcolm Turnbull has made it clear that he wants the FWC to ‘phase-in’ the new arrangements over a period of years in order to ensure that workers’ take home pays would not be drastically affected.

The Prime Minister stated that ‘the independent umpire has also said that they’re looking now to ensure that as they transition to a change in penalty rates, the impact on workers is minimised.

“There is a means of doing that, they’ve done that in the past, that’s phasing in changes over a period of years. There are a number of ways that they’re looking at doing that.

“Obviously we would welcome the Commission doing that it has always done in the past, which is to ensure that the impact of changes to modern awards is mitigated, so that people are not worse off in terms of what they’re taking home in their pay packet.”

Parties can file written submissions on the transitional arrangements by 24 March 2017, with the hearing set to occur in early May.

The NRA will continue to keep you updated on this issue.

If you are concerned whether you are paying your employees correctly and whether you are being compliant with Fair Work Laws, we recommend that members make use of NRA Legal’s Payroll Audit Service which is currently offering basic payroll audits for $250 + GST per employee (see details here). For more information, please contact our legal team on law@nra.net.au or 1800 738 245.

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