Proposal will discourage businesses from opening on weekends, hiring young Australians
Employers in Australia have criticised Labour's plan to enshrine penalty rates in legislation, describing it as a "job killer."
Innes Willox, chief executive of The Ai Group, warned that Labour's plan will "signal the death knell" of many businesses across Australia.
"The new proposals to enshrine penalty rates in legislation are a job killer that do not represent a serious plan to revitalise our struggling businesses and economy," Willox said in a statement.
"Our workplace laws are already ludicrously complex, outdated and restrictive, and actively discourage business investment and employment, especially of young Australians who will be the main victims of this proposal."
The chief executive's statement comes after Labour recently announced that it will enshrine penalty rates in law if re-elected.
"If Labour genuinely wants to assist with the cost of living pressures, it needs to spell out a pathway to addressing our failure to lift productivity so that businesses can afford to deliver the sustainable wage rises everyone wants to see," Willox said.
"All this will do is further discourage businesses from opening on weekends and employing young Australians, and will further drive up the costs both for businesses who must open on weekends and their consumers."
According to Willox, the proposal will only tie the hands of the Fair Work Commission, which decides on the current penalty rates in awards.
"Labour should trust the independent umpire it empowered to set fair terms for Awards, not simply change the rules to ensure unions get their way," Willox said.
Labour's plan to enshrine penalty rates in law comes after the Australian Retail Association (ARA) lodged earlier this year a proposal for some staff at large organisations to opt out of penalty rates in exchange for a 25% raise. The Ai Group followed with a similar push but for clerks and banking awards.
But Fleur Brown, ARA Chief Industry Affairs Officer, stated that the government and unions continue to "misconstrue" their proposal.
"Penalty rates will not be removed under our proposal," Brown said in a statement. "What's proposed is that retail managers can opt into an annualised salary which provides greater income and financial stability and would see them on average $5,841.65 better off annually."
ARA, together with the Australian Chamber of Commerce and Industry (ACCI) and the Council of Small Business Organisations Australia, warned that the government's plan to increase workplace regulation will threaten the survival of some businesses.
"Employees want choice and flexibility and that needs to be at the heart of any workplace proposals. Business needs that agility to survive," said ACCI CEO Andrew McKellar in a statement.
"Tying Australian businesses up in knots around workplace systems has the effect of strangling growth - and that means fewer jobs and lower wages."
The debate over penalty rates comes ahead of the upcoming Federal election on May 3.
Seven in 10 Australians said protecting penalty rates is important when it comes to deciding on how they will vote, according to a new poll by Essential Research, as commissioned by Australian Unions.
Overall, 44% of Australians said they will vote for a political party that has a plan to legislate to protect penalty rates.
Data from the Australian Council of Trade Unions warned that employees in some sectors risk losing over hundreds of dollars if penalty rates were removed from their take-home pay over Easter. Among those affected are:
Retail workers (would lose $353.21 without penalty rates)
Aged care workers ($623.52)
Paramedic ($742.56)
"Everyone working over this Easter break deserves their penalty rates. Give them your thanks because big employers, Peter Dutton and the Coalition won't," said ACTU President Michele O'Neil in a statement.
