Bill Shorten (Maribyrnong, Australian Labor Party, Minister for Financial Services and Superannuation) Share this | Link to this | Hansard source

For our children an Australia Day barbecue is not the same without having around their parents who care for them. Nor is Christmas lunch with a family member's seat vacant, or a son or daughter absent at work. We have a modern economy, but the value of some traditions does not diminish with the passing of time. Family time is just such a timeless tradition. Yet vacant seats at the table and missing barbecue cooks are a reality of modern Australia on public holidays.

Essential services must of course go on. We still need someone to serve at the petrol station. Families still want to go out to eat—someone needs to wait their table, cook their meal. All of us live in a seven-day-a-week consumer friendly retail economy—but someone has to stand at the cash register. This is the price, and the blessing, of our global, flexible and competitive economy.

But the time not spent with your children is time you never get back. We know our loved ones would prefer you spent time at home with them rather than the hours at work. Kicking the ball with the kids, helping them with homework, watching a family movie. These are the most important hours. Not the next meeting or your next hour at work. And therefore this government—this Labor government—believes that adequate compensation for unsociable hours of work is reasonable.

There are some fundamental differences that separate those of us on this side of the House from those opposite. One of them is Labor's determination to support and protect penalty rates and public holidays instead of allowing them to be rolled back or scrapping them completely, as some in our community would have us do. In Labor we believe in handing on better conditions, not worse conditions, to the next generation. We believe in protecting the most vulnerable in our society, including the low paid. We believe in the transformative power of education for all Australians regardless of their background. And we believe in better superannuation in securing the retirement incomes of our workers, along with their safety at work and indeed their take-home pay. We also believe that there are some days in our calendar that are particularly important—that are in fact special. They are days where we come together in a circle of family and friends to celebrate our shared history and customs, our milestone achievements, our community, our family. And because we believe in these days, we recognise and respect the work performed on these days.

That is why this government does not believe in measures to reduce public holiday protections or penalty rates for working Australians. We believe that these protections and compensations should continue. Australian workers who work on public holidays ought to command our respect and our gratitude. They work so we can enjoy our leisure. These are workers who take time away from their social, community or family activities to allow other Australians to enjoy that special time. It is these workers:

This government also recognises and respects the workers who do work when the rest of us are enjoying our own family time—whether on weekends or late at night.

Australia has come a long way since the 1950s but we should not surrender the idea of the weekend, or give up on getting the balance right between work and family time. We understand that of course some people need to work on these days to support their families. All of us enjoy our weekends—we enjoy them because they are the best days for time with family. When we play sport (or watch sport) or head to the beach, go to the movies, or just potter around in the backyard, it is typically the quality time we get to spend with those closest to us. We believe that weekends are important, and the idea that you should have to trade in that family and home time for nothing—this is not the Labor way.

These are days that cannot be simply substituted for another day in the week. Try telling a working Australian with children that they can easily swap working on a Tuesday, when their children are at school, to a Saturday with paid child care necessary to work, for no extra payment. Or that the late night shift over dinnertime, homework and bath time during the week is the same as being at work between nine and five when their children are at school. Treating every hour as having the same value may easily be made on a balance sheet, but it can never be fairly made in real life. Not all hours are equal. We understand the importance of life outside of work—of family and community, and interests and hobbies and sport and culture, and our national traditions. This identity cannot simply be traded away for nothing like economic commodities. Our identity, both individual and national, is set not merely by our work but by all of what we do, both at work and outside of work.

I note media reports today that employers in the high-end restaurant game are wanting to bring in foreign labour due to extensive labour shortages in the hospitality industry. One employer is quoted as saying this: 'I would be opening up more restaurants but I can't find the staff to do it.' Reports also confirm the low rates of pay across the hospitality industry and retail sector. Therefore, it is counterintuitive to suggest that penalty rates are the major reason that retail is struggling, when retail wages are already amongst the lowest in Australia. Many businesses in this industry are struggling. It is also counterintuitive to say that in times of labour shortages reducing the take-home pay of workers will attract good staff. I am sympathetic to the position of all business owners in Australia who are struggling in the multispeed economy we have. I am sympathetic to the regions who identify a lack of available workers. I am sympathetic to the impact of the internet on bricks-and-mortar retail. But I say again: reducing the take-home pay of workers to deal with those problems is not the way forward.

Australia will never win a race to the bottom on conditions. There will always be a cheaper wage economy. And if cutting weekend penalties does not work, what do we do next—cut weekday pay? We will succeed with high-performance, high-quality, well-remunerated workplaces. Our people are our competitive advantage. Penalty rates are not something new. In this country we have recognised and paid penalty rates for work on weekends and unsociable hours for almost 100 years. That is why the latest attacks on penalty rates are so significant. Just like denying the science of climate change, there are those who try to argue that:

And this remains the norm.

The approach is supported by the evidence.

International studies have found that Sunday work affects parent-child relationships more than any other type of atypical work. And, importantly, that parents do not appear to make up for time lost by spending more time with children on another day.

Studies have found that working unsociable hours has a negative impact on both personal and family wellbeing. For example, research in the hospitality and retail industries found that weekend work results in relationship conflict and stress with immediate family members. Studies have found that employees working at weekends have reported significantly higher emotional exhaustion, job stress and psychosomatic health problems than employees not involved with weekend work and that working late night shifts has adverse health impacts, such as an increased risk of cardiovascular disease compared to day shift workers, and adverse lifestyle behaviours, such as poor nutritional intake.

Workers who rely on penalty rates are not generally well paid—usually on around $40,000 or $50,000 a year. Their workplace arrangements are largely based on modern award provisions, which makes securing the award safety net all the more important. Over 10 per cent of all Australian workers, or around 1.2 million workers, currently work in the retail sector and a further 777,000 Australians work in the hospitality and accommodation sectors. Of these, seven out of every 10 in the accommodation and food services sector work on weekends, and more than half the workers in the retail sector work on weekends. This compares with only a third of workers across our economy.

Given these workers are often demonstrably low paid and reliant on award protections, penalty rates make up a significant proportion of their income. For example, penalty rates comprise approximately 11 per cent of the salary of a casual restaurant worker and nine per cent of the salary of a casual hospitality worker who regularly works weekends. Even with penalty rates, full-time workers in the retail sector earn only around $51,000 per year and full-time workers in the accommodation and food services sector receive around $50,000 per year. This is only around 69 or 70 per cent of total weekly full-time average adult earnings.

There are a number of policy suggestions about how to manage penalty rates. The independent panel that reviewed the Fair Work Act this year noted that:

Perhaps the major difference with the treatment of public holidays under Work Choices was the ability to trade off penalty rate entitlements for little or no compensation in bargaining.

And it went on:

It is likely that low-skilled vulnerable workers who lost penalty rates and other protected award conditions under Work Choices AWAs have benefited [from the Fair Work system].

This government does not support the reduction of public holiday entitlements, including penalty rates, with little or no compensation. We call on the opposition to do the same—without reservation. It is not right and it is not fair. Importantly, it is false to say that improved productivity can be achieved by cutting wages for low-paid workers. In fact, cutting wages is likely to have a negative impact on productivity. We also do not support propositions that undermine the eight-hour day or that say weekends and public holidays are not important if you have not already had a full week of work—not every day is the same.

The Gillard government understands the challenges that affect many businesses in Australia—the high Australian dollar, the competition from online businesses and our changing economy caused by the cautious consumer. The Fair Work Act provides a range of options to deliver flexibility in relation to managing penalty rates. Under the Fair Work Act more than 20,500 enterprise agreements, covering 2.62 million employees, have been made since the agreement-making provision of the Fair Work Act began on 1 July 2009. Enterprise agreements can roll up penalty rates into a higher flat base rate of pay or provide for annualised salaries which takes into account a component for penalty rates so long as employees are better off overall. Individual flexibility arrangements, whether under an award or an enterprise agreement, can allow for individual arrangements which deal with penalty rates so long as the employee is better off overall.

Those who argue that the Fair Work Act does not provide flexibility should consider the following. Between 1 January 2010 and 30 June 2012 over half the agreements made under the Fair Work Act, covering almost 60 per cent of employees, contained a flexibility term which allowed penalty rates to be varied by agreement between the employer and employee so long as the employee is better off overall. As at 30 June 2012, more than 48 per cent of agreements contained a commitment to improve productivity, 95 per cent provided for flexible engagement of employees and 72 per cent provided for flexibility in hours of work.

The government is currently consulting with stakeholders, including the state and territory governments, in relation to the recommendations contained in the Post Implementation Review of the Fair Work Act 2009. One of the recommendations is that the number of public holidays on which penalty rates are payable be limited to 11. This recommendation is one that is particularly relevant to states and territories because the issue the independent panel seeks to address has been caused by the proclamation of additional public holidays in state and territory jurisdictions. This year state and territory governments declared 13 public holidays in New South Wales, Queensland and the ACT; 12 public holidays in Victoria, South Australia and the Northern Territory; 11 public holidays in Western Australia; and at least 10 public holidays in Tasmania, depending on where you live.

In addition to days such as Australia Day, Labour Day and the Queen’s Birthday holiday, state and territory governments declared public holidays for things as diverse as Melbourne Cup Day in Victoria, Royal Queensland Show Day in Brisbane, Foundation Day in Western Australia, and Family and Community Day in the ACT. Each of these days is important to the people of that state or territory.

Today I have written to state and territory governments seeking their views about whether they support the recommendation and, if they do, which day or days in their state they suggest should not attract penalty rates. But the Gillard government is not going to say that some of these public days are more important than other public days and therefore penalty rates should not be payable for them.

There are many ways businesses increase their competitive edge, but cutting wages for low-paid workers is not the way to get ahead. We will not be supporting in the Fair Work review of modern awards the low road of paying already low-paid workers less. We will not say that hospitality workers on Melbourne Cup Day should not have penalty rates or that workers who cannot go to the Ekka with their families because they are rostered on to work are not at a disadvantage compared to other employees.

The opposition also need to come clean about whether they support this recommendation and which public holidays around Australia they think are less important than others. Labor will always fight for life outside of work and the idea that we work to live, not live to work. That is why this government’s submission to the Fair Work Australia review into modern awards reaffirms our unequivocal commitment to penalty rates being paid to workers on weekends and public holidays. I thank the House, and I present a copy of my ministerial statement. I ask leave of the House to move a motion to enable the honourable member for Farrer to speak for 16 minutes.

Leave granted.

I move:

That so much of the standing and sessional orders be suspended as would prevent the honourable member for Farrer speaking in reply to the minister's statement for a period not exceeding 16 minutes.

Question agreed to.

Sussan Ley (Farrer, Liberal Party, Shadow Minister for Childcare and Early Childhood Learning) Share this | Link to this | Hansard source

I welcome the opportunity to respond to the minister's statement on penalty rates and public holidays. I do find that his views appear to contradict those of the Minister for Tourism and former ACTU boss Minister Ferguson, who I understand attended a conference in Hobart recently and indicated his concern regarding the retention of penalty rates and the impact on the tourism industry. Minister Ferguson stated:

I hope the bench of Fair Work Australia has given proper regard to the input of the tourism industry in this context because I understand that is the key issue to industry at this point in time.

From the outset, it is important to reiterate the position of the coalition. We are adamant that the determination of modern awards rests with Fair Work Australia. And may I assure everyone with an interest in this matter that Fair Work Australia will continue to have a central role under any future coalition government. But none of this detracts from the coalition's very real concern about small business and for the job opportunities of young Australians.

Those concerns are well reflected in the submissions to the Fair Work review, made by, for example, the Retailers Association, the chambers of commerce, Chamber of Commerce and Industry Queensland, Business SA and the Accommodation Association of Australia as well as unions and employee organisations. The independent umpire is best placed to make a decision on the determinations contained in modern awards. We will accept the umpire's decision, and I would urge those opposite to do the same. Why would the government that created Fair Work Australia not trust its own independent umpire in this or any other matter? Fair Work Australia is a quasi-judicial body containing panel members who are drawn from industry, business and unions, representing the entire spectrum of the workplace from every perspective. Yet we have this minister today, in the middle of the review process, seeking to insert himself into such a process with this ministerial statement.

Of course the opposition supports penalty rates and public holidays. They have been part of the employment landscape throughout successive coalition governments. It is totally unsurprising. We will not be wedged and verballed with this ministerial statement here today in this House. But, if the independent umpire is taking submissions and conducting a review, we will let that process take place. We will let the review take its course, as we should. Why does this minister not have faith in his own Fair Work Australia and the perfectly legitimate process upon which it has embarked? However, I would strongly urge Fair Work Australia to factor in ramifications for the broader economy when arriving at their determination. What we do not want to see, as Frank Crean once said, is for one man's pay rise to be another man's job.

It is of concern that, despite Minister Shorten's pledge that no worker should be worse off, he will not pledge that no worker will be out of a job because penalty rates could be adversely affecting a small business. It is apparent that there is an inherent mistrust of Fair Work Australia by the minister. We have a full bench here of Fair Work Australia considering the issue of penalty rates, yet the minister cannot wait for them to deliver a verdict. Instead he is intent on jumping the gun and telling them how they—an independent body—should respond. Their verdict should be based on common sense, as I am sure it will be, assessing the impact of broader economic benefit when they determine what equates to a fair day's pay on a public holiday or the correct penalty rate environment.

The coalition is two parties of aspiration. We believe in reward for effort, in rewarding those who work hard. We have a 10-point plan for business. We believe in supporting families. Those opposite, however, have presided over a 17 per cent increase in the cost of child care since Prime Minister Gillard came to power. Labor's paid parental leave scheme does not pay parents at their replacement wage. Instead it offers up just the minimum wage. This is leaving thousands of families worse off, as they have budgeted their mortgage and car repayments on actual salaries, not on one parent earning a minimum wage. Their paid parental leave scheme also omits superannuation contributions, meaning that Australian women are left even worse off than their male counterparts—$50,000 worse off by the time they retire, according to research undertaken by Suncorp.

Now, it is well and good for this government to hang their hat on penalty wages this week, but that does not prove their commitment to the best interests of Australian workers, families and business. The significant fee hikes necessary in child care have been the result of COAG reforms designed by those opposite. The carbon tax has seen electricity bills skyrocket. So families and businesses are really doing it tough under this government with its economic mismanagement.

On this theme I would like to remind the House that the Treasurer promised to create 500,000 new jobs in the 2011 budget—just two budgets ago. Regrettably, the Treasurer has since had to backflip on this promise and after 15 months only 57,600 more jobs are evident. I personally think those opposite would do better to focus on job creation and ensuring that they meet their own promises, instead of creating this quarrel against a decision yet to be made by a creation entirely of their own making. I conclude by saying we trust Fair Work Australia to proceed through its deliberations, and we do not anticipate that the minister's intervention today will make the slightest bit of difference.