Alex Gallacher (SA, Australian Labor Party) Share this | Link to this | Hansard source

I rise to make a contribution in adjournment about a very important issue to many South Australians and, indeed, many Australians. On 23 February 2017, the Fair Work Commission handed down a decision on penalty rates. That recommended a reduction in penalty rates for workers covered by four awards: fast food, pharmacy, retail and hospitality.

As different workers are employed at different levels under the different awards, each award has a different base rate of pay, and the impact on workers is diverse. To get a sense of the scale of the impact of the proposed cuts you need to have a look at the lowest paid casual workers covered by the retail award. They would lose $38.88 on a Sunday for an eight-hour shift. The highest paid permanent work is covered by the pharmacy award. That would be $127.09 worse off for an eight-hour shift.

While the number of people affected by the proposal is disputed, there is no dispute that the number of people affected is significant. The government is reported to believe about 285,000 people face a pay cut, while the ACTU points out that 648,000 people are covered by these relevant awards. To the extent that award conditions influence the conditions in non-government agreements, the number of people affected by the decision is likely to be even greater than the 648,000 which is quoted.

What we have here is a situation where a government, in seeking to refer to an independent umpire, has destroyed the independence of the umpire by making a continuous series of one-sided appointments. For anybody who is not familiar with the Industrial Relations Commission and its predecessors and the current Fair Work Commission, there's normally an appointment from an employer side and an employee side. This government disbanded that and made five direct appointments from one side, but it doesn't stop them saying that they still refer to the independent umpire.

What's really worrying is that, since 2013, real wages in normal terms have been flat. That's a problem for tax collectors. That's a problem for retailers. That's a problem for lenders. That's a problem in all sectors of the economy where people are finding it really difficult to consume goods and services, invest or borrow money. It's going to come back and bite the government exactly in the wrong place: in revenue collection and economic activity.

What we have in Australia is a system where, over 100 years, workers have been able to bargain. They've been able to get reasonably progressive wages and conditions, unlike other areas of the world, like the United States. If you were to talk to an American about long service leave, they'll think you're on another planet. Long service leave does not exist to them. If you were to talk to an American about four weeks annual leave every year, they'll think you're on another planet, because they get two weeks after five years. If you talk about a leave loading payment they'll think you're on another planet, and, if you talk about a minimum rate of pay of about $17-plus an hour, they'll also think you're in some sort of alternative galaxy.

One of the things we've done really well in Australia is to share the economy around. Workers, through unions and their own efforts, have been able to bargain for respectful wages and conditions and enjoy respectable take-home wages and conditions. A flat and declining wage outcome is not good for anybody: it's not good for the government, it's not good for business and it's certainly not good for those workers who rely on those penalty rates. Increasingly, the people in retail and fast food do not enjoy a full-time job. They are casuals and students. They are people who take that opportunity to supplement their studies with a couple of days of work. I think the stats are that junior rates are about 14.8 hours per week. That's about the average that junior workers get. That's actually dropped down to 13.4 hours per week. So it's not as if these people are working 40 hours plus the weekend; it's 14 or 15 hours a week. It is barely sustainment. They're barely able to sustain themselves. The diminution of their earning capacity through a reduction in penalty rates in retail and fast food is reprehensible. It really is penny-pinching and mind-boggling that a government thinks it can actually stimulate the economy by supporting this sort of reduction in take-home pay.

If we look at the average weekly total hours worked, it was 32.1 hours per week, but it has now gone down to 31.8. So even those who have a full week's work are suffering in that there's less work available throughout the working week. I'm sure that the people who earn these sorts of salaries spend 90 per cent, if not 100 per cent, of their take-home pay. They would need to do that just to simply sustain themselves. As I've already said, a lot of these people are students, people who are trying to progress themselves through university. They are incurring a HECS debt and they are earning some money to offset the burden they may be on their parents, or whomever. It really is an absolute disgrace.

Let's have a look in the state of South Australia. There'll be contention about these figures, but we know that in the seat of Boothby there are about 7,433 retail workers who are affected and 3,789 food and accommodation workers. In a federal seat almost 10 per cent of workers—11,222—are going to be affected by this reduction in penalty rates. That's a significant issue, and I'm sure all of those workers will know who the person in that electorate is who voted in favour of not protecting their penalty rates. Nicole Flint, the member for Boothby, is on the record as saying that she is not a supporter of penalty rates and that it is a disincentive for employment. Well, there are plenty of retail workers and pharmacy workers in the seat of Boothby who will remember those comments.

In the seat of Grey there are 6,529 retail workers and 4,303 food and accommodation workers—potentially a total of 11,482 workers affected. I know that Mr Rowan Ramsey is on the record as saying that I've distributed a DL which is a mistruth that was his characterisation of it. Look, you can argue the semantics of it, but are penalty rates going to be reduced in the seat of Grey? The answer is yes. Are they going to be reduced at Chemist Warehouse? The answer is yes. Are they going to be reduced at any of those outlets open on a Sunday? The answer is yes. Rowan and I will continue to engage right up until the next election about this issue, but, suffice to say, there is a substantial number of people who will be affected.

In the Xenophon seat of Mayo, 6,716 retail workers will be affected and 4,005 food and accommodation workers. It is a total of 10,721 workers. So we might take the ambit of the top level of people that are going to be affected by this, but you would need a pretty precise algorithm to actually work out who isn't going to be affected. We believe broad-brush is good. If that's the number of people in that sector then, potentially, they could be affected. I would say that some of those people may be under other agreements or arrangements and others may not be, but that's the potential of it.

This government has been mean-spirited with pensioners, with young workers and with fast food, retail and pharmacy workers. It is not going to end well. This is a recipe for electoral disaster, hopefully. In all of these seats where up to 10 per cent of the most vulnerable workers are affect by this diminution in penalty rates we will use our best endeavours to make sure that they know who is responsible for this, that they know that they should be talking to their elected member of parliament, saying, 'Why aren't you resisting this? Why aren't you protecting my ability to earn a decent wage, enjoy decent conditions and go about my business in a satisfactory and sensible way?' It's particularly wrong to deny the 30 per cent of young workers who are unemployed the ability to enjoy a fruitful return for their endeavours.