Almost everything conservative commentators say about the industrial relations system is wrong, says Peter Martin. It works well, it isn’t creating wages explosions, and it isn’t pricing people out of work.
What do the conservatives think about Sunday penalty rates? Mark Kenny explains:
- Economists, politicians, the Productivity Commission, and peak employer groups – all say the higher labour unit costs of operating a business on a Sunday can be make-or-break as to whether to trade at all that day.
Thing is, there is no evidence to support this contention, a fact confirmed by Professor Ray Markey, Director of the Centre for Workforce Futures.
Of course, there is no evidence for the contrary case either, but so convinced is the Productivity Commission that they believe the onus of proof should be reversed:
- The one new argument in the report is very interesting, namely that the onus of proof about the impact of reduced penalty rates on employment should be reversed i.e. employers shouldn’t have to prove this is the case to get changes – clearly an admission of a lack of evidence.
The politics of penalty rates and industrial relations in general is tricky according to Mark Kenny. Coalition voters appear to favour keeping penalty rates. Turnbull doesn’t want the issue to become a factor in the next election. Employers, of course, are baying for greater, braver ‘reforms’, to restore the privileges they had under Work Choices and more. Turnbull’s current stance, enunciated by Michaela Cash, is that the Fair Work Commission will decide.
The Productivity Commission’s view is that the Fair Work Commission is not well placed to decide the matter. It is a judicial body which deliberates on the evidence presented. They have suggested a Workplace Standards Commission with responsibility for reviewing and varying the minimum wage and modern awards. This would be a non-judicial body, capable of undertaking its own inquiries and paying for independent analysis.
Such a body could overcome the criticism of a lack of evidence. Almost inevitably, however, it would be stacked with believers in reducing Sunday penalty rates. If Turnbull forgoes this opportunity then he will be shown to be truly chicken-hearted on industrial relations.
Peter Martin tells us the Sunday rates are often 150 to 200 per cent of weekday rates, compared to Saturdays, where the rates are nearer to 125 per cent.
- But weekends are changing. Traditionally a time for socialising, there’s now less of it and it is highly likely to be done while shopping. In one survey, 39 per cent of Australians nominated their shopping centre as their most important meeting place. Only 16 per cent nominated a park, and 19 per cent nominated a pub. For some stores, Sunday has become their most important trading day, accounting for 25 per cent of all sales.
The Productivity Commission favours the Sunday rate being brought into line with the Saturday rate for the leisure industries of hospitality, entertainment, retailing, and dining.
Martin’s main point, though, is that the Productivity Commission’s report was about the industrial relations system in general. It was asked by the former Abbott government to review Australia’s workplace relations framework to see what effect it was having on levels of unemployment, productivity, and competitiveness. In general it found the system in pretty good shape.
Gareth Hutchens has an explainer on the report.
In retailing generally Sunday is almost like any other day:
Here are the penalty rates for the retail industry:
On minimum wages:
- It says Australia’s minimum wage should not be abolished.
It says minimum wages are likely to have a zero “or even positive” effect on jobs so long as they are not set too high.
It says there is no agreed estimate of the number of adult Australians paid at the hourly minimum wage rate, but previous estimates range between 4 and 11 per cent of employees who are paid up to or close to the national minimum rate.
This upset the conservatives. Youth wages are apparently low by international standards.
Another feature of our system is that many of us work long hours: