In Business & Trade by Clyde Mooney

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Early election jostling has seen political leaders vie for the attentions of business and the unemployed in WA, flaring up a long-standing national debate on penalty rates.

Western Australia will see a State election on 11 March, 2017, and experiencing the nation’s highest unemployment rate (currently 6.5 per cent) jobs and the economy are set to be key issues.

Incumbent Premier Colin Barnett pronounced to the press on Wednesday that his re-elected government would ‘clamp down’ on penalty rates, in support of hospitality, tourism and retail business, with the goal of job creation.

The issue of penalty rates is primarily one of Federal jurisdiction, but the States control much to do with small business employment.

Barnett says he agrees workers should get paid more for working on Sunday and public holidays, but at the same rate as Saturdays. He announced intentions to look at ‘special’ awards being created in WA for specific awards, affecting retail, hotel and tavern, restaurant and catering workers.

WA Premier Colin Barnett

WA Premier Colin Barnett

“You are not going to get the growth in tourism and hospitality if people are required to pay up to three times the hourly rate on a Sunday,” said Barnett.

Opposition leader, Labor’s Mark McGowan, is taking the reverse stance, stating no consideration of changes to penalty rates and that cutting them was not the solution to unemployment. The party’s policy is that a more diversified economy and workers with “more money in their pockets” will ultimately be better for the State.

The Australian Hotels Association WA backs Barnett’s platform of a reassessment to the amount of penalty rates, believing it will pave the way for better performance of the affected industries and more work for eager workers.

“The AHA(WA) supports penalty rates for Sundays and public holidays at a Saturday rate, which is 150 per cent of a worker’s hourly rate,” said AHA WA CEO Bradley Woods.

“Restaurants, pubs, hotels, retailers and service providers have consistently indicated that they would be more prepared to trade and hire extra staff if the penalties for opening on weekends and on public holidays weren’t so excessive.

Woods says that at a time when WA must focus on attracting more visitors and satisfying the high expectations of travellers, high penalty rates can make it impossible for businesses to supply the service levels they would like to provide, and additional costs are often passed on to consumers.

He suggests that while Australia’s economy has globalised, the award system has not kept up and still bases employment benefits around a Monday-to-Friday working week.

“The burden of penalty rates means that on Sundays and public holidays many small businesses can’t afford to open, meaning less productivity and less wages for local workers.”

The Federal Hospitality Industry (General) Award 2010 has been under review by the Fair Work Commission during 2015-16, and the AHA WA has been active in the process, with submissions, collation of evidence and work with legal counsel.

Small and ‘micro’ businesses, typically regulated by the States and less able to negotiate better terms with national entities such as unions, currently employ an estimated 11-16 per cent of the private sector workforce.