Burke applies pressure on Morrison over penalty rates

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ALP Minister Tony Burke has released a public statement calling on the PM to rethink his stance on penalty rates, writes William Olson.

TONY BURKE, the Federal Shadow Minister for Industrial Relations, has called upon Prime Minister Scott Morrison to help arrest the domino effect of cutting penalty rates.

Burke cites that the nation’s cosmetologists – a segment of the workforce comprised of an estimated 76,000 employees – would be next in the firing line of penalty rate cuts and has appealed to Morrison to lead by example to get his Parliamentary peers in the Liberal-National Party to cast a ruling to hold off on those cuts before they would take effect within the next ten months.

In a statement released on Monday, Burke said:

‘If these cuts go ahead, these already low-paid workers – the vast majority of them women – will find it harder to pay the rent, cover the bills and look after their families.’

Ever since the Fair Work Commission approved the first cuts to penalty rates in 2017 as lobbied for by the LNP, an estimated 540,000 workers in the hospitality, retail, fast food and pharmaceutical sectors have experienced cuts to their penalty rates on Sundays and public holidays.

Workers relying on Sundays and public holidays in their rostered shifts have seen their pay packets cut by as much as 15 per cent over the last two years, even as the FWC said that cuts would be phased in over a number of years.

Burke fears that if hair and beauty workers have their penalty rates cut as of the start of the next financial year on 1 July 2020, the LNP may gain incentive to cut the pay packets of workers in other industries.

In his statement, Burke continued:

‘This should worry every Australian. If this tired third-term Government wants to stimulate the economy, the last thing it should be doing is standing idly by while people’s pay and conditions are cut.’

Burke also maintains that despite prognostications to the contrary ahead of the FWC’s initial actions on the matter, the spike in jobs created has not materialised as a result of penalty rate cuts — a claim corroborated by the Council of Small Business.

“There’s no extra jobs on a Sunday. There’s been no extra hours [for workers],” said CSB Chief Executive Peter Strong back in April. “It’s been a waste of time.”

Strong’s observations even mark a backtracking from him, where he initially thought the first round of penalty rate cuts would actually create jobs and stimulate the economy.

Strong also said that whatever employment gains small and medium-sized businesses around Australia have made, they have been quite minimal, while hospitality, fast food, retail and pharmacy workers are estimated to have lost a collective amount of $2.562 billion by the time the penalty rate cuts are completely phased in by the end of 2020.

That averages out to approximately $4,745 in wages lost to each worker – even as a conservative estimate – in those employment sectors over that time.

And Burke says that statistic affects each person as a worker in such a way which hampers their abilities to make ends meet while the cost of living keeps increasing.

Burke added in his statement:

‘Penalty rates are not a luxury — they help people put food on the table and petrol in the car. They can make the difference for people struggling to pay the electricity bill, the private health insurance premiums or child care costs — all of which keep soaring under the Liberals.’

Morrison, dating back to when he was first elected to Parliament in 2007 as the Member for Cook, has voted eight times in favor of cutting penalty rates.  Therefore, hoping that he could implore members of the Coalition to stem the tide of the cuts would represent a leap of faith, given that other Coalition members possess similar voting records on the issue.

However, Burke feels that it would represent the right action to take on behalf of all Australians.

‘But it is what we have come to expect from a Government that admits low wages are a deliberate design feature of its economic policies,’ said Burke, citing LNP Minister Mathias Cormann’s statements prior to last May’s Federal Election where he admitted that stagnant wage growth was an intentional tactic, as well as noting the actions of a LNP Coalition Government over the last six years appearing to rely on trickle-down economic theory as another method to stimulate the economy.

Sally McManus, Australian Council of Trade Unions Secretary, said at a 2018 speech in Brisbane detailing record inequality in Australia:

“We were promised that trickle-down economics would ensure that all the wealth we hand over to the very rich will come back to us. Instead, it seems we cannot rely on the very rich to put limits on their own greed, or to share, as they have kept much of this wealth for themselves.”

Burke and McManus are unified in a collective fight, between the Left-wing Parliamentary political factions and the union movement each sharing a vested interest, to protect workers’ wages, especially with the cosmetology sector now perceived to be in the firing line.

But a precedent does exist from an unlikely source. Just days before the first round of penalty rate cuts in 2017, when Labor attempted to halt or reverse the FWC’s decision to implement them, Liberal-National backbencher George Christensen crossed the floor to vote against the cuts.

Christensen did so not as much as to buck the trend of his own party’s lines, even introducing a private members bill of his own to reject the penalty rate cuts, but because he felt it was the best thing to do on behalf of those in his electorate of Dawson in Queensland, which counts Mackay and other south-eastern suburbs adjacent to the city of Townsville among its territorial boundaries.

“I was happy to cast my vote for the amendment putting to rest all those claims my bill was a stunt," Christensen told the ABC at the time. “My bill sought to protect penalty rates but also have a level playing field between small business and big business.”

The bill eventually lost by one vote, 73-72.

Burke would be hoping for the support like Christensen showed at the time, in droves, for that the standard of living among those in the cosmetology sector – in this context – depends on such support.

Or else others may correspondingly suffer the same fate in the future.

William Olson was a freelance journalist from 1990-2004 and hospitality professional since late 2004. 

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