Hundreds of thousands of Australians who work on Sundays will have their take-home pay slashed after a landmark ruling by the national workplace umpire.
The Fair Work Commission on Thursday morning announced existing levels of Sunday penalty rates paid in retail, fast food, hospitality and pharmacy industries will be reduced from the existing levels, which, in some cases, are as much as "double time".
Full-time and part-time workers in retail will have their Sunday penalty rates dropped from 200 per cent to 150 per cent of their standard hourly rate, while casuals will go from 200 per cent to 175 per cent.
Hospitality employees will face a reduction in Sunday pay from 175 per cent to 150 per cent, while casual hospitality workers' pay will remain unchanged.
Fast-food employees' Sunday rates will go from 150 per cent to 125 per cent for full-time and part-time staff, and casuals will go from 200 per cent to 175 per cent.
The pay cuts take effect from July.
The controversial decision will anger Australia's union movement, which has invested heavily in a massive campaign to safeguard weekend penalty rates across the country.
'Bad day for working Australians'
"This is a bad day for working Australians," said Australian Council of Trade Unions president Ged Kearney.
Struggling workers "won't be able to survive on a 25 or 30 per cent pay cut".
"We are on the way to seeing a whole class of working poor in this country," she said. "We are talking about people who do not earn a fortune. The retail industry made a very healthy operating profit last year. They can afford to pay people decently."
"This is a bad day for working Australians."
- Australian Council of Trade Unions president Ged Kearney
Ms Kearney said unions would "not accept any pay cut".
Union leaders have argued that Sunday loadings of up to 200 per cent were crucial compensation for low-paid employees who sacrifice weekends and work unsociable hours.
Employer groups have been pushing for years for a reduction to penalty rates on Sundays, which they say are too high, no longer reflect community standards and are forcing businesses to close their doors on weekends and public holidays.
They claim a higher wage for Sunday staff is no longer justified in a 24/7, seven-day-a-week economy, where workers see no difference in working Sundays compared to Saturdays.
The Fair Work Commission has spent almost two years weighing evidence from more than 140 witnesses and 6000 written submissions.
'No worse time'
Pressure for a reduction to penalty rates has increased since Australia's Productivity Commission in 2015 recommended cutting Sunday rates in line with Saturdays.
Although Prime Minister Malcolm Turnbull has previously referred to Sunday penalty rates as an outdated concept, the federal government has left reform on the issue to the independent umpire, the Fair Work Commission.
Labor leader Bill Shorten has indicated he would act to protect workers' take-home pay in the event of any reduction.
Earlier this week, Mr Shorten said his party would "never support a decision that sees workers worse off".
"With wages growth at record lows and underemployment at record highs, there could not be a worse time to cut penalty rates," he said.
"Millions of Australian families rely on penalty rates to put food on the table – Labor will fight for these people and their penalty rates."
Mr Shorten said Labor was "greatly concerned" that the ruling could set a precedent that could eventually cut weekend penalty rates for other occupations, too, such as nurses or paramedics.
Aaron Lane, a fellow at the Institute of Public Affairs, on the other hand welcomed the decision and said it would make weekend work more secure.
"Penalty rates are a penalty on jobs. The higher the penalty, the higher the barriers are into employment - putting the job market further out of reach for the most disadvantaged Australians," he said.
"There are businesses right around the country that have stopped trading on Sundays because penalty rates are prohibitively high.
“Case after case, we hear of family-owned small businesses that run on skeleton staff on a Sunday because they are unable to afford the extra penalty rates.”
- With reporting by Tom McIlroy
More to come.
The story, Penalty rates for Sunday, holiday work to be slashed by Fair Work Commission, first appeared on the Sydney Morning Herald.
