Either way, cut workers' pay: Employers' shifting case against penalty rates

Employer groups have seized on evidence of growth in retail trade on Sunday to again push against penalty rates, arguing that data showing a healthy rise in the number of people at the shops on Sunday is a good reason for cutting penalty rates.

This is a curious change in the reasoning from employers. Today, strong Sunday trade is given as a reason to reduce penalty rates. A few months ago, the Australian Chamber of Commerce and Industry launched a national campaign arguing that businesses were shutting down in significant numbers on weekends and public holidays because of the impact of penalty rates.

So which is it? Are we all hitting the shops on Sundays in record numbers or are shopping precincts reduced to ghost towns on the weekends due to penalty rates? It seems employer groups want it both ways.

Sunday workers want Sunday rates

The reported healthy growth should also be good news for businesses, making it a little easier to cover the extra loading for their employees, who make our Sunday shopping excursions possible.

Retail Council chief executive Anna McPhee gives one further justification for reducing penalty rates. She points to research conducted by her association and “member feedback”, that shows a “significant proportion” of employees in retail wanted work on weekends and public holidays.

This is a plausible argument. Indeed, my own research with young employees supports it to some extent. The participants see some value in working weekends, because it can be difficult or impractical to find work at other times and because the higher pay means that they can work a little less and still have the money to pay the bills and to take part in Australian cultural and social life (including hitting the shops).

The Retail Council may be correct that people want to work weekends given the options that they have, but on its own this is also a poor justification for cutting penalty rates. It is likely that far fewer would report that they wanted to work weekends if it meant working at normal pay rates. Indeed, recent analysis of the Australian Work and Life Index (AWALI) survey shows that many workers rely on penalty rates and that more than half report that they would stop working on Sundays if penalty rates were removed.

Research conducted by Australian academic Michael Bittman using Australian Bureau of Statistics time use data gives further insight into why Sunday work is unsocial and the real reason a pay premium is applied.

This nationally representative survey data showed that those who work on Sundays get less opportunity to sleep-in and spend less time eating with family, and less time socialising. Importantly, it shows that people cannot catch up fully on the things they miss through working on Sundays on other days of the week. The reason is that many of these activities rely on synchronising schedules with friends and family.

For most, time off on our own is less enjoyable than time off with those we love and like. Those who work Sundays will miss out on sporting events, family lunches, concerts and shopping trips with friends. They will more likely be doing things on their own. As one of the young people in my research project described the impact of weekend and evening shifts, it can lead to “no social life, bad sleeping patterns and no friends”.

Better evidence needed

The available nationally representative time use evidence used here to evaluate the impact of Sunday work is now somewhat dated. The last relevant data was collected by the ABS in 2006; the next survey was due in 2013 but was cancelled to reach government mandated budget savings.

Our evidence could be better. As the government has embraced employers’ call for ever increasing “flexibility” in the name of the economy, they have also removed funding from one of our best avenues for tracing the impacts of the way we work on the quality of our lives.

However, more recent large-scale research using representative data from 31 European countries continues to show that people working Sundays report poorer work-life balance, and poorer health.

Employer groups often claim that the impact of weekend work is lessening over time. Yet, the “evidence” is often feedback from their members. They also show a remarkable propensity to come to the same conclusion about the need to reduce penalty rates, no matter what the evidence.

The latest push for cuts based on the strength, not the weakness, of Sunday trade is an example of this. However, the best Australian and international evidence we have does not back this up.

Dan Woodman receives funding from the Australian Research Council. He has previously provided expert evidence on behalf of the Shop, Distributive and Allied Employees' Association to Fair Work Australia (now the Fair Work Commission). He is the Vice President of The Australian Sociological Association (TASA).