Unions go to court over penalty rate cuts

Unions representing hospitality and retail workers are about to challenge the Fair Work Commission’s decision to cut Sunday penalty rates during a Federal Court hearing.


In June the Fair Work Commission decided Sunday rates would drop by five percentage points for workers in the fast food, hospitality, retail and pharmacy sectors, starting July 1.

Hospitality union United Voice launched Federal Court action to keep workers’ penalty rates the same for Sundays and public holidays.

The Shop, Distributive and Allied Employees’ Association (SDA) also launched a Federal Court case.

In July, Justice Mordecai Bromberg decided both cases would be heard together.

The parties are due to appear before a full bench of the Federal Court in Melbourne on Tuesday for the start of a three-day hearing.

Employer and business groups including the Australian Industry Group, the Australian Hotels Association, and the NSW Business Chamber will argue the cuts should be respected.

Under the Fair Work Commission’s decision, the first cut to penalty rates will be five percentage points, with more significant cuts in 2018 and 2019 for fast food and hospitality workers.

Retail and pharmacy workers will have cuts to their rates phased in through until 2020.

United Voice says the cuts will hit lowest paid workers the most.

The ACTU has backed United Voice’s case, with president Ged Kearney arguing that if the law did not protect lowest paid workers, then the law was broken.


Shop, Distributive and Allied Employees’ Association (SDA)

Australian Business Industrial

NSW Business Chamber

Restaurant & Catering Industrial

Australian Retailers Association

National Retail Association

Master Grocers Australia

Pharmacy Guild of Australia

Fair Work Commission

Accommodation Association of Australia

Restaurant & Catering Industrial

Australian Business Industrial

United Voice

Australian Hotels Association.