Tuesday, 16 October 2018

Casual retail penalty rates to increase from 1 November 2018

In a decision that has been received with widespread criticism by retailers, the Fair Work Commission (FWC) has recently announced increases to penalty rates for casuals covered by the General Retail Industry Award 2010, commencing from 1 November 2018.

Recognising the need for transitional arrangements, the FWC has proposed that the penalty rates will increase gradually as follows:

Saturday work – increases for casual employees

Commencement date Saturday casual penalty Total addition to base rate (Saturday penalty + 25% casual loading)
1 November 2018 15% 40%
1 October 2019 20% 45%
1 March 2020 25% 50%

 

Evening work (Monday to Friday hours after 6pm)

Commencement date Evening work casual penalty (Monday to Friday) Total addition to base rate (evening penalty + 25% casual loading)
1 November 2018 5% 30%
1 October 2019 10% 35%
1 March 2020 15% 40%
1 October 2020 20% 45%
1 March 2021 25% 50%

 

The Saturday penalty increase applies to all hours worked on a Saturday, whilst the evening penalty applies only to hours worked after 6pm.

Alongside the penalty increases for casual retail employees, the FWC has announced a gradual reduction to the Sunday penalty rates for shift workers (from 195%-175% for permanent shift workers and from 220% to 200% for casual shift workers). These decreases will be implemented progressively in three stages from 1 November 2018 until 1 July 2020

What should you do?
From 1 November 2018 employers operating in the retail industry must ensure they are paying all casual staff the correct Saturday and evening penalty rates, particularly bearing in mind the coming Christmas retailing season.

Employers should:
– carefully review their wage arrangements and plan to implement the necessary penalty increases (or decrease in the case of shiftworkers) from 1 November 2018;
– diarise to review the rates again next year prior to phase two of the transitional arrangements taking effect; and
– in the case of employers already paying above-award rates to casual staff, review these arrangements to ensure the payments remain high enough to accommodate the penalty increases.

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This article was produced by HR Legal. It is intended to provide general information only in summary format on legal issues. It does not constitute legal advice, and should not be relied on as such.

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