Penalty Rates were set up because of what it says on the tin: a penalty to employers who penalised employees by making them work on weekends.
Bosses say that penalty rates are preventing them from employing people. That is exactly why penalty rates were introduced. Your health and social needs are what bears the cost, whilst employers privatise the gains.
We are told that we are living in the past, that it’s a 24/7 society so hanging on to outdated notions like penalty rates is a relic of the age of the dinosaurs.
But is it? Any real social and economic research done on the issue finds that the original claims and the decisions to pay penalty rates were based on social and physical needs that remain true to this day. A boss saying we need to “compete” is not research, just hubris and greed.
The World Health Organisation (WHO) has found that today, over 100 years after Justice Higgins said that penalty rates were aimed at penalising employers for making workers miss their day of rest, tinkering with our circadian rhythms (our body clock) is probably carcinogenic. The time we would have spent on self-care ie resting, eating in a slower way, exercising – is “bought back” by taking less exercise and eating fast food.
Overwork or working on weekends has been decisively shown to MAKE US FAT. We are not designed for constant work. The 19th century demands for eight hours work eight hours lay, 8 hours rest almost precisely matches the outer boundary of how much humans can safely work without damaging their health.
Olav Muurlink reports on a large Hungarian study shows that being in control of your time is a crucial issue in well- being. It is possible to predict heart disease by simply asking “how much can you influence what happens in your work group?” Of the work variables in this study “sense of control” was the single most powerful predictor of heart disease in women, and not far behind for men.
Workers not only are more likely to work hours they can’t control, but they feel less in control of other aspects of their work and life.
The risk of injury to a worker on a 10 hour day is 41% higher than someone on an eight hour shift, and this increases when someone is on the 6th and 7th day of a week- long shift.
As more people become employed in what are seen as essentially “servant” industries by bosses (and hence low paying) ie hospitality, cleaning, waiting we all pay the price. Business looks for ways of paying less (cash, casual short shifts, no overtime or PENALTY rates, and society suffers with poorer health and lower pay. No trickle down here. It all is safely scooped up by those at the top.
One of the great examples of the failure of the 24/7 society was the early days of the Soviet Union (remember that place?) The Bolsheviks aimed to eliminate the vestiges of capitalism and overtake capitalist societies. In this recasting of society weekends were out. The grand experiment was abandoned because it very quickly became apparent that more people were sick, working less in the longer time, production processes were not as good and service was worse.
Australian Innovation in Industrial Law
Initially it was Sunday that was the problem. Two years after his famous Harvester Judgement on a living wage, Justice Higgins ruled that workers at Broken Hill (in 1909) should be awarded time and a half for all work done on the seventh day in any week, or an official holiday, or all work done in excess of any shift.
In 1919 Higgins and the Court reiterated their position stating that payments for work on Sundays have…been the highest because “it is the day for family and social and religious reunions, the day on which one’s friends are free, the day that is most valuable for rest and amenity under our social habits”. The claim for Saturday morning rates came with the winning of the 40 hour week from 1947, but the reasons remained the same. Our amenity, not theirs.
The “thin end of the wedge” process is being undertaken by the Productivity Commission. Their draft report recommends eliminating the difference between Saturday and Sunday rates by reducing Sunday rates naturally) penalty rates. Research by Lyn Craig and the Social Policy Research Centre shows that for workers there is a distinct difference between Saturday and Sunday. Saturday is more for sport and weekly shopping, but Sunday, even though people might not go to church as much as in the past, is still regarded as the day of rest – a family day.
As Dan Woodman reports “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”.
Nowadays employers want to penalise workers for working on weekends and especially Sundays, saying it is not good – for employers!! to actually have to pay them. The claim of extra employment is not borne out anywhere, only lower pay and more profit. The penalty was supposed to be a deterrent to employers requiring workers to work long or abnormal hours and compensation for workers for having to do this.
Resistance to penalty rate cuts is resistance to the grab for more of your time by those who see you as the precariat, as cheap fodder for their gargantuan appetites, even as the world burns.
- Penalty rates have been an integral part of the Industrial Relations system for over a century. Their origin in Australia can be traced to 1909, when Justice Higgins of the Commonwealth Conciliation and Arbitration Commission agreed that penalty rates for work on the seventh day of the week. The 1919 decision reinforced this.
- In 1947 this right was broadened when the commission found that Saturday work should be compensated at 125% of the base rate and Sunday work should be increased to twice the base rate.
- Employers must compensate employees for “the disturbance to family and social life and religious observance that weekend work brings”.
- This decision gave the concept of the weekend the full respect of Australian law: not only is special compensation required for working on a weekend, there is a deliberate attempt to discourage weekend work.
- Underpinning penalty rates is the concept that family, social and leisure time are important factors in a person’s life, that they contribute to improved health and wellbeing and that this time must be compensated for financially if it is to be restricted.
- Recent research has provided clear evidence that an eight hour day is the maximum we should work to maintain our health
- 24/7 claims are made to penalise workers who need to work to pay the bills, but add to the bottom line of employers
- Ordinary time earnings on the minimum rate of pay will produce poverty line conditions. Penalty rates keep us afloat
- Growing areas of employment have been the hospitality sector. Penalty rates clearly have had no impact on the level of employment
- a summary of the state of play by Neale Towart