Unions have lost their legal challenge to overturn cuts to Sunday penalty rates for retail and hospitality workers.
The United Voice and the Shop, Distributive and Allied Employees Association disputed the Fair Work Commission’s decision to slash penalty rates for full and part time workers in February, but the Federal Court found met its legal obligations when it handed down its decision.
Unions argued the commission’s decision was “legally unreasonable” and failed to consider how cutting rates would affect low-paid workers.
They argued the commission’s views were inconsistent with the Fair Work Act, did not properly understand the nature of the inquiry and failed to take into account relative living standards and the needs of low paid workers.
However, Justice Mordy Bromberg said the court found no error in the way the commission arrived at its decision.
“The Fair Work Commission alone was vested with the responsibility for assessing all relevant matter and reaching all the conclusions necessary to decide whether or not to make the determinations that it did,” he said.
“In the view of the court, the Fair Work Commission’s decision read as a whole reveals no jurisdictional error.
United Voice called the judgement a “new low blow for Australians who work weekends.
“United Voice believes that the system has one again failed to protect workers and warns that business groups will attempt further attacks on worker entitlement in other industries,” national secretary Jo Schofield said.
“When our industrial relations laws are used by employers to cut pay and undermine the existing entitlements of workers in our country, when the courts refuse to intervene and when our Government refuses to utter a word in support of these workers, the system is broken.”
“We will continue to challenge this harsh and unfair pay cut and will continue to speak out on behalf of all workers.”
The Shop, Distributive and Allied Employees Association said it would continue to fight the decision with United Voice.
Opposition leader Bill Shorten voiced his disapproval at the result, calling the “disappointing” on Twitter.
“Disappointing decision in the Federal Court. It’s clear the best way to protect penalty rates is to vote Labor,” he tweeted.
However, the Australian Retailers Association welcomed the decision, calling for organisations to accept the court’s decision.
We now have a unanimous decision from a five-member full court of the Federal Court supporting the unanimous decision of a five-member full bench of the Fair Work Commission to reduce penalty rates,” executive director Russell Zimmerman said.
“The ARA hopes the ALP and other political parties who are seeking to overturn this decision are sensible enough to accept the umpire’s decision and allow retailers to get on with the job of employing more people.”
The Australian Council of Trade Unions (ACTU) argues nearly 500,000 people will be affected by the changes, losing up to $6,000 a year.
Full-time and part-time hospitality workers’ Sunday pay rates will be cut from 175 per cent of their standard wage to 150 per cent.
Retail workers’ wages will be reduced from 200 per cent to 150 per cent for full-time and part-time staff.
Fast food workers classed as “level one” will have their pay cut from 150 per cent to 125 per cent.
Casuals in the retail and fast food industry would also have a pay cut, but the rates would remain the same for hospitality workers.
The public holiday cuts came into effect on July 1 this year, but Sunday penalty rate cuts will be introduced over several years.