Sunday and Public Holiday Penalty Rates Reduced

23rd February 2017

After nearly 3 years of deliberation, the Fair Work Commission has decided to reduce Sunday and Public Holiday penalty rates prescribed in modern awards covering retail, hospitality, fast food and retail pharmacy employees. The decision effectively halves the penalty currently applicable on Sundays to retail, fast food, hospitality and pharmacies. Registered and licenced clubs have not been included in the decision, which will be implemented over a transitional period commencing 1 July 2017.

Sunday Penalty Rates

Sunday penalties for full-time and part-time employees working in Retail, Hospitality and Pharmacy business will be gradually reduced to 150% of the ordinary hourly rate commencing 1 July 2017. Casual rates for work on Sunday will be reduced to 175% of the ordinary hourly rate.

Sunday penalties for base grade Level 1 full-time and part-time employees working in Fast food businesses will be gradually reduced to 125% of the ordinary hourly rate commencing 1 July 2017. Casual rates for work on Sunday will be reduced to 150% of the ordinary hourly rate. Penalty rates for Level 2 and 3 graded employees are unchanged on 150%.

Sunday penalties for full-time, part-time and casuals working in stand-alone restaurants have not changed as they are already 150% and 175% of the ordinary hourly rate.

The Fair Work Commission is considering how it will phase in the reductions over the next one to two years.

Public Holiday Penalty Rates

Penalty rates for full-time and part-time employees working on Public holidays in restaurants, hospitality, retail, fast food and pharmacies have been reduced to 225% of the ordinary hourly rate . Casual employees working on Public holidays in these industries must be paid 250% of the ordinary hourly rate of pay.

The new penalties will apply in full from 1 July 2017.

Businesses operating in retail, hospitality, fast food and retail pharmacy that apply enterprise agreements for their employees will not be affected by the decision. Enterprise agreements override modern awards whilst they continue in force. A summary of the decision is available from the Fair Work Commission.

Please contact us if you require advice or assistance in understanding and applying the decision.