Union suggests Labor laws could reverse past penalty rate cuts   

Financial Review
Jun 16, 2025

The retail union has said Labor’s upcoming laws to protect penalty rates could allow unions to seek to reverse past decisions, as it pushes to delay a crucial ruling affecting thousands of workers in the industry.

The Shop Distributive and Allied Employees Association has urged the Fair Work Commission to hold off on deciding a bid by retailers to exempt higher-paid staff from the award’s penalty rates in return for a 35 per cent pay rise pending Labor’s proposed legislation to prevent penalty rate cuts.


Major retailers want to let workers agree to exempt themselves from penalty rates in return for higher pay.

The Fair Work Commission asked parties whether it should postpone its decision in response to a letter from Workplace Relations Minister Amanda Rishworth flagging Labor’s upcoming bill.

The union’s argument suggests that Labor’s laws, which are yet to be drafted, could have a much broader scope than blocking future decisions in retail cases and also open a path to reverse past changes.

The SDA said that while the commission had to apply the current law it also had discretion on how and when it made its decisions and urged it to defer its decision at least until the bill’s situation was clear.



“Given the commission has been formally advised of the government’s intention, it would be inappropriate to make a variation to a modern award which would be inconsistent with that intention if amending legislation is passed,” its submission filed late last week said.

“If such a variation were made and the legislation were subsequently amended the effect of the variation would be negated by the legislation or it might become subject to a further variation application to bring it in line with the amended act.”

Employers seek exemptions
Such a situation would clash with the Fair Work Act’s objective to ensure a “stable” award system, it argued, and FWC “should avoid creating a situation where the provisions of a modern award undergo repeated changes”.

So far employers have applied for exemption or “buyout” rates for the retail, clerks and banking awards which cover some 3 million workers in total.

Promising laws directly targeting those cases, a spokesman for then-workplace relations minister Murray Watt said during the election that the laws would be “prospective (not retrospective) in its operation”.

However, some experts have voiced concern that this would not stop unions from applying to change awards following passage of the legislation so they meet the act’s new penalty rates objective.

Such applications could potentially extend to the commission’s 2017 decision to reduce Sunday penalty rates in retail and fast food awards, current exemption rates in hospitality and restaurant awards, or award provisions that allow employers to pay workers annualised salaries.

“While the exact scope of the policy is yet unknown, if legislated, the Albanese government’s pledge to protect penalty rates will have a direct impact on annualised salary arrangements for modern award covered employees,” a recent legal note from Kingston Reid workplace lawyers Duncan Fletcher and Jessica Tinsley said.

“Employers could see less scope to offer annualised salary models that offset penalty rates under the modern award, even where such models result in higher overall pay.”

The Australian Retailers Association, which is pushing the penalty rates case on behalf of retailers such as Woolworths, Coles and Costco, strongly opposed the delay on the basis it would compromise the independent tribunal.

“The commission would be abdicating its statutory duty in anticipation of a hypothetical future event (noting that there is no certainty that the minister’s proposed legislation will be passed by parliament at all or in the form the minister currently intends),” its submission said.

“Such an approach risks undermining confidence in the commission’s independence.”

In contrast to the SDA, which argued ARA’s case “clearly cuts across the provision of penalty rates in the modern award”, ARA chief executive Chris Rodwell insisted that “penalty rates will not be removed under our proposal”.

“What’s proposed is that retail managers can opt into an annualised salary which provides greater income and financial stability.”

The commission has been considering its decision on the retail award since March. Parliament is not due to sit until July 22.

Rishworth said legislation to ensure penalty rates cannot be “reduced or removed” from awards was a top priority and promised to consult with unions and employers. She said that “timetabling of individual cases is a matter for the FWC”.   

The important part of the coin is getting control over costs of living - to which end - cut childcare and thus reduce unemployment by creating less pressure on jobs; terminate the MADIF (Mandatory Dual Income Family) as the economic base for the majority; chop immigration to a trickle; place utilities under control of independent bodies not-for-profit and get rid of 'shareholders'; cut out 'privatisation' of facilities and roads and such; and thus remove the huge profit margin ....

Perhaps it's already too late ... what 'tradie' is going to accept less than $100 an hour now after the Salad Days?  What 'boss person' is going to accept a huge pay cut for being chief clerk?

If working public service is such a disadvantage - why are they not in the private sector?