Government Moves to Block Retail Push to Cut Penalty Rates

Employment Minister Murray Watt speaks during a press conference in Brisbane, Australia on July 22, 2022. Dan Peled/Getty Images

The federal government has said it would oppose the push by retailers to amend the General Retail Industry Award (GRIA), arguing the changes would erode worker protections.

The Australian Retailers Association (ARA) had applied to amend the award, which would relax rostering rules, allow split shifts, and let managers earning over $67,000 opt for a fixed salary—at the cost of penalty rates.

‘Pay Cut Disguised as Flexibility’

Employment Minister Murray Watt said the government would not stand by as retailers attempted to cut penalty rates.

“The Albanese government has worked incredibly hard over the last three years to try to get wages moving again,” Watt told ABC News.

Watt quoted the latest ABS data to substantiate his claims.

“We got new figures through that showed that the average full-time worker in Australia is now earning $206 a week more than they were under the coalition,” he said.

He further emphasised that working on weekends has to be compensated.

“I think all of us recognize that weekends still matter in this country, weekends are when we gather with our families. It’s when people have their weddings. It’s when Grand Finals are scheduled. And the people who give up their weekends to feed us and clothe us should be rewarded for that, just as they should be rewarded for night work and overtime,” he said.

Retailers Defend Proposal

The ARA insists the changes would modernise the retail award without forcing workers to forfeit penalty rates—unless they voluntarily opt into a higher salary arrangement.

“This choice and flexibility aligns with the shift towards more flexible ways of working,” ARA Chief Industry Affairs Officer Fleur Brown said.

Brown dismissed claims that the proposal would remove penalty rates entirely.

“There is no proposal to remove penalty rates, overtime, or paid breaks from the award. Managers can opt into a pay increase if they select the voluntary salary absorption option. This will only apply to employees that agree to it,” Brown said.

Watt acknowledged the need for changes in the award system but insisted it should not come at the cost of pay cuts.

“I accept that the award system can be simplified, but you can simplify awards without cutting workers’ pay. That’s the principle here,” he said.

Watt Challenges Dutton to Take a Stand

Watt also challenged Opposition Leader Peter Dutton to clarify his stance.

“They’ve (opposition) already said that if they win the next election, they'll scrap a range of the changes that we’ve made to workplace laws. Peter Dutton needs to tell the Australian people, will he back our submission if he wins the election, or will he line up with big business and support these pay cuts?” Watt said.

The Fair Work Commission will hear the ARA’s application in March 2025.