Fair Work Commission Slashes Penalty Rates





SUBJECT/S: Penalty Rates Cut and NBN in Western Australia 

PETER VAN ONSELEN: Thanks for your company Stephen Jones




PVO: Let me just talk to you about penalty rates if I can, this decision is one that is only possible because Bill Shorten as you would  well know made amendments to the Fair Work Act which gave the Fair Work Commission the power to do what it’s done, it’s his fault isn’t it?


JONES: No, I’ve seen that spin that’s going out today mate, it’s simply not true. The Fair Work Commission has had a capacity to review, increase; decease penalty rates for just about as long as it’s existed. Let’s get to the heart of the matter, I respect the independence of the Fair Work Commission but we are able to criticism them when we think they’ve got a decision wrong and I think they’ve got this decision wrong.


PVO: But if they have got it wrong, Bill Shorten in his media conference earlier gave a very strong impression that he would look to legislate to reverse it. That’s not respecting the independence of the Commission is it?


JONES: Look if we are unable to legislate for changes in community sentiment or legislate where we think the act needed to be improved there would have been no changes to the Fair Work Act over the last 116 years. The truth of the matter is it’s

one of the most amended pieces of legislation on the federal statute book but I want to get to this point. We think the decision is wrong. It is not only a cut in the take home pay of thousands of already low paid workers, but a time when wages growth is very flat and that is impacting on demand, this is not the time to be cutting the pay of workers who let’s face it they spend every cent that they get. That’s what we are talking about a group of workers, who spend every cent that they get, what we have done is basically put another dampener on demand. So for those reasons it’s not a good decision.


PVO: So you don’t like the decision, Bill Shorten has said the same, so Labor if elected will reverse it, is that right? Through legislation?


JONES: Yep, we will look at what our options are mate, there’s a little bit of time between now and the next decision and next election; we will look at what our options are. Let’s explain why we think it’s wrong. It’s a cut to take home pay, it’s going to take money out of the economy and dampen demand. But here’s the thing the employers and the government have been saying for many years now, and particularly the big business employers, if you cut penalty rates we create more jobs. Does anybody think for a moment that McDonalds, Hungry Jacks, and KFC are going to extend their opening hours on a Sunday for one more hour or employ one additional worker as a result of today’s decision? I put that challenge out to those companies right now, tell us how many more new jobs you are going to create or how many additional hours you are going to open. We know what the answer, the answer quite simply Pete is none.


PVO: But do you accept that this is not the Government’s doing. This is an independent body that has made an independent decision under rules, frameworks and laws that Labor brought in.


JONES: A campaign that is being run by Members of the Liberal Party, by the Industrial Relations Minister herself and over sixty of her backbenches the Fair Work Commission is not immune to that sort of pressure. Let’s be frank we all know whose been championing for cuts to penalty rates.


PVO: They did not even make a submission Stephen Jones.


JONES: And they should have. And they should have  


PVO: Okay so we can say that they weren’t proactive in trying to stop it but you can’t say they were proactive in trying to make it happen can you surely?.


JONES: Do your research on this one Pete and see how many Liberal and National Party Members of Parliament have stood up in Parliament or elsewhere and called for cuts to penalty rates. You get almost hundred percentage of them and we just think it is a bad decision at this time of all times it’s a bad decision for jobs and the economy.


PVO: What about this exchange though, on radio in Melbourne between the Opposition Leader and a presenter there.


PRESENTER: “Will you accept their finding given this is an independent body assessing penalty rates for Sundays if you’re Prime Minister”



PRESENTER: You’ll accept them?




PRESENTER: Even if they reduce Sunday Penalty Rates?


SHORTEN: Mr Shorten: Well I said I would accept the Independent Tribunal.  


PVO: Doesn’t sound like that now that it’s gone the wrong way.


JONES: Well you can always accept the findings of the Tribunal, but look at where you might need to legislate if that has a negative impact on low paid workers and the economy as a whole. This is what Bill, and Brendan and others have been saying we think this is actually going to have the opposite effect to what the people who have championing it have called for, we think it’s going to be not only impact on the demand, let’s not forget those people who are going to have less money in their pocket when they walk into shops, coffee shops and retail outlets, they’re going to have less money to spend as a result of this decision, so that’s one negative impact we are going to have to respond to. We don’t think it’s going to create any additional jobs and how’s this going to impact low paid workers? Now we will take our time to look at a whole raft of measures that might be able to be put in place to compensate for this decision that has been made today. 



PVO: Alright, just on this, don’t get me wrong I understand this is political matter from heaven for Labor and I am not suggesting you like the decision, but I’m saying politically I suspect this is a tough one for the government irrespective if we talk about how the decision was made or what independence was there but facts still matter in this Stephen Jones. You mentioned KFC, McDonalds and Hungry Jacks in terms of the impact this will have, they are all under EBAs which are unaffected by this decision.


JONES: Then why is it that their industrial body was one of the leaders in taking this matter up to the Fair Work Commission and as anyone who has been involved in this field for a long time as I have will be able to tell you, the award sets the underpinning on which  the enterprise agreements are made. 


PVO: So you’re talking about flow on effects?


JONES: It has a flow on effect, for the next EBA and for everybody else’s EBA.


PVO: So down the track, somewhere there might be an impact on those companies, but you do accept that the decision today has no direct impact on the existing conditions under the EBA of those three big businesses.


JONES: Well why were they appearing before Fair Work Australia calling for a cut if it was not going to have any impact on them. Of course it’s going to have an impact on them, of course it’s going to have an impact on them Pete, we know it, their workers know it and they know it, that’s why they were calling for it.


PVO: Can we agree on this, can we agree on this if we were starting in Year zero I would personally like the idea of Saturday and Sunday penalty rates being aligned, but we are not starting in year zero and the optics of a cut to some of the lower paid workers in our community to be adjusted to a position, which you might as a starting principal may think is okay, but adjustment frankly is not okay, do we agree with that?.


JONES: Look, I think there’s a problem, here’s what that proposition boils down to Pete. Is Sunday and Saturday the same as any other day of the week and if it was why are most government departments, most large businesses, parliament itself why is that not open on a Sunday and the answering is that its long accepted that Sunday is a little bit special and its maybe the one day in the week where you get to spend some time at home with your family or catch up on those jobs you’re unable to do during the week. So Sunday is a little bit different and I don’t think that’s changed that much.


PVO: Why did Bill Shorten amend the Fair Work Act to have this review of the penalty rates in the first place, I don’t understand why he would have done that.


JONES: Look this was a part of a whole range of reviews, a whole range of amendments that were made to the Fair Work Act in part as a response to a long running campaign, that employers and the Coalition had been running in this country in the need to get more flexibility into the workplace relations system. So amendments were put into place to ensure that the Fair Work Commission could look at these and a whole range of other matters. Now I repeat the point it’s not a contradiction to say that you respect the independence of the Fair Work Commission and to say when you think they’ve got a decision wrong, them or any other court in this country, the parliament, the legislator and members of parliament who represent their constituents can stand up and say well we think you got it wrong and we think this needs to be addressed.


PVO: What about this though, Bill Shorten when asked whether it was likely that the Commission would make the change that it has now in fact made he said “that it was as likely as aliens contacting earth”. Now we have had news today about NASA finding planets that are similar to ours so who knows but it doesn’t make you much of a judge does it, bit of an issue there for Bill Shortens ability to predict the future I’d like a Prime Minister whose got a better handle on those sort of likely predictive outcomes.


JONES: Which underscores my point Pete, that this extraordinary decision, one that could not or should not have been anticipated and one that were with great respect to the eminent members of the Fair Work Commission we think they’ve got it wrong.


PVO: This is the slippery slope argument that I am putting to you now Stephen Jones where does Legislative intervention end. I mean we had the rhetoric before the decision went one way from Bill Shorten which I read out to you before saying he would respect the independence. It looks like from his media conference and what you say that you would like to Legislative intervene. Where does that end though what about minimal wage decisions, what about the reserve bank on the setting of interest rates. Where does it end?


JONES: Look, this has been one of the most disputed pieces of legislation, since the federation of Australia. There have been amendments to the Work Place Relations Act and the Fair Work Commission and before it the conciliation and arbitration Commission, in just about every parliament since Federation. So it’s simply not true to say that this is an act and a body that is set in stone. There’s always been a healthy in sometimes unhealthy, dialogue between the Parliament, the government and the Fair Work Commission. Over the long run we always get the balance right. We haven’t said, and this is an important point Peter, we haven’t said what we would do to address this decision. We will take a calm look at all of the measures that are available to us, through all the branches and all the acts of parliament that are available to us, but what we are saying quite clearly is that at this time, of all times taking a hatchet to the pay packs of low paid workers is bad for them and bad for the economy and it needs some address.


PVO: Just finally, we’ve ended up talking all about penalty rates for obvious reasons with the news of the day, but you’re over in the great state of Western Australia, don’t tell me and this is my question Stephen Jones, and please don’t tell me that you are over there as a Federal Shadow Minister campaigning in a State Election that wouldn’t be appropriate would it?


JONES: I’m going to have to break your heart Pete, I have not been doing that, last night I was out in the great town of Kalgoorlie talking to them and trying to excite them and G them up about a campaign to stop the roll out of copper-based NBN and to get the same sort of fibre-optic cable-based NBN in regional Western Australia that is going to be rolled-out in the capital cities of Sydney, Brisbane and Melbourne, and as a proud Western Australian Pete, I’m sure that’s a campaign that you would support me in.


PVO: Well, we don’t need any of that do we Stephen Jones not with 5G and ongoing technology, this is just becoming one big white elephant isn’t it the NBN whether its copper or fibre.


JONES: Mate in about five or six years times there will be a Piñata with Malcolm Turnbull’s name on it, because of the enormous damage he has done to one of the most important nation building project in this country. You can’t beat fibre. Do it right the first time and the people of Kalgoorlie and the rest of Western Australia know that. In fact this is one of the slowest states in Australia for rolling out the NBN. Your home town of Perth mate, one of the worst internet speeds of any capital city in the country, so right throughout Western Australia their crying out for better NBN, better Broadband and fibre is the answer to that not, old copper.


PVO: Stephen Jones appreciate you joining us on Newsday, Thanks for your company.


JONES: Good to be with you