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Don't penalise the job opportunities

By David Leyonhjelm - posted Monday, 12 October 2015


For some time the government has been talking about jobs, in the process claiming that 335,000 new jobs were created in the two years of this government.  However, unemployment officially remains at 6.2 per cent, higher than the USA and UK. Youth unemployment is much higher, especially in some areas.

Greater focus is needed on policies that will result in larger numbers of jobs being created.

The restaurant and catering, retail and tourism industries are labour intensive and dominated by small businesses.  They are also large employers of young people. To maximise growth in the jobs market, it seems logical to focus on where the most jobs are to be found. With that in mind, I have introduced a bill to create more opportunity in these industries based on the new reality of the working week.

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The bill will retain penalty rates for public holidays, but remove them for specific days of the week, that is Saturday and Sunday.  Penalty rates would apply after the first 10 hours of work on any day, or after the first 38 hours of work in any seven days.

The bill will apply to businesses in the nominated industries with fewer than 20 employees.

The original reason for penalty rates was to penalise employers for requiring employees to work outside the standard Monday to Friday working week, or conversely, to reward employees who agreed to give up traditional weekend days.

However, we no longer live in the world that existed when penalty rates were introduced. Pubs used to shut at 6pm; dining choices were limited; shopping ceased at noon on Saturdays; and sporting events were held almost exclusively on Saturdays. 

Today’s world operates 24/7. We now shop all weekend, dine out from breakfast through to the early hours of the morning, and there has been a vast growth in the breadth and depth of dining choices over the last thirty years.

Tourism services have blossomed in the same period, to the extent that tourism is now the second fastest growing sector in the economy. 

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These revolutions in retailing, dining and tourism have generated numerous business and job opportunities for hundreds of thousands of Australians. But now we are stalling.  Businesses are pulling back, shrivelling under the dead hand of government regulation.

A significant number of retailers, restaurants and tourist businesses are restricting trading hours and will not open on weekends, particularly Sundays, because they lose money as a result of the obligation to pay penalty rates.  Some continue to open to try to hold on to their customer base, staffed mainly by family members.  Others open, pay penalty rates and forgo profit, hoping to maintain their market share.

Any business, other than a sole trader, that restricts trading hours is closing off a job opportunity for someone. It is ludicrous that business owners are being forced to restrict trading hours, and therefore job opportunities, because regulated pay rates deny profitable trade.  Any business should be at liberty to trade according to the preferences of its customers, not according to outdated labour laws.

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This article was first published in the Australian Financial Review.



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About the Author

David Leyonhjelm is the Liberal Democrat Senator for NSW.

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