Jan Davis: It’s time to rework our penalty rates

Remember when restaurants added a surcharge to your bill for weekend service because, if you were rich enough to eat out on a weekend, you could afford to pay extra for the privilege?

Remember when petrol stations worked on weekend rosters, usually only till 6pm? Remember when you had to actually go to the bank to get cash before they closed at 5pm on Fridays or go without until 10am on Monday? No ATMs; no credit cards.

For most people, work and the weekend did not mix in those days. Pretty much everyone had leisure time on the weekends and it was accepted that this was family time – except for farmers, of course. So, if you did have to work, it was reasonable that you should be recompensed for the loss of your recreation time. This is where penalty rates (overtime) came in, traditionally time and a half on Saturdays and double time on Sundays – except for farmers, of course.

Life has changed considerably since those days when weekends were king.

Today, we live in a 24/7 environment in a globalised economy. We expect services to be available whenever we want to access them. We all work harder and longer, we do more and more work wherever and whenever on smart phones and tablets. There’s no such thing as a common leisure time and the weekend is now part of the normal working week for many of us.

In this world, many people choose to work in industries where hours are not the traditional 9am – 5pm. It may suit their personal life circumstances, or they might be happy just to have a job.

This is why the concept of one-size-fits-all penalty rates is such an anachronism.

The cycle of farming doesn’t stop because it is after 6pm or Sunday. Farmers can’t decide to work a 9 -5, five-day week, Monday to Friday. Cows need to be milked and crops need to be cared for when the time is right, not when the labour is cheapest. If people have to work into the night, longer than eight hours, or on Saturday or Sunday, that is what they do to get the job done.

People who work in farming understand that.

Farmers reduce costs as much as they can (a), they try to optimise the price they get for their goods (b) and they hope that b – a is a positive number. They can’t just whack a premium on the price asked for the goods they are producing because they had to pay penalty rates for workers on the weekend. It simply doesn’t happen that way.

People who work in farming understand that.

The TFGA has been a long-time advocate of flexible working hours because that is the only way farmers can afford to employ people. That doesn’t mean that we expect workers to accept unreasonable employment conditions; but it does mean that normal working hours should be related to the normal requirements of business.

If the agreed norm is 37.5 hours a week, for 5 days a week, then so be it. But those 37.5 hours should be able to be worked without penalty in the best way to suit both the business and the employees. Normal hours for one worker might be 6am – 12.30pm Thursday – Tuesday; for another, 12.30pm – 7pm Monday – Friday; and dairy hands might work for three hours in the morning and three hours in the afternoon on any five consecutive days. If they work outside these hours, then penalty rates would apply.

People who work in farming understand that, too.

We’re supposed to be promoting tourism potential of our state. As consumers, we expect to access all services on a weekend without any surcharge. Tasmania has one of the highest unemployment rates in the nation. Yet skyrocketing labour costs are forcing many businesses to rationalise their opening hours and lay off staff.

It simply doesn’t make sense. Everyone knows we can’t have our cake and eat it too. If we want to live in a globalised 24/7 world, then we have to accept that there will can be no standardised working time. Other nations don’t do this, and our farmers (and other businesses) simply can’t absorb these costs and remain competitive. Otherwise, we must understand that we have to pay a premium for services outside whatever is deemed to be ‘normal’ work hours.

We all know our economy is in a parlous state. The current one-size-fits-all approach of the Modern Awards system is simply unsustainable.

The federal government needs to take a fresh look at how we work, how we can recognise the realities of the modern world we live in, and how we can optimise the opportunities for all Australians.
TFGA chief executive Jan Davis