Senate report seeks better overall pay for workers
The Australian understands the inquiry’s ALP majority report has found the trading off of weekend penalty rates for higher weekday pay was “perfectly legitimate” provided affected workers backed the changes and were better off overall under the deals.
However, the majority report, prepared by committee chairman and Labor MP Gavin Marshall, calls for the development of an improved, more robust better off overall test to ensure “optimal outcomes” for workers were safeguarded.
The report, due to be tabled in the Senate today, followed an inquiry into claims that retail and fast-food employers received a competitive advantage over small businesses by striking deals with the shop assistants’ union that paid below-award weekend and public holiday penalty rates.
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Enterprise agreements must pass the better off overall test as a condition of approval by the Fair Work Commission. An agreement passes the test if the commission is satisfied at the “test time” that each award-covered employee, and each prospective award-covered employee, would be better off overall if the agreement applied to the employee, than if the relevant award applied.
It is understood the report says there is considerable ambiguity around the application by the commission of the better off overall test and that it “might benefit from fine tuning”.
The report reaffirms recent findings by a separate committee inquiry that the Fair Work Act “requires bolstering” to ensure it keeps pace with modern workplaces and ensures employers do not exploit loopholes.
Noting the other inquiry highlighted the power imbalance between the bargaining power of employers and workers, it says the better off overall test should be strengthened to ensure it provided clarity and certainty, was rigorous, robust and capable of delivering on its purpose.
In line with the ALP’s view, the report recommends legislation be introduced to overturn the commission’s decision to cut Sunday penalty rates, finding the cuts will have a disproportionate and pronounced impact on retail, fast-food and hospitality workers.