The Fair Work Commission’s decision to cut penalty rates is a huge blow to the pay packets of Tasmania’s most vulnerable and lowest paid workers.
I don’t think anybody ever expected that the Fair Work Commission would actually bring down a decision that reduces the take-home pay of some of the lowest paid workers in the country.
At a time when we have historic levels of underemployment, wage growth at a record low and almost 5,000 full time jobs lost in Tasmania over the last year, there could not be a worse time to cut workers’ take home pay.
Penalty rates do not provide luxury items. For many workers, they are what pays the rent or puts petrol in the car.
Penalty rates are not only critical to the people who rely on them. Along with the 40,000 Tasmanians who stand to lose up to $77 a week, are devastating economic and social repercussions which will impact the rest of the community.
A McKell Institute research paper estimated a partial abolition of penalty rates would result in a loss in disposable income of between $15 million per annum and $29.4 million per annum to Tasmania’s economy.
If you reduce the take home pay for these workers, you reduce the amount of money they have to spend which has negative impact on the economy.
Pretty soon, we will see less and less people stopping to buy a coffee on the way to work, sending their kids on school excursions and more families struggling to put dinner on the table each night.
Advocates for cuts penalty rates have been quick to predict a wave of job creation but it isn’t that simple.
Take home pay for those working on a Sunday will be reduced, but I doubt the cost of buying a coffee or eating out on a Sunday will also decrease.
I’ve had a lot of calls over the last few weeks from members the community who rely on their penalty rates - a lot of these calls have been from women.
The decision to reduce penalty rates will have a disproportionately negative impact on women.
Women dominate the sectors that will be affected the most by the reductions to penalty rates (hospitality, retail, fast food and pharmacies), and will suffer the most.
This a pay cut for women working female-dominated industries who are already struggling to balance their budgets and scraping by on low incomes to support their families.
Last week I had a conversation with a woman called Laurel, who works in the hospitality sector and is a single mum. She feels disrespected by the decision and says that she is going to have to scramble for extra shifts to make up for her lost income.
“The Government doesn’t care about the sacrifice that the people who rely on penalty rates make. I work on weekends and public holidays just to get by and I often miss out on important family events like birthdays and gatherings,” she said.
There are serious social implications at play here too, because with women representing more than half of the workforce in the affected sectors, a reduction in take home pay will only widen the gender pay gap.
On average women earn around 17% less than men for doing work of equal value.
We should be working to break down barriers to equality for women – not adding to them.
Last week the Turnbull Government had the opportunity to join with Labor and support our legislation to stop unfair cuts to the penalty rates of low income workers, but sadly they didn’t.
At a time of great uncertainty this was particularly disappointing.
Their priorities are all wrong.
Turnbull Government’s refusal to stop the Fair Work Commission’s cut to penalty rates comes on top of their cuts to family payments, childcare, and pensions which will see women fall even further behind.
All of us know someone, or know of someone who relies on these rates to get by.
Nationally there more than 700,000 Australians are unemployed, there are 56,000 fewer full time jobs since January 2016 and more than 1 million people want more work but can’t find it.
Too many Australian families are feeling squeezed.
And, far too many people are telling me that they’re reaching their breaking point.
It’s time for Malcolm Turnbull and the Liberals to prioritise real people over the profits of big business.
This article was originally published for International Women’s Day in The Mercury on Wednesday, 8 March 2017.
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