The loss of penalty rates would have a disproportionate effect on retail workers in rural and regional areas, leaving them up to $111 million worse off, a new study has found.
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The study by the McKell Institute found that if penalty rates were cut, rural NSW could lose between $89 million to $315 million each year in take-home pay, or between 4.6 per cent to 16.5 per cent of retail worker salaries.
It also found $26 million to $111 million in disposable income could be lost across rural NSW.
''In the country, where workers typically earn $5300 per year less than their city counterparts, they'll end up facing a disproportionate burden inflicted on them by this potential change,'' the research said.
Business groups have been putting pressure on the federal government to abolish penalty rates.
The Shop, Distributive and Allied Employees' Association NSW commissioned the research and will present the findings to the ALP state conference in Sydney on Saturday.
NSW branch secretary Gerard Dwyer said cuts to penalty rates would make it particularly difficult for rural families to pay for essentials such as food and utilities.
''Retail workers make up about 12 per cent of the workforce in rural NSW, so if they tighten their belts, the flow-on will hit local businesses and economies hard,'' Mr Dwyer said.
''Penalty cuts are simply not a sustainable, long-term way of ensuring profitability for retailers in regional and rural areas.
''We mustn't forget that penalty rates are paid in compensation for the loss of time with family. Retail workers should be given a fair go and retain penalty rates for working long hours, weekends and public holidays.''
NSW Business Chamber chief executive Stephen Cartwright said penalty rates had a place in workplace agreements but their inflexibility in ‘'modern awards'’ was making it unprofitable tor some businesses to open during peak times, or it falls back on the business owner and their family to run the business.
''What’s important to remember is that award-imposed penalty rates are meaningless if the shift is never worked because the business can’t afford to open. Everybody loses because the worker loses wages, the employer loses sales, the governments lose tax and the consumer loses a valued service. All in all, a crazy outcome for a country with rising unemployment and a rapidly growing (and unaffordable) welfare bill,'' he said.
