Penalty Rates on Sunday

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I have just spent about 10 days in Vienna.  Aside from catching the flu, and the freezing temperature it was an interesting visit.  One thing I found is worth talking about.  On Sundays, no shops open other than cafes and restaurants and the odd tourist place.  To my surprise, shops being closed on Sunday did not cause the world to stop.  Last year I was in a couple of other European cities including Munich and Athens and they manage to cope with shops only open six days a week.  So do we really need to open on Sunday in Australia?

What made me think of this was the push by business to reduce, or do away with penalty rates on Sunday.  It seems a bit of a circular argument.  This is how it goes.

Business tell us the public wants shops to open on Sunday.  This is the most convenient time for people to get their shopping done because they don’t have enough time during the week.  Saturdays are full of running the kids around and generally doing household duties.   For the general population Sunday is more valuable time than weekdays, to be able to do your shopping.

Assuming shop staff are part of the general population, they must also find Sunday the most valuable time to shop.  But if they are required to work on Sunday, you are taking from the shop staff, time that is more valuable than weekdays.  If it is valuable to shop staff, as it is to shoppers, why should they not be paid a premium on Sunday?

If the reverse is true of the general population – Sunday is not the most convenient time to do their shopping – why open on Sunday?  Europe seems to manage.  If you must shop on Sunday, there is always the Internet.

I can see the business driver.  Opening Sunday is better utilisation of an asset (the shop) rather than have it closed one day a week.  It comes down to a cost benefit analysis of the day.  What is the cost in terms of staff, and what benefit, or sales profit, can I make.  If the profit exceeds the cost, you do it.  If the costs exceed the profit, you don’t.

Business must decide if it is ethical to look at the cost benefit analysis and remove penalty rates to make the equation work?

Most staff, given a choice would work a weekday rather than a weekend if the money was the same.  Sure there would be a few who prefer to work on a weekend, but the weekend is where most people are available to socialise, or even go shopping.  This is the time sport and entertainment is scheduled.  This is more valuable time than weekdays.

To me the moral position is this.  If a shop owner believes it is worth opening on Sunday, they must factor in penalty rates to compensate staff who work on Sunday.  If it is not worth opening, we close all shops on Sunday and follow the European example.

Unfortunately, the real question turns out to be this.  Is a moral position relevant to the decision business is asking government to make?

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