NATIONAL: Australian fashion retailers are struggling to understand new industrial relations legislation which could see their wages bills soar by a minimum of $18,500 per annum.
One in two businesses contacted by Ragtrader said they could not identify their obligations under the sector’s new award system, to be introduced across the country from January next year.
A Melbourne-based chain with over 40 outlets and distribution across department stores Myer and David Jones stated it was “not completely across” the legislation, while a designer brand with six stores across Sydney and Melbourne claimed it was still waiting on a full briefing on the new system.
“[We] will look at the outcomes of the changes in more detail following this,” the brand manager said.
Costings analysis by the sector’s peak industry body suggested there would be substantial wage increases as a result of the new legislation.
According to the Australian Retailers Association (ARA), the average bill for a small retailer with two full-time and two casual employees would increase by $22,000 per annum while New South Wales operators would be stung an extra $28,473.
“It is clear small retailers are extremely concerned about the impact IR changes will have on their business but they may not have a complete understanding of their new obligations,” ARA policy officer Kath Christie said. “It is essential employers are equipped with the knowledge and understanding to meet their new obligations…[and avoid] intervention by IR enforcement agencies.”
The greatest concerns among retailers were increased penalty rates for hours worked on Saturday and Sunday and the introduction of casual loadings across Australia. Myer chief executive Bernie Brookes told the Herald Sun newspaper that full-time jobs would be lost as a result of the wages burden and that costs would ultimately pass on to the consumer.
He said the new system would fracture existing enterprise bargaining agreements with staff.
“It is a move to some of the barbaric and adversarial union-employer relationships that we used to have, that I don’t think we need to return to or we can afford to return to.”
However, according to the Fair Work Ombudsman, the retail industry consistently featured in the top three industries for complaints received and money recovered for workers each year. The most common breaches in the fashion sector included the underpayment of employees’ minimum hourly rate, annual leave entitlements and penalty rates.
Workplace relations adviser Ryan Peddler said one recent case saw 20 teenage girls in Adelaide reimbursed a total of $10,000 after an investigation found they were underpaid.
“As such, educating employers and employees about workplace laws and improving compliance laws in this sector continues to be an area of strong focus for the Fair Work Ombudsman.”
The Modern Retail Industry Award will commence from January 2010, with a detailed five-year transition program yet to be announced.