Retailers concerned draft modern retail award could increase inflationary pressure

Posted by James Ferre on 6th November 2008

Peak retail industry body the Australian Retailers Association (ARA), in its final opportunity to present to the full bench of the Australian Industrial Relations Commission (AIRC), today submitted a costings analysis of the draft modern retail award, indicating an average 14 per cent wage bill increase for retailers across Australia.ARA Executive Director Richard Evans said this is an unnecessary financial imposition on retailers who are already struggling with the tightening economic environment. “The general consensus among employer groups has consistently shown the exposure draft’s severe financial impacts and the ability of SME retailers to absorb these price impacts is questionable. There is no doubt consumers will foot the bill through price increases on goods and groceries,” he said.

“The ARA’s costings analysis based on a roster for a small retailer with two full time and two casual employees indicates a $22,000 wage bill increase on average across Australia with state costings estimated to be the following:”

New South Wales: $30,094 p/a – 22% increase
Victoria: $20,443 p/a – 11% increase
Queensland: $27,024 p/a – 19% increase
Western Australia: $21,117 p/a – 14% increase
South Australia: $27,745 p/a – 20% increase
Tasmania: $25,314 p/a – 18% increase
Australian Capital Territory: $26,484 p/a – 18% increase
Northern Territory: $17,202 p/a – 11% increase

“With other major economies around the world going into recession, Prime Minister Rudd has warned this ‘is going to be very tough indeed for Australia’. Clearly, this is not a time to be imposing costly legislation on retailers who are already struggling after months of stagnant and declining growth. Right now is the time retailers need direct help,” Mr Evans said.

“The AIRC has released modern retail award exposure draft seeking to simplify and rationalise the existing system – but it has failed in its principle task of creating a ‘modern award’. Retailers need a modern award to suit the modern consumers’ demand for deregulated shopping hours but the exposure draft’s penalty rate structure is reminiscent of the 1960’s regulated Monday to Friday working weeks.”

“There are always winners and losers – and unfortunately this time the loser is the consumer. The retail award exposure draft has ensured prices will go up and the consumer will pay at a time when they can least afford it,” Mr Evans claimed.