Penalty rates to stay as employers call on Abbott to act

WEEKEND workers in the retail, hospitality and tourism industries have been granted a reprieve on their penalty rates, but employers have urged the Abbott Government to act.

The Fair Work Commission on Thursday rejected industry calls for double-time and a half penalty rates to be scrapped.

Employers across the three industries called for the end of the extra pay on the basis shops and restaurants were being forced to shut on weekends due to high wage costs.

United Voice national secretary Louise Tarrant said the case was a "sweet victory" for hospitality workers, saying up to 90% of industry workers would have lost "significant income".

"By confirming that penalty rates should continue to compensate workers when they are required by their employers to work unsociable hours the Fair Work Commission has stood up for the Aussie weekend and for Australian values," she said.

"Workers pay a high price for giving up this precious time with family and friends. They must be compensated for their very real sacrifice."

But industry groups the Tourism and Transport Forum and Restaurant and Catering Association have labelled the pay rates as excessive, calling for the government to address the problem.

RCA chief executive John Hart told the Australian Financial Review the industry had already seen a third of businesses forced to shut on Sundays, compared with the same shifts a year ago.

Other groups including the Australian Chamber of Commerce and Industry have also called for the penalty rates to be scrapped in recent months.

But the Abbott Government had pledged before the election it would not be changing the industrial relations laws within its first term, leaving any changes until 2016.