What has been proposed is that a voluntary salary absorption option would allow employees at higher classification levels to choose a permanent salary that includes compensation for overtime and penalty rates.
The way Australians shop, work, and manage their work-life balance has changed enormously over the past decade.
Yet, the primary industry award that governs retail as our largest private sector employer remains frozen in the past.
Allowing employees to work a more flexible four-day week and finish shifts early, and retail managers to choose a permanent annual salary over hourly penalty rates, are logical changes that mean retail workers have more choice in how and when they work.
Under an Australian Retailers Association proposal to the Fair Work Commission, retail workers can choose to work their 38 hours across four days instead of five, while allowing “split-shifts” would provide working parents greater flexibility for activities such as school pickup and drop off. Those who want to finish early, for example to attend an appointment, can choose to take their break at the end of their shift without any loss of pay.
There is already a working precedent for the salaried managerial proposal, which is used broadly and effectively across a range of industries.
It’s important to note that there is no trade-off of penalty rates, rostering, breaks, minimum rates, allowances or overtime. Our proposal is an optional annualised salary framework whereby senior employees can receive all those benefits in a different manner and with additional benefits. Employees can access a consistent, higher fixed salary that will allow them to better plan their finances and obtain loans.
The Fair Work Commission has already endorsed the alternative framework in comparable awards. Such arrangements operate successfully and fairly across the economy. It is unfair that retail employees are denied similar opportunities.
Our proposals are not about reducing hours or pay; they are simply giving employees other ways to structure their work.
Disappointingly, a campaign has been waged recently by unions around the retail award proposals and it is significantly misleading. There is no proposal to remove penalty rates, overtime or paid breaks from the award.
What has been proposed is that a voluntary salary absorption option would allow employees at higher classification levels to choose a permanent salary that includes compensation for overtime and penalty rates. This ensures a stable, predictable income while providing a financial boost to those eligible. And importantly, it is an opt-in option for the employee.
Here is an example. Jenny, a (hypothetical) full-time retail manager at Level 6 under the award, works an average of two overtime hours per week. Her current weekly wage under the award including overtime is $1176.37. Her new wage under our proposal would be $1362.88. The financial benefit to Jenny would be $186.51 more per week. These changes would be strictly voluntary, with safeguards in place to protect employees’ rights. No one would be forced to change their pay structure – this is about offering choice, not imposing change.
For many employees, the ARA’s proposed changes to promote flexibility will mean an extra day off to spend with family, pursue further education, or simply recharge. In an industry where weekend and evening shifts are common, flexibility is key to maintaining a satisfied and engaged workforce.
Our proposals are not about reducing hours or pay; they are simply giving employees other ways to structure their work. Our proposals aim to remove counterproductive barriers that make rostering and payroll overly complicated, without diminishing employee protections.
Streamlining outdated provisions and clarifying key terms is about ensuring employees and employers can spend less time on administration and more time focusing on what matters – delivering great retail experiences and fair employment outcomes.
More than half of retail businesses surveyed by the ARA report that current workplace relations laws create barriers to employment outcomes. The current award is rigid, and that rigidity means retailers can’t offer split shifts that might help working parents, students, or help those with other commitments find shifts that suit them best.
With almost 1000 individual pay rates, the current 96-page General Retail Industry Award is recognised as unnecessarily complex. This is particularly unfair to small business which makes up the backbone of the retail sector and typically needs to navigate this complex award without the support of specialised legal or HR expertise.
Modernising the award will also support job creation and business sustainability – ensuring retailers can continue to grow and provide employment opportunities across the country. When businesses succeed, employees thrive, and the entire industry benefits.
The ARA respects the Fair Work Commission process and looks forward to the upcoming hearing in March. However, it is critical that the conversation remains factual and constructive.
Retail is an industry that employs 1.4 million Australians – a sector built on fairness, opportunity, and the ability to adapt to change. The proposals we have put forward reflect a future-focused retail sector – one that values flexibility, empowers employees, and removes outdated barriers, which hold the industry back.
Modernising the award is not about diminishing workers’ rights; it is about ensuring that employees and businesses alike can thrive in a rapidly changing retail environment.
We urge all stakeholders to look past the rhetoric and see these proposals for what they truly are – a step forward for Australian retail workers.
The future of retail work should be fair, flexible, and financially rewarding – and that’s exactly what we’re working towards.
