A bitter penalty

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It’s a decision that seems likely to split the profession: with low base wages already a significant problem, employee pharmacists are signalling that they may leave for good over cuts to penalty rates. Megan Haggan investigates.

The Fair Work Commission handed down its decision on penalty rates in the hospitality, general retail and pharmacy sectors in late February. The decision means Sunday penalty rates under the Pharmacy Industry Award for full and part time employees will reduce gradually to 150%; this is set to take place over a period of between two and five years. 

Over the same period, Sunday penalty rates for casual employees will reduce gradually to 175%.

Perhaps predictably, employer groups welcomed the decision while those representing employees condemned it; and when the AJP ran a poll on our website to gauge our readers’ reactions, a full third of respondents said they planned to leave the profession as a result.

“There’s already signs of enormous strain on the profession, and we see many young pharmacists with huge potential leaving the profession,” Professional Pharmacists Australia national campaign manager Matt Harris told the AJP shortly after the decision was handed down.

“When we go into universities and speak to the pharmacists there, they’re shocked at the current state of pay in pharmacy, and really do reconsider their career options.

“This continues that trend.”

Are Sundays different?

Society has changed. Shops no longer close at midday on Saturdays, leaving working families with only one morning a week to do their shopping; consumers expect to be able to purchase goods and services online at any time of day or night, and to have their choice of café open ready for Sunday brunch. In the 24-hour economy, Sunday opening has become a baseline expectation.

Indeed, the fact that Western Australia’s Sunday trading hours don’t match up to those enjoyed by shoppers elsewhere in Australia has been a cause of concern for retailers in that state, with the previous Barnett Government’s moves to extend trading hours welcomed by employer groups. Retail Council CEO Anna McPhee still recently described WA’s regulations as “complex and restrictive,” however.

The Pharmacy Guild’s submission to the Fair Work Commission included a copy of a report by Lynn Pezzullo, lead partner of health economics and social policy and a director of Deloitte Access Economics, which was engaged by the Guild, Australian Retailers Association, Australian Hotels Association and other employer stakeholders to research and report on “The Modern Face of Weekend Work”.

This report showed many workers, such as women with family commitments or university students, preferred evening, night or weekend work as it gave them flexibility when it came to other commitments.

“These findings cast a shadow on claims that weekend work causes social and familial disadvantage by producing higher levels of aggregate disadvantage on the part of those who work weekends,” the report states.

It found that 69% of weekend workers did not feel it was more important to keep Sunday free than Saturday, and the views of younger workers “suggest its importance may decline in years to come”.

“There’s no escaping the fact that Sundays are not what they used to be when people went to church and didn’t go out and eat or shop,” Small Business and Family Enterprise Ombudsman Kate Carnell told the AJP.

“Things have changed,” Ms Carnell, a former pharmacy owner, said. “Shoppers expect stores to be trading, people expect restaurants and cafes to be open for business. 

“Nowadays it’s all about ‘round-the-clock access to shopping and other activities; this isn’t unique to Australia of course, it’s happening worldwide, and employers are forced to respond – whether they can afford to or not – or else risk losing market share.”

Missing out

But does the demise of church followed by a Sunday roast necessarily mean Sundays aren’t important to workers?

The Australian Nursing and Midwifery Federation is arguing that the FWC decision means nurses and midwives working in some parts of the health and aged care sectors are also at risk of losing their penalty rates and entitlements.

Recent analysis by Maurice Blackburn on behalf of the Australian Council of Trade Unions shows that the decision could “open the door on reducing penalty rates and loadings in other awards in the future”.

ANMF Federal Secretary Lee Thomas called for allied health professionals to stand together to fight the reduction in penalty rates; she maintains that weekend work has a fundamental difference when compared to working during normal business hours.

“A lot like pharmacists, our members work over seven days, and so when their families and husbands and wives, partners and children are on a Saturday or Sunday having lunch with Grandma or Grandpa, or celebrating a birthday, or going to the noodle markets, whatever it is, they can’t be involved,” Ms Thomas says.

“That’s time you’d otherwise spend with your family. People give up enormous family time for events such as Christmas, for example, and other public holidays. And public holidays are the next thing we are worried about.”

PPA’s Matt Harris told the AJP last year, during the National Pharmacies strike, that “pharmacists will not accept reduced penalty rates for evening and weekend shifts.

“They work weekends to provide a health service for their patients. They miss family events, weddings, birthdays, school fetes, sporting events and they deserve to be paid properly.”

These pharmacists settled their workplace agreement with National Pharmacies with several penalty rates remaining “well above” the industry award; as a result, they will be protected from the cuts to penalty rates.

Low pay and disrespect

One of the biggest themes that emerged among AJP readers in response to the decision was feeling disrespected as health professionals.

Wages have long been a contentious issue for employee pharmacists. At the PSA16 conference, PSA CEO Lance Emerson told delegates that pay was “the single largest issue facing the profession in community pharmacy”.

And wages came up in submission after submission to the Pharmacy Remuneration and Regulation Review, with one warning that, “if the minimum wage for a pharmacist is not lifted, there will be a mass exodus of bright young pharmacists who will flock to better careers, and the Australian public will be much worse off for it.”

Pharmacists who see their penalty rates cut as a result of the FWC decision will now be at even greater disadvantage.

That the Guild, as an employer group, joined the push to have penalty rates cut shows a lack of respect for the professionalism of pharmacists, some stakeholders said.

“The Guild had a choice,” says PPA’s Matt Harris. “They didn’t have to join this case to slash penalty rates. They made an active decision to disrespect the work of thousands of hard-working pharmacists.

“It’s an extraordinary contrast, when you consider that the Guild is talking to the Government about the important and vital role that pharmacists play in our health system, and what they do for patients each and every day – and then when they’re talking to the Fair Work Commission, it’s a different story. It’s a story about retail, and those objectives around health seem to disappear.

“This will affect a large number of pharmacists who are on the award working for discounters like Chemist Warehouse,” he says.

“So I hope that Chemist Warehouse has sent a thankyou note to the Guild.”

He says there is strong support for PPA’s attempt to increase the base rate of pay, which it would like to see raised by 30%.

In AJP’s website poll, 66% of respondents said they felt “disrespected as health professionals” by the penalty rate cuts. Many pointed out that the low base rate is also a significant problem, and that it must now be raised.

“This is another sad indictment of the abysmal failure of the union to facilitate a professional award rate for pharmacists,” one commentator wrote on our Auspharm forum.

And the Pharmaceutical Society of Australia issued a statement titled, “Remember pharmacists are healthcare professionals”.

“It must be remembered that community pharmacies are not like other retail settings. Pharmacists are health professionals and their contribution needs to be recognised and remunerated in a different way to that of other retail workers,” said national president Joe Demarte.

Shadow Health spokesperson Catherine King took aim at the decision in her address to pharmacists at APP.

“I take your point that 44% of your pharmacies do not open on Sundays, and I have heard your argument that penalty rates play a part in that,” she told delegates in her keynote speech.

“But I would like to think that we can maintain access to medicines and pharmacies without penalising staff.

“While pharmacy owners will have one reaction, pharmacy assistants and other staff on awards will feel the pinch from the loss in their pay packet.”

But the Guild’s executive director, David Quilty, says the Award is a minimum safety net, “and more employers are entering into agreements that provide a range of hourly rate schedules and benefits for employees, which are attuned to the needs of their particular workplaces. 

“It is simply not in the interests of community pharmacies to put their considerable investment in their staff at risk by demotivating them or devaluing their work,” he wrote in Guild newsletter Forefront.

“The Guild supports a sensible transition that will enable community pharmacies to maximise the number and quality of the job opportunities in their businesses while ameliorating any financial impact on pharmacy staff.”

He says that the Guild will be “an active participant” in the upcoming Work Value Case, “which will ascertain the extent to which the nature, skills and responsibilities and conditions of the role of community pharmacists has changed since the last work value review in 1998.”

Opening up hours

Employers argue that cuts to penalty rates will give them the flexibility they need to open for longer hours and even put on more staff.

Only 44% of pharmacies currently open on Sundays, compared to 6% which do not open Saturdays, the Guild says. And the FWC highlighted in its decision that, “the evidence discloses that a range of operational limitations are imposed on Sundays in order to reduce labour costs, namely restricting trading hours; lower staffing levels or service delivery restrictions”.

One pharmacist who swore an affidavit in support of the Guild submission to the FWC said that their pharmacy receives complaints about the three days each year that it is not open – Good Friday, Christmas Day and New Year’s Day – but that due to penalty rates it was not viable to open these days.

“[Group] staff members generally work on weekends and public holidays which significantly increases the cost of staffing the pharmacy due to the high penalty rates that are incurred,” the pharmacist said.

“Although penalty rates make it attractive for staff to work, I need to carefully plan the number of staff required at the times when penalty rates are incurred to ensure the financial viability of the business.

“I run the pharmacy on skeleton staff at times when penalty rates are incurred. This means that it is not possible to offer a number of services at these times.

“Given staffing is kept to a minimum at times when penalty rates are incurred, it is difficult for pharmacists to spend time with patients and provide them with the best healthcare service possible.”

The pharmacist said that if the Guild proposal was accepted, they would be able to extend their trading hours even further, from 7.30am to 9pm each day.

“It would mean that I could roster more staff on and hire additional staff members.”

David Quilty wrote that the decision will enable more pharmacies to “consider trading on Sundays, thereby providing enhanced patient access and choice, as well as additional jobs and hours for pharmacy staff.

“Many pharmacies are currently considering whether to employ an additional pharmacist so they can focus more on patient services as they transition away from being solely reliant on the dispensary. 

“It is likely that the Fair Work Commission’s decision will assist pharmacies, including those that already open on Sundays, to take on additional staff or to offer their existing staff additional hours of work or a broader array of work opportunities.”

Kate Carnell says that there have been several pieces of work done over the years which have come up with figures of between 15,000 and 40,000 new jobs created as a result of cutting penalty rates on Sundays in various sectors.

“But let’s have a look at real life experience; New Zealand cut weekend penalty rates and found quite significant amounts of new jobs; businesses opened longer hours or alternatively employed more people on Sundays to grow their business and it worked, it was a shot in the arm, not just for the small business sector but for the economy more broadly,” Ms Carnell says.

“I had my own pharmacy for lots of years and then went into politics and when I was leader of the [ACT] Opposition I was still working Sundays in my pharmacy, fundamentally because one of my businesses simply couldn’t afford to pay people at that time. 

“This FWC decision will provide a huge benefit for small businesses; the mum-and-dad operators who have been working themselves on Sundays or have their family working on Sundays and public holidays because they simply couldn’t afford to have too many staff. 

“This will give those business owners an opportunity to open longer hours, so there will be more hours available for people who might not have jobs at the moment – or might not have enough hours at the moment – and hopefully it’ll give some of those small business proprietors a few hours off a week at least.”

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