It was only a matter of time before a government agency belled the cat on the economic harm being done by the Fair Work Act. Actually, the Governor of the Reserve Bank came close when he talked about the poor performance of productivity and the need for ‘sensible’ labour market regulation – strongly inferring that we do not currently have sensible regulation.
The Productivity Commmission yesterday released its report on the retail industry which was ostensibly focused on the smallish issue of the payment of GST on goods purchased online from overseas (is it not strange how all those left-wing luvvies have become fans of tax evasion?). But true to form, the PC was wont to point out the key issues affecting retailing and a key one is IR. Using sadly restrained language, here is what the PC report had to say:
If the Australian retail industry is to become more competitive in the face of international online competition, it is critical that employers, employees and unions work constructively to implement productivity-enhancing workplace arrangements, including those focused on operational and trading hours flexibility and improved customer service… Concerns raised suggest that there is scope to improve the operation of workplace regulation to enhance flexibility and adaptability at the enterprise level..”
The report also notes what everyone knows – that the Individual Flexibility Agreement clauses in the Modern Award are complete joke – they were never meant to do anything, just for show. Just check out the official examples to remind yourself that these clauses are nothing about the need for employers to run efficient enterprises.
Of course, our Bill – I wouldn’t buy a car from – Shorten wasn’t having a bar of it. I guess as an ex-trade union official and one who owes his current position to the trade union movment, what else could we expect?
The idea that a shop assistant on $15 an hour, and reducing those people’s wages, will lead to a new golden age of Australian retail are short-sighted.
OK, Bill, here is the real information. The lowest rate of pay in the Modern Retail Award is actually $17.03; with a casual loading now set at 25 per cent, that comes to $21.29 for a casual staff who must be employed for at least three hours at a time (save for very exceptional circumstances for school students). On Saturdays, staff are paid between 125 and 135 per cent of the base rate and on Sundays, it is 200 per cent. On public holidays, 275 per cent. (I am not making this up, go and have a look at the award). These rates are of course before SGC, WorkCover levy etc.
But Bill likes to patronise his audience and tells the retailers how to suck eggs, even though Bill doesn’t himself know.
The challenge here is not for retailers to force down the wages of young students and people working part-time, the challenge is to bring back the customer by good service [on Sundays and public holidays, Bill?], by the range of products and by not taking unrealistic profits [tell that to small retailers; actually tell that to Myer and DJs] at the expense of the shopper …
There is a challenge in productivity in the way businesses are structured. [whatever that means]
I was very taken the other day by a letter sent to Andrew Bolt on this very topic and it summarises the situation facing many, many businesses. Written by an owner of small IGA in regional South Australia, she had this to say:
The new Fair Work Act impacted my business greatly, making me remove all part time staff and switching to all casual staff (excluding 3 full time management staff). The new leglislation is so difficult to follow and has already increased my annual wages by 10%. We still have phasing in penalties to endure and with the 3.4% increase this year to the minimum wage has made me cut back on hours for my employees, many of who rely on their employment with me to live their day to day lives. A senior casual check out operator gets $20.78 plus Super, plus Workcover. This increases to double time on a Sunday and double time and a half on Public Holidays. This is crazy for a small shop in a busy tourism town. I think eventually I will have to close the store and run Monday to Friday only, as I think a lot of other stores will end up doing. It will not be practical to open on such high wage cost days.
Judith, Thanks for posting up that letter from the IGA person, I saw that and thought it completely sums up the reality of the situation that the trade unionists and the Trade Union Party either cannot or will not understand.
Rafe
6 Aug 11 at 3:08 pm
$17.03 by 275% is $46.83. That can’t be right. Have I calculated wrong, or do you really get close to $50 an hour for running a checkout on a public holiday???
wreckage
6 Aug 11 at 3:28 pm
Excellent post. As somebody intimately aware of the costs of small business, this post sums up the situation very well.
Why am I not surprised that this government has no idea about the costs of small business? Hmmm.
Generic Person
6 Aug 11 at 3:33 pm
Around my place, quite a number of small restaurants etc have “made an arrangement” with the staff who work Sundays (& Sat) that only the weekday rate will be paid.
We know how this will work out.
In conversation with these business operators, it transpires that they are unaware of their vulnerability.
They believe that because their staff have agreed to this “deal”, that it is binding & the govt (ombudsman etc) cannot do anything about it.
Besides they say, I can’t afford to pay the government’s idea of a Sunday rate.
Steve at the Pub
6 Aug 11 at 3:34 pm
It’s not particularly surprising Steve. By the ATO’s own figures, the average profit margin of most restaurants is just 4-5% of revenue.
Generic Person
6 Aug 11 at 3:37 pm
The PC said that? I’m impressed there’s anyone in the public service with the coglioni to even broach the topic (same goes for Stevens, mild as his rebuke might have been).
That’s OK, they’ll vote Labor anyway.
benson
6 Aug 11 at 3:38 pm
It is right. Sundays and public holidays are good days for trading but which are ruined by the loadings. And if you’re in a shopping centre then you can’t even elect to stay closed for those days.
The Hunted mind
6 Aug 11 at 3:48 pm
You are right, wreckage. Almost worth applying to work on public holidays, eh?
The trouble for those small restaurants doing mutually acceptable deals with their staff is that the Fair Work Ombudsman (staffed by law graduates from appalling universities who can’t get other jobs) could come knocking and then the business is up for back pay and penalties. And certain industries are targetted – eg. retail, cleaning, security. Could be restaurants at some stage. Also it takes on one disgruntled employee to dob on an employer. You can run, but can you hide? In the old days, compliance was a joke because the trade unions were supported to do the heavy lifting but they could never be bothered with small business – too few members even if their efforts succeeded.
Judith Sloan
6 Aug 11 at 3:51 pm
What often happens is that the owner works on Sundays and public holidays because that is the only affordable means of being open (or being required to be open). The stupid thing is that many people are only too happy (and prefer) to work on Sundays and public holidays because of their other commitments. Lose-lose.
Judith Sloan
6 Aug 11 at 3:53 pm
Judith, I’m so glad you brought up the fair work act again, it reminds me to pursue the comments you made back on 19th April about Fair Work Commissioners being not up to the job.
You see, I find it hard to accept your statements about the Fair Work Act as fact.
You claimed back then that one commissioner had 10 cases appealed, and offered to debate Marks,as you had “dates, citations available. I searched hard for those cases and requested more information. None was forthcoming, so I assumed either you really weren’t interested in a “debate”, or that more likely, you had simply made up your “facts” to support your argument, assuming no-one would bother to check.
Still happy for you to supply the case numbers to back up your argument
steve
6 Aug 11 at 3:55 pm
Abbott may be feeling like Michael Corleone on IR…
http://www.youtube.com/watch?v=UPw-3e_pzqU
… but this is one arena that’s too important to play small target.
Simply astonishing.
C.L.
6 Aug 11 at 3:58 pm
Skeleton staff is the only feasible way to manage the Sunday wage cost. It is just so egregiously expensive otherwise.
Then consumers have the hide to complain about sunday surcharges. Blame the bloody government.
Generic Person
6 Aug 11 at 3:59 pm
There was never a problem with a restaurant being open on Sundays and now I’ve found more than a few a closed.
Yep.. looks about right.
JC
6 Aug 11 at 4:00 pm
Spot on Judith. I have two business partners and we all work on Sundays and public holidays. Always.
We roster other staff off. These are people who would probably be happy to work for, say, the Saturday loading of 125%, and at that rate we’d be happy to put them on instead of us.
Also despicable is the overtime loading of 150% for first 3 hours and 200% thereafter when working past your 38 hour week.
The Hunted Mind
6 Aug 11 at 4:00 pm
The problem with all of this, with the exception of perhaps public holidays, is the special significance attached to Sundays. It’s rather anachronistic, I would submit.
I don’t see why employers shouldn’t be able to come to mutually acceptable deals with their employees in regards to weekend work – e.g. whole days off during the week etc.
Generic Person
6 Aug 11 at 4:02 pm
Not to quibble, but it’s 250% of base for a public holiday, or equivalent time off. I’ll look forward to seeing Judith work on Boxing day at her local Franklins/IGA/Coles for 17.03 and hour. Of course they’re usually juniors, paid as low as 45% of the full pay, but it would be inconvenient to include ALL the facts now wouldn’t it.
steve
6 Aug 11 at 4:11 pm
Exactly GP, I find that some staff want to work hard and make more money by working Sundays and public holidays and by way of overtime and I simply aren’t allowed to come to an agreement with them to make it happen. It’s like we’re not adults.
The Hunted Mind
6 Aug 11 at 4:12 pm
I’ve heard it from 2 sources now that there are 30 shops looking for new tenants in an important strip in the city I live.
Retail could get seriously ugly.
JC
6 Aug 11 at 4:15 pm
Yeah, thanks for nothing steve. That option doesn’t apply to Sundays. Please explain how a checkout attendant or food runner deserves $50 an hour.
Generic Person
6 Aug 11 at 4:16 pm
$17.03 by 275% is $46.83. That can’t be right. Yep.. looks about right.
It can be far worse than that JC. My brother told me how some of his friends who own coffee shops etc on the Gold Coast now find they can end up paying 60-70 per hour for some staff. Their solution was simple: they now close on the weekends. Great eh? Even making $25 an hour would be great for some, especially given that on the Gold Coast there are so many tertiary students involved in hospitality work. That sort of income means they can afford a precious few luxuries and the chance to enjoy life a little.
Fuck Bill Shorten with a porcupine. I hate Bill Shorten, he is a hair’s breath away from being the most despicable shit loving son of a bitch the devil ever put breath into.
John H.
6 Aug 11 at 4:16 pm
Prior to the (cough) Fair Work Act the ladies in my housekeeping department used to prefer working Sundays.
1/. The husband was at home for the weekend, & by Sunday they’d had enough of him around the house.
2/. The husband, being as he was at home could mind the kids (saves childcare costs)
Now there is only bare minimum housekeeping done on Sundays, whatever can be put off until Monday is.
The ladies do on Monday & pay child care, what they could have done on Sunday while hubby minds the kids.
Added bonus of new arrangement: Due to friction from being at home together all weekend, sometimes one of the housekeepers will probably get a black eye from hubby on Sunday.
Steve at the Pub
6 Aug 11 at 4:16 pm
John H. – I wholeheartedly agree.
Generic Person
6 Aug 11 at 4:19 pm
Steve at the Pub – if your workers are victims of domestic violence that isn’t the Government’s fault. Call the police. Keep it real son.
Generic Person
6 Aug 11 at 4:21 pm
Charming Steve.
You’re no doubt talking about these guys beating their wives on Sundays from personal experience, right?
JC
6 Aug 11 at 4:22 pm
You are quibbling Steve.
You’re right though. The loading is calculated on the award rate. However, someone who has an award of 17.03 and who is good in my industry may get 19.00 instead. Do the maths, it’s 34.06 instead of 38.00. It’s still way too much.
The Hunted Mind
6 Aug 11 at 4:24 pm
If Abbott is smart, he ought to stay well away from this and let the Greens/ALP work it out with the people that voted them in.
It’s their soup. The cooked it, they should now eat it.
Abbott should now say that he will have a policy closer to election time and not another word. It’s too early to be saying what he would do because he needs to punters totally softened up as a result of Greens/ALP ravages.
JC
6 Aug 11 at 4:26 pm
I meant on Sundays, for example.
The Hunted Mind
6 Aug 11 at 4:26 pm
That’s a good example of why people at times reject the right, as they suspect that upstairs downstairs attitude permeate from certain quarters.
The fundamental view of nearly everyone on this site other then Steve-drinking-at-his-pub is to maximize living standards and ensure everyone that wants work is able to find it and hopefully be able to choose from several offers.
It’s never been about looking down at workers and who they are. Big freaking difference.
JC
6 Aug 11 at 4:30 pm
Shorten hates business as much as he is ignorant of how markets work.
He is trying to ban stockbrokers getting paid on commission. He is trying to ban equity raising. He thinks everyone should let the unions invest their money in unlisted scams (industry funds). He is an economically illiterate dolt
Then again, with $50 an hour available, I would be better off being a checkout chick at the moment than a screen jockey.
Don
6 Aug 11 at 4:31 pm
Yes JC, plenty of personal experience, the most common cause of absenteeism in my industry is cohabiting females “sick” for a few days, they are always sick for just the time for a shiner to go down.
BTW I am a teetotaller. Keep it clean.
Generic Person, don’t get OT. I draw to your attention that some people live that way, distasteful as it may be to some hothouse flowers who imagine the world is a nice place.
Steve at the Pub
6 Aug 11 at 4:35 pm
I love the irony of people posting about the merits of paying (or not paying) penalty rates on a Saturday afternoon, while they themselves are idly tapping away on a computer enjoying their Saturday afternoon, and of course, NOT working.
steve
6 Aug 11 at 4:36 pm
Bullshit.
JC
6 Aug 11 at 4:37 pm
You’re a class act JC. Goodbye.
If you have a sensbile contribution I’ll respond.
Unless that happens then as far as your postings are concerned I’m blind.
Steve at the Pub
6 Aug 11 at 4:39 pm
Perhaps they don’t have a job that requires them to work Weekends, you nimrod.
Also people that work on weekends have compensating days off like hairdressers closed on Mondays.
In other words the very same people you’re whining about could be here tapping away enjoying themselves on Monday.
Retail isn’t 9 to 5 5 days a week.
So STFU.
JC
6 Aug 11 at 4:40 pm
Fuck yourself Steve. I said I work every Sunday and public holiday and that I would be prepared to pay Saturday rates for people to work those days.
Where’s the hypocrisy?
The Hunted Mind
6 Aug 11 at 4:42 pm
Actually steve that percentage has just been increased.
Happy to give you the name of the member of the FWA who has had his decisions appealed – new boy, not a clue. Of course, FWA does not make any research easy, deliberately, but check out all the agreements going through that are a direct violation of pattern bargaining and even have the identical font and layout – sourced from the union office. What a joke!
And sure there are junior rates of pay but that is why 20 year olds find that their hours are cut back and then dropped after a while. Great system for all those adult DSP recipients who might like a few casual hours of work.
steve – you are one of the shrinking number who thinks the system is working. Impossible to defend.
Judith Sloan
6 Aug 11 at 4:42 pm
Hang on steve, before you “go”.
You suggested that it’s a good thing those gals that used work for you on Sundays because it kept them away from their husband or boyfriend’s fist. You also suggested it was a common problem.
And you’re now the one offended because I think your characterization is pretty fucking offensive and most obviously bullshit.
Some nerve you there, squire.
JC
6 Aug 11 at 4:44 pm
He’s an MBA, so no shock there.
Really? Do you have a link to that?
Are you certain. It wouldn’t shock me, but I would be really shocked he’s that stupid….
That’s a great scam, isn’t it.
JC
6 Aug 11 at 4:48 pm
Steve is apparently unfamiliar with the concept of rostered employees, for services & industries which must operate 24/7/265. Anything from 4d/4d (4 12-hour days (or nights) on, 4 days off) to 2w/2w, 3w/2w and 6w/3w (weeks on, of consecutive 10 or 12 hour days, to weeks off).
sdog
6 Aug 11 at 5:00 pm
The comm ban for brokers was reported front page of the AFR this week – I don’t subscribe.
He thinks we are financial planners flogging debentures and managed funds when we trade stocks.
The banning of commissions on equity raisings is just as stupid. Should I bill my clients when they take up stock in a placement?
He thinks I am in business to rip off my clients.
How does the small cap mining sector raise money? Fucking imbecile
Don
6 Aug 11 at 5:02 pm
No modern economy operates on solely a 9-5, M-F basis anymore.
Labor needs to move forward on their thinking.
sdog
6 Aug 11 at 5:02 pm
Ever meet a Labor voter who didn’t live in some cornily-worshipped past?
benson
6 Aug 11 at 5:05 pm
Really he wants to ban commissions? What a complete whack job.
So how does he think capital raising should be done? Capital raising aren’t done on a commission per se, they are done on a fee basis, so he wants to ban that?
It’s like a bunch of lunatics from the aslyum have taken over government.
The more I hear about these idiots the more it surprises me because they seem to be raising the stupidity stakes each time.
JC
6 Aug 11 at 5:07 pm
Yea, this lot a really hankering for the 50′s.
JC
6 Aug 11 at 5:08 pm
Except, then they go completely against that ideal by pushing the “progressive” gay marriage, euthanasia, full-term abortion on demand type barrow.
That’s doing in a lot of formerly “old labor” heads.
sdog
6 Aug 11 at 5:15 pm
Yet all they did in Opposition was bag Howard for apparently wanting to take us back to the 50s.
The Hunted Mind
6 Aug 11 at 5:16 pm
But steve you are so wrong. Many of us work at all times of the day and night, weekend and week. The 1960s world of Monday to Friday, with dad at work and mum at home is dead. Penalty rates were put in awards to deter the provision of work in what were regarded then as anti-social hours, less as a reward. But times have moved on but the penalty rates are still there .. actually worse. Try to explain our arrangements even to Europeans and they will laugh. And we have multiple minimum wages, not just a single one which the norm everywhere else.
Judith Sloan
6 Aug 11 at 5:16 pm
Judith
Why in lord’s name didn’t that make award rate penalty after clocking up a certain number of hours? Were they that stupid?
I know it was a pay off to the unions but I can’t imagine they would make that colossal error.
Nice to see industry only pushing back when their backs are to the wall.
JC
6 Aug 11 at 5:20 pm
I love the irony of people posting about the merits of paying (or not paying) penalty rates on a Saturday afternoon, while they themselves are idly tapping away on a computer enjoying their Saturday afternoon, and of course, NOT working.
Fascinating. I can tell you’ve run a small business, your command of the subtleties gives you away.
wreckage
6 Aug 11 at 5:21 pm
Woah. Awesome post, John.
Abu Chowdah
6 Aug 11 at 5:31 pm
@Judith
I’m sure you’re right, but not for $17 per hour.
steve
6 Aug 11 at 5:33 pm
steve… actually for less. Thanks for playing.
wreckage
6 Aug 11 at 5:33 pm
Just got back from assisting a customer to set up their new TV purchased through me today. Its 1530, I shut shop at 1200 and got the call about 45 minutes ago. Drove to clients house and found the problem was their stuffed airial.
Located a new airial, fitted it and the customers happy.
Oh, and on the way there passed a bloke giving his other half(??) a punch or 2 and called the coppers, bloke and lady are fairly well known heavy drinkers.
So yup, black eyes are a big issue in some strata of society, and running a business and keeping customers happy isnt always 9-5, 5 day a week job.
Ill pay myself the usual $640.00 a week though, no penalty rates for me.
Oh and feel free to abuse me as a wealthy pig if after a few more years of doing this I own a successful business and pay myself an above average wage… cos you know… I musnt have earned it..
thefrolickingmole
6 Aug 11 at 5:35 pm
@Hunted –
.
So glad to see the quality of debate hasn’t diminsihed since my last visit here.
steve
6 Aug 11 at 5:35 pm
Not for $17 per hour?
Quite right, sometimes for much less.
Steve at the Pub
6 Aug 11 at 5:35 pm
Sheez, just read the thread.
“Steve at the pub” is speaking from real life experience,he happens to be correct.
“steve” is speaking shit.
I think some may have the steves mixed up.
jumpnmcar
6 Aug 11 at 5:35 pm
Doubtless steve(nopub) will accuse me of some degree of stupidity fro being in business for less than the minimum wage. Simple: I work for less and for longer so I can do what I want to. All I want from IR reform is for other people to be given that freedom.
wreckage
6 Aug 11 at 5:39 pm
Lol
Steve, you lefties gotta change the operations manal. This “it doesn’t quite reach my standards” crap is about 13 years old.
Next you’ll be whleeling out the crying kids, telling us to think of the children and their childrens children.
There’s no real debate about this as your side is done like a dinner. You have no argument other then playing to the most basic and primitive emotions…. lets call it primitivism.
JC
6 Aug 11 at 5:39 pm
I love the irony of people posting about the merits of paying (or not paying) penalty rates on a Saturday afternoon, while they themselves are idly tapping away on a computer enjoying their Saturday afternoon, and of course, NOT working.
Showing your age there, might be under 50 years wise but 100+ cognitive wise. People don’t think like that anymore. In my experience the successful people don’t watch the clock they watch the work. My sister started with nothing and built a very successful small business which after 30 years of very long hours she sold for a small fortune a few years ago. She was so busy I rarely bothered to ring her up. Then I found that the best time to get her on the phone was at the office, 7.00-8.00am Saturday mornings. I kid you not.
Many people do not appreciate that if you want to start your own business you are very likely to fail(odds are against success), you are very likely to earn below the minimum wage for 1-2 years, the rewards from good will take at least 5 years to accumulate and can quickly be destroyed by economic factors, you often need very good people skills and management skills and financial skills.
John H.
6 Aug 11 at 5:41 pm
steve (nopub) has precisely the superior tone and attitude of someone who’s never worked. Perpetual student? Public service?
wreckage
6 Aug 11 at 5:41 pm
Steve, why should Judith be compared to an inexperienced young person with no qualifications? Different people bring different skills and get different rates of pay. Is that so surprising?
As for you complaining about the quality of debate being diminished …
The Hunted Mind
6 Aug 11 at 5:42 pm
My namesake has a very valid point about the quality of debate.
A couple of keyboard commandos here ought to pull their socks up.
Steve at the Pub
6 Aug 11 at 5:44 pm
One reason offered:
http://blogs.news.com.au/heraldsun/andrewbolt/index.php/heraldsun/comments/business_leaders_declare_government_bankrupt
Ivan Denisovich
6 Aug 11 at 5:45 pm
Small businesses don’t have the time or resources. Medium businesses are vulnerable to legal, legislative, and union action.
Big business wants to nobble the competition and latch onto the taxpayer’s delicious teat, and those that don’t have the same problems that medium businesses have.
Plus I think all businesses overestimate the hostility of the public and the MSM.
wreckage
6 Aug 11 at 5:52 pm
Yea perhaps he does Steve at the pub.
After the crap you wanted us to digest about regular workers.
JC
6 Aug 11 at 5:53 pm
Or because industry bodies are now populated with the Heather Sellout types.
JC
6 Aug 11 at 5:54 pm
The construction industry has a wonderful quality.
Work availability fluctuates.
When work is plentiful= better margins,more employment opportunities and wage rises.
When work is not plentiful = Workforce gets cut back and the most valuable employees keep their jobs and the rest (least valuable ) learn a lesson.
Sometimes the ” BOSS ” will take a loss for a short period to keep his “good ones” till things pick up.
This system is under threat from the ” unfair(sic) dismissal law”
jumpnmcar
6 Aug 11 at 6:03 pm
Judith
If I may veer away from the main topic for a moment,why did you include that strange parenthetical comment about luvvies avoiding tax?
Rococo Liberal
6 Aug 11 at 6:13 pm
…and a good number of people have their self managed super funds full of commercial real estate. Add to that all the commercial funds with exposure in commercial traded funds and this stupidity is going to burn the retirement funds of a lot of people.
Token
6 Aug 11 at 6:16 pm
Yep. And they were buying these shop fronts with 2% yield.
JC
6 Aug 11 at 6:18 pm
One of the reasons I respect the Hawke / Keating government was the creation of super. It left Australia less exposed to the greying of our population than our peers.
How many ways is this government working to stuff this up? The end of this will be the loss of this benefit as most people are shoved onto government pensions.
They are going out of their way to self managed funds with the recent changes to capital gain. Their IR laws & carbon tax are going to ship a lot of industries overseas to avoid the high wages and green tape.
Add to this the fact that self funded retirees will become, with the passing of the carbon tax, welfare recipients.
I know this government is too incompetent to be this devious, but a suspicious mind would wonder about the ex-union officials assault on non-fund super investments.
Token
6 Aug 11 at 6:21 pm
Retail is structurally flawed in this country. Retail property will halve in value.
The employees are getting paid too much – but it is the landlords who are about to cop it. Retail cap rates are t stupid low levels while their tenants are about to go bust.
Westfield is still a short and the punters scared out of equities who went and bought retail strips at 5% cap rates are about to be turned upside down.
The extremely uncompetitive position of our retail sector which has been forced to compete globally is going to cost jobs and heaps of capital.
Don
6 Aug 11 at 6:22 pm
Steve, the stupidity of this question is beyond belief. Please refer to the example given by the Steve at the Pub as one of many reasons why it is better to have flexibility (I really wish you hadn’t wasted the point talking about domestic violence).
Many families work as described to reduce the cost of childcare and to ensure women may return to work most effectively.
By raising penalty rates you do not increase opportunity or equity you reduce it. What do those families do when the small business shuts the door on weekends?
I’ll give you a clue. As they have less income / increased childcare expenses, they tighten their bets and reduce all discretionary spending.
Do you see a negative feedback loop here?
Token
6 Aug 11 at 6:26 pm
Agreed Wreckage – You can tell people that have never tried / knows noone who has tried to getting an entrepreneurial enterprise up and going.
John H, I could repeat that story many times over.
In the first 3 years, if the business survives, most entrepreneurs I know are working 70-90 hour weeks for less than $15 an hour.
Token
6 Aug 11 at 6:35 pm
@Judith, I searched thoroughly on Fair Work and Austii for all appeal cases inclusing Roberts, and could only fine 2, so would me most obliged if you could provide all ten case numbers
steve
6 Aug 11 at 6:36 pm
I meant Roe
steve
6 Aug 11 at 6:40 pm
Wow – some robust (uncensored) discussion and debate!
I like it…
Rabz
6 Aug 11 at 6:40 pm
Don I’ve been saying that about retail for ages. I also think it will 1/2 in value. It will be 20 years before it gets its footing again and even then things may have changed further.
My prediction is that retail will eventually be used as office space.
JC
6 Aug 11 at 6:40 pm
I suspect a lot of “factors” which destroy small business are Government. Fringe benefits tax actually punishes good bosses! What aretrograde regime we have.
That’s true but it is a matter of simply ending the pension. Before the guarantee, the number of workers with super LOOKED low, but it was proportional to the number of households that weren’t temporary.
You can get high dividend yield, good div stability, low PE stocks at the moment. Shorten punishes funds for capital raising and not for investing in retail prop. below inflation? What a crazy time we live in.
The nexus of Keynes and minimum wage laws is why left wing economics is such a crock of shit. Allowing the adjustment of hours worked or wage rates in bad times for industries where it is necessary is evil they say, but borrowing money to inflate and reduce everyone’s real wages to allow those industries to adjust, isn’t.
What a bizzare religion.
.
6 Aug 11 at 6:41 pm
This seems a bit presumptuous. You’re asking Judith to do homework now?
daddy dave
6 Aug 11 at 6:41 pm
One of the most flawed models I can see is HVN and it is run by an ignorant clown
Don
6 Aug 11 at 6:43 pm
Wreckage and Pub steve, if you’re working unsocial hours for someone else for less than $17/hour, then you’re on a really bad deal. If you’re working for yourself then that’s your choice. I work all sorts of hours, for my own business, but for a hell of a lot more than $17/hour, as I’m sure so does Judith. If you’re in business and your total earnings are less than $40,000 a year, then I suggest you might want to find a new business.
steve
6 Aug 11 at 6:45 pm
And payroll tax punishes bosses who make the mistake of employing too many people.
Steve at the Pub
6 Aug 11 at 6:46 pm
Harve deserves the financial daylights knocked out of him for the rat he was over the GST on imports. I hope fries financially. His stores are crap anyway.
I shorted the stock for a few days only and could have made some decent change a while again when he started whining. That was a great clue he wasn’t doing well.
JC
6 Aug 11 at 6:47 pm
Stop over egging it. If you hire too many people the real problem is the salaries. That’s where you look first, not the incidentals.. although they matter.
You looking at the pyramid upside down.
JC
6 Aug 11 at 6:49 pm
I’m still waiting for someone who believes in this government induced inflation to explain how this does not disadvantage people with fixed income streams.
From what I can see, this is another way the government screws people that developed self-funded pensions based upon the rules (prior that moron Krudd conning his way into power).
Token
6 Aug 11 at 6:50 pm
Didn’t take long to get the predictable result:
I hear this stuff all the time from public servants/ALP politicians.
But never from anyone who’s had to cook for themself.
Steve at the Pub
6 Aug 11 at 6:51 pm
Lefties are charming are they?
JC
6 Aug 11 at 6:54 pm
Basic maths error there fellow Steve:
$17 per hour is $70,000 per year.
Steve at the Pub
6 Aug 11 at 6:55 pm
40K is the median income, you nimrod. That’s what the busy coffe shop owner down the road from me pulls and he has around 5 staff. HE says it’s max.
You freaking leftards have no idea.
JC
6 Aug 11 at 6:57 pm
Public servants do not earn, they are a cost.
JC – if you read the old PC reports, payroll tax sent Fisher and Paykel back to NZ.
.
6 Aug 11 at 6:58 pm
]
you run a pub? 17 X 8 hours X 5 days X 48 weeks
it’s 32k year you nimbus.
I hope your wife does the books and you just pour drinks.
JC
6 Aug 11 at 7:00 pm
Payroll tax also sent the Citibank call centre from NSW to Qld (who offered a 5yr payroll tax holiday) then when payroll tax was due to kick in for them in Qld, they scarpered overseas.
The really really intelligent capable premier at the time (Peter Beattie) was stunned, shocked, & indignant that Citibank would leave the state rather than cough up payroll tax.
There was a lot of jobs in that call centre.
Steve at the Pub
6 Aug 11 at 7:01 pm
Yea I believe that. I wasn’t understating it, dot.
JC
6 Aug 11 at 7:01 pm
Too many beers Pub Steve. You’re seeing double. It’s about $35K.
The Hunted Mind
6 Aug 11 at 7:01 pm
Oh yea it’s $35K . I forgot to make it 52 weeks instead of 48 . I left out the holiday pay.
JC
6 Aug 11 at 7:04 pm
For the benefit of the ever colourful Nimbus/Nimrod/Conrod JC, the quote was:
8 hours per day, 5 days per week, 48 weeks per year has little to do with small business. Those are the sort of hours worked by people who only used to run a small business.
FYI JC, stop the uninformed stereotyping. Not only am I a teetotaller, I am a virile young bachelor, and “drinks” as you call them, make up 4% of my sales.
Perhaps you haven’t updated yourself on the pub trade since 1965.
Steve at the Pub
6 Aug 11 at 7:05 pm
steve (nopub) came out with exactly what I predicted.
Now, listen carefully: I’m free. I want others to be free. When the government decides when and where it is “good” to work, we are not free. That is what penalty rates are intended to do, and it is the only thing they can be rationally expected to do.
wreckage
6 Aug 11 at 7:06 pm
How much do you make from pokies and what net percentage do you get from them?
I only ask as I’ve seen some bizzare figures bandied about, like 1% of turnover.
.
6 Aug 11 at 7:07 pm
I know some great cafe shop entrepreneurs that earn about the same. They get a new business up and going so to the point where there is reliable turn over and sell it for a good profit to people like ex-public servants that have never seen a real set of books in their life.
The ex-PS pays with a good amount of a their redundancy and the entrepreneur cashes in and scarpers off to set up a new cafe.
It is sad as you seen the ex-PS come in spouting the crap Steve does in the beginning. Pretty soon they find God, they start cutting hours and cutting costs when they realise the bulls**t they believed will result in them losing their shirt.
Token
6 Aug 11 at 7:09 pm
In my line of work, someone on $25ph, costs $50ph to employ.
SATP may be sober.
jumpnmcar
6 Aug 11 at 7:11 pm
So you’re running a restaurant then and not a pub, so why don’t you call yourself steve at the restaurant then. But don’t do the books.
JC
6 Aug 11 at 7:12 pm
Poker machines (Qld hotels):
92% of what is played is returned to the players as winnings.
The remainder is between the state govt & the site.
All the costs are borne by the site. Eg: We even pay for the governments telephone call where they log in to read the meters.
Steve at the Pub
6 Aug 11 at 7:14 pm
Oh it’s pokies. I forgot about them, as I haven’t been in a pub like that forever.
Hey Steve at the pokies.. honest question.
Can you run your own pokies off the government’s eye, Do other hotel owners try that? I know I would.
JC
6 Aug 11 at 7:18 pm
Steve: If you don’t mind, where do you get revenue from? 5% from booze seems really, really low. Is your hotel also a hotel-motel?
.
6 Aug 11 at 7:18 pm
Fuck me that’s rude.
.
6 Aug 11 at 7:20 pm
There are many strings to the pub bow..er… person without a name.
Retail, On premise, Gambling, Accommodation, Wholesale, & food.
Rude? Yes, we even pay for the person who reads the meter. The money from Poker Machines is made (in descending order):
1/. State Govt,
2/. Manufacturer of machines,
3/. Monitoring company (who reads the meters)
4/. The site (either a hotel or club)
Steve at the Pub
6 Aug 11 at 7:23 pm
steve: hint, it’s not roe!
Judith Sloan
6 Aug 11 at 7:30 pm
Great post Judith – just want to note your comment about the complexity of multiple awards and penalties. I can understand why some people at an emotional level might want a minimum wage (I personally don’t think the government has any right to interfere in mutually agreed contracts) but there is no need for the wage to vary by job, qualification and hour of the day. It is a cottage industry updating and fiddling with these awards and it is going to cost the nation dearly. Demand for our resources comes off the hammer even slightly and it is going to be a bloodbath.
Rebel with cause
6 Aug 11 at 9:29 pm
“”" but there is no need for the wage to vary by job, qualification and hour of the day.”"”
Your kidding, right?
jumpnmcar
6 Aug 11 at 10:45 pm
“is it not strange how all those left-wing luvvies have become fans of tax evasion?”
It’s not “tax evasion”, and frankly why should we support wasting $1.5bn to catch $400m of revenue? Which services should we cut to impose this tax?
Is it not strange how all those right-wing anti-tax types have suddenly become fans of pointless taxation?
Jeremy
6 Aug 11 at 10:59 pm
I recommend that it come out of the ATO budget…
.
6 Aug 11 at 11:06 pm
“”” but there is no need for the wage to vary by job, qualification and hour of the day.”””
This refers to a minimum wage arrangement. Currently there are a few hundred minimum wages in Australia and the differences are arbitrary. Perhaps one for each sector?
Jeremy; good point. I’m not sure how much of the nation’s tax enforcement actually pays for itself.
wreckage
7 Aug 11 at 12:03 am
Jeremy that’s silly. Judith was obviously being sarcastic.
JC
7 Aug 11 at 12:08 am
Thanks Judith for the cryptic clue. I will do some more research. I am intrigued why as an academic you choose to make it so difficult to find your references.
steve
7 Aug 11 at 12:11 am
Regarding my discussion about $40k per year not being a lot. I stand my my point that earning less than $17 per hour for long unsocial hours in your own business is a crap return. If you include the capital gain when you sell the business and you think $17/hour is a good return, then you really need to rethink your business model. If you DON’T include the capital gain when you sell the business, then you are being disingenuous.
steve
7 Aug 11 at 12:15 am
Gillard, Shorten, Crean, Ferguson, etc. surely know this stuff. They have worked in the IR field and must have come across empirical evidence showing the economic costs of IR regulation. So why do they choose to ignore it? It was the ALP for goodness sakes that started the IR deregulation process!
Capitalist Piggy
7 Aug 11 at 12:25 am
Don’t think you’ll find many righties that want our online purchases suddenly taxed – I saw the comment more as a dig at lefties – though Judith can clarify.
For the record, I don’t think GST should apply to these purchases – just as I wouldn’t want to see item price adjusted to reflect our local (higher) income tax rates. Government taxes and regulations are often a disadvantage for locals… the correct response is for us to become competitive on a taxation and regulatory basis. Businesses wanting to tax online sales aren’t taking a long-term view, imo.
Fleeced
7 Aug 11 at 12:54 am
A GST on online overseas purchases is, in effect, a tariff. I thought we got rid of those back in the 80s?
Capitalist Piggy
7 Aug 11 at 1:24 am
Exactly… but it’s being presented differently – and if people don’t think about it properly, it can almost seem intuitive to “charge GST on both equally”. That’s why you need to mention other taxes – like income tax – as having the same effect, since this reinforces where action should be taken.
I don’t think this is going to die easily though. Too many rent-seekers looking for short-term protection – and people like Harvey should really know better… it’s bad enough when government protects industries from inefficiencies – but when that inefficiency is high government taxation (or excessive regulation, which has the same effect,) then what’s going to be the end result? Yep, more inefficient taxes.
Fleeced
7 Aug 11 at 1:39 am
If I remember correctly, there was quite a backlash against this idea when first mooted, including from those of the left (because it would protect the coles/woolies duopoly). And Shorten seems lukewarm on it. Remember the Grocerywatch fiasco? I could be wrong, but I don’t think the govt is going to push this one.
Capitalist Piggy
7 Aug 11 at 1:45 am
Maybe not, but they’d like to, and will be looking for ways. Whose idea was it for the Productivity Commission to ask Visa collect GST?
Fleeced
7 Aug 11 at 1:49 am
steve @ 6 Aug 11 at 4:11 pm . A chap who works in KMart gets $43.00 an hour on P.H.
Have you ever run a business or know of anyone in business? Do you have any idea about running a business? I know of a couple who worked in the public service and only voted Labor. They took a package, started a small business employing a handful of people. For Labor voting people, they were eager to offer AWAs to their employees when the Workchoices legislation was introduced thus paying a flat hourly rate of pay. Under the Fair Work Act they could hardly keep their business going. The last time I met the couple, the wife asked when can we get rid of Julia Gillard and her government.
Greyfield
7 Aug 11 at 2:01 am
Greyfield, if you check my post at 6.45, you’ll see I aid I do run my own business and have done so for over 10 years. If I was earning less than $17/hour, as some others have claimed they do, then I would give it up pretty quickly. I have no doubt that a lot in small business are doing it tough – they always have -, but blaming it on penalty rates and the Fair Work Act is a pretty thin excuse
steve
7 Aug 11 at 9:02 am
You’re missing the point. They go through the low pay for a few years for the handsome reward when it all comes to fruition.
They are complaining that the Government is making it hard for projects to get up in the first place.
They could be talking in terms of opportunity cost as well, which is really the sensible thing to do.
.
7 Aug 11 at 9:07 am
Steve’s (my namesake) comments on running a small business are puzzling.
He claims to run one, but shows little empathy for the struggles & obstacles faced by most small businesses.
Points straight to either (a) is not in small business, or (b) has been handed a consultation post (possibly in a professional service sector) which is not competitive, nor is cost based. i.e. into selling time, rather than tradeable goods.
His comments are not those of one who has had to struggle to meet a payroll, a bank covenant, pay suppliers, and then be sandbagged by an ill-considered government regulation.
His comments are those of one who doesn’t have high fixed costs, isn’t faced with predatory competition, nor with customers who may arbitrarily cease being customers.
I struggle to accept that he is in “small business”.
Steve at the Pub
7 Aug 11 at 9:48 am
Good luck to you Steve that you do so well, but I agree with Steve @ the Pub.
Your answers make it clear you’ve never had to sweat getting in money from customers to make your payroll and / or get a key supplier to deliver.
Rather, you sound like this government full of bull’s tits who have never been responsible for employing anyone.
What do you expect from a government whose employment history is either:
1. Teacher or alternate Public Servant, and/or;
2. Union Rep, and/or;
3. Ambulance chasing lawyer, and/or;
4. Labor Party Hack
Token
7 Aug 11 at 10:22 am
I thought this article by David Penberthy was timely.
Most Chinese people in business I know couldn’t give a fig about traditional 1950′s Australian values.
When I talk to them they are too busy earning money to spend on their children’s educations. They don’t believe in trusting public schooling, rather they push their kids hard and given them a lot of out of hours tutoring.
They will build a business around a family so they can earn money and support the children.
Steve, please explain why these people need to work 9am-5pm and not on weekends?
Token
7 Aug 11 at 10:30 am
A saddler (old fellow with an amazing shop & big sewing machines) told me when I was still working for a wage that small businessmen make a success as much by working a half day & no more, but doing it every day.
“Yeah young feller” He said “and the best part is it doesn’t really matter which particular set of twelve hours you work, provided you do it every day, and keep it up for seven days EVERY week”
Steve at the Pub
7 Aug 11 at 10:42 am
A few years ago I was talking to an old friend of mine who is the local Malaysian HR person for an international chain of hotels. At that time he had just returned from setting up another hotel in the Maldives. He said that his company was keen to continue the trend by starting their first hotel in Australia. But they decided against that because when they did their number crunching, they discovered that the cost of labour for their business in other parts of the world was an average of 25 per cent but in Australia it was 46 per cent. That was the end of their dreams to invest in OZ. Australians are not saying that we should operate slave labour here but there is a limit for everything when they are looked at in context – pay roll, superannuation, tax, workers insurance, landlords insurance, lease of premise, the mortgage on the house taken to run the business, competition, supply and demand for the particular goods or service… I can go on more on the outlay side but let me stop here.
I greatly believe in one basic Federal minimum wage for all employees and the rest should be left to the markets. A basic minimum wage will ensure that employees have a decent take home pay and are not living in poverty. Can anyone explain why an employee employed at a fast food outlet should be paid more than one working in a restaurant – the difference being may be 0.10 cents an hour. Did you know that there were such awards as the “Fast Food Award” and the “Restaurant Award”. Why didn’t the unions, employers and the government create a single award called the “Restaurant, cafe, catering and take away food Award”. No confusions there.
Greyfield
7 Aug 11 at 2:35 pm
But the states have minimum wage laws too. At the very least, the federal minimum wage should be abolished. Then each state should follow suit. We don’t have a minimum haircut price law or a minimum bread price law or a minimum contracted bricklaying law. There is no justification for a minimum labour services law.
Capitalist Piggy
7 Aug 11 at 5:54 pm
“A basic minimum wage will ensure that employees have a decent take home pay and are not living in poverty.”
We already have that. Its called Newstart Allowance.
Capitalist Piggy
7 Aug 11 at 5:56 pm
Capitalist Piggy @7 Aug 11 at 5:54 pm
“But the states have minimum wage laws too.”
Capitalist Pig,
Since Jan 2010, the private sectors in all states came within the Federal jurisdiction under the Fair Work Act. Now there is no state minimum, just one Federal minimum. One Federal minimum for urban businesses and regional businesses is another cause for despair (a subject for discussion when Judith writes an article about that). Can a business in Pakenham afford to pay the same rate of pay per hour as one in Melbourne or Sydney and still remain viable?
Greyfield
7 Aug 11 at 8:27 pm
Sorry, I amend that. All states and Territories except WA are within the Federal system
Greyfield
7 Aug 11 at 8:28 pm
We just had a Federal Government enquiry because a supermarket was selling cheap milk. Don’t be surprised if the government comes up with minimum haircut pricing. We are a very stupid people.
Infidel Tiger
7 Aug 11 at 8:34 pm
No it won’t. What do you do if the cost of housing is say double what it is now?
.
7 Aug 11 at 8:36 pm
. What I said was that there should be a basic minimum wage (no one should be paid below that) and the rest depends on supply and demand for particular skills. If the wages were restrained, the pricing of houses will be restrained too. Now it is a vicious cycle where the FWA increases the wages as a matter of fact without consideration for productivity. Everything else goes up in price to match the wage increase. And then we cry that the CPI has gone up so let us increase the wages. The policy makers must find a better way of managing this dilemma.
Greyfield
7 Aug 11 at 10:49 pm