The Fair Work Commission has announced cuts to penalty rates for the retail, fast food, restaurant, hospitality and pharmacy industries.

The public holiday cuts are scheduled to begin 1 July 2017; the Sunday cuts will be phased in over 3 or 4 years. Meanwhile, unions are launching legal appeals against the cuts, so this remains a changing space.

What’s the problem? 

  • Many young workers are already doing it tough  
  • Lots of young people work for less than the standard minimum wage. Youth wages range from $6.21 an hour for 16-year-olds, to $16.48 an hour for 20-year-olds.
  • 1 in 5 young Victorian workers are getting paid at base rates below the national minimum wage.
  • Less than half of young Victorians who work unsocial hours get paid penalty rates.
  • More than half of young workers who are underpaid don’t realise they’re being ripped off.
  • The unemployment rate for young Victorians not studying full-time is 11.3% — almost twice the rate for the community as a whole.
  • Almost 40% of Australian tertiary students experience financial hardship.

Industries facing penalty cuts are full of young people 

  • The most common jobs for young school-leavers in Victoria: sales assistants, waiters, checkout operators, counter hands, store persons, kitchen hands and bar attendants.
  • 40% of young Victorians work in retail, and accommodation and food services.
  • 48% of young Victorian women work in retail, and accommodation and food services.

 Some young people are at higher risk 

  • Young women are overrepresented in jobs where penalty rates will be cut. There’s a 17% pay gap between Australian women and men, which hasn’t shifted since the 1980s.
  • 14.8% of early school leavers in Victoria go into part-time work as their main pathway — only 8.9% go from school into full-time jobs. 
  • Young people in rural Victoria are more likely than their Melbourne peers to go straight from school into employment. Cuts to penalty rates may hit rural communities harder because so many people there work in the affected industries for lower wages than workers in the city.

Haven’t young people always worked odd hours for low pay? What’s the big deal?  

  • Young people today are expected to earn higher educational qualifications than earlier generations.
  • Entry-level jobs are disappearing.
  • Costs of living are high.
  • Many young people stay underemployed.

Young people aged 20-24 working full-time

2008: 52% | 2014: 42%

Young people aged 20-24 working part-time

2008: 24% | 2014: 27%

Young people aged 20-24 working casually

2008: 30% | 2014: 34%

  • A young person takes an average of 4.7 years from full-time education to full-time work.
  • 30% of young workers want to work more hours — youth underemployment is at a 40-year high.
  • Working unsocial and unpredictable hours can cause financial and emotional stress.
  • In April 2017, 88,600 young Victorians were working part-time or casual but not studying.
  • Most young Victorians who go into part-time work as their main pathway after leaving school would rather have a full-time job.
  • In one study of ‘Gen Y’ young adults, 10 years after leaving school, 60% were still working weekends, 50% worked nights or evenings, and 40% worked public holidays.

What needs to change?  

  • Guarantee that reforms to penalty rates will not leave low paid employees worse off.
  • Substantially increase real minimum wages.
  • Review the “youth wages” system.
  • Raise Newstart and Youth Allowance for a single young person living away from home by at least $54 per week.
  • Take action to stop the violation of young people’s rights at work .
  • Undertake “big picture planning” at a national level for the future of work for young Australians. 

Where can I find out more?

Your rights at work

The Fair Work Ombudsman

The Young Workers Centre

ACTU Worksite for students

Youth Central


Young workers and the future of work

The Brotherhood of St Lawrence

Life Patterns study

McKell Institute 

Young Workers Centre

Foundation for Young Australians 

On Track study

Australian Bureau of Statistics 2011 and 2017.