Retail struggle in January 2020

It’s been another hectic past seven days for the retail sector as Australia continues its arm wrestle with COVID-19. Last week the ACCC granted interim authorisation to allow NRA members who are tenants to collectively bargain with landlords for continued rental relief if they’ve been adversely affected by COVID-19.

The decision allows tenants impacted by COVID-19 to discuss, share information and collectively negotiate with landlords regarding rental support. Landlords will also be able to discuss and share information to make agreements regarding rental relief offered to SME tenants by landlords. A full link to the ACCC ruling can be found here.

However, the bad news for the week was certainly the preliminary ABS retail figures for April which revealed that retail sales plunged by a staggering 17.9 per cent in April. While the results were not surprising as it was the first month to fully encompass the stringent business restrictions, it is still cause for concern. If there is a silver lining it is that April should be the worst month given restrictions have started to be eased to varying extents in each state and territory.

Another big development last week was a Federal Court ruling regarding ‘double dipping’ and casual employees. Although the case specifically related to a dispute in the mining industry, it will have ramifications across all sectors including retail. The ruling found that casual employees, who work regular and predictable shifts, are eligible to be back paid for entitlements reserved for permanent employees, such as leave pay.

Retail has one of the highest proportions of casual workers of any sector. If businesses are forced to back-pay leave entitlements to casuals who have worked regular shifts it could spell doom for many businesses and the workers they employ.

The economic sledgehammer of COVID-19 has hit retail as hard as any industry. The priority now should be to restore clarity to casual employment arrangements, save as many businesses as possible and thereby saving as many jobs as possible. This ruling by the Federal Court will only make that task harder, not easier.

The solution the NRA advocates is for Industrial Relations Minister Christian Porter to amend the Fair Work Act appropriately. We will continue to keep you all updated on this matter.

Finally, we were disappointed to learn late yesterday that the SDA had walked away from negotiations to vary the Retail Award.  Given we’re dealing with the greatest economic catastrophe since the Great Depression, it is imperative that all industry stakeholders work together in a cooperative fashion. We believe that varying this Award is vital to maximising the chances of many retail businesses surviving and we believe the decision by the SDA is not in the best interest of the retail industry including retail workers.

All the best for the week and keep well.