Should Victorian shops open for 24 hours a day, seven days a week?
Echo Issue Outline: copyright © Echo Education Services
First published in The Echo news digest and newspaper sources index.
Issue outline by J M McInerney
On September 12, 1996, the Shop Trading Reform Bill was introduced into the Victorian Parliament.
Once law, the Bill contains provisions which will dramatically liberalise retail trading in Victoria.
Under the new legislation general shop trading will be banned only on Good Friday, Christmas Day and before 1pm on Anzac Day. Other than on these days, all shops will be able to trade for 24 hours a day, seven days a week.
The changes are expected to come into force by December.
The legislation has generated significant public debate. The retail sector appears to divided on the issue, with the large retailers and employers supporting the move and small traders associations opposing it. The Shop, Distributive and Allied Employees' Association has voiced its opposition, as have churches and community groups.
Background
The history of legislative changes to Victoria's trading hours goes back to the 1800s. In 1885, the first restrictions under the Factories and Shops Act allowed one late-trading night a week. (This late-trading night was not abolished until 1946.)
In 1910, Saturday half-day trading became obligatory for all shops.
In 1953, opening hours were fixed and Sunday trading was formally prohibited. Some three years later, however, in 1957, a number of exemptions were made so that car shops, petrol stations, butchers, hairdressers, chemists and caravan trailer and boat shops could open for longer hours.
In 1969, uniform trading regulations exempted holiday resorts and tourist areas.
In 1970, the law required that most shops close on public holidays, however, in 1971, weekday restrictions were removed and in 1972, petrol stations were allowed to open on Good Friday.
Trading laws did not change again until 1983 when businesses with no more than 20 employees were exempted from restrictions. The principal effect of this change in the law was to enable small retailers such as milk bars and some suburban groceries to open on Sundays.
In 1987, trading hours were again extended to allow all shops to open between 1pm and 5pm on Saturdays.
In 1991, a partial move was made toward legalising Sunday trading by making ten Sundays per financial year legal trading days.
Then, in 1992, trading hours were deregulated in Melbourne's Central Business District (CBD).
Under the new legislation, petrol stations, milk bars and other exempt businesses will continue to be able to trade for 24 hours, 365 days a week.
There will be new lease laws banning landlords from stopping retail tenants opening on Sundays. The new legislation will also make it illegal for landlords to require leaseholders to open on Sundays, even if an existing lease requires it. (Under the new legislation, clauses in lease agreements for shopping centres that demand Sunday opening will be declared void.)
Municipalities can be exempted from the new laws but only after the laws have been rejected in a local referendum.
Such a referendum can be requested by petition which must bear the signatures of at least ten per cent of the voters in a municipality.
The referendum, if successful in having extended trading hours banned within a particular municipality, must be repeated every three years.
Melbourne City, which has had unrestricted trading for all shops in the CBD and Southbank since 1992, would not have the option of a poll to change opening times.
The Liquor Act is also not affected by the new laws.
The new legislation will give Victoria the most liberal trading laws in Australia.
The Northern Territory previously had the most deregulated scheme, imposing restrictions only on some liquor shops, florists, hairdressers and tobacconists. NSW had the next most deregulated situation, allowing unrestricted weekday trading, but imposing restrictions on Sundays.
Queensland had the next most open arrangements, with no exemptions being placed on exempt shops which make up some 85 per cent of all that state's retail outlets. Other shops can open between 8am and 9pm Monday to Friday and from 8am to 5pm on Saturdays. Sunday trading and trading on public holidays is prohibited in Queensland, though non-exempt shops can be granted extended hours due to their locality, their involvement in servicing the tourist trade or during special events.
Arguments in favour of extending shopping hours
The first argument offered in support of extended shopping hours is that a majority of consumers wish to be able to shop over a longer period.
A recent Quadrant telephone poll of 422 city and country Victorians found that 65 per cent favoured shops opening any time they wished, while 51 per cent specifically favoured shops opening on Sundays.
It has been claimed that this supposed support for extended trading hours reflects changes in the working lives of many Victorians. According to this line of argument, traditional shopping hours no longer suit the majority of Victorians.
The Victorian Industry Minister, Mark Birrell, has cited Australian Bureau of Statistic figures which show that some 57 per cent of Melbourne families were double income families in 1995. Mr Birrell also states that, in 1995, 51 per cent of sole parents worked and 33 per cent of Victorians worked part-time.
It has been claimed that for people living and working in these situations traditional shopping hours are not convenient.
It has been suggested that Victoria's former legal shopping hours were based on the assumption that all or most households would have someone home during the day over the working week, or available on a Saturday morning, to make any necessary purchases. Current patterns of work, it has been suggested, do not bear out this assumption.
The statement which accompanied the State Government's announcement that it would introduce extended trading hours included the following claim, `Later shopping on a Saturday evening and an extra weekend shopping day will be of great benefit to ... people.'
This view has been echoed by Mr Laurie Giuseppini, the state manager of Coles Supers Markets. Mr Giuseppini has claimed, `Every survey we look at shows that shoppers are crying out for convenience and want longer shopping hours to suit their life-styles and needs.'
Mr Giuseppini has further claimed, `These days people are time-poor and liberating shopping hours gives them the opportunity to shop at a time that suits them.'
A second argument offered in support of increased trading hours is that no retailer will be forced by the new legislation to open for longer periods.
Those who maintain this position note that the Bill actually offers retail leaseholders greater protection than they currently enjoy in that it renders void any contractual arrangement which requires leaseholders to open of a Sunday.
The Herald Sun, in its editorial of September 11, noted `No shop can be forced to open even if an existing lease requires this.'
A further safeguard which has been stressed by those supporting the change in the law is that individual municipalities can decide to exempt their retail areas from the effect of the new law.
The Age, in its editorial of September 11, also argued, `the Government is not compelling anyone to trade on Sundays. Indeed, one of the bill's provisions will permit a community in which 10 per cent or more of the voters demand a referendum on Sunday trading to have their say, and exclude their municipality from the law if such a referendum is passed.'
Thirdly it has been argued that the existing laws are an anachronism, in that the conditions which gave rise to them no longer apply.
The Age, in its September 11 editorial, further noted, `In the late 19th century, when children were working 16 hours a day in sweatshops, the law was right to set limits on trading hours.' The editorial then goes on to argue that at other times in Victoria's history, limiting trading hours was in tune with the values that then prevailed. This, however, the editorial asserts, is no longer the case. `In commerce as in so many other facets of life, what was appropriate in the 1950s is no longer the order of the day in the 1990s.'
A fourth argument offered to support the introduction of extended trading hours is that electronic shopping, which is available twenty-four hours a day is making inroads into the customer base of conventional retailers who have been unable to compete with the 24-hour ordering service the Internet can provide.
According to this line of argument, the only long-term solution to Internet competition is to make it possible for mainstream retailers also to be able to supply goods and services twenty-four hours a day, seven days a week.
`Due to the restrictive nature of the existing shop trading laws, these business [on the Net] have gained market share at the expense of retailers,' the statement accompanying the Government's announcement claimed.
Fifthly, it has been claimed, the law needs to be changed because the current legislation is not working and is expensive and time-consuming to attempt to uphold.
Related to this, it has been claimed that many retailers wish to open for longer hours, and of a Sunday, and that current legislation is unfairly restricting their opportunities to trade.
The Herald Sun, in its editorial of September 11, noted that `since January 1994, a total of 359 shops had faced prosecution for catering for demand' and opening of a Sunday.
According to this line of argument, this figure indicates both that the law prohibiting Sunday trading is not working and that a large number of Victorian consumers wish to be able to shop on a Sunday.
It has further been argued that the current law is piecemeal and confusing, allowing some businesses to trade for extended hours and prohibiting others.
Stressing the supposed inconsistency of the current legislation, the Victorian Industry Minister, Mr Birrell, has noted, `You can buy everything for a barbecue on a Sunday, except the meat. You can buy a surf-board in Melbourne, but you can't buy it in Torquay on a Sunday.'
Referring to those retailers currently facing prosecution for trading outside legally sanctioned times, Mr Birrell asked, `Are we seriously convinced that there is a need to turn into a criminal the person who wants to sell shoes or operate a hairdressing salon on Sunday? Of course we're not.'
According to this line of argument, any law which is significantly out of step with community values should be amended or repelled.
Finally, it has been argued, extending retail trading hours would have enormous economic advantages for Victoria.
Supporters claim that there would be a significant growth in employment in the retail sector, especially in demand for part-time employees.
Mr Peter Bartels, chief executive officer of Coles Myer, has claimed that the change in trading hours would create 850 full-time equivalent jobs in the retail giant's business.
Arguments against extending shopping hours
Those who argue against extended shopping hours generally have two major areas of opposition. They argue against its social impact and they argue that its economic consequences will be damaging.
The first social argument offered against extending trading hours is the damage it is claimed it will do to the social lives of those working in retail.
Those who argue against 24 hour trading hours, seven days a week, claim that, if trading hours are significantly extended, the supposed convenience of some consumers will be gained at the expense of employees in retail, and those who own and run small retail outlets.
According to this line of argument, those employed in large retailing outlets are likely to have little real choice as to when they are employed over the week and the requirement to work of an evening or through Sundays will damage their family lives and interfere with their opportunities for recreation, religious worship and community involvement.
Mr Julian Teicher, the executive director of the National Key Centre in Industrial Relations, has stated, `It is correct for church and community groups to be concerned that there will be continued erosion of family life, for the risk is that (new enterprise agreements) will deny the intention to make work more family friendly.'
According to this line of argument, employee contracts under enterprise agreements are going to increasingly require shiftwork. `Full time employment is going to mean being rostered over a seven day cycle,' Mr Teicher has suggested.
Fr Mark Coleridge, a spokesperson for the Catholic Church, has stated, `Human beings are not just traders or consumers. We need time for rest, reflection and family life.'
A similar view has been expressed by Ms Bronwyn Pike, a spokesperson for the Uniting Church. Ms Pike has claimed, `The whole religious basis to a day of rest is about balance for people in their lives and special time with family and community. It is about building community and these laws further demolish community.'
Relatedly, it has been claimed that the pressure on women working in retail, if trading hours are extended, would be particularly great.
The Shop Distributive and Allied Employees' Association has argued that the majority of shop assistants, who are women, do not want to mix weekend work and family commitments.
Ms Patsy Morrison, the executive director of the Victorian Council of Social Services, has also questioned the probable impact on women. `It depends on whether they have got flexible childcare arrangements,' Ms Morrison has claimed.
The second major argument offered against extending shopping hours relates to its impact on small retail outlets. This is both a social and an economic argument.
It has been argued that the pressure on small retailers or shopkeepers, both personal and financial, would be too great.
According to this line of argument, small retail businesses that do not employ staff, or employ a very small staff, would have great difficulty competing with larger retail outlets selling similar products.
It is claimed the larger retail outlets will much more easily be able to meet the additional costs involved in remaining open for longer hours and by staying open longer may well force the smaller outlets out of business.
Alternately, it has been argued, where smaller retail outlets decide to open for the extended trading hours, they will either have to pay their staff additional wages which their increased profit may not cover, or the owner-operator may decide to work the longer hours his- or herself, resulting in great personal strain and pressure on family lives.
(The ACT Liberal Government has claimed recently that it has reduced its shopping hours to protect smaller suburban supermarkets from the supposedly unfair advantage that extended shopping hours gave the large retail chains.
Under new legislation, stores in major ACT shopping centres will have to close at 7pm Monday to Thursday and at 10pm on Friday; previously they could open 24 hours a day.)
Mr Andrew Baker, the executive director of the Retail Confectionery and Mixed Business Association, has claimed that extended trading hours will have an `horrendous' effect on small businesses such as milk bars.
`Other times, when trading hours have been extended, it has been catastrophic for small business. It effects sales, profitability and employment,' Mr Baker has said.
`At the moment, Sundays and some late nights, are the only times that small business have got business on their own.'
Mr Baker has claimed that many small retailers are already working 14- and 16-hour days and that they do not have the resources to hire further casual workers.
It has been claimed that more than 500 milk bars have closed in Victoria in the last two years. Critics of the new legislation argue that extended trading hours will only worsen this trend and put at risk the businesses of the 3,500 Victorian milk bars and delicatessens still in operation.
It has also been claimed that small grocery stores and butchers shops will be damaged by the extended trading hours.
Mr Ivan Johnson, the chairman of the Victorian Master Grocers' Association, has stated, `Limitless trading will kill independently owned stores. They simply cannot compete with the corporate supermarkets with their unlimited financial resources.'
Mr Frank Maher, who has been a butcher for 33 years and currently runs University Meats in Hawthorn, has claimed that when supermarkets were allowed to sell meats during extended hours he lost 25 per cent of his custom.
Mr Maher has stated, `This is going to make it worse. We just can't go on working any longer hours.'
It has been suggested that the impact on small traders would be particularly noticeable in country towns where many small retailers operate and would compound the damaging social and economic impact that gambling was having on country communities.
The third major argument against extending shopping hours is largely an economic one. According to this line of argument, extending shopping hours is unlikely to increase employment opportunities.
Mr Johnson, of the Master Grocers' Association, has claimed that independent grocers in Victoria employ more than 30,000 people and that the new legislation places these jobs at risk.
Mr Michael Donovan, the state secretary of the Shop Distributive and Allied Employees' Association, has claimed there is no evidence that increased trading hours would create jobs. Mr Donovan argues, `It might change full-time jobs to part-time or take jobs from small retailers to large, but it won't create them.'
Behind Mr Donovan's argument is the belief that increasing the number of trading hours will not significantly increase the amount that Victorians spend on consumer goods, and thus will not generate the sort of additional profits which would make it possible to employ more people across the retail sector.
According to this line of argument, shoppers have a finite amount of money to spend on consumer items of all sorts and increasing shopping hours would merely effect when and where they spent, not how much they spent.
Fourthly, there has also been concern expressed that the new legislation might lead to a reduction in wages for shop assistants and to their effective exploitation by some employers.
Mr Michael Donovan, the State secretary of the Shop, Distributive and Allied Employees' Association, has claimed, `Under the Government's employee contracts ... the minimum you have to pay someone if they work 50 hours a week is the rate for 38 hours. With deregulation (shop assistants) could be asked to work Sundays for one cent an hour. People could literally be required to work for no pay.'
Further implications
Given the size of the Victorian Government's parliamentary majority, it seems all but inevitable that the Shop Trading Reform Bill will pass into law.
If this happens then Victoria will have deregulated shopping hours by December.
Deregulation is likely to have some impact on Christmas retail figures, especially given the novelty of unrestricted access to the major retail chains. It is less clear whether it will boost retail figures over the log-term.
It will be interesting to note the extent to which particular municipalities seek to have their retail areas exempted from the new law. A number of municipalities have already complained that the provisions under which exemptions can be granted are awkward and costly to implement.
Mr Robert Barnes, the chief executive of the Municipal Association of Victoria, has supported the principle of municipalities being able to vote to be excluded from the effect of the new legislation. However, Mr Barnes has noted that under the exemption provision, although municipalities will be responsible for organising referenda on the issue of extended trading hours, the polls would be based on state assembly electorates.
Mr Barnes has claimed that this would make the referendum procedures confusing and costly to put into effect.
It is also interesting to note that these costs are likely to be on-going - for at least as long as the municipality wishes to be exempted from the effects of the new legislation.
It is proposed that municipalities which vote to be exempted will have to continue to vote for exemption at a referendum which will automatically be called every three years while the municipality votes for exclusion.
Critics have suggested that this is effectively supporting the new legislation, as the municipality does not have to present a petition signed by some ten per cent of voters before a referendum to reverse the exemption can be held.
It will also be interesting to note what effect, if any, the new legislation will have on electoral support for the current Victorian Government. If, as has been suggested by some, the new law has a damaging effect on small retailers and their employees, this could affect these people's voting intentions and reduce support for the Victorian Liberal Party.
It is possible that one of the longer term consequences of Victoria's liberalised trading laws is that there will be pressure for similar changes to be introduced across Australia.
On September 10, 1996, Mr Steven Lowy, the executive director of Westfield Holdings, called for uniform national shop trading laws.
Sources
The Age
11/9/96 pages 1 and 2 news item by Shane Green and Farah Farouque, `Shop hours revolution,
11/9/96 page 1 news item by Sandra McKay, `For some, a hard business staying open'
11/9/96 page 2 news item by Sandra McKay, `Trade crusader hails new laws'
11/9/96 page 10 editorial, `The open society at last'
12/9/96 page 4 news item by Sandra McKay and Leon Gettler, `Church condemns trading on Sunday'
12/9/96 page 4 news item by Sandra McKay, `Workers to suffer, academics warn'
The Australian
11/9/96 page 3 news item by Ewin Hannan, `Protests greet 7-day, 24-hour retail trading
12/9/96 page 5 news item by Kimina Lyall, `Union attack on 24-hour shopping'
The Herald Sun
11/9/96 pages 1 and 4 news item by Matthew Pinkney, `Open slather'
11/9/96 page 4 news item, `Open and shut of the changes'
11/9/96 page 5 news item by Kylie Hansen and Dimitri Serghis, `Retailers back move'
11/9/96 page 5 news item by Fiona Byrne, `Nothing new at Shoots'
11/9/96 page 5 news item by Phil Skeggs, `Family businesses to suffer'
11/9/96 page 7 news item by Lainie Barnes, `Shoppers in Sunday push'
11/9/96 page 7 news item, `Different tack for capital'
11/9/96 page 7 news item, `Review lag left state behind'
11/9/96 page 7 news item by Jim Pollard, `Plenty of time to buy'
11/9/96 page 18 editorial, `Shopping around the clock'
`This is just another nail in the coffin of family and community time. It will mean that in many families there will be no time where the whole family can have time together, and in view of the number of family breakdowns, that's a pity'
Dr Keith Raynor, Anglican Archbishop of Melbourne
`The bottom line is that the consumer comes first, the consumer will be able to choose, and we will have a better retailing environment, the best in Australia, as a result of it'
Mr Mark Birrell, Victorian Industry Minister