Protection of worker penalty rates will be written into law, with the Gillard government embracing a key election-year demand from the union movement.
Prime Minister Julia Gillard told an Australian Council of Trade Unions summit in Canberra that she would insert a new modern awards objective in the Fair Work Act to protect penalty rates.
''We will ensure that penalty rates, overtime, shift work loading and public holiday pay are definite, formal considerations for the Fair Work Commission when it sets award rates and conditions,'' she told the audience at Old Parliament House on Thursday morning.
''We will make it clear in law that there needs to be additional remuneration for employees who work shift work, unsocial, irregular, unpredictable hours or on weekends and public holidays.''
Ms Gillard said the plan would improve the living standards and the working conditions of millions of Australians in insecure work.
She told reporters the legislation would be introduced shortly. The announcement drew applause from the union audience, but is likely to attract strong criticism from business groups, which have argued the case for flexibility in modern workplaces.
Currently, the Fair Work Commission is required to ensure that modern awards ''provide a fair and relevant minimum safety net of terms and conditions'' taking into account a range of factors.
These factors include the needs of the low paid, the need to encourage collective bargaining, the need to promote flexible modern work practices, the principle of equal remuneration for work of equal or comparable value, and the likely impact on business including on productivity and employment costs.
Ms Gillard has indicated penalty rates will be added to this list of issues to be considered in the Fair Work Act.
A labour relations law expert at Melbourne Law School said the Prime Minister's statement was significant.
John Howe, an associate professor in labour relations law at the Melbourne Law School, said employers particularly in retail and hospitality had long pushed for the abolition of penalty rates.
''WorkChoices kind of gave them what they wanted and then it was taken away from them (by Labor),'' Professor Howe said.
Professor Howe said that in recent months the government had faced a renewed campaign from business to give night and weekend work the same value as work on weekdays.
''The PM is saying we're not giving in on that issue and I'm going to tell the commission that it's a priority,'' Professor Howe said.
''It's a significant statement - a push back against the business lobby.''
Opposition Leader Tony Abbott described the move as ''another gesture''.
''We'll have a look at the detail of the particular proposal but as a I understand it what she's said is these would be matters for the Fair Work Commission and that's actually the way things currently are,'' he said.
Mr Abbott sought to assure voters that the pay and conditions of ''the decent hardworking people of Australia'' would be safe if the Coalition was elected on September 14.
''Penalty rates are a matter for the Fair Work Commission and that's the way it should stay,'' he said.
But ACTU president Ged Kearney said Ms Gillard's proposal was needed because employer groups had lodged more than 20 submissions to a Senate inquiry calling for penalty rates to be scrapped or reduced.
Ms Kearney said penalty rates were paid to more than 500,000 low-paid Australian workers in hospitality, retail, and other sectors who work weekends or public holidays.
Ms Kearney said the law change would ensure that people working unsociable hours away from their family would need to be recognised.
''At the moment we're seeing a concerted attack on penalty rates by employers through the award review process, so they're going to the Fair Work Commission and saying we can't afford to pay penalty rates or we now work 24/7, there's no such thing as weekends; things that we know are absolutely untrue,'' she told reporters.
''Weekends are still very sacred to people. We've had penalty rates for nearly a century in this country, through thick and thin.''
Ms Kearney said wages were low and employers were trying to remove penalty rates through the award review process conducted by the Fair Work Commission.
''What the Prime Minister has said today is you can't do that, that the Fair Work Commission has to take consideration of unsociable hours that require extra remuneration and that's a great thing,'' she said.
Ms Kearney downplayed the union movement's role in lobbying for the change, saying it was a matter of common sense and the issue resonated across the community.
Workplace Relations Minister Bill Shorten had previously been tight-lipped about the government's intention to write penalty protections into law, saying in February that it was not government policy at that time.
The move follows ACTU secretary Dave Oliver's demand for legislation to protect weekend penalty rates ''forever'' in the face of a business push for greater flexibility.
In February, Mr Oliver noted the retail sector was fighting to scrap penalty rates, potentially affecting hundreds of thousands of workers.
Mr Oliver said some minimum standards, such as hours of work, were already locked into law and guided what could not be negotiated.
''We've already got flexibility built into the system but it's got to have some checks and balances on it to make sure no one's disadvantaged,'' Mr Oliver said at the time.
He added the law did not need to be ''too prescriptive'' but should recognise the general principle that weekend work should be rewarded more than weekday work.
Australian Chamber of Commerce and Industry chief executive Peter Anderson said locking penalty rates into law was an ''outlandish" demand.
''If the Gillard government were foolish enough to accept these demands, it would not only be sending itself into electoral oblivion, but taking small businesses and service sector jobs with it,'' Mr Anderson said last month.
The Australian Industry Group's Innes Willox said many professional, managerial and other employees had compensation built into their annual salary for the hours worked ''and they would not want it any other way''.
''Penalty rates need to be dealt with in awards, not legislation, so that the needs of different industries, jobs and employees can be taken into account,'' he said last month.
Greens deputy leader Adam Bandt said his party would be willing to ''work with the government over the remaining few sitting weeks [to] legislate to protect people's rights''.
Last month, Coalition workplace relations spokesman Eric Abetz said Mr Oliver's call to insert penalty rates into legislation came amid an ongoing review of the modern awards.
Senator Abertz said this showed Mr Oliver had no confidence in the Fair Work Commission ''taking a balanced approach on these issues''.
with Dan Harrison