Fair Work crack down: Pharmacies targeted as industry growth slows

The Fair Work Ombudsman has launched an investigation and education program into Australia’s pharmacies prompted by over 200 complaints received against the pharmacy industry since July 2010.

Over 7,000 Australian pharmacies will be notified of the Ombudsman’s free tools, templates and advice to help businesses conform to industry standards.

The promotion of Fair Work’s services comes before a scheduled April audit of 400 privately owned pharmacies across all states and territories.

Spokesperson for the Pharmacy Guild of Australia, Greg Turnbull, told SmartCompany the guild supports the Fair Work campaign.

“We work closely with the Fair Work Ombudsman office to make sure members are aware of their obligations.

“We’re happy for Fair Work to do work in that area just as we do,” Turnbull says.

Turnbull said some past Fair Work breaches had been accidental, but education was needed.

“There are over 5,000 pharmacies in Australia, so 200 complaints aren’t that many over two years,” he says.

Fair Work inspectors will ensure employees are being paid in accordance with minimum wage rates, penalty rates, overtime and minimum hours of engagement.

Ombudsman Nicholas Wilson said in a statement that employer groups and unions were helping to promote the campaign to their members.

“This campaign provides a great opportunity for employers to improve their awareness and understanding of workplace laws.

“It is important that we conduct a national campaign to ensure these workers are receiving their full entitlements,” Wilson said.

Record-keeping and payslip obligations will also be investigated by inspectors.

“In cases where Fair Work inspectors find contraventions, they will aim to educate the employer and assist them to voluntarily rectify any issues and put processes in place to ensure ongoing compliance.

“Obviously, in those cases where a contravention is blatant or employers are not willing to promptly resolve an issue, we may escalate the audit to a full investigation,” Wilson said.

In 2011, the Fair Work Ombudsman investigated Queensland pharmacies, recovering $194,000 in back-pay for more than 1,300 underpaid employees.

The audit comes as the industry grew by 1.9% between 2008 and 2013 and generated $12 billion in revenue for the Australian economy annually, according to figures from IBISWorld.

In general, IBISWorld reported, growth rates in the industry have slowed over the past five years, in part because of ongoing regulatory changes.

IBISWorld senior industry analyst Naren Sivasailam told Smart Company the main factors driving the slow growth rates were regulatory changes and increasing polarisation between pharmacies.

“I guess primarily it’s the polarisation between pharmacies offering full services and health supplies, compared to discount pharmacies,” he says.

Sivasailam said another factor was wholesalers being bypassed when it comes to pricing.
Pharmacists are no longer able to set their own prices for pharmaceuticals, instead prices are determined by manufacturers.

Turnbull says it has been “pretty tough” for the pharmacy industry recently, with over 100 community pharmacies going into liquidation in 2012.

“Price disclosure regulations have reduced pharmacy margins and the new Pharmacy Industry Award since 2010 has increased some penalty costs,” Turnbull says.