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Challenges Facing Pharmacies

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The changing landscape of Australian Workplace Relations will have a considerable impact on Australian businesses, not the least those in the pharmacy industry. Increased trading hours and the provision of allied health services within pharmacies as a means to add value to traditional customer services has led to many pharmacies taking proactive steps to more effectively manage workplace relations practices.

The pharmacy industry has long experienced a shortage of appropriately qualified and experienced pharmacists. This has led to a number of pharmacies experiencing increases in wages costs which far exceed increases in minimum pay and conditions under underpinning awards.

So what alternatives are being explored by market leaders in the pharmacy industry?

Looking across borders

Pharmacy has been hit hard by Australia’s shrinking jobs market. Not surprisingly, many pharmacies are looking offshore for suitably skilled and experienced pharmacists.

Pharmacists remain on the “occupations in demand” list under skilled migration regulations. Despite recent Government announcements that immigration levels will be slashed, sourcing overseas pharmacists remains a real option.

The relevant visa for overseas workers is the Temporary Business (Long Stay) – Standard Business Sponsorship (subclass 457), commonly known as the 457 visa, which allows visa holders to work in Australia for between 6 months and 4 years.

Sponsorship of workers on 457 visas carries with it a number of obligations on an employer, including, but not limited to:

  • payment of a prescribed minimum salary level
  • adherence with all workplace relations obligations which apply to Australian workers
  • payment of all medical and hospital expenses which are not met by health insurance and
  • ensuring that the cost of return travel for the employee (and accompanying family member/s) is met to return them to their home country

Permanent visas are also an option but which ever visa you choose, it is critical that you understand your obligations and how to minimise compliance costs.

Creating and enhancing workplace flexibilities

Awards for pharmacists and pharmacy assistants set minimum terms and conditions of employment which have, over time, become increasingly irrelevant to pharmacy trading practices.

It is not surprising, therefore, that pharmacies are looking to registered workplace agreements to create flexibility and streamline work and pay structures.

The most commonly used workplace agreement is the collective agreement. Collective agreements can be used to displace award terms and create unique agreements tailored to the needs of a particular pharmacy and its employees. These agreements enable pharmacies to implement streamlined working patterns and pay structures which can apply universally to pharmacists, pharmacy assistants and allied health professionals engaged within pharmacies.

Simplified pay structures, relevant to the trading hours and customer demands of the particular pharmacy can be introduced, as long as employees are not disadvantaged when compared to the relevant award.

Collective agreements can include creative benefits such as the cashing in of leave entitlements, family friendly working provisions, and volunteer and community leave entitlements. Streamlined pay structures also enable pharmacies to develop more effective commission, bonus and profit-share schemes with key staff.

With significant changes in agreement making legislation expected to take effect from 1 July 2009, pharmacies interested in implementing collective agreements are encouraged to do so before the end of the current financial year. Businesses with a collective agreement in place will find the transition to upcoming legislative changes considerably smoother than their award-covered counterparts.

Despite changes to take place in agreement making legislation, collective agreement making continues to have the support of all sides of politics and represents an effective way to achieve stable and consistent workplace practices.

Modernising pharmacy awards

From 1 January 2010, any pharmacy that does not have a registered workplace agreement in place will be subject to the modern Pharmacy Industry Award 2010. The modern Pharmacy Industry Award 2010 will replace all pharmacist and pharmacy assistant awards currently in place, but allied health professionals working in pharmacies will be covered by different modern awards specific to their industry.

Key features of the modern Pharmacy Industry Award 2010 include:

  • limiting of ordinary hours of work to between 7am and midnight
  • meal, special clothing, transport and district allowances
  • overtime loadings
  • penalty rates for work performed before 8am and after 7pm Monday to Friday
  • penalty rates for Saturdays, Sundays and public holidays
  • 17.5% annual leave loading

The modern Pharmacy Industry Award 2010 will include award flexibility arrangements that can vary the operation of provisions dealing with hours of work, overtime, penalties, allowances and annual leave loading by agreement with particular employees. Such arrangements must not disadvantage employees and may be terminated by either party with 4 weeks notice.


The next 12 months will be a period of significant change in the workplace relations practices of all pharmacies. It is critical that pharmacies gain a clear picture of the environment in which they are operating and the options available. A review of workplace relations practices now will help gain a market advantage by properly preparing for and adapting to the changing industrial landscape.

Author: Katrina Sweatman