Dunsborough cafe owner Kellie Fossati adds a 15 per cent surcharge to her menu every public holiday so she can remain open.
Like many other Capes businesses forced to pay employees more for weekend and public holiday work, she would have welcomed a move to reduce the rates.
The owner of Evviva Café said introducing higher prices on public holidays was a bid to cover costs.
“All my staff are on casual rates as I can’t offer them full-time positions due to the seasonality of my business, and they can be making $40 (per hour) each,” she said.
“People get pissed off that we have to charge more, but we don’t make much at all. And if we do close people get upset.”
The Fair Work Commission handed down a decision on Monday to keep penalty rates unchanged for workers in the retail, fast food and hospitality industry.
In its ruling, the commission said “a case had not been made” to change the penalty rate because the modern award recognised the “disabilities of working at unsociable times”.
Dunsborough-Yallingup Chamber of Commerce secretary Andrew Hembroff said businesses were choosing not to open rather than face a financial loss.
“In the City this is not a big deal,” he said.
“However, Dunsborough attracts a large number of tourists over Easter, the tourists are then unable to find a place to go for dinner because several shops are closed.
“From a tourism perspective we need every business open during busy periods.”
Kent Street Bakery manager Colleen Hicks said they did not open on public holidays due to the high wage costs.
“If we did not have to pay the penalties, without a doubt, we would open,” she said.
Ms Hicks said the penalties were hitting small businesses the hardest, with many local shops choosing not to open on Sundays and public holidays.
Busselton Chamber of Commerce and Industry chief executive Ray McMillan said the decision to keep the status quo was not unexpected.
“It is becoming common practice for some owners to work on the days that attract higher penalties,” he said.
In a catch-22 situation for employees who would be happy with the decision, Mr McMillan said the penalties could work against them as businesses choose to shut and offer fewer working hours.