Opposition leader Bill Shorten has vowed to reverse penalty rate cuts which came into effect yesterday, if he wins the next election.

Penalty rates for hospitality, retail and pharmacy workers have been slashed and the minimum hourly wage is up to $18.93 from $18.29.

He’s also said he will repeal tax cuts for corporations of less than $50 million.

Australian Chamber of Commerce and Industry CEO James Pearson tells Ross Greenwood it would be a “double-whammy” for small businesses.

“If penalty rates are forced up by a Labor government and at the same time the tax that the small-medium sized business are paying isn’t reduced… then that’s a double-whammy.

“Their costs are going to go up and their not going to get the advantage of that tax cut.”

Mr Pearson says he’s worried it’s sending the wrong message to Australians looking for work.

“What worries me and the people I represent, is that a lot of young people across our country they get their start in small business. They get their start working weekends, working on Sundays.

“Are we saying to them that basically, well you’re just going to have to take your chances because it’s more important to put people’s pay up even though it can’t necessarily be afforded by small business?

“I don’t think that’s the way most Australians want to see it work.”

Click PLAY below to hear the full interview