Fast food retailers have been dealt more flexible public holiday employment options, following a decision by the Fair Work Commission (FWC).

The ruling this week by Greg Smith, FWC deputy president, lets retailers offer staff a day in lieu in exchange for working on a public holiday.

The decision effects fast food chains, quick service restaurants, and hair and beauty workers.

Smith said the use of the new arrangements rely on mutual consent between the retail boss and employee.

Staff must still be paid time and a half for the public holiday, and the day in lieu must be taken within one month.

Trevor Evans, CEO of the National Retail Association, says the ruling is a big improvement on the current arrangements.

“Fast food and quick service employers will likely be aware of the lack of flexibility in the previous provision,” he says.

“This change will restore much needed flexibility in the way employers and employees can work together.”