The Restaurant and Catering Association is calling for the hospitality sector to be exempt from some Fair Work provisions, including the mandatory payment of penalty rates on weekends and public holidays, saying its members are suffering with some being forced to close.
The comments come as the hospitality and tourism industries have been pressuring the Government for wage relief, sparked by celebrity chef George Calombaris who spoke to The Power Index this week about how profit margins are being squeezed by high pay rates.
Now, the Restaurant and Catering Association has laid out a 10-point plan for giving the industry some power back, which includes increasing the unfair dismissal cap from 15 employees to 25 employees, and allowing enterprise agreements to override modern award provisions where agreement is reached by a majority of employees.
The association’s workplace relations director, Greg Parkes, told SmartCompany this morning he receives calls from businesses that have to close down on weekends and public holidays because they can no longer afford to trade.
“We’re constantly getting calls from our members; they’re putting a lot of pressure on us. We want these points to be part of the Fair Work review and make these changes.”
Other points include replacing individual flexibility arrangements with genuine individual agreements that allow a flat hourly rate, limiting the scope of protected industrial action and rewriting transfer of business provisions that include too much red tape.
The RCA also wants employers to vary modern awards where industry conditions deteriorate and limit the scope of arbitration in Fair Work tribunal matters.
It also wants to prohibit the right of entry provisions for unions to enter workplaces where no members exist.
Parkes says the industry doesn’t want to reduce wages, just cap them so businesses don’t have to pay penalty rates for certain staff.
“We have university students who want work on weekends, or Friday to Sunday. But because of penalty rates, we have to pay them more. It’s not commercially viable.”
“What we want to do is just strike them at the ordinary rate, without the penalty rates for weekends. At the moment, you can’t do that, because you’d be considered in breach of the rules for staff being better off overall.”
But it isn’t just wages, Parkes says. Red tape, the complexity of regulations and other burdens are making it harder for companies in the hospitality industry to survive.
“Many businesses just don’t have the resources to understand all this, it’s very difficult for companies to keep on top of all this. We do our best to provide information but with our help they’re still struggling.”
“To calculate wage rates, you need to be a mathematician. Businesses just want to know the rate they need to pay – but even the Fair Work Ombudsman can’t do that accurately.”
The RCA’s list of demands will almost certainly not be met. Apart from the practicalities of carving out one sector from certain parts of the IR regime, the “better off overall” test is a key plank of the Fair Work system.
Earlier this week, Workplace Minister Bill Shorten delivered a stinging rebuke to Calombaris.
“Waiters are some of the lowest paid employees in the country. Penalty rates compensate wait staff and others who have to work late nights, public holidays and weekends while everyone else gets to spend this time with family and friends.”
“We saw penalty rates and wages slashed under the Liberals’ extreme Work Choices laws, which was of course roundly rejected by the Australian people. The Gillard Government won’t be adopting the low road of paying already low-paid workers less.”
Patrick Stafford is a freelance journalist and a former deputy editor of SmartCompany.
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