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PENALTY RATE REFORM BRINGS MIXED RESULTS FOR HOSPITALITY INDUSTRY

The Fair Work Commission’s decision to reduce Sunday and public holiday penalties in the Hospitality and Fast Food Industry Award will lead to positive employment outcomes in the largest employment sector in the tourism industry, according to peak industry association, Restaurant & Catering Australia (R&CA).

R&CA CEO, John Hart says he is pleased the Fair Work Commission has acknowledged the differences in hospitality work to traditional sectors, but highlighted the Association’s disappointment in leaving the Restaurant Industry Award largely unchanged, pending further submissions.

Key among the decisions include:

  • A reduction in the Sunday penalty for full and part-time workers under the Hospitality Award from 175% to 150%;
  • A reduction in the public holiday penalty for full and part-time workers under the Hospitality Award from 250% to 225%;
  • A reduction in the Sunday penalty for Level 1 full and part-time employees under the Fast Food Award from 150% to 125%, and a reduction from 175% to 150% for casuals;
  • A reduction in the public holiday penalty across the Hospitality, Restaurant and Fast Food Award from 250% to 225%; and
  • A reduction in the span of hours attracting the 15 per cent additional payment between midnight and 6.00am under the Restaurant Industry Award.

“The Fair Work Commission has finally got the fundamental principles right in recognising attitudes towards weekend and public holiday work have changed. The Commission has finally accepted the employment benefits of penalty rate reform, which is a huge step forward for our industry.

“It’s pleasing that the recommendations of the Productivity Commission have been given due consideration in a decision that ultimately affects the sustainability of the hospitality industry.

“Today’s decision will encourage operators to offer more shifts and open longer hours for customers. However, we have missed a huge opportunity to boost employment and increase productivity in the fastest growing sector of the food services industry.

“Cafes and restaurants account for 69 per cent of the total 824,100 jobs in the hospitality sector and 85 per cent of the projected 98,800 jobs growth. The sector remains disappointed the opportunity to capitalise on this employment potential has not been realised at this stage,” Mr Hart says.

R&CA’s claim sought to simplify weekend penalty rates, with a single rate to apply across both Saturday and Sunday at the Saturday rate. The claim was supported by findings of the Productivity Commission inquiry into workplace relations, as well as today’s decision to harmonise Saturday and Sunday penalty rates under the Fast Food Award.

“While industry submissions to the Hospitality and Fast Food Award have led to a great outcome for employment, the restaurant industry is still waiting,” Mr Hart says.

The decision comes as the industry continues to grapple with increased costs and softer economic conditions. R&CA’s 2016 Industry Benchmarking Report found on average staff wages and on-costs represented 44.2 per cent of business turnover, up from 42.2 per cent in 2015. Further,13.7 per cent of businesses close on Sundays and public holidays.

Jetty Research commissioned by R&CA as part of its evidence to support changes sought in the Award found 52 per cent of businesses would hire additional staff, 68 per cent would invest in training, and 41 per cent would open longer if a single weekend rate applied.

The same research found on average businesses would employ an additional 3.15 staff and open a further 5.07 hours on the weekend, equating to an extra 50,600 jobs or 64,200 hours of work across the industry.

Mr Hart says the industry will now focus on providing further evidence to the Commission to support the proposition that the weekend penalty rates in the Restaurant Industry Award in fact provide more than a minimum safety net.


For further information on this media release please contact:
Restaurant & Catering Industry Association
T: 1300 722 878
E: restncat@restaurantcater.asn.au

 

For members, R&CA will be providing an analysis via email communication, shortly. 
For further information please contact the association on:
T: 1300 722 878
E: restncat@restaurantcater.asn.au 

or log-in to the members’ area of the website.