Hotels and pubs are proposing new all-in pay rates for up to 50,000 full-time workers across the hospitality sector as part of the Morrison government’s push to inject more flexibility into the award system.
The Australian Hotels Association has applied to the Fair Work Commission for a new “loaded rates” schedule that will roll up penalty rates except those paid on public holidays, overtime and split shift allowances into higher above-award rates. The schedule contains five levels of loaded rates that range from 10.2 per cent to 30.8 per cent above the award rate depending on the days and hours worked by employees.
AHA chief executive Stephen Ferguson said employers would seek to have the schedule limited to full-time workers and not apply it to casuals.
Full-time workers make up 20 per cent of the 250,000 workers across the industry.
Mr Ferguson said the schedule was designed to reduce inadvertent breaches of awards by employers and the complexity of the existing award system. He said the AHA had originally sought to include public holiday penalty rates in the schedule but it became too complex to calculate appropriate rates.
“We think what we are putting forward is very even and equitable,” he said.
“There is no disadvantage to an employee. We don’t think it will replace what is currently there but for many employers who are looking to reduce their risk of non-compliance and to then reduce their administration costs, this could be something that is attractive to them.”
“It doesn’t cover all bases. It doesn’t cover public holidays.
“We recognise there are limitations in it.
“Coming up with a one-size-fits-all under the current, very complicated award is difficult but we believe that we have been able to capture a significant amount of employees who may benefit from a simplified system. We think it will suit some employers and not suit others.”
United Workers Union director Ben Redford said given the application was filed in the Fair Work Commission only on Monday, the union would consult with members about the proposal.
“At this stage, we are concerned the complex five level special rates proposal with different overtime thresholds and other parameters will be impossible for hoteliers and small business to grapple with,” Mr Redford said.
He said the union would continue to oppose measures that would leave hospitality workers worse off in terms of pay, especially when the industry was facing a retention crisis stemming from wage stagnation. “We will continue to oppose any measure which will contribute to wage theft and non-compliance with the award, which is rampant in this industry,” he said.
Former industrial relations minister Christian Porter wrote to Fair Work Commission president Iain Ross in December asking the tribunal to investigate implementing award changes that would allow employers to pay a single, higher rate to retail, hospitality and restaurant workers.
The proposed AHA schedule would not apply to workers on junior rates and supported wage rates or catering employees working in remote locations.
In its submission, the AHA said the hospitality industry had shown periods of both decline and recovery since March 2020, with snap lockdowns followed by easing of restrictions.
“However, the Covid-19 pandemic continues to negatively affect employment rates, business turnover and business’s ability to meet financial commitments within Australia’s hospitality industry,” it said.
The AHA said the hospitality industry was still in a state of recovery and not back to its pre-pandemic levels.
“The proposed variation balances the government’s request for sensible workplace flexibility in response to changing economic conditions against the need to maintain appropriate safeguards and ensuring employees are not ‘worse off’ when compared to award entitlements,” it said.