Small businesses hit back at global chains on Sunday pay

The Australian, September 5, 2017

Opening his family’s fast-food business on a Sunday was once a possibility for Michael Jacobs. But when he and his wife did the sums they realised paying an extra ­employee on the industry award was far from viable.

It’s why he is angry with agreements struck by McDonald’s, KFC and Pizza Hut, which significantly reduce the base hourly rate the global fast-food chains have to pay their Sunday staff.

“If we were to employ someone on Sunday we’d make no money. I’ve got to feed my wife and kids somehow,” Mr Jacobs said.

His small kebab and fast-food joint on Clarendon Street in South Melbourne competes against nearby branches of McDonald’s, KFC and Pizza Hut.

Analysis by the Department of Employment found employers hiring workers on award rates would have to pay $8.08 more an hour on a Sunday than McDonald’s does. Mr Jacobs said the difference would translate into a huge loss for a family business.

“It’s a hell of a lot. That’s ­another half a wage for a person,” he said. “Of course it is ripping (people like me) off, 100 per cent. It doesn’t give us an incentive to hire anyone.”

He said his son had worked at McDonald’s for five years, but had difficulty getting the number of shifts he wanted when he entered his late teens.

Mr Jacobs said he and his wife were keen to provide young ­people such as his son opportunities to work under better conditions, but it would be unsus­tainable for their business under current ­arrangements.

“I would love to help somebody … (but) you either do it yourself, work a little bit extra hard or get someone from the family to do the extra work,’’ he said.

Employment Minister Michaelia Cash seized on the new ­department analysis, which showed Sunday employees covered by union pay deals would have to work up to 50 hours during the week to offset the impact of lower Sunday rates. Senator Cash said the findings showed the union deals with big employers such as McDonald’s and KFC significantly disadvantaged employees who worked Sundays.

She said unions were negotiating the deals while the ALP was running a scare campaign about the Fair Work Commission decision cutting penalty rates.

“(Labor) will always stand for big business, big unions doing deals that, quite frankly, screw employees, but they will never stand for small business.”

Meanwhile, employers who do not keep pay records will be ­required to prove they have not underpaid workers if an ­employee makes a claim, under changes to the Coalition’s proposed vulnerable workers legislation.

Labor succeeded in introducing a Senate amendment that it said would remove the incentive for “dodgy” employers not to provide pay slips. Labor also succeeded in ensuring new coercive powers for the Fair Work Ombudsman did not apply to unlawful industrial action.

“Labor has ensured the Turnbull government cannot use this bill, which is supposedly aimed at stopping worker exploitation, to actually deploy powers to interrogate workers,’’ workplace ­relations spokesman Brendan O’Connor said.