At the Brisbane Mise en Place, on Monday 24 September, we held a forum to debate the question of “Can we afford to pay our chefs a fair wage?”.
By Jeremy Ryland
us debate this, sadly, topical question, we invited three very eminent speakers…
· Heinz Lepahe, a specialist in Workplace Relations from HWL Ebsworth Lawyers.
· Con Castrisos, lawyer, restaurateur and chairman of Restaurant & Catering Industry Association
· David Pugh, former QLD Ambassador Chef, ex Restaurant Two, Two Rooms and Baguette…currently at the Brisbane Convention & Exhibition Centre and very highly respected amongst Queensland chefs.
Now obviously “Can we afford to pay our Chefs a fair wage?” is a rhetorical question. As Heinz Lepahe pointed out, it’s a bit like asking “Should you pay your tax?”. You may not wish to, but you will get caught out if you don’t.
Owning a restaurant is tough. There are simply too many restaurants and not enough people dining out. I have written before about the fact that there are more food outlets per head of population in Australia than in Europe and the USA - one venue for every 290 people! Our research and review intelligence tells us that many establishments are struggling. In 2017, Gault&Millau reviewed 969 restaurants for the 2018 Restaurant Guide. From January to August 2017, 32 per cent of these restaurants either closed, re-named or underwent a major transformation in branding. Margins are slim – four per cent estimated with 64 per cent of establishments yielding less than three per cent, according to the ATO.
Con Castrisos highlighted that whilst customers are eating out more often, they are spending less money. And whilst there is competition for guests, there is also competition for good staff. A restaurateur has to be a lawyer, an accountant, a scientist, a mechanic, a social worker and much more. There are no barriers to entry and no licences necessary to be a restaurateur. And according to Con, it is possible for a person to open a restaurant, poison 100 people, close and then open up somewhere else.
Chefs are the “engine room”. Without a chef there is no restaurant. So, of course, we have to pay them a fair wage. Con estimates that there are approximately 100 000 chefs in Australia and this will grow by 16.5 per cent over the next few years. There is a shortage of good chefs and Australian chefs are valued around the world – many go overseas. So if you have a good chef and you want him/her to stay – you have to pay them correctly.
David Pugh agreed that it is too easy to open a restaurant and much harder to make a go of it. When a new restaurant opens, it takes away staff, patrons and interest from other venues – and if it closes, which many do, everyone loses. Restaurants need to be busy to pay their wages. And if they are not busy, they will cut costs. And whilst the huge majority want to pay a fair wage, there are ways to employ “cheap” labour. Apprentices and “work experience” staff are common. Many young chefs will work for nothing, especially in the premium well known venues, to gain experience and to be able to say they worked for a celebrity chef.
Underpaying staff and “wage theft” is unfortunately common, and not just in Australia, but overseas. Even big names like McDonalds are being fined for underpaying staff. Read more here.
But unless the industry does something to fix this, we will see legislation that will. According to Heinz, there is a push to make underpayment of wages a criminal offence – employers will go to jail if they do not pay a fair wage. The Fair Work Ombudsman is looking at issues such as Casual Conversion – converting casual staff into part-time permanent staff to avoid penalty rates. And the Fair Work Ombudsman is taking action against employers who underpay staff or do not provide their full entitlements. Heinz pointed out that one tactic of the Fair Work Ombudsman is brand damage through publication and “naming and shaming”. This is particularly damaging for the high profile businesses such as George Calombaris, Nell Perry, Dominos and others. It is also important to note that the Fair Work Ombudsman works for the employee: it costs the employee nothing to take an employer to court over unpaid wages, which if proven correct will cost the employer dearly in fines and back pay.
The industry is approaching a perfect storm! We need to address the sheer volume of new venues opening up which is unsustainable and is killing the whole industry slowly. We need to address the problems of affordability – but not at the expense of paying our staff a proper wage. We need to train the staff we have better and we need to provide them with the tools and information to do their jobs properly. And we need to stop taking advantage of young people trying to establish their careers. And if we don’t, there will be more rules and regulations and more employers going to jail.
If you would like some more detailed legal advice on any aspect of workplace relations, please contact Heinz Lepahe at HWL Ebsworth Lawyers: email@example.com.
And if you wish to contact the Restaurant & Catering Association, please go to the contacts page at http://rca.asn.au/rca/online-contact-form/.