Penalty rates 'tragic' for tourist economy

    by: Chip Le Grand
    From: The Australian
    December 29, 2012


SUMMER should be a time of plenty for restaurant owners in Noosa, one of Australia's favourite holiday towns. Instead, there are days this summer when hungry tourists will struggle to find somewhere to eat along Hastings Street as business owners shut their doors against the rising cost of penalty wages.    

As the peak union body the ACTU campaigns for penalty rates to be enshrined in legislation, Queensland's Sunshine Coast mecca is feeling the brunt of a wage regime that punishes businesses that trade when the rest of Australia plays.

Leading Noosa restaurateur Jim Berardo says the unintended consequences -- less places to eat and fewer shifts to work -- are "tragic" for his town's tourist-dependent economy.    

Local chamber of commerce and industry president Carl Beck agrees the growing wages bill is hurting employers and employees alike. "The thing this government carries on about is looking after the worker. They are actually hobbling the worker," he said.


When the Rudd government embarked on its "award modernisation" process in 2008, Mr Berardo paid his casual waiters a flat rate. Now he must pay them loadings to work evenings, weekends and public holidays -- the only times he opens.

The full impact will be felt at the end of the government's five-year phase-in period but is already starting to bite, with casual waiters earning $45.15 an hour on public holidays.

The bottom line for Berardo's, one of a handful of restaurants open in Noosa on Christmas Day, is that despite having a full dining room and imposing a $15 surcharge, the business lost money. Mr Berardo says he opened only out of a sense of civic duty. New Year's Day will be much the same.

"You have got tens of thousands of people here in Noosa and no place to eat on public holidays because people cannot afford to keep their doors open," he said.

"Small businesses, restaurants and cafes cannot exist under those wage rates. As we said all along, you are going to put us out of business. The system is all wrong."

In an interview with The Australian earlier this week, ACTU secretary Dave Oliver flagged an election-year push by the union movement to legislate penalty rates as a minimum entitlement of employment. While the legislation would not dictate the rates businesses have to pay, it would entrench penalty rates in the national wage system. There is bipartisan support for penalty rates.        

Workplace Relations Minister Bill Shorten warns against a "surrender" of weekends to work and argues anyone working public holidays deserves to be compensated for their loss of family time. Opposition spokesman Eric Abetz this week reiterated his support for penalty rates, telling The Weekend Australian that weekend and holiday loadings have "a proper place".

However, Senator Abetz was sceptical of the need to legislate penalty rates, which are being reviewed by Fair Work Australia. "It ought to be the independent umpire, the Fair Work Commission, determining what a fair, reasonable, balanced approach to all that should be," he said.

Wages have been adjusted along a sliding scale for the past three years and the changes will be complete by 2014. By then, Mr Berardo warns, many of Noosa's tables will be bare.

Restaurant & Catering Australia chief executive John Hart says the push to legislate penalty rates is unrealistic and out of touch.

A survey commissioned by his association earlier this year found one-third of businesses were planning to shut over holiday periods in response to rising wages.

"It is a total and utter nonsense to say the pendulum can be pushed any further in favour of employees because industries will grind to a halt," Mr Hart said. "It is already at a point where businesses are shutting because of the penalty rate regime in retail and hospitality.

"I don't see how they can arrive at any conclusion that they can push it further.

"We need to look at this from the view of the employees as well and I don't know that the union movement is actually representing the views of the employees; they are representing the views of the union movement."

Mr Beck says he witnessed the impact on Noosa earlier this week when he drove along Gympie Terrace, a popular strip outside Hastings Street. By rough count, he estimated half the restaurants were closed. While some owners may have chosen to take holidays, Mr Beck has no doubt penalty rates are forcing reluctant vacations.

"The problem with the union movement is none of these guys have ever run a business. They don't understand what it takes to run a restaurant and how many hours are involved for the owners.

"It just seems that at every opportunity they get, they are making it harder and harder for small businesses to make a dollar," he said.

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or go out of business and shut up shop. Either way it is yet another labor success story

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And when the business folds because it can't cover the costs?

Who cares, hey. As long as you stuck it to a business owner!

How typical it is, always try and get the low income workers to work for less.  A lot of low income workers rely on the penalty rates, to help make ends meet.  Simple if you don't want to pay penalty rates then don't.  Just don't expect them to work those hours then.    

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And just who do you think is pouring into our country by the boatload? These inbound people will work for $5 per hour if given the chance and they will do more to undercut wages and conditions than any restaurant owner will. But you say they are welcome so suck it up  princess.

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Well now they can live on the dole as there will be no penalty rates when the restaurant goes out of business.



But since you are all about the big pay packet maybe you should open a business using only your business philosophies. Pay top dollar to employees and sell everything extremely cheap to all customers and somehow magically still make a living yourself. 

You, as always, are totally full of sh1t

With some people around like you, thank goodness for the unions.   

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with people like you there will be no unions at all. unions have WORKING members. under your brain-dead idiocy no one would have a job because you would have more demands than it would be worth to an employer.

I understand now why you have never worked. you dont even understand the concept. yu are definately someone who should be denied the dole.