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The ongoing review of penalty rates will eventually come to an end. A decision will be made and if penalty rates are abolished it looks like Australia could adopt the American hospitality etiquette of tipping.
For employers it could result in some significant changes to business or even add to already confusing employment obligations.
There are some questions you should be asking yourself in preparation for the change…
According to Tara Moriarty, secretary of the liquor and hospitality division of the United Voice hospitality union, “there’s no requirement to tip in Australia”. So where will the money come from to encourage good staff to work on the weekends? Will employers need to be paying above the modern award just to keep good staff?
In the US the minimum wage is much lower than ours and employees heavily rely on tips. It is engrained in the culture and the overall experience of eating out. However in Australia the tradition is not always reciprocated. A 10% tip in most fine dining establishments is expected but what about all the cafes and small restaurants?
Currently some employers hire their staff on part time or full time positions to avoid having to pay penalty rates. If penalty rates are abolished does this mean that they will be able to hire more casual workers? Will that positively impact the unemployment rate?
This year the minimum wage increased by 2.5%, will this become a trend in years to come? If penalty rates are abolished it will see employees earning the minimum wage every day of the week. It way result in the lost wages being made up by raising the minimum wage. We will have to wait until June 2016 when the minimum wage is reviewed to see what happens.
An announcement will be made in the coming months, and will reveal the D day of the penalty rates decision. If you are an employer do not worry, Employsure will keep you updated on all decisions and important dates. We will also support you if a change to your wage rate/s is required and help you to decipher your modern awards and ensure that you are meeting your employment obligations.
If you would like to ensure that you are currently paying your staff correctly and to better prepare yourself for the change approaching, call Employsure today on 1300 651 415.