FAIR WORK APPROVES FAST FOOD AWARD CHANGES
The last few months have been very fluid from a HR/business perspective. We have recently updated you on Fair Work Act changes to allow more flexibility for business owners in running their enterprises in a COVID-19 era, as well as JobKeeper directions.
In the latest news in the fast food industry, the Australian Industry Group (AIG) submitted an application to the Fair Work Commission (FWC) to vary the Fast Food Industry Award 2010, supported by the Shop, Distributive and Allied Employees Association (SDA) and by the union heavyweight – the Australian Council of Trade Unions (ACTU). It was knocked back earlier this month by the FWC, although the door was left open for further consideration and submissions.
After a hearing on 15th May, the Full Bench released their determination that the Award will be altered for those employers who cannot access JobKeeper – albeit with some caveats.
The AIG and the ACTU were seeking to alter the Fast Food Award for an initial period of three (3) months to allow for greater employer flexibility during these difficult times on three points:
An employer can request an employee to take paid leave, and it cannot be reasonably refused;
During close-down, an employer can enforce paid annual leave; and
Changes to part-time employment provisions whereby part-time employees will not be paid overtime for hours less than 38 per week.
It is worth noting that AIG is acting on behalf of McDonald’s. While some franchisees may be able to access the JobKeeper wage subsidy scheme, McDonald’s own outlets cannot as they are unlikely to be able to show there is a 50% reduction in business (as a large business, the bar is higher). These approved changes to the Award only apply to those businesses who cannot access JobKeeper.
The reasons for this application’s controversy are three-fold:
the AIG and ACTU were hand-in-hand in requesting a change to the Award, which is unusual in itself;
the Retail and Fast Food Workers Union (RFFWU) opposed the application; and
part-time employees would not receive overtime rates for hours worked outside of defined part-time hours (i.e., they would be worse off than the current provisions of the Award which requires employers to pay part-time employees overtime rates for any hours worked over the agreed part-time hours).
The Full Bench, while implementing the changes on the basis that it will keep more young people in work, has put some restrictions on the determination:
The temporary changes only run to 31st July, not the three-month window the applicants were seeking;
It is only applicable to businesses who cannot access the federal JobKeeper wage subsidy scheme;
The notion to close parts of McDonald’s own outlets was rejected by the FWC on the basis of lack of merit.
There has been a lot of debate around the reduction of overtime rates for part-time workers as part of this temporary change. Opponents argue it hurts our young employees who are the most vulnerable, and that McDonald’s is somewhat protected from the economics of COVID-19.
My perspective calls for some sensible provisions around part-time employment – I am not a proponent of casualisation of the workforce as it has significant knock-on effects, therefore I am a supporter of part-time employment that provides flexibility for both parties. However, there is little business logic in requiring an employer to pay overtime to a part-time employee in a busy period after the agreed part-time hours are worked.
I do not agree that part-time employees should earn overtime rates for working less than 38 hours a week, as prevalent in many Awards. The incongruence that places into the workplace across employment groups is unnecessary – you could get employees on full-time earning less than a part-time employee, and it actively discourages employers from promoting the concept of part-time work rather than a casual status.