CUTTING COSTS AT CHRISTMAS

Heathwood, of McKays Solicitors, says business owners in competitive industries like hospitality are on a “knife edge of survival” in a tight economy.

“The combination of employee penalty rates, higher costs of electricity and other fixed costs makes it unappealing to a restaurant owner to open on statutory holidays, because the staff would be earning more than the owner,” Heathwood says.

Heathwood says higher wages become a burden for his clients, as more restaurants trade on Christmas Day and charge public holiday fees.

He says businesses are pressuring the government to change penalty pay rates, which currently differ between industries and can be anywhere up to an additional 150 per cent of an employee’s wage.

He says employees are not necessarily looking to abolish penalties, only to scale them back in order to make trading viable.

“For the retail industry if an employee works any public holiday, they should be paid an additional 150 per cent, so that means they are paid double time and a half,” he says.

“The unions have worked very hard for many years for the current penalties status so employers should expect a tough fight if they want to scale back on penalty rates.

“Some employers in the hospitality business are saying that if they don't get relief then it isn't viable for them to keep the doors open on certain trading days, such as Christmas or New Year’s Day.

“Employers are, I think, complaining that they have reached their limit and all that is left to them is to reduce the wages spend, either by lobbying to reduce penalty rates, or simply shutting their doors which means that hospitality workers lose working days.”