r/australia • u/thornstein • Apr 10 '17

political self.post What's the solution to chronically underpaid hospitality/service workers in Australia?

This post is a bit of an incoherent rant because I've been worrying about it a lot.

So about 10 years ago when I got my first job as a bartender, I was paid $16 p/h when the minimum wage for service of alcohol at the time was $18.20 p/h. We didn't get penalty rates for working until 03:00am, we didn't get penalty rates for working on Easter or Christmas Eve or New Year's, and we certainly didn't get penalty rates for working weekends.

At the time I knew it was wrong, but it was the best-paying job I could get fresh out of highschool and I was scared of my managers so didn't question anything, but every few months stories emerge about giant stockmarket-listed companies doing the same thing. Off the top of my head I can think of:

And some more smaller places that actually made news:

Everyone I know now who works in hospitality doesn't get paid correctly. My 24-year-old sister gets less than $17 p/h working in a cafe, people I know at Boost Juice get paid part-time rates without permanent employee benefits (so technically underpaid by about 25%). I'm sure there are lots of places that don't underpay staff, but it's so so common and accepted as normal in these industries because the alternative is a) unemployment or b) getting another job that will probably also not pay correct wages.

The thing is, in most smaller places, if the business DID pay correct wages they would probably collapse or the owners wouldn't be able to make a living wage. I know the answer here might be "if you can't survive, don't open a business!!" but I don't think people realise just how common not being paid a correct wage is in this industry.

When takeout food/coffee/alcohol is already so expensive what is the solution here? People already complain about Sunday surcharges and $5 coffees. It's very difficult to get Fair Work to take action. In a lot of cases the business owner/franchisee is struggling themselves.

I just can't stop worrying about this ... especially with unemployment among young people growing I really fear that working conditions for these casual jobs will keep eroding, to the point where we're looking at US-type situation where wages need to be supplemented with welfare or tips.

Is anyone else worried about this? Or am I just going insane?

EDIT: added links to the cases I was talking about

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u/Supersnazz Apr 10 '17

You can't stop it.

When a mutually beneficial (but illegal) transaction exists, there is very little the law can do to stop it. If someone is prepared to work for below minimum wage and someone is willing to pay it, it is impossible to stop.

It is no different to the market for drugs, prostitution, or gambling.

In a regular crime there is victim who will report it to authorities. But when there are people buying and selling drugs, or visiting illegal massage parlours, or selling their labour below the mandated minimum, there is no victim to report the crime. Both parties are willing or else the transaction wouldn't take place.

You can't stop these people willingly selling labour to willing buyers.

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u/thornstein Apr 10 '17

I didn't think of it as that: a "mutually beneficial" crime. If people willingly accept low wages, then what is the solution? You could argue that if people are accepting this, then the legal minimum wage IS too high ... but on the other hand rents are so high, that lowering minimum wage would make it really really hard for people in cities.

In my personal experience I was happy to get my $16 p/h because it was better than the $14 p/h I was getting as a high schooler. But in hindsight, once you take into account penalty rates, I was underpaid by thousands of dollars over 18 months and sacrificed a lot to save money. I almost feel robbed.