Labor laws a major trouble for QSRs
The laws are not motivating employees to work, according to some QSRs.
Burger Edge franchisor Issam Soubjaki said, “We don’t look to the government for assistance. I would be happy if they just didn’t make things more difficult than they already are. Labour laws, Cost of Goods and rising cost of utilities are causing some distress amongst franchisees.”
Labor laws are giving them a hard time. He added, “In terms of labour, most are working weekend themselves to avoid the penalty rates. I do believe the labour laws need reviewing and to be more reflective of the whole economy, not just some sectors that are riding high at the moment. Retail and QSR face serious challengers to retain quality staff or to encourage new people to go into these sectors if a balance is not struck. I hope it doesn’t result in falling standards in QSR’s and emerging systems being able to compete.”
Murat Coskun, GM at Sunshine Kebabs has the same opinion. According to him, “It is becoming impossible to hire labor on weekends and public holidays or even on normal trading days. The conditions are making employees less inclined to work. Any conflict between an employee and an employer there is a bias to the employee. I know of franchisees not only in our system but also in others that are looking at an earlier exit strategy due to the incredible labor costs.
Same goes with John Smith, MD at MYO. He said, “The industry has been lobbying, so far unsuccessfully, for flexibility in minimum hours and penalty rates which continue to have major negative impacts on growth.”
On the other hand, Wayne Homscheck, Founder Pie Face, is concerned with payroll tax. “The biggest and most important initiative Governments can do is to abolish or give a subsidy for state payroll tax. No QSR should be paying it. It means that Franchise Owners need to work in the stores themselves to be profitable.”
He also commented about wages when he said, “Australia has the highest wages in the world with the basic wage being around $25 an hour when you factor in all the levies. Many of the people that work in our stores are OS students, here for a short time, who will never collect their Superannuation.”
For Eagle Boys, the federal government can assist QSRs directly by assisting small businesses and keeping onerous red tape to a minimum, and indirectly by ensuring its policies promote consumer confidence.
Eagle boys said that they are essentially a collection of small businesses, and that consumer confidence is very crucial for them. Therefore, “any actions the Federal Government can take to support consumer confidence, from employment legislation through to taxation and household debt, will assist.”
Lastly, Rob McKay, Wendy’s CEO commented, “In our view, it is important for the Federal Government to have a strong, collaborative working relationship with the food sector in order to shape legislation that enables and improves a vital segment of the Australian economy – a relationship we believe the Federal Government currently understands and values. “
