Be Our Guest: Australia’s Hospitality and Tourism Industries in a Post-COVID Australia

June 21, 2021

What does 2021 have in store for the industries hardest hit by 2020’s constraints on our travel and leisurely freedoms: hospitality and tourism? Ceri Hohner, Senior Associate at FCB Workplace Law, catches up with Daniel Gschwind, Chief Executive of the Queensland Tourism Industry Council (QTIC) to discuss how the recent IR reforms will shape the industry over the next twelve months.

 

Ceri: Thanks for taking the time to chat with me, Daniel! What is the biggest workplace relations challenge currently facing the tourism and hospitality industries?

Daniel: For our industry, the immediate and practical hurdle many employers face is the end of the JobKeeper scheme in March, both in terms of the loss of financial support and the reduced flexibility. For some businesses which may still not be fully operational, this has had significant organisational implications as it meant that any flexibility in terms of hours or duties had to revert back to the original working arrangement.

Ceri: With the recent outbreak in Melbourne shutting down local cafes and restaurants once more, it’s becoming clear that there’s a big gap between businesses being back to normal, and the lack of an extended JobKeeper scheme.

Daniel: Exactly. And on a longer-term basis, the challenge – the proverbial Achilles’ heel – is the labour force and skill challenges in terms of a lack of staff with suitable skills.

The consistent theme that QTIC is hearing is a problem with recruitment, particularly filling positions in specialised roles such as chefs and drivers, where either workers can’t be found or their skills are inadequate. Some people have drifted out of our industry during the pandemic, and some into it – you hear stories of pilots driving buses, but that won’t be forever.

We have lost a whole section of the labour market with nearly 200,000 working holiday visa workers gone, and 100,000 international students who no longer participate in the workforce. When you consider that there is no skilled migration into Australia at the moment, we’re miles behind in some of our key labour sources.

Ceri: With one of the recent changes to the Fair Work Act being an ongoing entitlement for regular and systematic casual employees to elect to convert to permanent employment, how will this affect the engagement of casuals moving forward?

Daniel: From both employers and employees’ points of view, there is a very good reason why we have a ‘casual’ category of labour, which is particularly prominent in our industry where there is fluctuating demand for services, seasonal or otherwise: it’s very difficult to maintain a consistent revenue flow when business is based on the direct needs of customers at a particular point in time. You can’t invent work for staff where there is no business, it’s often impossible to commit to guaranteed hours, and unlike in some other industries such as manufacturing, there’s a limit to how much preparatory work can be performed.

While there may be some employers who seek to use casuals to avoid commitments, opening an avenue for every casual to elect to convert to permanent employment, even those who are casuals for very good reasons, is controversial and will have significant implications for our industry.

Ceri: What are QTIC’s views on the potential introduction of criminal sanctions for underpayment offences as was originally proposed in the recent reforms?

Daniel: If an employer deliberately or knowingly underpays an employee, that is a form of theft and deserves to be dealt with as such.

However, considering the complexity of pay rates, especially in our area where there is a prevalence of small businesses, honest mistakes are being made – it’s not necessarily an excuse, but is still an explanation for why it occurs. There should be a reasonable approach taken which recognises that many employers are overwhelmed by the complexity of workplace entitlements, and that most cases of underpayments are genuine errors.

Ultimately, there needs to be recognition between deliberate exploitation, particularly of minority groups, and your local coffee shop incorrectly calculating a wage rate when trying to match the job description to the appropriate classification in the award.

Ceri: What changes would you like to see happen to the Fair Work Act to benefit the hospitality and tourism sectors?

Daniel: Flexibility is probably the key thing. Employers are frustrated with the lack of recognition that ours is a 24/7 industry: it’s not confined to normal working hours. Nor for that matter are many people’s lifestyles anymore, but the IR system hasn’t quite kept up with that reality.

Over the years, we’ve seen multiple investigations and arguments about what are sociable hours, and about work on a Sunday where it is no longer the sacred day it once was. We go out to shop and enjoy ourselves at night and on weekends. We have a new lifestyle reality, an industry operational reality which is not yet reflected in Australia’s IR system.

Ceri: What do you expect 2021 to hold for this industry?

Daniel: The domestic tourism industry will continue to accelerate, although it will be a bumpy ride with strong seasonal changes.

There’s certainly an upside for the domestic market while the international borders are closed as we will be able to provide for those Australians who usually holiday or travel internationally. Over 10 million of us go overseas every year, spending over $50 billion and, this year, some of those funds will be reallocated to domestic products and services. To get there is not without its challenges for our industry and its workforce, but we’ve already started on our recovery phase.

Ceri: And finally, what should we be keeping an eye out for in the coming months?

Daniel: QTIC is currently running a campaign with the Queensland Government called “Give it a Go”, which is about encouraging people to try a career in tourism. We’re focusing on all levels of workers – we’re running roadshows in schools but also looking for school-leavers and mature-aged workers – anyone who would consider tourism as a career, not just a short-term job. If anyone is interested, take a look at https://youngtourismleaders.qld.gov.au/give-it-a-go

2021 is undoubtedly going to be a tough year for many businesses in the hospitality and tourism industries and, as Daniel described above, navigating award interpretation, enterprise bargaining, and employment compliance is a tricky thing to get right. For those employers who need assistance in traversing the complexity of Australia’s IR system or the new casual employment reforms, don’t hesitate to reach out to FCB for that peace of mind that lets you focus on building your business back up to full strength.