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More flexibility: COVID-19 prompts hospitality award changes

Hospitality employers now have more flexibility to change hours.
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More flexibility: COVID-19 prompts hospitality award changes

More flexibility: COVID-19 prompts hospitality award changes

26 March 2020

Award-covered employees who remain employed in the hospitality industry can now have their working hours reduced and be transferred to work under different classifications – the latter if they are qualified to do so (eg hold a Responsible Service of Alcohol qualification if the job requires it).

This change, implemented very quickly by the Fair Work Commission last night, may become the first of many similar “emergency” changes.

Joe Murphy, an employment lawyer at Australian Business Lawyers & Advisors, said it was "the first of a number of changes that are proposed to extend to a broader range of awards and provisions in those awards. Those matters are yet to be finalised and will ideally be dealt with by the Commission this week".

However, implementing the changes still requires prior consultation with affected employees and the union (if they are members).

The change was jointly backed by the Australian Hotels Association (AHA), representing employers, and the United Workers Union (UWU), representing employees.

What has changed?

The decision varies the Hospitality Industry (General) Award, initially until 30 June 2020, but it can be extended or varied again by further application. It was made under sec 158 of the Fair Work Act 2009, as an award variation. The changes are as follows:
  • The ordinary work hours of full-time employees can be varied to between 22.8 and 38 hours per week. In other words, hours can be reduced by up to 40% for an employee working 38 hours.
  • Hours of part-time employees may be between 60% and 100% of their ordinary hours.
  • Annual and personal leave accruals and pay rate will continue at the rates applicable to the employee’s work hours before they were varied.
  • Employees may perform any work duties that are within their skills and competencies, regardless of the employee’s award classification, provided that the employee is licensed and qualified to perform them.
  • As noted above, employers must consult with employees and the union before making any changes. Disputes may go to the FWC.
  • Employers can give 24 hours’ notice to employees to take annual leave.
  • The parties can agree that employees will take twice their allocation of annual leave but at half their normal rate of pay.

Joe Murphy said that while it wasn't a deal of the magnitude of the Hawke-Keating era Wages Accord, it was "great to see unions and employer associations coming together in a great demonstration of community spirit and unity".

What does this decision mean?

The hospitality industry is one of the hardest-hit by the increasingly-tightening restrictions imposed in response to the Coronavirus/Covid-19 pandemic. Restaurants, cafes, hotels, clubs etc have been forced to either close or restrict their operation to takeaway service only. This week’s announcements include closure of food courts within shopping malls.

This decision is an attempt, jointly backed by both employers and the union, to keep businesses operating and employees in some form of work while the restrictions apply.

That said, retaining the requirement to consult with employees and the union is significant – an employer cannot unilaterally make these changes.

The FWC has shown that is likely to act very quickly, at least when variation applications that have bipartisan support come before it. However, it can be expected to handle matters on a case-by-case basis, and it cannot be deduced that similar changes will follow in other industries – only that it will be possible to make them.

The parties to this application claimed that it came within the scope of sec 134 of the Fair Work Act 2009. This section covers the overall objectives of modern awards. Its provisions include taking into account relative living standards, the needs of low-paid employees, promoting social inclusion via increased workforce participation, promoting flexible modern work practices and the impact on businesses.

Read the judgment

Determination, Application to vary the Hospitality Industry (General) Award 2010, AM 2020/8, Fair Work Commission, 24 March 2020

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