Serving up inequality
CAYLA Edwards' shoe had filled up with blood by the time she realised how deep the cut was.
A kitchenhand dropped Edwards at the local hospital emergency to be stitched up (he returned immediately to the restaurant while she waited).
It wasn't this minor injury that Edwards recalls as emblematic of her years in the slipshod hospitality industry. It was what changed after the accident: absolutely nothing.
"The only thing that changed was I had a very special position of not having to carry out the bins again. Someone else did," says Edwards, who now has an office job.
Edward's experience isn't an isolated one in Australia's hospitality industry, where safety standards are lax and chefs and cooks work absurdly long hours for modest salaries; where tens of thousands of overseas students work as waiters and kitchenhands for as little as $7 an hour (that's just $14,000 a year for a 38-hour week); and where industry experts warn almost half the nation's restaurants are technically insolvent, staying open only by slashing the one cost they can control - labour.
Australia has become, over the past three decades, a foodie nation. There are almost 80,000 restaurants, cafes, and takeaway outlets in Australia, according to the Fair Work Ombudsman. With the boom has come the sort of glamour that last Sunday made MasterChef: The Professionals Australia's top rating television show.
But pull back the curtains separating the glamorous "front of house" from the ever-expanding number of commercial kitchens, and the reality can be numbing.
Erin Steele worked briefly last year as a waitress at a popular Federation Square restaurant. She was taken aback by the lack of safety training given to cooks and waiters alike, shifts lasting seven hours with no pause, the lack of staff with supposedly mandatory responsible service of alcohol permits, and the cash-in-hand payments.
The restaurant turned over staff constantly, hiring backpackers and overseas students, says Steele, who was let go after she questioned her $15-an-hour pay. "I think they got very nervous having hired an Australian because I was questioning things like rates of pay and breaks in shifts. The week after I did that, I was fired."
Her story is typical of an industry that employs three-quarters of a million Australians, a large proportion of them casuals. Bureau of Statistics figures show 60 per cent of the workforce is low-skilled with no post-school qualifications. Almost half are aged 15 to 24.
Hospitality industry veteran Tony Eldred has been advising restaurant groups on recruitment, productivity and work practices since 1987. Since then, he says, the sheer volume of restaurants opening across Australia has made the economics of running a food business hard to stack up. Competition has kept the cost of a meal low but all other costs - rent, food, electricity, water - have skyrocketed.
"So people are working their bottom-line hospitality staff harder and harder," says Eldred. "Some businesses are putting their staff on salary and then working them 60 hours a week, simply because they have to do this to survive."
Eldred describes some kitchens he sees as "little more than sweatshops" and says we are to blame for encouraging a "foodie culture" that has grown faster than the customer base that can support it.
"It's like Dickensian England in some situations - not the front of house but commercial kitchens," Eldred says. "But the owner is quite happy to let it go because he's getting his name into the good food guide."
One industry watcher, who declined to be named, said if restaurants in Australia's big cities paid their staff "according to normal community standards", prices in cafes and low-end restaurants would need to rise by a third. "A lot of restaurants, if they ran legitimately, are unviable," the watcher says.
David Le Plastrier found this out the hard way. For six years, until 2011, he and wife Jane owned a cafe in Ascot Vale. They left the industry when it became clear the only way to survive against neighbouring cafes was to slash wages from legal rates of more than $20 an hour to between $9 and $14. "One of our nearest competitors got done three times for underpaying their staff . . . They just kept doing it."
Wages once accounted for 20 to 25 per cent of a restaurant's costs, Le Plastrier says. Now, for businesses paying award rates, they can be up to 50 per cent. For his cafe to have remained viable, he says, meals needed to cost 30 per cent more. "No one is going to come to your business for that."
Le Plastrier now works as a small businesses consultant and doesn't miss the workplace culture created by hospitality's massive cash economy. "I had chefs turn up and demand to be paid in cash. I don't know how we have created such a culture in the economy that they have the gall to turn up in an interview and just demand cash and think that you will comply."
By coincidence, Workplace Relations Minister Bill Shorten used to buy his coffee from Le Plastrier's cafe. Shorten says there are huge problems in the industry because so many businesses dodge their legal responsibilities. "All the serious people in the industry are being undermined by the clowns," he says. He says the problems prove that calls from the Liberal Party and industry groups to further deregulate the nation's industrial relations system to provide more flexibility for employers were wrong.
Restaurant and Catering Association chief executive John Hart concedes around half of Australia's restaurants don't comply with regulations like pay rates. "They are opting out of the system and if they stay in the system they are going to go broke," he says. Many owners, he says, work back-breaking hours, often earning less than their employees.
THE darker side of the nation's restaurant scene is particularly evident in some Asian restaurants, where conditions can be appalling. A Fair Work Ombudsman prosecution, which goes to court in March, alleges the Hongyun Chinese Restaurant in Bourke Street employed Chinese national Su Xiliang to work for 147 straight days in 2011, chopping onions, making dumplings and preparing soups. The restaurant's owners, Zhu Chang Rong and Tao Moqin, were meant to pay Xiliang around $16 an hour, plus overtime and superannuation. Instead, Xiliang, who had a working permit but few skills to offer, got closer to $12. Often, he worked 13-hour shifts.
Xiliang's working conditions are a long way from unusual, says Andrew Edwards, a Fair Work Ombudsman investigator who regularly inspects Melbourne's restaurants. "It is fairly typical," he says. Chinese, Japanese and Indian workers in the restaurant industry are reluctant to complain, Edwards says. "Go to Dandenong and talk to a car mechanic, they are not going to be backwards about coming forwards. But if you go into Chinatown, you will find a bunch of students who wouldn't dream of saying, 'Hey I should get more'."
This exploitation is a national issue; early this month in Adelaide, after complaints from a Chinese students' association, the ombudsman raided 22 restaurants and found 90 per cent had no employment records, and no evidence they had ever issued a payslip. Of the 22 restaurants, 13 were fined for underpayments.
In Tasmania, the ombudsman has launched legal action against four Japanese restaurants in Launceston and Devonport, run by the Bento Box and Wan Japanese groups. The restaurants were paying staff between $5 and $10 an hour, over two years underpaying 50 employees $106,000.
Johnny Zhang, a Chinese commerce student who has worked as a waiter at two Melbourne restaurants, was paid $8 an hour and $10 an hour respectively and always in cash. Zhang says the pay rates across Melbourne's Chinese restaurants for waiters and kitchenhands range from $7-$11 an hour and are unfair, "but it is the market's choice".
"International students have no choice but to take these jobs. We can't work for a high-paying job, because of the language barrier," he says.
There are some instances of people fighting back. Bronwyn Davis, a teacher in Sydney who taught English to international students, was outraged by stories of flagrant mistreatment of her students, many of whom were earning $6 an hour in a city cafe in 2010. "They believed they couldn't get other jobs with the legal wage and conditions because they thought their English wasn't good enough," she says.
Encouraging her students to take collective action, Davis organised a "sit-in" at the cafe until the staff were paid properly. This resulted in a $2 pay rise, which Davis saw as a "small success". The long-term result? "It did not go out of business, in fact, it looked like they were doing better than ever."
But for many restaurant employees paid below minimum wages, there's little support.
In 2011 and 2012, the Fair Work Ombudsman was flooded with 52,000 inquiries and complaints from the restaurant industry after running awareness campaigns. Some 3218 complaints were followed up. Of those, $2.7 million in underpaid wages were clawed back for a lucky 1243 people. But for every case investigated, thousands go unchecked. Paid cash in hand, many workers have little evidence of their pay rates even if they want to complain. Many also have no motivation to complain because they work beyond the hours their visa allows if they are immigrants, or work for cash to supplement welfare or student benefits if they are locals.
Unions find it hard to gain a toehold in the industry. One former restaurant owner says unions are largely irrelevant. "There are thousands and thousands of small businesses, with mainly casuals who couldn't give a f--- about unions," he says.
Jess Walsh, the Victorian secretary of United Voice, which represents hospitality workers, says there is not a culture of unionism in many restaurants, with workers generally moving on if there are bad conditions. "Part of that is driven by high levels of fear in this sector. Very often staff are casually employed, with no guaranteed hours, so it can be very daunting for them trying to enforce their rights."
Overseas workers sponsored by their employer are the most vulnerable, she says. "They often miss out on breaks, penalty rates, superannuation, have to pay their own tax and are threatened with deportation if they complain." The union has occasional success, winning a recent unfair dismissal case for an Indian worker who got $5000 and found a job elsewhere. But such cases are rare.
And despite the high profile given to cooks and chefs by shows like MasterChef, their reality can be equally grim. Wages of between $600 to $750 a week is standard for smaller venues - but they are expected to work around 50 hours. One chef, who did not want his name used, said 60 hours a week was common.
Tellingly though, another said he put up with low pay to work in a really great restaurant. "You learn so much - great produce, great technique. And while you may earn f--- all to begin with, you will come away with better job security," he says.
"Around $90,000 seems to be a bit of a benchmark if you're a head chef in a big drinkers pub, or somewhere that makes a big amount of money."
David Le Plastrier supports a push from the restaurant and catering association to confine penalty payments to those who work more than five days in a row, instead of all weekends and nights (a proposal furiously opposed by unions).
Sundays were Le Plastrier's busiest day, when he says a kitchenhand would be paid "$32 an hour to come in and wash dishes". At the same time, a manager on a set salary would be working for $20 an hour.
However, Tara Moriarty, secretary of United Voice's New South Wales' hospitality division, thinks restaurants and cafes are "really one of the only sectors in society that you can think of that seem to be getting away with a cash economy".
Moriarty says bigger, more aggressive enforcement is the issue, not lowering award wages and conditions. She says the Australian Tax Office should get involved and ensure that individual businesses have things correctly in place - like insurance. "They are dangerous places to work, kitchens."
Tony Eldred predicts brute economics will help resolve the workplace issues created by the boom in new restaurants over the past three decades. "What is going to happen . . . over the next five to 10 years [will be] a lot of businesses going broke and not nearly as many entering the industry," he says.
"As competition lessens, prices will rise above inflation, until we achieve a balance again. We are talking here about a 20-year cycle; it has taken 10 years to get where it is now, and it will take 10 years to sort it out."
MINIMUM WAGE: WHAT WORKERS ARE ENTITLED TO
■ Restaurant workers: should receive at least $15.96 an hour
■ Cooks/chefs: $18.58-$20.28 an hour
■ First-year apprentices: $10.22 an hour
■ 16 to 19-year-olds get 50-85% of the minimum wage; 20-year-olds get full pay
■ Casuals get 25% more than the minimum wage
■ An extra 10% penalty between 10pm and midnight with an extra 15% after midnight
■ An extra 25% for Saturdays, an extra 50% for Sunday and an extra 150% for public holidays
SOURCE: RESTAURANT AWARD 2010