Penalty rates, that vexed topic
The simple fact is people open businesses to make money.
Many if not most aim for profit but believe it or not, some are happy just not to go backwards. So not all businesses are the same however nobody takes the risk of opening a small business like a café or restaurant to lose money.
In hospitality, the weekend trade is usually the busiest. This is factored in when someone decides to take a gamble and open a hospitality business. They understand that weekday trade will not be as great as weekend trade and so staff it accordingly with more staff at the weekend to cope with demand.
The penalty rates awarded to staff working over the weekend add a considerable percentage to the businesses wage costs. This is then borne by the business and can and does often eat into any profit that the business may have gleaned over the weeks trading.
At this juncture, many people will say and not unreasonably I might add, that ‘Your business plan should have accounted for the penalty rates in your wage forecasts’.
True and I agree entirely.
It’s not as if penalty rates are a new thing is it?
The fork in the road that divides people and their opinions on penalty rates appears pretty quickly when businesses decide to raise the price of their goods and services to adjust for the loss in profit that paying penalty rates manifest.
Businesses are accused of gouging, being greedy and holding the public to a ransom of sorts.
This is the bit that I don’t get.
Would you expect other businesses to absorb the cost of doing business on the weekends and losing profit as a result? Taking it further would you as a shareholder, be prepared to reduce your dividend because the company you invested in had to account for a higher wage bill for staff who worked weekends?
No you wouldn’t. You’d expect your company’s executive to adjust by raising the cost of its product/service to keep the profits coming.
Hospitality businesses are no different.
The problem is that being in the business of Hospitality is oft confused for being in the business of service solely because of the perception from the dining public, that its operators do this because they ‘love’ it.
Sure most of us do, we’re lucky we’ve found a vocation that we enjoy.
However, like a performance on stage, our job eventually comes to an end when we pack up, clean down and ring off the till.
This is when reality bites.
The till is the leitmotif, the inescapable truth that the restorative production that you are enjoying within a cosseted and welcoming enclave is a pantomime performance for which you must eventually pay. No matter how convincing a exhibition the players make to assure you otherwise and suspend your disbelief, eventually you’ll have to depart this wonderland and retreat to your own reality, via the till.
So for some, a previously enjoyable repast spent idly imbibing, can evaporate speedily leaving one with a disconcerting feeling that they had just partaken in an illusion of generosity and their purse is all the lighter as a result.
This feeling is at odds with the perception that some people have of hospitality and is at the heart of the misgivings they then reserve for the operators who respond by putting their prices up at weekends and public holidays to make sure they are also being recompensed for opening during such times, as well as their staff.