Would you like fries with that?

For many young Australians, flipping burgers at the local fast food outlet while juggling the huge amounts of homework and various other stresses of teenage life was a rite of passage. Getting your first job at in the fast food industry was one of the first steps towards independence.

There was no sweeter sensation than receiving your first pay cheque – money YOU earned through your own hard work as you mopped floors with the fluoro “Danger: Slip Hazard” sign next to your bucket and stared longingly at the deep fryer where one of you senior colleagues was lowering their basket of frozen fries into the burning hot oil thinking to yourself “it won’t be long now”.

Australia’s Fast Food Industry plays a vital role in helping teenagers to progress into the full time workforce. According to recent market research released by IBISWorld, the industry employs more than 153,000 workers and generates approximately $19 billion in annual revenue. The economic contribution of the Fast Food Industry to the Australian economy cannot be understated.

In a surprise move, the Minister for Immigration and Border Protection has announced changes to the Australian immigration framework which will make it more difficult for fast food businesses to employ foreign workers on 457 visas. So what are the changes? And what does this mean for your business?

The Government has announced that it will scrap the Fast Food Industry Labour Agreement. This Agreement provided fast food businesses with a fast track mechanism to fill skill shortages by sponsoring foreign workers on 457 visas, in cases where they might not otherwise have had access to the 457 programme. While the decision to scrap the Agreement will not prevent fast food businesses from employing workers on 457 visas, it will significantly increase the difficulty of this process.

Jacob Wyllie, Head of Migration with FCB Smart Visa, a subsidiary of HR Assured’s parent company, explains:

“The most important facet of the Fast Food Industry Labour Agreement was that it allowed holders to sponsor “Retail Managers” and “Retail Supervisors”, two occupations which do not appear on the standard 457 occupation list (the Consolidated Sponsored Occupation List). Without access to this template Agreement Fast Food Industry employers have few if any occupations which they are able to sponsor for a 457. I would note that specific DIBP policy also stops Fast Food establishments from sponsoring cooks on a 457, whereas cafes or restaurants can sponsor cooks. This really does close a massive door on 457 sponsorship in this industry.”

In a statement released on Thursday, Mr. Dutton said that “Australian workers, particularly young Australians, must be given priority“. The changes, however, have come as a surprise to key industry stakeholders who have criticised the Government as it will mean that many existing foreign workers will be forced to leave Australia once their visas run out.

Other recent developments within the Fast Food Industry:

The plan to scrap the Fast Food Industry Labour Agreement comes less than a week after the Full Bench of the Fair Work Commission handed down its long-awaited decision in the Penalty Rates case. This decision will see Sunday penalty rates for permanent Level 1 employees under the Fast Food Industry Award reduced from 150% to 125%, while there will be a corresponding reduction for casual employees from 175% to 150%.

FCB Group, HR Assured’s parent company, ran this case on behalf of the Australian Retailers Association. The decision is a particularly pleasing result for business groups and employers who have long argued that the existing penalty rates structure is inconsistent with the modern Australian workforce.

In handing down its decision, the Full Bench emphasised that, although working Sundays involves a higher level of disutility than working Saturdays, the extent of the disutility is much less than in times past. In particular, the Full Bench placed emphasis on the evidence presented by FCB that retailers would provide more employment opportunities, both through additional hours and new employment, if the penalty was reduced, and that retail employees were willing to work for a reduced penalty rate.

For more information on the recommendations and what this means for you, clients should contact the HR Assured team. If you’d like more information about the benefits of becoming an HR Assured client contact us today for an informal chat.