Is your cafe's public holiday surcharge actually going to the staff?   

ABC News
April 25 2018


It's becoming a common sight in Melbourne's cafes — that little note next to the till, or at the bottom of the menu, advising customers of a public holiday surcharge.

Usually, it's 10 per cent but can sometimes be even higher. The idea is that the charge covers the penalty rates of staff who work public holidays.

But 'David', who works at a popular cafe in Melbourne's CBD, said the 10 per cent levy charged by the owners on public holidays doesn't go to the staff.   

"The surcharge will go straight into the owners' pocket. We never get paid penalty rates," he said.

He said the owners are taking advantage of customers' willingness to do the right thing.

"Pretty much all the customers feel the surcharge is OK because they think it's going to the staff. It's not," he said.   

"The reason they're not paying it on to the staff is because they can. There's no consequence until someone puts their hand up and calls them out on it, but people are afraid to. The bosses simply say, 'take me to court'."

He said the holiday surcharge is a growing trend in Melbourne's cafes and restaurants.

"I'd say half of the places I've worked at in the last 10 years have applied the surcharge, and only half of those passed it onto staff in penalty rates."

'Christa', a chef at a Melbourne bayside cafe, said her employers do pass the 10 per cent public holiday surcharge on to their staff — but not all of it.

"If they take an extra $500 through the surcharge today, they'll divide $300 among the staff and pocket the rest," she said.

She said any public holiday payments to staff are made in cash and kept off the books.

"I worked four days over Easter and got less than $100 extra cash in hand," she said.


The hospitality union United Voice said under the current system, it's cheaper for employers to do the wrong thing.

"Employers know the chances of getting caught are remote, and the worst they have to fear is being forced to pay back stolen wages and get a slap on the wrist," said the union's Victorian secretary, Jess Walsh.

"We've been told about dozens of venues that have a surcharge but don't pay workers public holiday penalty rates.   

"Venues need to know they will lose business if they keep doing this. So if you're at a venue on Anzac Day, ask the staff: do you get penalty rates? If they don't, then find a place that does pay staff properly."

The office of the Fair Work Ombudsman confirmed it was making inquiries into Northcote's Barry Cafe over allegations it underpaid staff, and cancelled their shifts when they complained.

The ABC understands those staff have been contacted by the owners seeking a meeting to reach an agreement, and are considering their options.

David said he was worried the culture of underpaying hospitality workers won't change.

"It's happened for so long and at so many venues that it's systemic. Young people coming into the industry think, 'this is the way it's supposed to be'.   

This is what is known as trickle down economy.

Business gets a tax reduction, penalty rates dissapear, cost of goods go up with inflation.

And the workers gets........zip, nada, nuffink.
Perhaps a dollar or two extra in his pay, under duress of management
While the business pockets all the rest.

I've seen it in the company I work for.
We have increased our parts costs by around 12-15%
(Our suppliers increased costs 5-8%) that gives us an increase of 7%
What have increased labour charges by 8-12% based on service provided.

Guess what the workshop guys got?
2.5% because we can't afford any more.🤔🤔🤔

Trickle down economics.
We get what spashes over the top after their bucket is full.