Are wages too low to attract hospitality workers?

As people slowly return to dining out, New Zealand’s migrant restrictions have turned up the heat on the hospitality trade’s glaring skills shortage.
Jon Super/AP
As people slowly return to dining out, New Zealand’s migrant restrictions have turned up the heat on the hospitality trade’s glaring skills shortage.

Joel McGhie​ worked as a sous and head chef for eight and a half years, being paid at most $20 an hour.

Now he gets paid more for packing boxes.

The Auckland man says he loves cooking but has stepped out of the industry because of the low payback for what he was putting in.

“I feel silly sometimes complaining about money because it is something you do for the love of it ...

“But at the same time, how do you do something that you love if every day you come home and you’re stressing about bills and making sure you have enough rent, and having to do an extra 10 hours or 20 hours so you can take a couple of days off?

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“It is a big stressor for those who want to work in the industry.”

The restaurant trade this week repeated its plea for targeted support from the Government, as it deals with the twin blows of outstanding post-Covid bills and a rampant skills shortage.

But workers or former workers in the industry say low pay, long hours and even mistreatment of workers are major problems it must address.

STUFF
The Restaurant Association's annual report shows eateries were struck hard by Covid-19 but are slowly recovering.

Chloe Ann-King​, of hospitality union Raise the Bar, said that with the Government signalling it will dial down the flow of temporary workers, the industry’s focus was now on getting New Zealanders into the trade.

But many of them had already worked for it and knew it had a dark side.

“Employers need to understand there’s a reason we don’t want to go back any more.”

She said Kiwis also resented being called lazy, because in fact the industry was poorly paid and worked excessive hours. Chefs frequently worked 60 hours a week or more but were paid for 40 hours.

There were also cases where migrant workers had been treated badly, in some cases having their passports taken and forced into bonded labour.

“We’ve got a problem right, but it’s not an immigration problem, it’s the way we're treating migrant workers and allowing hospo employers to exploit them.”

Chloe Ann-King, of Raise The Bar, says hospitality workers are regularly taken advantage of in their wages, hours and conditions.
David White
Chloe Ann-King, of Raise The Bar, says hospitality workers are regularly taken advantage of in their wages, hours and conditions.

Restaurant Association Marisa Bidois acknowledged on Thursday that pay rates were not high at the entry level of hospitality, but that it was possible to get up to $80,000 for an executive chef.

However, Wanaka builder and former head chef Michael Mohl, who worked in the industry for 20 years, said even that pay rate was effectively no higher than $27 an hour when all was considered.

"First of all, you’ll only find executive chefs in the bigger and biggest establishment like hotels and restaurant chains. The majority of food outlets will not have that position.”

Larger hotel kitchens were open from 6am to 10pm seven days a week.

"The executive chef oversees all of it. Therefore typical hours per week range more between 50 to 60 hours, definitely not 40."

At 60 hours and excluding four weeks leave, the average head chef was earning about $27 an hour.

"Let that sink in a little. That’s what a highly trained and experienced chef receives after decades in his or her professional field.

"No wonder the industry is lacking staff.”

Industry players say the margins restaurants are making are very slim.
James Braund/Getty Images
Industry players say the margins restaurants are making are very slim.

However, Mohr acknowledged that restaurant owners were also doing it tough, especially if they were paying high rent for a prominent location where foot traffic had fallen.

“I’ve always said the only person who makes money in hospitality is the landlord.”

Helen Kono​, co-owner of Wellington food business Yoshi Sushi, agreed. Post-lockdown she had to close one of her outlets and said margins in the industry were “ridiculously slim”.

Kono said she always worked with her staff to try and figure out the best hours for them.

And sometimes the hours worked in well. “For example if they’re studying or have children going ot school during the day, it works in perfectly for them because they can fit in a few hours during their downtime.”

Their pay rate depended on experience, and many came into the job with no training.

“But I believe most restaurants would be working with their staff to give them the best salaries they can.”

Bidois said the Restaurant Association was working on the roadmap to address “legacy issues” such as pay.

But luring Kiwis back into the industry in post-Covid times will be a challenge. The industry still relies on migrants for at least 15 per cent of the workforce and moves by the Government to limit migration are causing concern.

Unite's Gerard Hehir agrees restaurants are under pressure but says they need to address the reason why Kiwis don’t want to work for them.
John Nicholson/Stuff
Unite's Gerard Hehir agrees restaurants are under pressure but says they need to address the reason why Kiwis don’t want to work for them.

Unite Union national secretary Gerard Hehir​ said low pay was certainly one of the factors in the shortage but he thought work insecurity was the bigger issue.

There were staff working big hours but only guaranteed a few hours, which made them fearful of turning work down. And there were often elastic finishing times.

“You start at a time but you don’t know when you’re going to finish. So if it’s a busy night, normally you’d finish at 1 or 2, you could end up going till 3 or 4am, so those hours can easily get extended.

“If you don’t have a finish time, you either get paid an allowance, which no one does in hospitality, or you have the right to walk out. Now workers who try to exercise that right will find themselves very short in hours next week, I guarantee it.”

The way many workers protested was by moving around. It was also the reason why Hehir believed many workers would go to Australia now the border was open.

“They actually have penal rates, for heaven’s sake. You actually get more for working unsociable hours at nights and weekends.”

Insecurity of work is an even bigger problem in hospitality than low pay, Gerard Hehir says.
Supplied
Insecurity of work is an even bigger problem in hospitality than low pay, Gerard Hehir says.

Packing boxes was not was part of Joel McGhie’s career plan but eventually he felt being a chef was too undervalued.

“I really love cooking, it’s a passion of mine, and so I pursued it as a career, but I guess towards the end of my time in kitchens, I started to realise, I’m putting in all this extra work, I’m doing this because I’m passionate about and, I don’t know, it almost feels like the business owners take advantage of that.”

He’s now working 7 to 5 with regular breaks.

“The difference I’ve noticed in myself has been incredible.

“I’m not getting tired until just as I’m finishing my day and it makes so much sense for me to do it this way and yet I worked so long in hospitality that it's really strange for me, actually.”

McGhie said he could understand if people did not see hospitality as a place to stay.

“The financial position will be a big factor in their decision making whether or not to take those jobs, but at the same time, hospitality is also known as a difficult industry to work in.

“I mean, if you’re working around alcohol, generally speaking, you’re dealing with people at their worst. And you get mistreated a lot. People don’t even realise how they treat wait staff, how they treat front of house staff.

“It takes a toll on you mentally and I’ve seen people break, and it’s very disheartening because I know that those people care about their jobs, they do enjoy what they do for the most part and then someone will come along and absolutely ruin their day.”