Fast Food Award Rates: Complete Guide 2024

Fast food is one of Australia’s biggest industries, with millions of people starting their first job at outlets like McDonald’s and KFC. Australians haven’t lost their taste for fast food either, with the industry turning over $20 billion dollars per year. Employees who work in the industry are covered by the Fast Food Industry Award MA000003.

About the Fast Food Award

The Fast Food Award includes pretty much any employee who takes orders, prepares, sells and delivers fast food. The Fast Food Award includes meals, snacks and beverages to be consumed away from the point of sale, packaged in a way that customers can take them somewhere else to consume, and sold in food courts, shopping centres or retail complexes.

Typically, employees covered by the Award include cooks, baristas (in take-away cafes), delivery drivers and supervisors. Importantly, the Fast Food Award does not cover cafes, restaurants, coffee shops or bars where food and drink is mainly sold to be eaten on the premises.

Limitations of the Award System

Australia’s award rates system is designed to balance an employee’s right to a “fair go” with the need for businesses to be able to make a profit. Because different industries have different costs and revenue streams, there are 122 modern awards covering different working environments. Each award, including the Fast Food Award can stipulate vastly differently rules for pay, working conditions, penalty rates and allowances. As a result, the system can be very complicated.

Interpreting the Fast Food Industry Award MA000003 can be difficult. Some businesses use the Fair Work Commission’s manual calculator to work out the pay rates for employees. However, this is time consuming and error-prone, with a small mistake likely to give the incorrect rate. This can lead to large-scale underpayments of workers and major liabilities for your business. Many businesses are instead turning to software with automatic Award Interpretation like Tanda.

Following the law

Fair Work has been increasingly targeting businesses of all sizes that have underpaid workers in recent years. In 2020 alone, the Commission recovered $2.4 billion dollars in unpaid wages. The vast majority of businesses don’t underpay workers deliberately, with most of the errors coming from incorrectly interpreting awards.

One of the most common errors under the Fast Food Award is failing to increase the pay of staff as they age. Many Fast Food Award workers are under the age of 25. Under most Awards, workers are entitled to pay increases when they turn 16, 17, 18, 20 and 21. Failing to update an employee’s pay rate could lead to underpayment.

Increasingly, businesses are using workforce management software like Tanda to manage this process. Tanda records time and attendance for employees and automatically applies the correct rate quickly and correctly. The system is equipped to adjust for the correct penalty rates and apply allowances, saving hours of interpreting awards. Importantly, Tanda also automatically updates an employee’s pay rate on their birthday.

It’s also important to ensure your rosters are compliant with the law and optimise your business performance. Tanda’s rostering experts have written a guide that outlines best-practice rostering so you can stay compliant.

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Classifying employees as casual, part-time and full-time

It’s crucial to classify staff correctly under the Fast Food Award. In Australia, staff can either be casual, part-time or full-time employees. Casuals aren’t given a guarantee of working hours or entitlements like annual leave, but in return they receive a 25% pay loading. Fair Work provides a full guide on how to classify employees, but for a basic outline, see below.

FULL-TIME EMPLOYEES

• Usually works, on average, 38 hours each week.
• Can be a permanent employee or on a fixed-term contract.

PART-TIME EMPLOYEES

• On average work less than 38 hours per week.
• Commonly work regular hours each week.
• Can be a permanent employee or on a fixed-term contract.

CASUAL EMPLOYEES

• Are employed with the understanding that there is no firm advance commitment to ongoing work with an agreed pattern of work.

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Casual conversion

There has been a great deal of controversy over the use of casual employees in recent years. The union movement claims casuals have been exploited, working full-time hours without receiving benefits like annual leave and sick leave. In response, the Government created casual conversion laws, which allows some casuals to become permanent employees.

To be eligible, a worker must have been employed for at least 12 months, and worked consistent hours for the last six months. The Fast Food Award includes casual conversion, and it’s important to offer it to eligible employees. However, there are many complicated rules covering casual conversion. For a comprehensive overview, read Tanda’s complete guide on the topic.

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Penalties and allowances

The Fast Food Award includes all the typical penalties and allowances for most workplace arrangements. This includes things like penalty rates for public holidays, weekends, working at night, and overtime. It’s important to apply the correct penalty rate.

Some of the most common allowances which apply to the Fast Food Award are the Vehicle Allowance and Laundry Allowance. The Vehicle allowance grants employees an extra amount per kilometre they have to drive for deliveries. Importantly, this only applies when using their own vehicle. The Laundry Allowance gives employees additional pay per shift when they’re required to wear a uniform, which is common at fast food restaurants.

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Leave entitlements

Staff covered under the Fast Food Award receive the same leave entitlements guaranteed to all Australian workers by the National Employment Standards (NES). Under these rules, part-time and full-time workers accumulate sick leave, annual leave and other entitlements based on the hours they work. Each workplace will have different arrangements depending on the award rules, but as a general guide, see below:

FULL-TIME EMPLOYEES

• Are entitled to paid leave including annual leave and sick & carer’s leave.

PART-TIME EMPLOYEES

• Are entitled to paid leave including annual leave and sick & carer’s leave.

CASUAL EMPLOYEES

• Are not entitled to paid leave including annual leave and sick & carer’s leave.