Labour flexibility in the hospitality industry: questioning the relevance of deregulation

Abstract

The search for labour flexibility has assumed great importance in most developed countries and has been the catalyst for the deregulation which has occurred, and continues to occur, in the Australian labour market. However, despite this, the question remains whether deregulation of the labour market in Australia is necessary for the attainment of flexibility since the empirical evidence is inconclusive. Industry representatives from the hospitality sector argue that a high degree of labour flexibility is a vital component in being able to meet market demands and achieve a competitive environment. Using data from a study of 435 registered clubs in the Australian state of NSW, areas of labour flexibility which these hospitality enterprises value are examined. Managers’ perceptions of the impact of awards and trade unions on the ability of the enterprises to achieve labour flexibility in a variety of areas are also examined. It was found that while there was a perception by managers that awards and trade unions did have a moderate to low impact or restriction on labour flexibility, the impact was not perceived to be as great as the proponents of deregulation would suggest. It is argued that registered clubs are choosing not to enter into formal enterprise bargaining because of this perceived low/moderate level of award and trade union impact on labour flexibility.