The unseen cost of South Africa’s restaurant industry
South Africa’s restaurant industry is grappling with a crisis of exploitation, including underpaid workers, long hours, and violations of labor laws. What lies ahead?
Recent investigations into Ocean Basket, Babel, and Tang have uncovered a troubling pattern of worker exploitation. Despite labor laws, these restaurants have been found breaching fundamental employment standards by paying below minimum wage and compelling employees to depend on tips for income.
The National Minimum Wage Act and Basic Conditions of Employment Act (BCEA) set clear standards, yet non-compliance persists, exposing the greed of certain employers who capitalise on vulnerable workers.
Systematic Violations and Corporate Greed
Daily Maverick reported that at Babel, waitstaff were paid as little as R150 per shift, far below the legal minimum of R27.58 per hour. Such practices violate Section 7 of the BCEA, which mandates fair remuneration.
In Ocean Basket’s case, R813,000 was allegedly owed in unpaid wages, an indication of systemic exploitation. The failure to uphold the National Minimum Wage Act signals blatant disregard for workers’ rights, and a pursuit of profits at any cost, even when it comes to human dignity.
The Unlawful Shift Structures at South Africa’s restaurant industry
Many workers in these restaurants were subjected to 12-15 hour shifts without compensation for overtime or sufficient breaks, breaching Section 9 of the BCEA which establishes the maximum permissible hours an employee can be required to work under normal circumstances and the compensation regime beyond normal hours (ie overtime, breaks and rest).
The Labour Relations Act mandates fair treatment and prohibits such exploitative working conditions. Yet, in pursuit of higher profits, employers compel employees to work excessive hours under grueling conditions, exploiting their desperation for employment. These practices are indicative of corporate greed, with workers’ welfare taking a backseat.
The Struggle for Basic Benefits
Several of the restaurants failed to comply with UIF contributions or worker protections under the Compensation for Occupational Injuries and Diseases Act (COIDA). Without these essential protections, employees are left vulnerable, lacking both financial security and healthcare coverage.
South African law demands contributions to UIF, yet these restaurants shirk their obligations, placing workers at greater risk. Such practices are not only illegal but represent the wider culture of neglect prevalent in the industry.
Exposing the Tip Culture
Relying on tips as the primary form of income violates the National Minimum Wage Act, as tips are supplemental, not a substitute for wages. Yet, many of these restaurants, including Babel and Ocean Basket, have normalised this practice, leaving workers dependent on fluctuating, unreliable income.
Employers pocket the profits while shifting financial responsibility onto their patrons and staff. This practice exacerbates inequality, where low-wage workers are exploited under the guise of legal commission-based pay.
What Restaurant Managers Should Know
Managers in the hospitality industry must comply with labour laws, including the National Minimum Wage Act, BCEA, and COIDA. Employers must ensure workers are paid fairly, with proper contracts and benefits, and cannot rely on tips to meet wage requirements. Additionally, excessive working hours without breaks or overtime pay is prohibited. Failure to adhere to these laws risks not only legal repercussions but damages brand reputation, as seen with Babel, Ocean Basket and Tang.
A Call for Accountability and Reform
The right to fair labour practices is enshrined in the Bill of Rights. This wave of exploitation calls for stronger enforcement of labour laws and accountability for those who violate them. South Africa’s hospitality industry must prioritise human rights and worker protections over corporate greed.
The Department of Labour’s recent actions are a step in the right direction, but more needs to be done to ensure that these exploitative practices are eradicated. Employers must be held accountable, and the industry reformed to prevent further abuse of vulnerable workers.