Bewley's sets catering trade precedent with pay rates over national minimum wage

Bewley's cafe division has just concluded a pay agreement with SIPTU that will ensure staff are paid more than the national minimum…

Bewley's cafe division has just concluded a pay agreement with SIPTU that will ensure staff are paid more than the national minimum wage of £4.40 an hour, due to be introduced next April. Some will receive increases of 11 per cent.

The agreement will have a major impact on catering sector rates in Dublin, which are already under severe pressure because of labour shortages. "The reality of life is that the Celtic Tiger has struck the national minimum wage already," Bewley's industrial relations and personnel consultant, Mr John Power, said yesterday.

He added that companies like Bewley's welcomed the idea of a national minimum wage because it would create a level playing pitch - provided it was rigorously enforced. The cafe business was fiercely competitive, Mr Power said, and Bewley's main sources of profit came from its other activities.

But the cafes are an important part of the company's overall marketing strategy, as the appeal of products such as Bewley's tea and coffee rests heavily on the continued existence of the cafes which symbolise the company. However, he said calls by the Irish Congress of Trade Unions to set the minimum wage at a higher rate than £4.40 an hour could cause problems.

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"We reckon that every penny increase in the rate in Bewley's equals between £10,000 and £12,000 on the pay roll," he said. Bewley's also suffers from the disadvantage of being more labour-intensive than fast food outlets, where no waiting or washing-up staff are required.

Bewley's operates a five-grade system. Fewer than 30 of the 450 Bewley's cafe division staff fall into the lowest two waiting staff grades, who will be paid less than £4.40 an hour. Probationary staff on the lowest grade will see pay increase from £3.66 an hour at present to £4.09 by September 2000.

This is more than the £3.30 an hour the National Minimum Wage Commission recommended as a training rate for employees in their first year, or the recommended training rates of £3.52 and £3.96 set for the second and third years respectively, though it is 31p short of the national minimum wage.

In the higher three grades, current pay rates range from £4.20 an hour to £4.50 an hour. These will be increased to £4.80 to £5.74 an hour by September 2000.

The ICTU has been calling for the index-linking of the minimum wage, recommended by the National Minimum Wage Commission, to take account of inflation since the commission reported last year. On this basis, the new national minimum wage would start at £4.80 an hour.