Negotiations begin at KFC, Pizza Hutt and Starbucks

2 Apr

Hi all Restaurant Brands members.

Negotiations began this week for a new Collective Agreement covering workers at KFC, Pizza Hut and Starbucks. All these brands are covered by the Restaurant Brands Collective Agreement with Unite Union.

Over recent years we have sought to improve the wages and conditions of union members at Restaurant Brands and other fast food companies covered by Unite Union Collective Agreements. We have made progress on wages, getting rid of youth rates, and more security over hours and breaks. We have also had a constant struggle to enforce those rights – particularly over hours and breaks.

The first negotiation session was held over two days on March 26 and 27. There were 9 delegates from various company stores across the country and two union officials – myself (Mike Treen, Unite National Director) as lead advocate and Joe Carolan, a Unite fast food organiser in Auckland.

This year we submitted 39 claims to the company for discussion. The company has also submitted its own claims to change the agreement. The company claims included reducing the break time to 10 minutes and introducing 2-hour shifts at KFC. The opening wages offer was also a disappointing 1.5% for most. While this may not be the final offer it indicated what the company claims it can afford given their recent profit decline.


The union claims covered areas that should be included in a collective agreement plus some operational issues that may not go in the agreement but can be covered in a “Terms of Settlement” as part of the negotiations. Not all claims are listed here and some have been grouped together to make them clearer.

1) Wages: Start Rate of $15 – all rates adjusted above that by a similar percentage increase. A new and higher rate for cooks. $20 allowance for being called in on an RDO. Allowance for working after 10pm.

2) Guaranteed hours: After 1 year’s service staff should be able to have minimum guaranteed hours of work. This should be able to improve with longer service.

3) Breaks:Double time for missed breaks. The union believes we need a penalty if the company does not ensure all staff get their breaks. Breaks should also be scheduled as close to the mid-point as possible of any work period.

4) Pass on: No pass-on of the benefits in the union agreement to non-union staff unless there is an agreed form of compensation of union members for negotiating the collective.

5) Overtime: Overtime waiver abolished with all overtime paid at time and a half after 8 hours.

6) Disciplinary procedure: Amend the disciplinary procedure checklist to include written notification at least 24-hours in advance, the right to have a support person or representative including contact details for the union, and full disclosure of information being relied on. It should make clear whether the action is considered misconduct or serious misconduct and what the possible outcome could be. If there is no misconduct found it should be explained that references will be removed from the file. There should also be a process if serious misconduct is found. This should include a final representation from the employee to respond and to request a lesser penalty. Investigation meetings should be in paid time with minimum shift if on RDO.

7)Staff areas: to be provided where possible – especially in any new or refurbished stores. Lockers for staff. Access to food heating facility, fridge, water, tea, coffee.

8) Early Outs & unpaid work: Clear prohibition on being sent home early unless by mutual agreement. Explanation that “off the book” work (including training) is not acceptable and can be considered serious misconduct if encouraged by a manager.

9)Shoes: to be treated as part of the uniform and supplied by the company.

10) Security: Stores to be reviewed for security of staff (distance to car parks etc.) and a guard put on duty for late nights where appropriate. Also look at night security for drive through window.

11) Meals: Free meal on shift with all items up to a certain value able to be ordered. Half price discount on all items in store outside hours.

12) Bullying & harrassment: A culture change around bullying and harrassment is needed. Restrictions put on use of video surveillance to micromanage managers and staff.

13) Leave: 7 paid sick days plus 3 paid family days. Extra week’s leave after 5 years’ service

14)Compliance: Worker’s rights under the Collective (ie breaks being taken) to be part of any audit process of the stores.


The company claims included some that were simply clarifying the agreement and need not be controversial. Below are the main claims that could affect members if accepted.

1) Removal of the higher rate for union members under the KFC Gold Star

2) Two-hour minimum shift at KFC

3) 10-minute (not 15) break and removal of a provision to take the 20-minute meal break at the end of a shift.

4) Company to be able to ask for a medical certificate after one day if they pay for it.

5) Prohibition on working for competitors like McDonald’s or putting company information on social media like facebook.

6) A two year agreement with no guranteed rise in year two – to be left to discussions followoing the minimum wage announcement.

Wage offer:

The company also made its initial wage offer. The company accepted that we would find their offer “disappointing” but claimed that this was reasonable in the circumstances because they had suffered a reduction in profit over the past year.

The wage offer was to increase the base rates to the legal minimum wage in KFC and Pizza Hut ($13.50), no increase to the Starbucks minimum ($13.77) and a 1.5% increase on all other rates and allowances.

If these new rates were imposed in the new agreement it would be the first time in recent years that all rates haven’t increased by at least the minimum wage. The percentage increase of the minimum wage from April 1 this year is 3.85%. Last year we got the higher of the increase in the minimum wage or inflation. This meant that the percentage pay rise last year was higher than the 25c increase in the minimum wage. Therefore we were able to move the base rates to be 13 cents above the legal minimum – an important first step to stopping this industry just being a minimum wage payer. Other rates increased by the same percentage so the margins were maintained.

The company offer this year (at this stage) has no guaranteed increase for all rates to match the minimum wage or inflation like we have had in previous agreements.

The current rates applying at KFC, Pizza Hut and Starbucks are listed below and the new rates under this offer are listed beside them.

                                                           Current Rates                      Offer from company


Team member (Base)                            $13.13                                  $13.50 (+37c to = the minimum wage increase)

Team Member (Gold Star)                      $14.11                                  $14.32 (+21c)

Team Member (Shift Supervisor)             $14.73                                  $14.95 (+22c)

Pizza Hut

Team member (Base)                            $13.13                                  $13.50 (+37c)

Team Member (Expert Gold)                  $13.98                                   $14.19 (+21c)

Team Member (Shift Supervisor)             $14.60                                   $14.82 (+22c)


Barista (Entry)                                      $13.77                                    $13.77 (No increase)

Barista (Certified)                                  $14.47                                    $14.69 (+22c)

Shift Supervisor                                    $14.62                                     $14.84 (+22c)

(Under the proposal the Learning Coach position at Starucks is abolished and replaced with a new Trainer Allowance of $0.27c per hour)

The minimum rate will have to increase to $13.50 anyway. That is because the legal minimum wage increases to $13.50 from April 1.


The company representatives indicated that if they are able to reach an agreement with us on wages then they would be open to agreeing to some of our other claims (at least in part). These included:

  • Guaranteed 20 hours after three years subject to availability and being LAS qualified.
  • Stronger action to ensure breaks are taken
  • Elimination of the overtime waiver
  • Rewriting the disciplinary process clause
  • Clarifiying and enforcing policy regarding bullying and harrassment and some restrictions on video usage
  • Ensuring rosters go up on Tuesday of prior week
  • Agreeing that early outs should be by mutual agreement and all work and training to be paid.


We are trying to negotiate a separate union collective agreement for managers as well. We understand the pressures they are under and the fact that their wages have fallen behind both the increase in the cost of living and in relation to waged staff given the hours many work.


Negotiations are scheduled to resume on April 12 & 13.

We are hoping that the company will return with a better offer. We will continue to argue that the company profit drop was not the workers’ fault. There were three main factors that created this problem for the company – the Christchurch earthquake, the cost of the double down campaign (the company mispriced the product in relation to demand and took customers from higher margin products), and lack of investment in Pizza Hut as they prepare stores for franchising out. You must wonder if the people who made those decisions have had their pay cut.

However the only way to ensure we can get a better offer is if we have as many members as possible in the stores. That is not just the job of your union and its officials – it is something we all can do. Talk about these negotiations with your workmates. Make sure they are in the union. Try and make your store a 100% union store.


Mike Treen

National Director, Unite Union

Lead Advocate Restaurant Brands negotiation


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