Restaurant, hospitality associations threaten legal action over new industry rules

The Restaurants Association of South Africa (Rasa) and Federated Hospitality Association of South Africa (Fedhasa) are threatening legal action against government over new rules by the newly formed Bargaining Council for the industry, which they say is the final nail in the coffin for the sector.  

Under the new rules, all restaurants and fast-food outlets, including those not part of the council, will have to:  

• pay a wage to all employees that exceeds the national minimum wage
• grant employees wage increases of 1.5% above inflation  
• give employees a December bonus as well as weekly payments to clean their uniforms 

The industry has been the most hard-hit by the coronavirus pandemic and subsequent lockdown levels, which include shortened operating hours and a ban on the sale of alcohol.  

Rasa CEO Wendy Alberts says there was no consultation before these measures were implemented.  

She says it seems government does not care about the sustainability of the industry. 

“This is just the final blow to the industry you know, there should have been further consultation. We would be collaborating with COGTA regarding the curfew.”

“We would be looking at ways with Health Minister Dr Zweli Mkhize to mobilise the liquor and be able to find ways that we can work with government to support the slowing of the curve and to safely allow our businesses to trade. We should be having engagements with rates and the landlords to be able to bring us to a position where we can also free our debt in order to be able to close our doors to support government. We are in a position where there’s no support coming in and there’s an expectation from our side to allow the industry to be decimated.”  

Rasa had also announced its intention to take the government to court over its decision to ban the sale of alcohol, as Alberts elaborates:

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Impact of lockdown  

The Liquor Trader Formations has requested a meeting with President Cyril Ramaphosa to discuss the impact of the alcohol sale ban on the industry. 

They are calling for the unbanning of liquor sales as a matter of urgency. 

They also say that many people working in the liquor industry will lose their jobs. 

The sale, transportation, and on-site consumption of alcohol are prohibited under Adjusted Lockdown Level 3, which came into effect in late December last year.  

Liquor traders say they are battling to make ends meet due to the alcohol ban:  

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