Snow holiday company Powder White recently sent us a press release announcing their opposition to a minimum wage increase in Austria.
The Austrian Anti Wage Dumping Act essentially requires all companies to pay their workers a proscribed minimum wage. Often migrant workers accept lower wages than Austrian nationals, which drives down the average earnings of employees in certain sectors (primarily construction and hospitality), but now any worker must be paid a minimum amount regardless of any other factors.
Regardless of what else is included in their employment package, the law says the worker is entitled to the minimum wage (roughly €1000 per month)
So how does this affect a holiday operator? It’s simple: ski industry workers such as chalet hosts and hotel dishwashers often accept a relative pittance over the course of the season, provided that they are given free accommodation, food, transport to and from resort and – in most cases – liftpass. However, regardless of what else is included in their employment package, the law says the worker is entitled to the minimum wage (roughly €1000 per month). On top of that, workers in Austria receive 14 months’ pay rather than 12, so it would follow that someone working a full winter season will be entitled to an extra months’ wage. Plus those working over Christmas and New Year (which is just about everyone) would get a bump.
Chalet companies are claiming that this will mean a significant rise in their staffing costs – and that money has to come from somewhere. Perhaps they’ll have to increase the price of their holidays? If that’s the case, it’ll be a serious threat to Austria’s ‘cheaper than France’ image.
instead of providing food and board for free and paying a crappy wage, can operators not just pay their staff the required minimum and then charge for those things?
Or maybe it won’t make all that much of a difference – instead of providing food and board for free and paying a crappy wage, can operators not just pay their staff the required minimum and then charge for those things? That might even give returning seasonaires the option of finding their own place in the resort and paying for that separately, rather than having to take whatever the company provides. Then there’s the fact that it may attract better-skilled workers into the industry, if there’s a chance of making a bit more cash out of it. Lord knows that most people who’ve done hotel/chalet work (including most of us at Whitelines) would have certainly appreciated coming back to the UK less deep in the red…
Fraser Ewart-White, founder of Powder White, had this to say: “These highly damaging proposals would lead to a large increase in employment costs, which will affect the viability of providing good value chalet holidays in Austria. We are working with other ski operators to challenge these plans which, if passed, would hurt the Austrian tourism industry immensely. We would ask the Austrian government to think very hard about these law changes, which if implemented, would be bad news for the country and also not enable operators to pull out this season if they wanted to due to holidays already sold.”
What do you think – is he right? Or is this a necessary – and ultimately minimal – consequence of providing broader employment protection for the whole country’s workforce, and not just that of the ski & snowboard industry? Let us know in the comments.