A recent Fair Work Commission ruling permitting collective bargaining across South Australian McDonald’s outlets has come under fire from employer groups, who argue it sets a worrying precedent for multi-employer bargaining in Australia.
The Shop, Distributive and Allied Employees Association (SDA) has been granted approval to represent over 5,100 workers spanning 18 McDonald’s franchises in South Australia. The union aims to secure better pay and working conditions for employees who have long relied on award rates.
SDA South Australian secretary Josh Peak described the outcome as a “historic achievement” for fast food employees. “This is an industry where a significant proportion of workers depend on award minimums, and they absolutely deserve the protections and benefits of collective agreements,” Peak said.
However, the decision has sparked strong criticism from the Australian Industry Group (Ai Group), with chief executive Innes Willox calling it a “concerning development.”
“This ruling exposes thousands of businesses in sectors such as hospitality, retail and fast food to the risk of being compelled into multi-employer bargaining, often without the backing of their own workforce,” Willox argued. “It especially threatens small operators already grappling with economic headwinds and rising costs.”
Willox highlighted that the supported bargaining stream was originally designed for sectors with substantial government funding or where there are significant barriers to bargaining. “This marks the first occasion where this mechanism has been extended to a commercially operated sector like fast food,” he added.
According to Willox, the fast food industry has successfully negotiated hundreds of enterprise agreements under existing laws, and there is no justification for bypassing traditional majority support requirements.
Echoing these concerns, Australian Retailers Association chief executive Chris Rodwell questioned whether the decision aligns with legislative intentions. “This outcome raises serious doubts about whether supported bargaining thresholds are being applied too liberally,” Rodwell said. “Operators in retail and fast food are already under enormous financial strain. Being forced into broad-based negotiations without clear majority backing could further jeopardise their viability.”
Both Ai Group and the Australian Retailers Association are urging the federal government to urgently reconsider aspects of the Fair Work Act to prevent unintended extensions of supported bargaining provisions.
Why this matters for your business
As Australia’s industrial relations landscape evolves, businesses face increasing uncertainty around bargaining obligations and employee engagement. Recent developments like this McDonald’s decision highlight the importance of proactive HR and compliance strategies to safeguard your operations.
At [Your HR Brand], we partner with businesses of all sizes to navigate complex workplace laws, strengthen enterprise bargaining approaches, and build robust compliance frameworks. Whether you’re concerned about potential union involvement, need to prepare for multi-employer bargaining, or want to ensure your agreements align with best practices, our team can help you stay ahead.
Book a complimentary HR compliance assessment today, or reach out to discuss how we can support your business to remain both compliant and competitive in this shifting environment.