Yahoo Finance 7-Eleven back-pays 4,000 workers $173.6m
Convenience store operator 7-Eleven has back-paid more than 4,000 employees after an investigation uncovered underpayments totalling more than $173.6 million.
The Fair Work Ombudsman (FWO) on Friday announced it has been working with 7-Eleven since 2017 to rectify the systemic underpayments, after a joint investigation by Four Corners, The Sydney Morning Herald and The Age revealed the extent of the wage theft.
7-Eleven made the back-payments between September 2015 and February 2020, with the FWO warning it will continue to monitor 7-Eleven’s activities.
Several of the major fuel and convenience store franchisees had been deliberately falsifying records to hide wage theft.
The FWO had brought 11 litigations against franchisees which saw courts award more than $1.8 million in penalties against 7-Eleven for paying flat rates, falsifying records and operating unlawful cash-back schemes.
7-Eleven was also forced to install a biometric time recording system which requires employees clock in and out with a thumbprint which is cross-referenced against facial recognition images and store rosters. This came at a cost of $10 million.
Additionally, staff must be paid electronically and new training has been implemented, while 7-Eleven was forced to wear the cost of three compliance audits.
“After widespread non-compliance in its franchise network was identified, 7-Eleven has implemented extensive high-tech systems, training and employee assistance programs across its business,” Fair Work Ombudsman Sandra Parker said.
“Through our Compliance Partnership, the franchisor has delivered on its commitment to address past breaches by its franchisees and lead a network that meets its lawful obligations to workers.”
She said the FWO considers franchise networks a “priority sector” and encouraged similar businesses to prioritise compliance as it risks their brand and their workforce.
“Franchisors can now be held responsible for their franchisees’ conduct and may be subject to enforcement action, court proceedings and penalties if their franchisees have breached the law.”
7-Eleven responds
In a statement, 7-Eleven Australia CEO Angus McKay said 7-Eleven now has industry-leading compliance systems due to its partnership with the FWO.
“I said we would be accountable for our actions and take ownership of our remediation journey. I truly believe we have done just that and will continue to do so,” McKay said.
“We remain absolutely committed to ensuring continued compliance.”
Employees can call the Fair Work Infoline on 13 13 94 for free advice on their rights in the workplace.
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