7-Eleven sides with Fair Work over franchisee actions

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Inside Franchise Business: the 7-Eleven network has been struck by another franchisee cash-back investigationConvenience chain franchise 7-Eleven is backing the Fair Work Ombudsman’s investigation into one of its own franchisees.

The Brisbane-based franchisee allegedly dismissed one of its workers after he refused his employer’s request to repay accrued annual leave.

Balaji Australia Pty Ltd and current director and shareholder Madhav Ponnada will also face the Federal Circuit Court on allegations that false and misleading records were created during the employment of two workers and later provided to Fair Work Inspectors during the course of their investigation.

The franchisor, 7-Eleven, said not only has it fully cooperated with the Fair Work Ombudsman’s investigation but it supports the action being taken.

7-Eleven conducted its own investigation into the allegations, but was unable to find a level of evidence required for the company to take its own action under the industry codes, it said in a statement.

This inability to deal with franchisees guilty of serious non-compliance has rankled with the convenience chain which, for 18 months, has been calling for franchisors to have the right to terminate a franchise agreement in the case of serious breaches of Commonwealth Workplace Laws or Fair Work Instruments.

The Fair Work Ombudsman alleges that Ponnada made multiple requests for the worker to return the $731.06 that had been paid, and that the day after the worker refused to repay this money, the franchisee instructed a store manager to remove the employee from a rostered shift, advising the manager that the employee no longer worked at the outlet.

“Workers cannot be deprived of work for exercising their rights, regardless of whether they are engaged on a casual, part-time or full-time basis,” James said. “We encourage anyone with information on alleged ‘cash-back’ schemes to come forward and assist us in our investigations.”

Fair Work ombudsman Natalie James said requiring workers to repay portions of their wages is an insidious practice.

“We are concerned that so called ‘cash-back’ schemes are being utilised to disguise the underpayment of some of the most vulnerable workers in our community,” James said. “This is the type of behaviour that warrants serious enforcement action, such as litigation through the Courts.”

In December 2016, the Fair Work Ombudsman and 7-Eleven signed a Proactive Compliance Deed which requires the convenience store to overhaul its systems and implement fully biometric time recording to prevent the falsification of records.

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