Caltex fight gets worse

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A Caltex franchisee claims he has been targeted for protesting. Inside Franchise Business: A protesting Caltex franchisee claims he has been targeted.

Caltex franchisees took to the streets two weeks ago claiming the franchisor made “oppressive” and “unAustralian” demands for a $10,000 auditing fee and personal documents. The franchisees said they were being targeted in the audit for “a small minority” that had underpaid workers.

Now, a prominent franchisee has accused Caltex of victimising him for speaking out in a report by Fairfax Media.

Franchisee Sanjeev Sharma spoke for disgruntled Caltex franchisees on the day and claims he is now paying the price after he was hit with 13 breach notices two days after leading the protest.

"You know how the mafia and underworld operate, that's how they operate," he said.

Lawyer Tean Kerr, acting for Sharma, said Caltex's timing shows "Mr Sharma has clearly been singled out by Caltex as a troublemaker".

​"It appears that Caltex is trying to send a message to franchisees to keep quiet otherwise they will similarly receive breach notices," he added.

A spokeswoman from Caltex Australia has countered this and stated that Caltex Australia’s timeline has been driven by conducting a thorough wage underpayment audit process.

Julian Segal, Caltex chief executive added, “Caltex Australia has been fair and reasonable in our conduct of wage underpayment audits and provided franchisees with fair and reasonable opportunity to remedy or explain breaches of their agreements with Caltex Australia, including breaches of Australian workplace laws.  

“Our stance on fraud is non-negotiable: there is no excuse for wage or visa fraud.  

“We will not allow the honest, hard-working majority of franchisees to be unfairly affected by the inappropriate actions of others.”

The spokeswoman continued, “Caltex Australia respects the right of people to protest. We do not, however condone underpayment or mistreatment of workers, and this is what our audit has been about.

“Caltex Australia always works cooperatively and genuinely with any franchisee who raises concerns about the profitability of their site.  Requests for assistance are assessed and responded to on a case by case basis to address specific site issues.”

Although protesting franchisees demanded that the franchisor amend the model to boost franchisee profitability, Caltex Australia said it is confident its franchise model allows franchisees to draw a wage, make a profit and pay their employees lawful wage rates.  

Caltex Australia provided an assessment is based on data including:

  • Profit and loss accounts submitted by franchisees for the 2014-2015 tax year;
  • Reported data for sales, gross margin, fuel volume and all associated franchisee income provided by the franchisee;
  • Data obtained from applications by some franchisees for profitability support and review;
  • Data obtained from independent audits of some franchised sites; and
  • Calstore operating expenditure and labour costs which were used as a benchmark for the review, although Calstore costs are generally higher than franchised site costs and therefore provide a more conservative view of site profitability.

Noha Shaheed

Noha writes for Inside Franchise Business. She has worked across the communications landscape, with a background in PR, digital communications, and editorial. She is no stranger to digital and print media, as well as social media platforms.  View More...
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