Unhappy franchisee takes Australia Post to court

By Sarah Stowe | 29 Oct 2015 View comments

On February 14, former franchisee John Christensen took Australia Post to court over an agreement the company had with the Communications, Electrical and Plumbing Union of Australia (CEPU).

Under the agreement Australia Post was permitted to open only 20 franchisee run stores, however in 2006 the company announced that it planned to convert 150 of its already existing stores into franchises.

Christensen, who is the former franchisee of Australia Post in Coorparoo, Brisbane, alleges he was never told about the company’s agreement with the CEPU.

According to SmartCompany Christensen told The Australian that Australia Post informed him the store was going to be closed just two days before the Christmas of 2010.

"I had plans to buy two or three over the years and on sell them in the future,” he said.

"But now they've effectively scrapped the whole thing, no one wants to go near them. There's no market there and the franchises are next to worthless.”

Furthermore, the Australian Consumer and Competition Commission received a number of complaints from industry bodies including the CEPU, the Post Office Agents Association and the Consumers' Association of Western Australia alleging that the company’s decision to turn some of its stores into franchises was driven by factors including employee wages, productivity and price increases.

The Australian reported that Eric Abetz, opposition industrial relations spokesman had been contacted by "at least half a dozen" Australia Post franchisees who were displeased that the company had not provided them with a "sufficiently cogent explanation" as to why Australia Post was not proceeding with it’s franchise model.

Jim Metcher, spokesperson, CEPU, told SmartCompany that yes, an agreement had originally been made between the parties, however it has since ceased. 

"We had an agreement about the number of outlets at one stage a couple of enterprise bargaining agreements ago. It was regarding the number of franchises in place, I think it was about 20, but this no longer exists," he said.

"The reason why it hasn't continued on to existing agreements is we're no longer seeking to pursue Australia Post over their franchises.”

"Our understanding is they are no longer pursuing a franchise model because it wasn't financially beneficial. The only franchise outlets currently in place were the ones created back at the time because of obvious contractual agreements," he said.

An Australia Post spokesperson told SmartCompany they were unable to comment on the agreement with the CEPU because of the court proceedings.