What exactly is 7-Eleven proposing for franchise reform?

Sarah Stowe

The convenience chain has hit the news again on a number of issues, including franchise reform and further franchisee underpayments.

Just last week 7-Eleven turned its attention to the broader issue of workplace compliance issuing a statement regarding governance and franchisor responsibilities.

7-Eleven is advocating for termination provisions in both the Franchising Code of Conduct and the Oil Code (applicable to petrol sites) to allow franchisees who breach workplace laws to have their agreements immediately terminated.

The business is also seeking the expansion of franchisor responsibilities within the applicable industry codes and a review of student visa conditions. 

7-Eleven chairman Michael Smith said “it is important the company takes the lead in effecting positive change that will preserve and enhance the industry’s reputation by setting standards that meet communication expectations.

“The proposals provide clarity of responsibilities, remedies and sanctions for everyone involved in the industry, and seek to significantly diminish the potential for companies and/or individuals to exploit workers.”

So what exactly is it proposing?

There are three key points:

1. 7-Eleven is suggesting franchisor responsibilities should be expanded to include the following obligations:

  • The systemised promotion of education and compliance
  • Wage protection for franchisee employees, even (in specific circumstances) making good on staff wages owed by franchisees
  • Disclosure documents to include information on likely wage costs and detailed wage modelling
  • All new employees of franchisees to be informed about their workplace rights and responsibilities, and how to access an appropriate whistleblower mechanism for any complaints

2. Increasing penalties for employers who breach the Fair Work Act, consistent with ensuring an effective level of deterrence is in place.

3. A discussion on reforming student visa rules to ensure students are able to earn enough working legally to cover average tuition and living expenses, beyond the first year of their course.

Smith said “Our advocacy is based on the workplace challenges 7-Eleven has confronted and the actions we have taken to improve compliance, governance and transparency across our store network.

“We are urging Government and stakeholders in the franchise sector to support these reforms and I look forward to a positive and balanced debate that will lead to real and lasting solutions,” he said.

Underpayment claims in the spotlight

Since these proposals were released, Fairfax Media has revealed the Fair Work Ombudsman is pursuing fresh claims of staff underpayment by 7-Eleven franchisees, and made allegations about the process being undertaken to reimburse underpaid employees.

In response, the franchise chain has hit back at what it describes as “inaccurate comments and inferences”.

A statement from 7-Eleven reads:

“Claimants and potential claimants should not be discouraged from pursuing claims as a result of reports published over the weekend in Fairfax Media, which in 7-Eleven’s view contained inaccurate comments and inferences about the use of private investigators to verify claims and the types of evidence required to support a claim.”

The convenience chain indicated it is being transparent with its claims processing.

“In the interests of openness and transparency, the operating protocols of the Program have been shared with the Fair Work Ombudsman (FWO) and updates on the progress of the Wage Repayment Program (WRP) and 7-Eleven’s broader reform agenda are regularly shared with the FWO and other stakeholders.

“Claimants can be assured that 7-Eleven is unwavering in its commitment to the WRP so that franchisee staff receive their entitlements in a fair, efficient, consistent and timely manner. Any suggestions to the contrary are false.

“Franchisee employees who have lodged a claim or are considering lodging a claim and need support or have any questions are encouraged to contact the independent Secretariat on 1800 619 802 or www.wagerepaymentprogram.com.au.”

  • In the latest news from Fairfax Media, law firm Maurice Blackburn has rejected 7-Eleven’s defence of its processing of back-pay claims.