What damage has been done to the 7-11 brand as a result of franchisee actions? The saga is likely to continue as more franchisees are brought to account for their underpaying ways. Interestingly the franchisees were alleged to be manipulating the payroll system at "head office" to cover up their actions. Sounds to me like 7-11 head office has had a fraud perpetrated on them as well, so not only did the franchisee employees suffer loss, but now the 7-11 brand is impacted. This whole saga reinforces how franchise networks really do need to ensure their brand is upheld and somehow they minimise the risks that individual franchisees operate outside the law.
Fair Work Ombudsman, Natalie James, today announced legal action against Haiyao Xu and Yiran Gu, and their company, Hiyi Pty Ltd. Gu and Xu allegedly made false entries into the 7-Eleven head office payroll system to make it appear the employees had been paid award rates and that they had worked less hours than was actually the case. James says the agency alleges the store operators were aware of their lawful obligations, but initially chose to ignore them and try to cover up their actions. A statement of findings on the 7-Eleven Inquiry will be issued early next year, including recommendations for the company’s head office. “The findings will be designed to ensure 7-Eleven takes steps to bring about sustainable change in culture in the 7-Eleven network in relation to compliance with workplace laws,” James said.