UNITE, the fighting union for fast food and retail workers in Victoria, was appalled to read the “7-Eleven Stores Audit Campaign: Final Report” released today by the Fair Work Ombudsman.

See report HERE

This audit was conducted after UNITE waged a long campaign against the super-exploitation of international students in 7-Eleven stores. The main complaint UNITE has made is that there is a far reaching scam being orchestrated by 7-Eleven franchisees whereby they pay employees for only half the hours they work.

On top of this there are other problems in the stores including the non payment of penalty rates and long periods of unpaid trial work. These underpayments amount to the theft of hundreds of thousands of dollars in wages per year.

UNITE has explained clearly to the Fair Work Ombudsman that a simple audit of the books would not show up the full extent of the underpayments taking place. We recommended that a comparison be done between the time and wages records and the cash register reconciliation forms. In most stores the employees log in and out of the cash register and a comparison with time sheets would show that people are not being paid for all the hours they work.

Disappointingly this comparison was not done. Instead the Fair Work Ombudsman merely wrote a letter to some franchisees and then asked them to conduct a “self audit”. The Fair Work Ombudsman then only looked at the books of 20% of those who participated. Even this limited investigation showed that 30% of the stores were not adhering to workplace laws – an indication in itself that big problems are present within 7-Eleven.

UNITE Secretary Anthony Main said “It is our view that the Fair Work Ombudsman has systematically failed to take these matters seriously. We have made complaint after complaint about the double hours scam but they continue to refuse to look into it.

“They need to explain very clearly why they refuse to compare the time sheets and the cash register log in details. We have told them on countless occasions where the bodies are buried but they refuse to go and dig them up.

“This can not be put down to incompetence alone. The truth is that if the full extent of this rip off was known it could bring down this retail giant. It would also do damage to Australia’s reputation amongst international student markets. I would say this is a case of the Fair Work Ombudsman working to protect big business interests in both the retail and education sectors while ignoring the plight of underpaid workers.

“Our campaign against these dodgy practices in 7-Eleven will continue” Anthony said.

A COURT case involving former Moorabool Street convenience store operators allegedly owing hundreds of hours in unpaid wages has been adjourned to include more workers in the hearing.

But Unite, the fast food and retail union, claims the six former 7-Eleven employees who will front Melbourne Magistrates’ Court later in the year to recoup their losses are about half the workers with underpayment complaints against the operators.

The Fair Work Ombudsman is taking legal action against owners Hao ‘Eddie’ Chen and Xue Jing, of Toorak.

Lawyers have lodged documents alleging that between 2005 and 2009 four Geelong convenience workers were underpaid a total of $85,408, including $40,583 for one worker alone.

But the Ombudsman asked the court for an adjournment on Wednesday to include a further two men to the case.

“They said evidence had come to light of more exploitation,” Unite secretary Anthony Main said.

He alleged that the Fair Work Ombudsman was aware several more former 7-Eleven employees had complained.

“There is 12 or 13 blokes down there that have worked in that Moorabool Street store that have come to the Workplace Ombudsman with various degrees of evidence,” Mr Main said.

The Ombudsman claimed the men were paid flat rates of between $9 and $11.50 per hour and Mr Chen had entered false information into the 7-Eleven payroll system.

The Ombudsman has alleged the operators listed the workers’ pay rates at double what they were paid and recorded half the number of hours to make it appear the employees were paid correctly.

Penalty rates were allegedly dumped for weekend, night and public holiday work, workers were not paid annual leave entitlements and some were required to undertake unpaid training, the Ombudsman alleged.

The court has ordered mediation between the two parties for August before returning for a directions’ hearing the next month.

Defence lawyers for Mr Chan and Mr Jing are arguing the former central Geelong store owners should have to pay just costs if found guilty.

But the Ombudsman’s office is seeking further penalties.

Mr Main said the union was concerned the case could drag on for years.

One Indian worker’s visa expires in October. Many of the workers are international students trying to pay their way through Deakin University.

“It is quite frustrating because these guys made the complaint in December, 2008,” Mr Main said.

“By the time they get paid we’ll be looking at a time closer to December, 2010.”

UNITE General Secretary Anthony Main was recently interviewed on 3CR’s Stick Together about the campaign to claim unpaid wages for 7-Eleven workers.

Listen to the interview here:

http://www.3cr.org.au/aggregator/sources/797

Stick Together airs on 3CR community radio in Melbourne on Sundays at 10 – 10.30AM, and is repeated Thursdays 6 – 6.30AM. It is Australia’s only national radio show focusing on union and workplace justice issues. It broadcasts each week on the Community Radio Network, the satellite service of the Community Broadcasting Association of Australia, to stations nationally Wednesdays at 6.04PM.

Subscribe to the weekly podcast, or listen to recent podcasts.

http://www.3cr.org.au/

UNITE members and supporters will protest against the underpayment of 7-Eleven workers outside the Court from 9am.

7-Eleven and its franchisee Eddie Chan are responsible for stealing more than $100,000 from a group of young workers in Geelong!

The crimes of 7-Eleven and Eddie Chan include:

• Only paying workers for half the hours they worked
• Refusing to pay penalty rates
• Bullying workers and threatening them for speaking to the union
• Trying to make workers pay for their own security on late night shifts
• ‘Cooking the books’ and shredding records of underpayment
• Attempting to bribe workers to scab on the others

7-Eleven and Eddie Chan must be held to full account. Anything less will be a green light to other employers who want to rip off their staff.

Come along and STOP THE RIP OFF of international students in 7-Eleven!

DETAILS:

9:00am
Wednesday 19th May
Outside the Melbourne Magistrates Court
Melbourne, Vic

For more info visit:

www.unite.org.au

Join the Facebook event here

UNITE has been made aware today that the Fair Work Ombudsman is set to prosecute the former operators of two 7-Eleven stores in Victoria.

While this news is welcomed, UNITE remains frustrated that the Ombudsman is only scratching the surface of this case. UNITE first brought the issues of severe underpayment at these stores to the attention of the Ombudsman in January 2009. After 12 months and many protests outside these stores, only now is the case being taken to court.

The Ombudsman has announced that the allegations only relate to four former employees. They are chasing $85,408 owed to four workers from the period between 2005 and 2009. This is despite the fact that UNITE has furnished the Ombudsman with the details of more than a dozen employees that were systematically underpaid in the exact same way. UNITE estimates that the actual figure owed to the former employees from these two stores who have come forward about their underpayment is upwards of $200,000.

UNITE Secretary Anthony Main said “We are extremely disappointed with the conduct of the Ombudsman in this case. Not only have they failed to meet their responsibilities of investigating all of the underpayments, but they have refused to keep us and the workers informed about the state of proceedings.

“Some of the workers we represent have complained that despite constant phone calls to the Ombudsman they have never been contacted to come in for an interview. UNITE officials have also been denied a meeting despite months of asking for an update on the case.

“I am concerned that because many of the workers are Indian international students, the Government authorities are trying to sweep the issue under the carpet in order to protect their reputation.

“If the Fair Work Ombudsman is to maintain any credibility they need to come clean about the scams going on at 7-Eleven. It’s not just these two operators who are at fault. The double hours scam is widespread and international students are being ripped off everywhere” Anthony said.

The Fair Work Ombudsman’s media release can be read here.

7-Eleven franchisees have recently been forced to back pay 168 workers more than $162,000. At the same time the Fair Work Ombudsman has launched a Victorian state wide audit into the company’s employment practices because of widespread underpayment. UNITE estimates that hundreds of 7-Eleven workers across the country have been seriously underpaid for many years.

UNITE Secretary Anthony Main said “When I first read this news I thought it was a joke. 7-Eleven have been all over the news in the past year for all the wrong reasons. It is common knowledge that they are far from a model employer.”

7-Eleven’s financial success is based on the super-exploitation of mainly international students. Both Head Office and the franchisees are implicated in these scams.

As far as UNITE is concerned, they only award &-Eleven deserve is that of Australia’s dodgiest employer!

If the Franchise Council of Australia (FCA) think 7-Eleven are a model company what does that say about the rest of their members?

By Genevieve Gannon

Fair Work is investigating 7-Eleven franchises in Victoria over claims of exploitation. The union for fast food and retail workers, UNITE, said international students, particularly Indians, had become common targets.

UNITE secretary Anthony Main said some 7-Eleven workers were being paid half what they were entitled to.

A year-long campaign has uncovered proven cases of exploitation, and 88 7-Eleven workers in Melbourne’s CBD shared in more than $100,000 in unpaid wages.

The Fair Work Ombudsman has now launched an investigation into 63 more 7-Eleven stores, which could spark a statewide investigation, if enough breaches are found.

Mr Main said the union had been “flat-out to find a single employer that was doing the right thing”.

“Profits have been made off the super-exploitation of mainly Indian students,” he said.

Mr Main said employees were working shifts of up to 16 hours and were not being given proper breaks or leave entitlements.

The union is also investigating claims of unpaid trial periods- one workers told UNITE he had worked unpaid for two months.

“We represent 20 guys down in Geelong and every single one of them has done unpaid trial work,” Mr Main said.

The Ombudsman, in partnership with 7-Eleven head office, is investigating employers that have failed to pay workers, neglected to pay penalty rates and have not complied with record-keeping obligations.

Fair Work Ombudsman executive director Michael Campbell said many 7-Eleven staff were vulnerable to exploitation as they were mainly international students, migrants from non-English speaking backgrounds or young people who were not aware of their rights.

The Victorian 7-Eleven head office is helping the Fair Work Ombudsman, but declined to comment.

National franchisee manager Geraldine Dzielakowski said in a media release 7-Eleven took the obligations of its franchisees as employers extremely seriously.

“Every 7-Eleven franchisee operates as an independent, privately owned business.”

Mr Main said the Ombudsman should investigate the head office, too.

“They don’t have a legal obligation to pay, but they certainly have a moral one,” he said.

The 7-Eleven audits will start this month. This comes after a year long campaign where UNITE exposed various 7-Eleven franchisees for systematically underpaying their staff.

As stated in the Herald Sun:

“Dodgy convenience store owners ripping off vulnerable workers are in the gun of the workplace watchdog. The Fair Work Ombudsman will conduct a statewide audit of 7-Eleven stores after spot checks in Melbourne and Sydney found 168 workers had been underpaid a total of $162,000.

Five 7-Eleven stores in Melbourne’s CBD have been asked to pay 88 workers $112,000 in back pay and a sixth store owes 12 staff 1,000 hours of annual leave.

The Fair Work inspectors and 7-Eleven franchisers will jointly scrutinize records of 60 Victorian convenience stores to check staff are being paid properly.

Issues identified included workers not be paid for hours worked and losing penalty rates.
A 7-Eleven spokeswomen said individual franchisees would co-operate.”

The Ombudsman anticipates their investigation will be conducted over several months. UNITE will also spend this time visiting stores and encouraging workers to come forward about their underpayment and join UNITE.

In order to cover all Victorian stores we will need help from volunteers. If you would like get involved contact Mel on 0400 588 202 or email the UNITE office.

We will start our coordinated visits Friday 9th October.

More than 30 people attended a protest outside the 7-Eleven store on Domain Rd, South Yarra last Friday evening. The action was organised by UNITE, the union campaigning against the underpayment of wages in 7-Eleven stores.

The protest targeted this particular store because Eddie Chan has interests in the business. Until recently Chan also owned the Moorabool Street 7-Eleven store in Geelong where he paid his workers only half of the wages they were owed.

UNITE estimates that workers employed by Chan are owed more than $100,000. So far Chan has refused to pay up despite being ordered to do so by the Fair Work Ombudsman.

Hundreds of leaflets were handed out to South Yarra locals and the front of the store was draped with banners and placards explaining the situation. The overwhelming majority of local residents were shocked to hear that people who have worked in the store had been paid as little as $10 an hour and others had done unpaid trials for up to 2 months.

While the local residents were very supportive of the campaign, the local police were shocked to see a protest in the quiet, leafy streets of South Yarra. The police turned up to the action and brought with them a riot van and members of the Critical Incident Response Team!

Some locals thought that they had come to arrest Eddie Chan but unfortunately they had come to tell UNITE members not to block the entrance to the store, not to hand out leaflets and not to talk to people!

The protesters were not deterred and insisted that it was their right to inform people about the dodgy practices that Eddie Chan was involved in. Once the police saw that UNITE were getting support from the local community they retreated.

UNITE Secretary Anthony Main made the point that the person breaking the law in this dispute was Eddie Chan. When a boss steals more than $100,000 from his workers people have to take to the streets for the matter to be taken seriously, yet when UNITE hands out a few leaflets on the street the authorities are swift to act.

UNITE is not only calling on Chan to pay back the money owed. The Fair Work Ombudsman must pursue Chan and prosecute him for breeches of workplace law. Anything less would be a green light to other employers who want to undermine minimum wages and conditions.

The action was successful in highlighting the issue to South Yarra locals and the dispute was covered in the Geelong Advertiser and Sunday Herald Sun. UNITE has pledged to continue the campaign until Chan pays up and 7-Eleven stops the widespread underpayment of workers.

Lies and misinformation

On Saturday September 19 an article written by Nick Wade was published in the Geelong Advertiser titled ‘Geelong 7-Eleven wage row’.  See article here.

The article featured extensive quotes from Eddie Chan’s lawyer Andrew Senia. Senia claimed in the article that “no complaints had ever been made directly to Mr Chan, only allegations made through the media “some time” after the alleged incidents occurred.”

This is completely false. UNITE officials have met with representatives of Eddie Chan and 7-Eleven head office on many occasions. We have handed over the details of the complaints to Chan’s representatives and demanded that he pays the money owed to the workers. 7-Eleven head office have also told us that they have encouraged Chan to pay up but he has refused.

UNITE has documentation of Chan’s representatives admitting to the underpayment of wages. It is unfortunate that Nick Wade did not contact us before publishing the article as we could have shown him this evidence. A phone call to the Fair Work Ombudsman would also have confirmed the underpayment.

The article also stated that the Domain Road, South Yarra store is owned by members of Chan’s family. Regardless of whose name the business is under, UNITE understands that Chan refers to this store as ‘his’, and regularly organises the staffing. Despite being caught out, Chan and his family are still profiting under the name of 7-Eleven.

Eddie Chan and 7-Eleven need to understand that dodgy accounting and dishonest lawyers will not discourage us from continuing the campaign. Its time to stop with the games and pay the workers the money they are owed.

DISGRUNTLED ex-employees of Moorabool St’s 7-Eleven will picket the convenience store’s South Yarra franchise this afternoon where their former boss has interests.

The workers will join dozens of fast food and retail workers who are members of the union UNITE, which claims the former franchisee Eddie Chan withheld more than $100,000 in unpaid wages during his time as owner of the Geelong store.

UNITE claims Mr Chan has refused to co-operate with the Fair Work Ombudsman, which launched an investigation into several stores in January for their treatment of international students they employed. So far the Ombudsman has recovered more than $150,000 in stolen wages, but none has been paid back by Mr Chan.

UNITE secretary Anthony Main said protesters would rally from 5pm to 6pm outside the South Yarra store on Domain Rd, opposite the Royal Botanic Gardens.

“I think his customers need to know that he is treating his workers with contempt,” he said.

“At least 12 or 13 staff we’ve come into contact with are from overseas and weren’t aware of minimum wages and loading on weekends.”

Mr Main said several workers employed by Mr Chan from 2003 to 2009 were paid a flat rate of just $10 per hour, with some forced to do an unpaid trial for up to two months.

The Ombudsman’s office could not confirm yesterday if it would seek to prosecute Mr Chan for the unpaid amounts.

Mr Main also slammed 7-Eleven’s head office saying it had a moral obligation to prevent franchisees from breaking work practices.

7-Eleven corporate chief operating officer David Ginsberg said, while it did not condone Mr Chan’s behaviour, it was powerless to do anything now he had ceased his franchise agreement.