New Fair Work Ombudsman report reveals exploitation and further illegal practices by 7-Eleven

THE latest report by Fair Work Ombudsman has shed new light on the 7-Eleven work scandal, as the Agency’s inquiry into the franchise reveals shocking details on exploitation against international students. Amber Ziye Wang reports.

A new report by Fair Work Ombudsman, entitled ‘Identifying and addressing the drivers of non-compliance in the 7-Eleven network‘, was released Saturday, April 9 after an inquiry was made based on allegations that franchise operations had been systemically in breach of workplace laws.

According to Fair Work Ombudsman, a number of 7-Eleven franchisees had been “deliberately falsifying” records to disguise the underpayment of wages, while illegal practices date back to as early as 2008.

“Not only did some franchisees fail to keep proper records of what had been worked and paid, a number produced and relied on false records,” Fair Work Ombudsman Natalie James, said.

The Fair Work Ombudsman also noted the franchise failed to co-operate or provide accurate records during investigations between 2009 and 2014, despite awareness of high non-compliance throughout its network.

“It was either disinterested or ignored public concerns…until exposed to public scrutiny,” the Ombudsman said.

Employees with the franchise were identified to be predominantly from non-English speaking backgrounds, the report found, with the most common countries of origin being China, Pakistan and India.

“There is an understanding that visa-holders can work hours in excess of what is allowable, and this will not be reported – in fact, it will be disguised by the franchisee,” the Ombudsman noted.

“We were also told that employees in 7-Eleven stores are typically male international student visa-holders.”

7-Eleven is reported to have underpaid several temporary visa holders. After intervention from Fair Work Ombudsman between 2009 and 2014, the Agency saw no signs of improvement from the convenient store chain. | Photo: Fridy via Flickr

Since the Fair Work Ombudsman was created in July, 2009, the Agency has placed eight matters involving 7-Eleven franchisees before the courts and recovered $625,000 for underpaid 7-Eleven employees, many of whom were paid as low as $5 an hour, according to the report.

Other outcomes include an Enforceable Undertaking, issuing 20 Letters of Caution, 14 Infringement Notices (on-the-spot fines) and three Compliance Notices.

Between 2009 and 2014, the Agency has had “significant engagement” with the 7-Eleven head office and has invited the franchise to pilot a program that would address compliance. But the results were disappointing, according to Fair Work Ombudsman “expected to see improvements” but didn’t.

Following widespread media coverage of the scandal, the Ombudsman is now receiving more requests for assistance from employees than ever before, while many visa-holders are still reluctant to come forward to report underpayment for fear that they themselves maybe investigated by another government regulator.

The Fair Work Ombudsman also acknowledges that the exploitation of temporary visa-holders working in Australia is a long-standing and widespread issue, and that there are limitations to its investigative powers despite current efforts.

“Under current settings, the Fair Work Ombudsman alone is unlikely to be able to eliminate serious and deliberate manipulation of visa-holders across multiple regulatory frameworks,” the Ombudsman laments.

According to Australian workplace laws, employers found to have allowed a foreign national to work in breach of their visa can face financial penalties of up to $81,000, with some circumstances constituting a criminal offence punishable by up to five years jail or a penalty of $270,000.

Overseas students or workers are encouraged to contact the Fair Work Ombudsman if they feel they are being mistreated or underpaid at work. The Agency has an an interpreter service which can be contacted on 13 14 50. The Ombudsman’s official website also has materials translated into 27 different languages with information also distributed on YouTube, Facebook and Twitter.