The wage abuse scandal deepens for 7-Eleven

By Ryan Solomons

A combined Fairfax / Four Corners investigation has alleged that 7-Eleven stores across Australia have engaged in fraudulent workplace practices including:

• underpayment of wages;
• falsifying payroll records; and
• threatening illegal workers with deportation if they complain about their wages or conditions.

Know your rights

While investigations by the 7-Eleven head office, the Fair Work Ombudsman and the Department of Immigration and Citizenship are ongoing, this scandal is a timely reminder to employers regarding:

1. minimum wage: the Fair Work Act 2009 (Cth) (FWA) requires employers to pay their workers the minimum wage prescribed by the relevant award or agreement. Underpayment of wages can result in, amongst other things, court ordered compensation to affected employees and penalties per breach of up to:
2. • $6,600 for individuals who are involved in a breach; and
   • $33,000 for corporations.

2. record-keeping and pay slips: record-keeping and pay slip obligations are prescribed under the FWA. Failure to comply with record-keeping and pay slip obligations can result in penalties per breach of:
3. • $3,300 for individuals who are involved in a breach; and
   • $33,000 for corporations.

3. visas: it is an offence under the Migration Act 1958 (Cth) to hire workers who do not have visa and work rights in Australia. Civil and criminal penalties may apply to individuals and corporations for employing illegal workers ranging from $3,060 to $270,000.

And there were others ...

• The Fair Work Ombudsman has commenced legal proceedings against a 7-Eleven store in Sydney which allegedly underpaid 2 migrant workers almost $50,000 and created erroneous records for the workers.
• The Federal Court of Australia held that a 7-Eleven store in Brisbane had unpaid an international student the sum of $21,298 and ordered the student to be back-paid his lost wages. The Court also issued the 7-Eleven franchise owner with a $6,970 penalty.

Up, up – prices are up!

Did you know that Fair Work has raised the national minimum wage by 2.5%, which may apply to your staff if they are covered by an award? Have you passed on these increases to your workers? For further advice regarding your obligations under the FWA and the modern award regime please speak to one of our employment specialists.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.