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TRADE unions have stepped up their fight to protect penalty rates for Hunter workers, launching a new pitch in conjunction with survey results which claim majority support for their campaign.
The ‘Save Our Weekend’ campaign, backed predominantly by the Shop, Distributive and Allied Employees (SDA) union and United Voice, was launched at the weekend with the results of a survey conducted on the Central Coast and in parts of Lake Macquarie.
UMR Research surveyed several thousand people in the federal electorates of Robertson and Dobell. Asked about Sunday penalty rates for workers in the hospitality, retail and entertainment industries, a majority of respondents opposed any cuts to existing penalty rates.
In Dobell, 55 per cent opposed cuts, 36 per cent supported with the remainder undecided or not caring. In Robertson, 49 per cent opposed, 40 per cent supported and 11 per cent were undecided or didn’t care.
‘‘Workers in the Hunter and Central Coast region are facing a multi-pronged attack on their penalty rates, including from employers, the federal government, the recent productivity commission report and local business lobby groups,’’ the SDA’s Newcastle secretary Barbara Nebart said.
United Voice’s NSW secretary Mark Boyd said the survey showed that any plan to cut penalty rates was ‘‘out of step’’ with community views.
‘‘People working around the clock in our restaurants, shops, hospitals and other vital facilities deserve to be compensated for missing out on our important weekend events,’’ Mr Boyd said.
While the federal government and productivity commission have flagged penalty rate reviews, no concrete proposal is in place.
The NSW Business Chamber and its Hunter affiliate have argued that they are not opposed to weekend penalty rates, only ‘‘excessive penalty rates’’.
The chambers ran a campaign of their own over Easter which claimed excessive rates were forcing some small businesses to close on Sundays and public holidays.
In its submission to the Fair Work Ombudsman, the NSW chamber said it did not want penalties abolished.
‘‘Sensible penalty rates should be paid for certain weekend and public holiday times, however it’s ridiculous that penalty rates are now so excessive that businesses are forced to close to avoid making losses,’’ state chamber CEO Stephen Cartwright said.
The latest union campaign will culminate in a ‘‘massive day of action’’ on September 13.
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by ADELE FERGUSON
AUSTRALIA’S biggest convenience store chain, 7-Eleven, is under fire for paying many of its staff as little as $10 an hour before tax, with the company’s own figures suggesting up to two-thirds of its stores are ripping off their workers.
A joint investigation between the ABC’s Four Corners and Fairfax Media has uncovered collusion between franchisees, rampant underpayment and allegations of a cover-up.
Internal documents reveal that, between July and August this year, 7-Eleven head office reviewed the payroll compliance at 225 stores and found that 69 per cent had ongoing payroll issues. This is equivalent to one in four of all the 620 stores nationally based on one month’s review.
The chain is owned by billionaire businessman Russell Withers and his sister Beverley Barlow, and their spouses. Mr Withers also serves as the company’s chairman.
This article is the first in a series of investigative reports that will expose the breadth of wage fraud within one of Australia’s most recognised retail outlets and franchise chains.
The range of apparently illegal activity by franchisees extends beyond wage fraud and includes blackmail and withholding passports and driver’s licences of staff.
The documents, seen by the joint investigation, show franchisees are continuing to flout the law and are continuing to underpay staff even when caught out by the Fair Work Ombudsman.
Fair Work has recently launched a full-scale investigation into wage fraud across 7-Eleven’s network of stores. It was the third time in six years the wage regulator had conducted raids on 7-Eleven, with each raid showing little improvement.
In September last year, the wage regulator raided 20 stores in Melbourne, Sydney and Brisbane, seizing rosters, time sheets and CCTV footage from franchisees it suspected of committing wage fraud. The regulator found that 60 per cent of stores raided were underpaying staff.
Fair Work’s raids have already produced findings of underpayment of staff and led to an enforceable undertaking with a franchisee in the Melbourne CBD. Separate to the raids, it has launched legal action against a franchisee in Blacktown in Sydney’s west for underpaying workers.
The Blacktown franchisee, Harmandeep Singh Sarkaria, said he would be defending the claim and was disappointed Fair Work had decided to litigate against him as he had been under the impression he had been cooperating with the ombudsman.
A third store in Parkville in Melbourne that was raided resulted in the franchisee agreeing to pay staff the money owed. That franchisee has since sold the Parkville store but documents show that he maintained another store in the Melbourne CBD. It is understood this store is underpaying wages.
Fair Work declined to answer questions about whether it had reviewed the second Melbourne CBD store owned by the franchisee that it had busted last September.
The ombudsman’s office is still working through its findings for the other stores. It is expected to release a report into 7-Eleven late this year or early next year, outlining recommendations on how to deal with the systemic wage fraud.
A spokeswoman for 7-Eleven said head office expected franchisees to meet their legal obligations and that if even one store was underpaying workers, it was one store "too many".
"In the one instance we were made aware of a store employee’s passport being held by a franchisee, we intervened to facilitate the return of the passport," she said. "7-Eleven strongly supports the Fair Work Ombudsman’s investigation into employees’ pay and conditions currently under way."
Yet a company insider said head office had been covering up the wage fraud by scores of its franchisees for years.
"They can’t run 7-Eleven as profitably and successfully as they have without letting this happen. The reality is it’s built on something not much different from slavery," the insider said.
A common payroll fraud employed by 7-Eleven franchisees is known as the "half-pay scam", where staff members are paid for half the hours they work.
Under the half-pay scam, a worker is forced to work for 40 hours a week for an average of $12 an hour before tax against an award rate of $24.69 an hour.
As part of the scam the franchisee will doctor the roster and fudge time sheets to make it appear that the staff member has only worked half the hours in the store that they have actually worked.
The staff member is then remunerated based on the hours they are listed as having worked in the payroll details that are sent to 7-Eleven head office.
Names of so-called "ghost workers", often family members of the franchisee who don’t actually work at the store, are used to fill the gaps on the roster and give the impression that all staff are being paid correctly.
The 4 Corners and Fairfax Media joint investigation has seen evidence that franchisees are flouting penalty rates as well as not paying the minimum wage. Overtime rates for shifts exceeding 10 hours are also not being paid, according to the internal documents.