The scandal-plagued convenience chain 7-Eleven is facing fresh scrutiny, with covert video showing an employee handing back a sizeable portion of her pay to the store franchisee.
The employee at a Brisbane 7-Eleven told the ABC that she and other staff were told to pay back thousands of dollars or face losing their jobs.
“My bosses say they can’t afford to pay the government rate. That’s why they ask us to give some of the money back,” said the worker “Anna”.
The ABC agreed to protect her identity.
Known in the industry as the “cash back” scam, workers are paid the full award rate but have to hand back up to half their pay to the store franchisee.
7-Eleven told the ABC it has launched an internal investigation into the allegations involving the Brisbane store.
Like many of her co-workers, Anna is an international student studying in Australia, and she said the cash-back scam is the only way of securing her job.
“[The franchisees] say agree to paying back the money. If not, you can go find another job. Everyone at the shop has to do it,” she said.
Anna has paid back $6000 in a year
Using hidden cameras, the ABC filmed on two occasions when Anna handed back hundreds of dollars of her pay.
At one handover, her boss can be seen accepting $150 in cash from Anna in the manager’s office of the Brisbane store.
She said she hands back about $11 for every hour she works.
“The government pay is $25 per hour for casual staff. What I get is $14 per hour. Every week I pay [back], because they pay me every week,” she said. “[I] take the cash out of the ATM, and hand it back.”
Anna showed the ABC her bank statements detailing her withdrawals, saying she had paid back more than $6000 since the start of this year.
Cash-back scam concerns raised previously with 7-Eleven
Systemic wage fraud and the underpayment of workers was exposed by Four Corners and Fairfax Media last year, prompting the company to set up a wages compensation panel headed by former Australian Competition and Consumer Commission chairman Allan Fels.
7-Eleven later sacked Professor Fels after he refused to agree to new conditions the company wanted to impose on the process.
“When my panel was effectively fired by 7-Eleven we had drawn their attention to many continuing cases of these cash back payments,” said Professor Fels.
“This example here clearly shows not enough has changed.”
Asked if 7-Eleven headquarters knew of the cash back scam at the Brisbane franchise, Anna said she was told that a staff member had complained.
“The staff member who wanted to report our boss just got fired,” she said.
The ABC went to the Brisbane store to ask the franchisees about the allegations that staff were being underpaid.
A manager said she was not authorised to comment, saying all questions should be directed to 7-Eleven’s headquarters. A spokesman for the company told the ABC that 7-Eleven “takes any allegation of illegal activity in our franchisee network”.
“We are not aware of any allegations relating to this store, and no staff members have raised any concerns with us. As soon as the allegations were raised with us we commenced an internal investigation,” the spokesman said.
He said 7-Eleven will act upon any allegations of illegal activity, “up to and including termination of the Franchise Agreement”.
In response to questions from the ABC, a spokesman for the Fair Work Ombudsman said any employer who tells a worker that they have to pay part of their wages back is breaching work laws.
“The Fair Work Ombudsman is concerned about the use of ‘cash-back’ arrangements we are seeing in some 7-Eleven cases,” he said.
In June, another 7-Eleven franchisee was fined more than $400,000 over a cash back scheme.
It is the largest court-imposed penalty achieved by the Fair Work Ombudsman, whose investigation found that the franchisee had stripped back $82,000 from 12 of his employees, some of whom were international students.