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Corporations making wage theft part of their business plans

Many Australian corporations have included ripping off their own workers as part of their business plans, Queensland unions say.

Recent findings against major fast food franchise Pizza Hut add to increasing evidence of systemic and widespread wage rorts and underpayments from well-known corporate brands.

The Queensland Council of Unions have outlined these and other breaches in a submission this week to a Senate inquiry into the corporate avoidance of the Fair Work Act.

QCU General Secretary Ros McLennan said today the underpayment of wages is often a deliberate decision by business to not pay employees their legal entitlements, which is theft.

“In particular, sham contracting is not a clerical mistake but rather a wilful attempt by an employer to avoid a raft of obligations, including minimum wages,” she said.

The Fair Work Ombudsman has issued compliance notices to recover wages for underpayments, infringement notices and formal letters of caution to Pizza Hut franchisees, 92 percent of which were said to be non-compliant.

Pizza Hut franchisees were found to have underpaid delivery drivers, wrongly classifying them as independent contractors and failing to keep adequate records.

“If you were a Pizza Hut employee who removed the equivalent cash from the till you would have your employment terminated, and, at worst, face criminal charges and even gaol,” Ms McLennan said.

She said major brands – including Pizza Hut and 7-11 – seem to think they can rip off their workers with impunity.

“They have no regard for their public reputation, particularly when they break the law and steal from their most vulnerable employees and only receive a slap on the wrist from the Fair Work Ombudsman.

“The light treatment of non-compliant employers appears incongruous given the way in which the Abbott and Turnbull Governments have pursued unions and workers, particularly in the building and construction industry, for supposed breaches of industrial laws and right of entry provisions,” said Ms McLennan.

In the case of Pizza Hut, 11 infringement notices were issued resulting in only $6,300 in fines for a brand with 270 stores across Australia and turns over an estimated $400 million a year.

Ms McLennan said the federal government had allowed a corporate culture to flourish where ripping off employees was an accepted business practice.

“It’s time for this federal Liberal government to show it will pursue corruption and lawlessness no matter how close it is to home,” she said.

The Senate inquiry submission outlines numerous instances of corporate avoidance of Fair Work Act legislation, including abuse of labour hire arrangements.

Ms McLennan called for more resources for the Fair Work Ombudsman, and said unions needed stronger rights to investigate suspected breaches of employment law.


Click here to download the QCU Submission to the Senate Inquiry