Ethical Misconduct at 7 Eleven: A Case Study

7 ELEVEN
CONVINIENCE
STORE
ETHICAL MISCONDUCT –ILLEGAL AND
EXPLOITATIVE WORK PRACTICE

CASE STUDY
 In the year 2015 trouble arrived at one of the most well known
convenience store chain 7 Eleven in Australia . ABC’s documentary
series Four Corners reveled how the company use illegal work
practices by curbing labor cost at the cost of the labors. The
employees were paid half their minimum wages and were harassed at
their workplaces. The famous cash back practice existed where the
employees were paid their right wages in their bank accounts but
they were forced to give back half their pays to dodgy franchisees,
away from CCTVs and biometrics. The young and foreign youths were
targeted the most. The end result of the scandal saw the resignation
of both its Chairman Russ Withers and CEO Warren Wilmot. Not only
this but the court also imposed penalties exceeding $1 million for
worker exploitation.
 The above case study will help in elaborate explanation of ethical
issues and will show how moral philosophy and inter and intra
cultural organizational support will help in reducing ethical dilemma
for the same leading to the development of a fair global business
environment.

WHAT THEY SAID...
 EMPLOYEES SIDE:
 “We worked like slaves and no one cared!!!!”
 “The sad thing is nobody was listening, not even 7 eleven...we gave
our souls to the store ,but they don’t cared”
 EMPLOYERS SIDE:
 “This model will only work if we underpay our employees”
 “Guest work regulations were to be levied on permanent employees
in order to minimize cost”

ANALYSIS
 The case was a clear case of ethical misconduct rom the employer side. The
company did not abide by the code of conduct of ethical norms and they
levied their own laws for their own benefit in profit making irrespective of the
employee side.
 The cash back scam gained momentum quickly but 7 Eleven had not done
enough to address it.
 The work culture was so exploiting that the employees were bound to take
legal actions against the organization.
 The structural framework was so feeble that they themselves sacked senior
employees prior any notice, changed business models overnight and
overhauled the board of directors as well.
 The scandal suggested that there was some ethos in place in the organization
but “bad ethics is good business” has been their motto.
 New compensation schemes were formulated but that sill cannot pay all the
employees their desired wages and thousands more remained unpaid.
 The fair work act system only imposed fines on those whose cases were
considered but systematic underpayment prevailed.