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Fraudulent Payroll Management in an Organisation

   

Added on  2019-11-12

7 Pages1548 Words173 ViewsType: 173
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Running head: FRAUDULENT PAYROLL MANAGEMENT IN AN ORGANISATION Fraudulent Payroll Management in an OrganisationName of the studentName of the UniversityAuthor note
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1FRAUDULENT PAYROLL MANAGEMENT IN AN ORGANISATIONNo1: Australian Financial Review The store chain 7-Eleven was witness to the largest case of wage abuse in the history ofthe corporation. Four Corners and Fairfax media has exposed the issue on international forumand it revealed the dark side of the labour market of Australia (Afr.com, 2017). This case ofeconomic exploitation carries along with it the threat to the Australian Taxation Office. Wagefraud accounting to million dollars in a year has thrown a dark light on the labour force ofAustralia.The effectiveness of Fair Work as a regulator is being questioned and enquiry is beingmade into the issue of wage abuse. The structure of the regulator is being monitored closely andits powers and budget is being increased so that it’s surveillance process is improved. They aremaking an enquiry regarding the fact whether the head office or franchise is responsible for thefraudulent act (Sivaraman & Turner, 2016). The reviews that were made dated back to previousSeptember and revealed payroll compliance issues. A grim reality was brought out in a reviewthat revealed that pay summary showed evidence of payment to a small number of four peopleby the franchise. For engaging in fraudulent acts, they should pay their employees back was theverdict. 7 Eleven was distraught at the breach of trust and was worried about the dismal act of thefranchises. The repercussions on the employees were great and the prestige of the franchises wasat stake. It would result in the loss of trust of people towards these employees. Appropriateaction was promised by the head office however, the efforts were not good enough. The resultsof the underpayment of wages have not been viewed strictly by the head office and lack ofstringent action on their part has forced the problem to continue (Fraser, 2016). A notice
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2FRAUDULENT PAYROLL MANAGEMENT IN AN ORGANISATIONspecifying breach should have been charged on the franchise in order to prevent any such thingin future. 7 Eleven should have reported about this illegal behaviour to the police or to theregulator instead of taking things lightly. The overall reputation of the company would be atstake and proper steps taken could save the name and reputation of the company. They have beensecretly covering this issue adding to the problem. 7 Eleven has a huge amount of earnings and it earns more revenue as compared to othercompanies. In accordance to the franchise agreement, the main office earns around 57 percent ofnet profit and the rest of the profit goes to the franchisee. The head office is responsible forpayment of the rent, equipment supply, fittings as well as for the services that are related to theback office. The franchise is responsible for payment of running costs that includes that of thestaff wages. The average earnings of 7 Eleven franchise will be between $300,000-$1.7 million(Terry-Armstrong, 2016). This will depend on the location and size of the franchise. A finalincome of $40,000 is earned by them after payment to the employees. After the payment ofinterest, it would be found that the earning would be even less than that. After the payment of allthese dues, there will hardly be any room left for payment of the freight salaries.The head office should have been more careful before selecting a franchise. The headoffice should not be moved by vague statistics but rather carry out thorough research beforegetting into any agreement (Spector, 2017). Press clippings with positive feedback is not alwaysreliable and their accolades may be of hardly any merit. A great deal of research on the part ofthe head office and proper steps taken in the right direction will add more credibility to thecompany.
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