Ethical Concerns at 7-Eleven: Editorial for 'The Australian' News

This essay presents an editorial analysis focusing on the wage fraud scandal involving 7-Eleven in Australia. It highlights the exploitation of young and foreign employees, who were underpaid, sometimes receiving as little as 50% below the minimum wage. The investigation by joint four corners and Fairfax revealed unethical practices adopted by the company to reduce labor costs, including threats against employees to prevent exposure of the wage fraud. The essay also discusses the legal actions taken against the company director and store manager, and the spillover effect of this scandal on the broader retail sector in Australia, leading to allegations against other retail chains for similar violations of workplace laws. Desklib provides a platform for students to access similar solved assignments and past papers to aid in their studies.

Running Head: EDITORIAL FOR ‘THE AUSTRALIAN’
EDITORIAL FOR ‘THE AUSTRALIAN’
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EDITORIAL FOR ‘THE AUSTRALIAN’
Exploitation by 7-Eleven has left a spillover effect
The retail sector in Australia is going through a bad phase. Experts blame that the turmoil
in the retail sector is due to the issue of ‘wage fraud’ by 7-eleven. According to them, this is
unexpected from a retail giant like ‘7-Eleven’. Australia is one of the 17 countries, where this
Japanese owned international chain of retail hub has established its largest convenience store. ‘7-
Eleven’ has been crowned with the title of ‘Australia's franchiser of the year’ several time.
According to the investigation conducted in 2016, by joint four corners and Fairfax, in
order to fulfill its intention to reduce labor costs, the company has adopted practices which are
unethical and exploitative. The reports published after investigation showed that young and
foreign employee at the 7-Eleven store in Australia at 7- Eleven were underpaid. The rate of
payment is substantially low. Sometimes the rate is about 50% below the minimum wage (ABC
News., 2019). As per the report published by joint four corners, Company director Jing Qi Xia
and her 7-Eleven store manager Ai Ling Lin were alleged of exploiting the employees at the
retail store of Australia, who were basically international students who came to study in
Australia and worked in retail store of 7-11 to support their living in Australia. The report also
revealed how the company threatened young workers from so that the issue of ‘wage fraud does
not come in front of the mass (Smethurst, 2019).
Fairfax report argued that, there should be strict legal actions against 7-Eleven. As a
result, the director of the company, and Ai Ling Lin, one of the store managers were penalized
by the in the Federal Circuit Court (The Sydney Morning Herald, 2019).

EDITORIAL FOR ‘THE AUSTRALIAN’
Experts argued that, this unethical practice of wage fraud had left a spill-over effect on
the retail sector (Australian Financial Review, 2019). After 7-Eleven, many retail chains in
Australia were alleged of providing false pay records, and violating workplace laws, failure in
paying minimum hourly rates and weekend or public holiday penalty rates.

EDITORIAL FOR ‘THE AUSTRALIAN’
References
ABC News. (2019). 7-Eleven staff work twice as long at half pay rate. Retrieved from
https://www.abc.net.au/news/2015-08-29/7-eleven-half-pay-scam-exposed/6734174
Australian Financial Review. (2019). 7-Eleven wages scandal: culture is key to fixing problems
not expensive systems. Retrieved from https://www.afr.com/boss/culture-key-to-fixing-
problems-not-expensive-systems-20171110-gzir6g
Smethurst, M. (2019). 7-Eleven Labor Scandal (2015). Retrieved from
http://businessethicscases.blogspot.com/2017/11/7-eleven-labor-scandal.html
The Sydney Morning Herald, N. (2019). 7-Eleven operator fined $335,000 in wage scandals.
Retrieved from https://www.smh.com.au/business/workplace/7-eleven-operator-fined-
335-000-in-wage-scandals-20190118-p50s81.html