7-Eleven Australia: Examining Corporate Responsibility and Governance

This case study delves into the employee exploitation incident at 7-Eleven Australia, specifically focusing on wage underpayment and its implications for financial stakeholders, society, and the community. Drawing from articles in the Australian Financial Review and The Australian newspaper, the analysis highlights the payroll compliance issues, the alleged distortion of records, and the company's initial response to the allegations. The case study also addresses the moral implications of exploiting vulnerable workers, including international students, and the long-term consequences of the scandal on 7-Eleven's reputation, which ultimately led to an independent review of wages and franchisee buyouts. The conclusion emphasizes the systemic nature of the problem, the alleged role of the head office, and the broader implications for corporate responsibility and governance.

Running head: CORPORATE RESPONSIBILITY AND GOVERNANCE
Corporate responsibility and governance
Name of the student
Name of the university
Author note

1CORPORATE RESPONSIBILITY AND GOVERNANCE
Introduction:
This article covers the incident of employee exploitation that happened in the headquarter
of 7 eleven. The incident of underpayment has actually taken place. This article describes the
incident from the perspective of financial stakeholders as well as society and community as a
whole. Australian Financial Review is an Australian newspaper related to business and finance.
On the other hand, The Australian is a broadsheet newspaper which is published from Australia.
The event was criticized and it was marked as one of the worst case that occurred in the history
of corporate culture. The continuation of the incident acted as a catalyst to the incident. This was
not paid heed by the organization and this is the reason it took such a massive form.
Article for Australian Financial Review:
The incident of the exploitation of the workers has remained as a doom in the labor
market of Australia. It was observed that the 7 eleven head office conducted a payroll
compliance review of 225 stores. After the research it was found that nearly about 69 percent
stores faced the issue of payroll compliance. This included the distortion of the archives and
timetables in a month. It was commented by an insider that it would be higher if the schedules
could be cross-checked against the CCTV footage. This was considered to be a big loss in the
field of business. 7-eleven was forced to respond to the allegations that was imposed on them. In
their response they mentioned that it was unsatisfactory for them that the number of franchisees
have opted not to meet the obligations as employers. It has been assumed by many database that
the head office was aware of the problem and they were planning to take effective measures to
eradicate the problem. There has been extracts of store reviews that was conducted by Sydney
and Brisbane which rebounded the allegations on the organization about the fraudulent activities

2CORPORATE RESPONSIBILITY AND GOVERNANCE
in which 7-eleven Australia was found to be engaged. The owners on the other hand failed to
confront the questions that were asked by Fairfax. This event has turned out to be one of the
biggest revelation about 7-eleven Australia ("7-Eleven: Wage abuse claims puts scrutiny on Fair
Work response", 2018).
Article for the Australian Newspaper:
The owners of 7- eleven Australia has been found to be one of the richest persons of
Australia. It was considered to be shameful for them to exploit the poor people who volunteered
to work for them. Among the employees there are large amount of students who have come to
Australia on a student visa. They chose to deal the felonies internally. It included a breach of the
7-eleven Agreement the expectation to solve the breach was planned to resolve by returning the
passport and the license of the drivers. They were expected to pay the monies that was owned by
the employees through the payroll system so that the verification of the breach can be done. The
question of morality can be raised in this respect. It has been reported that the rosters and the
schedule sheets did not match with the activities of the store. It was extremely disgraceful on the
part of the organization to pay the employees less than the award rate. While conducting an
internal research it was found that the organization did not pay their staff members for six weeks
as they did not consider the fact whether the staffs are being paid correctly as the money is not
important to them. This has affected 7-eleven in the long run. The scandal was dragged for the
longer period of time. This made the organization to announce an independent review of the
swages and they planned to buy out the franchisees ("Subscribe to The Australian | Newspaper
home delivery, website, iPad, iPhone & Android apps", 2018).
Conclusion:

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The incident of the employee exploitation was increasing with the pace of time. It was
slowly evident in almost all the stores in Australia. It grew from one store and ended up in
another store. The students who worked there were forced to pay back half of their wage to the
franchisee. The question that remained unanswered that what was the role of the head office. The
head office claimed to make the investigation later but initially was it really possible that they
knew nothing? The workers were not only deprived from the daily wage but they were also
asked to return their money back. This was a brutal and unrefined step that the franchisee
allegedly performed. The problem would not be able to rise to this extend if the head office
would have stepped forward to take the responsibility of keeping a regular check on the activities
of the franchisees.

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Bibliography:
7-Eleven: Wage abuse claims puts scrutiny on Fair Work response. 2018. Retrieved from
http://www.afr.com/business/retail/fmcg/7eleven-wage-abuse-claims-puts-scrutiny-on-
fair-work-response-20150830-gjavxh
Subscribe to The Australian | Newspaper home delivery, website, iPad, iPhone & Android apps.
2018. Retrieved from https://myaccount.news.com.au/sites/theaustralian/subscribe.html