A Business Report on Ethical Issues and Wage Fraud at 7-Eleven

This report delves into the ethical issues that arose within 7-Eleven, a convenience store chain, focusing on the wage fraud scandal that significantly impacted the company. The report outlines how 7-Eleven was involved in underpaying its workers, leading to a major ethical crisis and affecting both internal and external stakeholders. The fraudulent practices, exposed by the media, involved the company taking back a portion of the wages paid to employees. This unethical behavior resulted in financial losses, damage to the brand's reputation, and the closure of several stores. The analysis covers the impact on various stakeholders, including employees, management, and the government, highlighting the negative consequences on the economy and public trust. The report emphasizes the importance of ethical conduct in business and the severe repercussions of failing to comply with labor laws and regulations, concluding with a call for ethical practices to maintain a positive brand image.

Ethical Issues on 7 eleven

Table of Contents
INTRODUCTION ..........................................................................................................................1
MAIN BODY ..................................................................................................................................1
CONCLUSION ...............................................................................................................................3
REFERENCES................................................................................................................................4

INTRODUCTION
Ethical issues get arise in a business due to unfollow the rules and regulations which
frame by government and management. It is a duty of manager to perform every task in an
adequate manner through which chances of these issues get decline. This report is based on
ethical issues which arise in 7 eleven is a convenience store which founded in 1927 and operate
their working as a partnership firm. It’s a subsidiary company whose parent entity is 7 eleven
Japan Co. Ltd. The organisation is operating their business all around the 18 major countries
with more than 56000 stores. Company provides quality products. According to a report they
have more than 600 stores in Australia and 30 stores in Melbourne. But several issues lead to
get arise in a company which affect their working as well as stakeholders of a company. As these
all are considering as ethical issues of 7 eleven (Boon, 2011).
MAIN BODY
One of the major issue which arose in 7 eleven was ripping off, of workers of a company
by not providing them adequate wages. It was considered as a wage fraud of company which was
exposed by Fairfax media. According to them, company pay full amount to their workers but
later take back half amount from them in the name of betterment of company. By this company
made a fraud of million dollars which was later exposed. As managers already follow the
legislative dilemma but then take half amount from their employees as well. Thousands of under-
payments claims are still being settled by a company out of which they already paid 26 million to
680 workers. Both the parties have to face many issues by this because such people do not
operate their regular activities in an adequate manner as well as company have to bear the loss of
brand image (7-Eleven: Investigation exposes shocking exploitation of convenience store
workers. 2017).
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Stakeholders are the one who aid in operating business properly. They are considering
considered as essential part of a business. For every organisation, there are two types of
stakeholders are found out: internal and external. If an organisation will lead to engage in any
unethical crises then their stakeholders have to suffer by this (Brezina and Zhao, 2012). The
same situation gets arise in 7eleven whose stakeholders were get affected after the company
involve in a big fraud of underpayment. That issue was seeing seen as one of the largest fraud in
Australian history. As by this, both stakeholder (internal and external) get affected by this major
crisis. Employees are internal stakeholders and company attempt a fraud against them. This
affect the interest and faith of people towards company. Hence for this, they have to made a back
pay to all of their workers. Moreover, leaders and management also get affected by this. As they
are the ones who play a major role in such fact. Without their permission this fraudulent never
took place. It affects in working and thus as a result management had to close down their 12
stores in Australia (Nijboer and et. al., 2013). According to management of Seven eleven they
clearly signify that “It ensures our network is positioned for growth and removes any suggestion
that store owners cannot afford to comply with law including staff with right wages”. This was a
one of a largest issue which arise in Australian history and affected large number of individuals.
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Several major stakeholders are identifying who directly get affect by these ethical issues
are government, CEO and board of a company and employees or workers of 7 eleven. As all of
them are impacted by this because it directly made a question of authority that they are not
looking on a company in an adequate manner (Mittelstadt and Floridi, 2016). As they are not
complying with law and might be many complaints get filed against them. Hence, they did not
take appropriate action for this. Along with them another stakeholder who got affected by this
was CEO and Board of Directors because their jobs take back by them. As they got unemployed
and this directly lead to affect economy of a country. Management have to shut down their stores
which means more and more number of individuals became unemployed. Moreover, employees’
faith and trust towards others get impacted which is not appropriate at all. As the above, it gets
concluded that overall impact by this ethical issues was negative in which economy as well as
interest of general public get decline. Company’s image got tarnished not only in Australia but
all around the 18 countries in which it was operating its business.
This whole essay is about ethical issues of seven eleven in which a major problem
becomes measured which is related with wages scandal. A news channel covers this fact and
disclose all facts and problems which are related with that (Wellington, 2015). As this is a major
ethical issue in which owner lead to get failed in comply with all moral and values of a business.
Hence, this fact create problem in generating of profit as well for a company. Ethics are
important for every business because it aid in creating a brand image as well as trust on an entity.
If a company get failed in do so then their image have to suffer heavy loss from this. By
following the values, there are vast number of benefits can gain by a business organisation. As
the whole discussion was based on the ethical issues which arise in 7 eleven company in which
wages fraud is taking place because lack of employ of laws and regulations. As for this,
management take a major step which lead to affect employment of many people. As this was a
crucial step, company shut down their 12 stores which are belong to same locality.
CONCLUSION
Ethical issues are major the problem which arise due to lack of looking upon on business.
They are going to completely affect and impact brand image of a company. For this,
management and authority have to take adequate step for overcoming from them and again
establish a well brand image. By these ethical issues stakeholders of a company get affected
which is inappropriate in nature. Hence, taking care f each and every associate which are related
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to business is must. In such relation, management have to adopt crucial step which provide
strength and benefits for long term.
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REFERENCES
Books and Journals
Boon, H., 2011. Raising the bar: Ethics education for quality teachers. Australian Journal of
Teacher Education. 36(7). pp.76-93.
Brezina, P.R. and Zhao, Y., 2012. The ethical, legal, and social issues impacted by modern
assisted reproductive technologies. Obstetrics and gynaecology international. 2012.
Mittelstadt, B.D. and Floridi, L., 2016. The ethics of big data: Current and foreseeable issues in
biomedical contexts. In the Ethics of Biomedical Big Data (pp. 445-480). Springer
International Publishing.
Nijboer, F., and et. al., 2013. The asilomar survey: Stakeholders’ opinions on ethical issues
related to brain-computer interfacing. Neuroethics. 6(3). pp.541-578.
Wellington, J., 2015. Educational research: Contemporary issues and practical approaches.
Bloomsbury Publishing.
Online
7-Eleven: Investigation exposes shocking exploitation of convenience store workers. 2017.
[Online]. Available
through:<http://www.smh.com.au/business/workplace-relations/7eleven-investigation-
exposes-shocking-exploitation-of-convenience-store-workers-20150828-gja276.html>.
[Accessed on 19th August 2017].
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