A Senate parliamentary inquiry into the franchising sector has heard explosive revelations of Domino’s franchise owners being racially targeted with random employment audits.
Devanshi Panchal, a former Domino’s franchisee who owned a store in country New South Wales gave evidence at a public hearing for the inquiry into franchising code of conduct in Melbourne on Friday.
She alleged there was racial targeting by Domino’s head office staff in the wake of the 7-Eleven wage fraud scandal in 2015, Sydney Morning Herald reports.
Domino’s has denied the allegations.
Domino’s has denied claims that franchisee owners were racially targeted with random employment audits
Domino’s chief executive Don Meij (pictured) was grilled for an hour at the inquiry on Friday
‘Standing in a room full of franchisees, it was clearly evident who was being targeted… and the five white people there who weren’t getting audited,’ Ms Panchal told the hearing.
In her four page written submission to the inquiry, Ms Panchal alleged Domnio’s had ‘a very clear and open little world of favouritism and partiality.’
‘It was quite visible franchisees were being favoured towards,’ her submission states.
‘While all these employment audits being conducted on franchisees with a certain racial background. None of the ‘white’ franchisees had their store audited. This issue of racial discrimination was brought up and rugged under by DPE (Domino’s Pizza Enterprises) denying there was such things occurring. However, it was clearly visible through to the division of the franchisees, who was being targeted here.’
Domino’s has rejected many of Devanshi Panchal’s claims in her submission. Pictured is chief executive Don Meij, who also appeared at Friday’s Senate inquiry
In its response, Domino’s described Panchal’s submission as containing ‘significant factual errors as well as material omissions.’
It also outright rejected her claims ‘favouritism and partiality’.
‘DPE rejects absolutely the assertion that DPE only investigates franchisees of a particular racial background. The comment is offensive and there is no evidence to support it,’ Domino’s response stated.
‘DPE appreciates the Parliamentary Joint Committee’s consideration of these matters and looks forward to the opportunity to discuss them in more detail.’
Domino’s boss Don Meij was grilled for an hour at Friday’s inquiry, where he couldn’t guarantee that no staff at its 733 franchised stores is being underpaid, The Australian Financial Review reported.
Pizza Hut (pictured) also came under from former franchisees at Friday’s public hearing
He said it was a franchisee’s responsibility to hire, train and remunerate staff, who he said were now the best paid in Australia’s fast food industry, the publication reported
‘What we can do as a franchisor is educate them, and encourage people to bring us evidence of wrongdoing because we are very keen to act on it,’ Mr Meij said.
A number of former Pizza Hut franchisees also spoke at Friday’s public hearing about how selling pizzas at below cost took their toll.
Chris Hackett claimed was working 100 hours a week for as little as $350 a week.
Another former franchisee Adam Gordon worked 80 hours a week without pay, the Sydney Morning Herald reported.
Mr Gordon eventually sold at a loss and claimed he contacted the Australian Competition & Consumer Commission and was told it couldn’t help.
Former Pizza Hut franchisees spoke about how selling pizzas at below cost took their toll
‘To try and save some money I worked over 100 hours a week, I was working for less than $4.50 an hour at the time including overtime,’ Mr Gordon stated in his written submission.
‘Within a few weeks, the sales had dropped but I was still carrying the increased cost of running this business. The business was ruined and I became desperate, having to reduce staff, it broke my heart to tell staff members that I could no longer keep them employed and continued to work 100 hours a week to keep the business afloat. I did not know much about the company, the Franchise agreement or why anyone would do such a horrible thing.’
The inquiry continues with a public hearing in Sydney this Friday (June 29).