FWO discovered a big hole in Domino’s system

Domino’s Pizza Enterprises Limited

The investigator Fair Work Ombudsman issued 17 formal cautions on Dominos (ASX:DMP) after finding breaches of workplace law, non-payment to employees, inaccurate record keeping and unauthorized deductions.

The report of 33 Domino’s stores audit issued by FWO on 7 September 2018, found that just 4 stores were fully compliant with the workplace law while investigation is still on in ten stores. [optin-monster-shortcode id=”wxhmli4jjedneglg1trq”]

FWO’s investigation revealed that 20 workers had been underpaid a total of $1,978 in a month. In addition to these underpayments discovered, the inspectors found other defalcations in the workplace system which included non-payment of hours worked, unauthorized deductions, inadequate time records, and leave entitlements and delivery allowance breaches.

But before coming to these results, inspectors interviewed 144 Domino’s workers and analyzed employee records at 33 Domino’s stores.

However, in response to FWO investigations, the company stated that correct payments were made to almost 97% of employees as only 19 out of approximately 600 Domino’s employees were issued to be underpaid by the investigator.

In clarification of misstatement discovered in employees accounts, CEO Nick Knight said: “Our goal is to ensure team members receive their correct entitlements at all times and, where this has not been the case as revealed by FWO’s investigation, we will ensure any wages underpayments are rectified as quickly as possible.”

The investigation reports told that 65% of franchisees being audited belong to non-English speaking background and have little knowledge of Australian workplace laws. Also, the audits found many vulnerable employees working at Domino’s stores in which 72 per cent were under 25 years of age and 48 per cent were visa holders.

The Fair Work Ombudsman has been calling on Domino’s head office to act after finding breaches of workplace law across 19 stores in Brisbane, Sydney, Melbourne and Adelaide. It has also been stated that further non-compliance could lead the FWO to charge financial penalties on Domino’s.

“It is in head office’s best interests to set clear expectations with their stores, provide them with comprehensive training and support and regularly check that workplace laws are complied with,” said Fair Work Ombudsman Sandra Parker

Moreover, further Domino’s compliance activity is expected to be conducted by Fair Work Ombudsman within 12 months.

Not withstanding the negative results of FWO’s investigation, Domino’s share price surged 4.739% to $54.810 on 7 September 2018 (4:52 PM AEST). The stock has seen performance change of +24.15% over the past one year.

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