The Fels Panel has ceased deliberations today, with all existing claims continuing to be processed by an independent unit within 7-Eleven.
7-Eleven says the secretariat will operate under enhanced terms of reference and will be staffed by qualified forensics accountants, meet the highest levels of claimant confidentiality, adopt evidentiary standards that protect against the prospect of corrupt activity, and liaise with the Fair Work Ombudsman (FWO).
In assessing claims, the secretariat will provide 7-Eleven with a recommendation, the basis of validation and the quantum of each claim to be paid.
7-Eleven Chairman Michael Smith thanked Professor Allan Fels and Professor David Cousins for their oversight of the process over the past eight months and said the process for existing and new claims will continue.
“7-Eleven will pay all legitimate claims by franchisee employees for the past underpayment of wages,” he said.
“We will ensure claimant confidentiality and the independence of the proposed internal unit that will be responsible to the CEO, be separated from all operational aspects and staff within the business and staffed by appropriately qualified individuals and backed by a secretariat.”
In the interests of openness and transparency, 7-Eleven will regularly publish the outcomes of the claims process on its website and provide the FWO with complete access to the process, investigative and determination data as well as the whistleblower service already established to protect claimants from intimidation.
7-Eleven is also prepared to fund additional resources for the FWO should that be required for the ombudsman to take an active oversight role.
“It is incumbent upon 7-Eleven to take responsibility for this process,” Mr Smith said. “Ethical corporate standards cannot and should not be outsourced. We are happy to be held to the standards we have set for and expect of ourselves.”
7-Eleven CEO Angus McKay says enhanced in-house capability and his requirement that the company be responsible and accountable for all aspects of the business means now is the time to make this transition.
“In enhancing aspects of the process through an amended terms of reference, I acknowledge that 7-Eleven is changing the basis upon which the panel has operated,” he said,
“However, it is incumbent upon us to adapt to the changed circumstances we are confronting in order to maintain the integrity and credibility of our efforts to pay all legitimate claims for past wage underpayment.
“I believe the changes we are implementing are important and necessary and will enable the claims process to be effective and efficient, while remaining fair in all the circumstances.”
The Fair Work Ombudsman Natalie James has raised concern over 7-Eleven’s decision to terminate the services of the Fels Wages Panel in recovering the lawful entitlements of workers as she awaits detail of “how the critical work of the Fels Panel” will be continued under the new arrangements.
“As an independent, statutory regulator funded by the taxpayer to ensure compliance with commonwealth workplace laws, the suggestion that we would accept funding from 7-Eleven to oversee its activities in this space is both unacceptable and ludicrous,” she said.
“In fact, the Fair Work Ombudsman confirms it has active, ongoing investigations into a number of 7-Eleven franchisees.
“There is also a real prospect that we will take legal action against more 7-Eleven operators.”
The Fair Work Ombudsman acknowledges there may be concerns from some 7-Eleven employees, particularly visa-holders, about coming forward to an internal 7-Eleven process now the Fels Wages Panel has been abolished.
“To that end we encourage any visa-holders at 7-Eleven concerned about the impact that a claim of underpayment may have on their visa status to contact us on 131 394,” Ms James said.
“They have our assurance that if they assist us with our inquiries into wage theft, we will request that their visa status will not be prejudiced, following agreement we reached with the Department of Immigration and Border Protection.”