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Muffin Break and Jamaica Blue franchisor to backpay employees

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2 weeks ago

By Leigh Johnston

Foodco, the franchisor Jamaica Blue and Muffin Break cafés, has back-paid 166 employees a total of $26,562.30 under a two-year audit and compliance agreement with the Fair Work Ombudsman (FWO).

In 2016, the Foodco Group approached the FWO with the intention of proactively engaging with the agency to ensure it and its franchisees were compliant with Commonwealth workplace laws.

After discussions, both parties agreed to enter a Proactive Compliance Deed in 2017 focused on ensuring compliance with Commonwealth workplace laws. In broad terms, the agreement means the FWO will provide assistance to Foodco Group where appropriate and Foodco Group will maintain or implement the proactive measures contained in the Deed to promote and ensure compliance and promote productive workplaces.

The two-year proactive partnership covered more than 4,000 Muffin Break and Jamaica Blue workers across Australia.

This followed Enforceable Undertakings the FWO entered into with two Muffin Break franchise operators, one in 2014 and the other with a former operator in 2016, after workers at these cafés were underpaid.

A key component of the compliance partnership is that Foodco Group undertakes to demonstrate its commitment to compliance with Australia’s workplace laws throughout its network, by undertaking a self-audit certified by an agreed independent third party to ensure staff received their correct entitlements.

The third-party audits identified 152 employees were underpaid a total of $4,244.75. The regulator also referred an additional 12 requests for assistance from Muffin Break and Jamaica Blue staff to Foodco, which resulted in 14 employees being back-paid $22,317.55.

Under the compliance deed, Foodco has also conducted workplace law training for staff and franchisees, established an employment relations hotline for staff to raise concerns, and improved access to information on workplace laws across the business.

Under the partnership, the FWO will notify Foodco Group within seven days of each request for assistance received by an employee or former employee of a business operated by Foodco Group under the “Muffin Break” brand or under the “Jamaica Blue” brand and provide details of the alleged non-compliance.

One year after the commencement of the Deed Foodco Group Pty have also agreed to prepare a report that will be provided to the FWO addressing the actions taken by Foodco Group, a summary of the outcomes of any requests for assistance referred and learnings from the compliance partnership.

Sandra Parker from the Ombudsman said the compliance deed will continue to benefit current and future Foodco employees.

“Our key objective of this partnership was to ensure that Foodco established processes to identify and resolve workplace disputes efficiently across its network and educate franchisees on their lawful obligations under the Fair Work Act,” Ms Parker said.

“Franchisors are a priority sector for the Fair Work Ombudsman, and we urge all head offices to prioritise compliance with workplace laws or they risk damage to their brand and employees.”

“Under the Protecting Vulnerable Workers amendments to the Fair Work Act in 2017, franchisors are responsible for ensuring compliance throughout their service network,” Ms Parker said.