Extract from ABC News
Updated
The chairman and chief executive of 7-Eleven have
both resigned in the wake of the worker exploitation scandal at the
company's Australian stores.
Chairman Russ Withers and chief executive Warren Wilmot have stepped down from the board of the company effective immediately. It follows a Four Corners/Fairfax investigation into under-payment of wages and exploitation of workers.
"Mr Wilmot offered his resignation following the recent realisation of the extent to which 7-Eleven franchisees had underpaid workers," a statement released by the company said.
7-Eleven investigation
- 7-Eleven staff work twice as long at half pay rate
- 7-Eleven business model rips off workers, former ACCC boss says
- Convenience store empire 'built on something not much different from slavery'
- Greens to refer evidence of 7-Eleven worker exploitation to Senate inquiry
- Labor urges Government to give amnesty to students forced to breach visa rules
- 7-Eleven chairman denies widespread wage rorting claims, says 'relatively few' franchisees at fault
"Mr Wilmot acknowledged it would be difficult for him to play a central role in navigating the company through the current challenges it faces given his long-standing executive role and that a new independent CEO was appropriate in the current circumstances."
Former iiNet chairman Michael Smith will become the new 7-Eleven chairman and Bob Baily has been appointed interim chief executive.
"Mr Smith will lead an executive search process to identify a permanent candidate for the CEO role," the statement said.
The convenience stores came under scrutiny following an ABC Four Corners investigation which revealed the company was systematically paying its workers about half the minimum wage.
Many of the staff were foreigners who were being forced to work in contravention of their visa conditions.
An inquiry into Australia's temporary work visa program found the underpaying of staff in the convenience store chain was systemic and had been happening for decades.
Mr Withers told a Senate committee last week the behaviour was abhorrent.
"I want to stress that this has been highly embarrassing and I apologise unreservedly to any worker that has worked in a 7-Eleven store who has not been paid correctly," he said.
Investigation into true extent of underpayment of workers
Mr Withers will remain chairman of the group holding company that has as its investments 7-Eleven and Starbucks together with real estate and a share portfolio."Naturally this is a major decision for me to stand aside, however I will continue to be a shareholder and I am determined to make sure the company is in the right hands to move forward," he said in a statement.
Mr Smith said 7-Eleven had implemented a number of actions to identify the true extent of the underpayment of staff by franchisees and implement appropriate remedies, including refining the business model in cooperation with franchisees.
The company said that before the scandal broke it had been working closely with the Fair Work Ombudsman in conjunction with accounting firm Ernst & Young to investigate the allegations.
It has also recently appointed Professor Allan Fels to chair an independent panel to identify underpaid workers and determine how much they are owed.
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