Before Senate Inquiry.

The Shop Distributive Allied Employees Association (SDA), the union for workers in retail and fast food, has described the Franchising Code of Conduct as ‘deficient and ineffective’, following the instigation of a parliamentary inquiry into the franchise sector by the Senate.

SDA national secretary Gerard Dwyer said that among a myriad of deficiencies the Franchising Code of Conduct makes no attempt to ensure that workers are treated fairly.

“The current Code makes absolutely no attempt to ensure that franchisors and franchisees abide by workplace laws. It does not require the franchisor to ensure that franchisees provide proper wages and working conditions to those employed in franchise operations.

“It does not require a franchisor to abide by the law in regard to those who are employed by the franchisee, and there is nothing which requires an employer to be aware of their legal obligations toward their employees,” he said.

Dwyer said that migrant workers were particularly vulnerable and poorly served by the Code.

“The Code does not address the issue of the interaction of employment and immigration law and does not address situations where overseas workers are subject to exploitation and intimidation.

Overseas workers still face fears and threats of being reported to immigration and deported. Proceedings to recover unpaid wages in the current system are complex, time consuming and costly.”

He also said that certain franchise models were structured in a manner that was financially unsustainable for franchisees and that this was not addressed by the Code.

“It is clear that many individuals enter into franchise arrangements without having a clear understanding of all that’s required. Once all the costs have been met, the actual return to the franchise holder is often minimal or even non-existent.”