Craig Kelly (Hughes, Liberal Party) Share this | Hansard source

I find that it is a rare occurrence when I actually have some partial agreement with the member for Wakefield. It is in the sentiment of his motion, but not actually in the sentiment of his language used during his speech.

It is true that this has been a scandal involving 7-Eleven. But the facts are that in this country we can never forget that the vast majority of employers do the right thing by their employees. We know that all visa holders in this country must be employed in line with Australian pay, conditions and workplace entitlements under the Fair Work Act. All employers are legally required to remunerate and to meet the work rights of all their employees, including foreign visa holders, in accordance with workplace law.

If you listened to the speech by the member for Wakefield, you would think that nothing is being done about this. It is far to the contrary. In fact, in June 2014 the Fair Work Ombudsman commenced a long-term inquiry into the systematic workplace issues at 7-Eleven franchises. The Fair Work Ombudsman conducted an education and audit campaign of several 7-Eleven franchises in metropolitan Melbourne and Geelong in 2009-10. In February 2015 the Fair Work Ombudsman commenced proceedings in the Federal Court. In June 2015 the Fair Work Ombudsman filed court proceedings against the operators of a 7-Eleven store in Blacktown. So for the member of Wakefield to say that nothing has been done is completely incorrect.

Yes, we have to look after the workers, but we also have to look after the franchisees, those small business operators. The real problem, the root cause of this evil, is the franchise agreements between the franchisor and the franchisee. We have seen the attitude of the Labor Party to this. We have seen the current leader of the Labor Party's attitude with the hot pie scandal where he actually went into a 7-Eleven store and abused the worker. That is the attitude of the Labor Party.

When it came to looking after the interests of small businesses, we saw that during their term of government no less than five separate small business ministers—a rotisserie of changing small business ministers. Most of all, this issue gets down to unfair contract terms. I quote from an article by Robert Gottliebsen about this issue. He said:

… then the standard contracts put out by Wilmot's—

which is Warren Wilmot, the former chief executive—

7-Eleven might be one of those declared unfair because they made it impossible for many franchisees to make a profit without using low-cost labour.

Indeed that’s exactly what former ACCC chief Allan Fels concluded on the program. Fels is now heading the 7-Eleven inquiry into its contracts. The Allan Fels I have known for a long time will honour his word and recommend changes to make 7-Eleven contracts fair—exactly what would have been required under the … “fair contracts” promise …

I remember the Labor Party back in 2007 when they were first elected. They had promised to extend the unfair contract provisions from consumers to small business but when they came to government they buckled, they took their orders from the Franchise Council of Australia and they refused to introduce that legislation to extend to small businesses protection from unfair contract terms. We in the coalition have taken that step that the Labor Party refused to do to protect small businesses from unfair contract terms. It may well be said that the $100,000 cap that we have placed on those contacts is not high enough and could exclude some—and there is some truth there—but we have at least taken the first step—something the Labor Party refused to do when they were in government.

Of course, the other issue is the statutory term of 'good faith' that we in the coalition have put into the franchise contracts. Again there were complaints from the Franchise Council and the opposition. I have great concern about the issue of franchisee churn, which is where one franchisee leaves and gets replaced by another franchisee. We need to address this for the future. A report in TheSydney Morning Heraldsays that 68 franchisees left the 7-Eleven system in the 12 months to June 2015. That is 68 franchisees that have closed down and gone out of business in 12 months. This is something that must be in the Franchising Code of Conduct; this is something that must be disclosed. Someone going into one of these contracts should know that there has been that significant churn through the franchise system.

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