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Background

The Fair Work Ombudsman (FWO) and its predecessor agencies have received a number of requests for assistance from United Petroleum franchise and commission agent employees.

On 3 September 2015, a media article was published containing allegations United Petroleum employees were underpaid minimum hourly rates, in some cases receiving as low as $10 an hour. These allegations were consistent with the pattern of requests for assistance received by the FWO, and as a result, a broader compliance activity (the Activity) was undertaken to assess United Petroleum retail fuel outlets compliance with Commonwealth workplace laws.

Consistent with other significant compliance activities involving franchise networks, the Activity assessed the levels of compliance by United Petroleum, its associated entities, franchisees and commission agents.

During the Activity, United Petroleum operated a 100% franchise and commission agent model. Approximately 40 of their 440 outlets were franchised and the remainder operated as commission agents. However United Petroleum has since informed the FWO of its intention to move away from a franchise model and operate stores through commission agents, the company directly or on a supply-only basis in the future.

United Petroleum [ACN 085 779 255] is based in Abbotsford Victoria, and is an Australian owned proprietary company first registered in 1999. United Petroleum does not operate any retail fuel sites itself and does not directly enter into the franchise or commission agent agreements. That role is performed by United Petroleum Franchise [ACN 127 764 989], an associated entity also based in Abbotsford. United Petroleum Franchise is an Australian owned proprietary company first registered in 2007. Both entities have common Directors.

United Petroleum franchisees and commission agents operate under different arrangements. Franchisees receive a fixed commission payment per month that equates to a set amount of litres of fuel sold, and an additional amount per litre for additional fuel sold. On top of this, franchisees also receive a commission for all stock sold. Franchisees pay daily fees on total gross shop sales and a fee for licensing and maintenance.

Commission agents individually negotiate the fuel commission received and also receive a commission for all stock sold. Commission agents pay fees daily for insurance and maintenance. Their licence fee is negotiated at the time of entering into the agreement.

Keycomp Pty Ltd is an Australian owned proprietary company, first registered in 1999 and based in Abbotsford. It is an associated entity of United Petroleum and shares common Directors. Keycomp provides staff to United Petroleum outlets transitioning to new ownership. At the time of publication of this report, Keycomp Pty Ltd had ceased employing staff, but remains a registered company. The outlets that were staffed by Keycomp Pty Ltd are now operated by new franchisees and commission agents.