Fair Work terminates Domino’s Pizza worker agreements

Shares in Domino’s Pizza have dropped sharply after the Fair Work Commission terminated deals with workers under which they were paid less than minimum award rates.

The ruling by the Fair Work Commission to terminate 27 expired, existing enterprise agreements by January 24 could add significantly to Domino’s labour costs.

Domino’s shares dropped $1.36, or 2.9 per cent, to $45.23.

The company in August forecast a 20 per cent rise in annual profit in 2017/18, its weakest pace in four years, due to the impact of higher wages and slowing sales growth.

The Shop, Distributive and Allied Employees Association (SDA) said it had long held concerns about the pay and conditions of Domino’s workers, especially Sunday penalty rates.

Domino’s said it had not opposed the termination of the enterprise agreements, and had requested and been granted time to transition to a new agreement that is currently being negotiated.

“Negotiations with the relevant parties for a new EBA are well advanced, and the intention is for it to take effect before the termination of the existing EBAs,” Domino’s said in a statement yesterday.

Over the past 18 months, Domino’s has already increased our team members’ take-home pay in good faith in anticipation of the new EBA.

“Domino’s will communicate the Commission’s decision to its franchisee network today, so that employees continue to receive their correct entitlements in this transitional period and beyond.”

The new enterprise agreement will apply to more than 20,000 employees in 660 Domino’s stores across Australia, and the company intends for it to take effect before the termination of the existing agreements.

“Over the past 18 months, Domino’s has already increased our team members’ take-home pay in good faith in anticipation of the new EBA,” Domino’s said in a statement.

The company has been auditing its franchise stores for three years and recovered $5.4 million worth of unpaid wages and superannuation since 2014.

The Retail and Fast Food Workers Union said the Fair Work decision will return tens of millions of dollars to Domino’s workers every year.

According to the union’s analysis, an average casual delivery driver working 10 hours per week was being underpaid by more than $2,000 per year under the old agreements.