A Michel's cake featuring coloured tiles that had its expiry date extended. In one memo, franchisees were told that coloured, edible plaques with a use-by date of January 15, 2019 had been extended to July 15. "If you receive coloured plaques from this batch number that still denotes the original January expiry date, please disregard this and ensure staff are aware of the new expiry date," the memo says. Other memos extend the use-by date by three months on chocolate cakes, including tortes and birthday cakes. Products including vegetable, and spinach and feta scrolls had their best-before date extended by two months on the original packaging.

The extensions have triggered the NSW Food Authority to refer RFG for investigation to its counterpart in Queensland, where RFG is headquartered. A separate body that sets food standards, Food Standards Australia New Zealand, told The Age and The Sydney Morning Herald that food should not be eaten after the use-by date for health and safety reasons. RFG acknowledges that there have been challenges in the Michel's network and is actively working to improve these. RFG statement It said it was illegal to sell a product after the use-by date, adding that while it was legal to sell foods that had passed a best-before date, the food may have lost some quality. RFG refused to answer questions about the issue but said in a statement that any date extension was considered only after consultation with suppliers.

Loading "RFG takes its food standard obligations extremely seriously and any potential breach of such standards would be investigated thoroughly alongside our suppliers," it said in a statement. It said during the week it had met with franchisees to discuss ways to improve the network, including how RFG would source, develop and deliver products to franchisees. "RFG acknowledges that there have been challenges in the Michel's network and is actively working to improve these," it said. One of the suppliers listed on the memos that calls on franchisees to extend the use-by date of cakes, Homebush Cakes, failed to respond to questions.

A spokesperson for the NSW Food Authority said it had started an investigation into Homebush Cakes concerning the extension of use-by dates. Loading It is the latest scandal to hit RFG, which was singled out for special mention in a damning parliamentary report into the $170 billion franchise sector. The March report said RFG’s success relied on extracting profits from its franchise systems with hugely deleterious results for franchisees, which operate under the Michel’s, Gloria Jean's, Pizza Capers, Brumby’s and Donut King banners. It recommended the Australian Securities and Investments Commission, the Australian Competition and Consumer Commission and the Australian Taxation Office investigate behaviour including possible insider trading, breaches of market-disclosure obligations and tax avoidance.

Wayne Hong, a former Michel’s franchisee who closed his store last year and suffered a massive financial loss, said he lodged many complaints to RFG about the poor quality of products. Former Michel's Patisserie franchisee Wayne Hong in Melbourne on Friday. Credit:Eddie Jim He said cakes regularly arrived at stores damaged, chocolate ganache cakes were cracked and the taste of some cakes was bad. "It was really dodgy," he said. A message sent to a franchisee Whatsapp group about the issue resulted in a series of photos of cakes and other products taken in the past week after being delivered with human hairs stuck in the icing, sausage rolls broken or over cooked, one cake frozen and refrozen, split pies and chocolate cakes with icing stuck to the box, indicating problems with the quality of delivery. Insiders claim the expiry time shift was an act of desperation by RFG to avoid writing off old stock, which would have an adverse impact on its finances.

Sausage rolls delivered to a Michel's franchisee. One said RFG had thrown out hundreds of thousands of dollars worth of expired stock in recent years. The insider said RFG ordered products from suppliers at agreed quantities and prices. The products were frozen and sent to distribution centres, then delivered to franchisees once an order was placed. “They are now just extending the shelf life and forcing us to sell expired product, which is preposterous for a company that deals with food. I was going to ask a government agency about the legalities of this but was concerned about repercussions,” one franchisee said. Another franchisee said store owners were being forced to buy old cakes and rolls at full price and each product sold attracted a royalty fee and a marketing levy.