
When profits are tight, franchisees look for different ways to flout the system.

When he was working as a delivery driver and cook, Rob Goodwin remembers being told by a franchiser to scrimp on core ingredients like flour.

“You can only make 42 bases out of a bag of flour but we were making upwards of 50 - they were getting around 10 more pizzas out of each bag then they were supposed to,” he says.

Former Queensland franchisee Rohit Malhotra said he was aware of some franchisees using raw ingredients that fell off unbaked pizzas.

“They put it into a container and put it back into the cold room to reuse them. That’s how much you have to cut corners,” he said.

Malhotra lost four stores following an audit that found underpayment of wages. He had to repay more than $200,000 in unpaid wages and superannuation and admitted to not always paying staff by the book. He says it was standard practice across many stores.

Goodwin claims there are many franchisees “doing dodgy stuff”.

“It is not just one-off people, they can’t make money without it,” he says.

Like most of the cases of underpayment of wages uncovered during spot checks or audits, it was handled by Domino’s with the regulator none the wiser. If it isn’t a complaint, they don’t have to tell the regulator.

Devanshi Panchal says running a Domino’s store threatened her health, relationships and financial wellbeing. In 2013, after three years managing stores in and around Sydney, she decided to buy her own store in Bathurst on the NSW central tablelands.

She worked at the store six days a week, clocking off at 3am some nights.

In early 2016, Domino’s conducted a payroll audit which found she had underpaid staff by more than $80,000. She found discrepancies in the audit and says she negotiated it down. She disputes underpaying staff, but says the stress of dealing with Domino’s and the meagre profits wasn’t worth it.

“A lot of people I’ve known have had mental breakdowns because there is so much you have to do, and so many restraints … I was seeing doctors. I had anxiety and cardio problems caused by all the stress,” she says. Panchal sold her store just before Christmas.

“If you haven’t run a Domino’s you don’t understand it.”

She was no novice. Before she became a franchisee she worked at a Domino’s store at Kings Langley in NSW for three years. In March 2016 she wrote to Domino’s saying she had been ripped off, working up to 30 hours a week for a flat rate of $12 an hour.

She herself eventually received $25,000 in back pay. The franchisee is still working in the system. “A broader investigation did not identify any ongoing breaches of employment obligations,” Domino’s said in a statement.

Pamir Dehsabzi runs 10 stores on the outskirts of Sydney. He also represents Domino’s franchisees on the powerful Franchisee Advisory Committee and has even been put forward to Fairfax Media by Meij as a satisfied franchisee (Meij forwarded an unsolicited email Pamir had written that outlined his passion for Domino’s and how the company had achieved what franchisees could never have dreamed about.)

Dehsabzi told Fairfax Media he has fostered a “loving” relationship with his staff.

“I am not a dictator, I just want my staff to be happy. I want them, when they come, they are not scared of me … they are very hardworking, I love them and they love me. Happy staff work better than unhappy staff,” he said.

But not all his staff agree. Azrael Yin, his former store manager, remembers long hours in suffocating heat, with no air conditioning.

“I was so stressed all the time,” he says. “I was working 60 hours a week without a break and sometimes I was the only person in the shop, to save on labour costs. I would have to make the pizza, run to customers if they came into the shop, take phone orders, deal with complaints, go out the back and make the pizza, pack the pizza, train staff, order stock and do the payroll.

“I had to bring in a fan because it was so hot working close to a 200-degree oven … North Ryde was the same, bad air conditioner and wages.”

Yin says his job involved systematically underpaying employees to meet Dehsabzi’s 27 per cent labour-cost ceiling. Every week Yin would send Dehsabzi payroll reports which listed employees working less than their actual hours.

Dehsabzi vigorously denies allegations that he underpaid workers. The Fair Work Ombudsman says it has a record that 12 workers were underpaid by one of his businesses.

He admitted the payroll figures didn’t always match the hours recorded on internal “sales reports”, but blamed his employees for the discrepancies, claiming they often clocked in early or clocked out late.

“People are not signing out on time or they are going out on a delivery and not coming back … I’ve seen it with my own eyes, people coming in late. Even the store manager, I have caught them many times,” he said.

“A lot of the time people are coming to work not [to work] but they are coming for fun - they are having lunch or come to see their friend.”

Yin said he worked between 50 hours and 60 hours a week but that his pay slips often showed he worked 35 hours as anything above 38 hours would attract penalties.

But they also credited him with payments for deliveries he never made. This had the effect of denying him overtime payments for extra hours he worked. In one week he was credited with making 140 deliveries as well as working 35 hours as store manager. Some weeks the entire delivery of pizzas at the store was 250.

Dehsabzi says store managers can work 50 hours but he never asks them to work more than 38 hours a week. He said sometimes store managers deliver pizzas and this accounted for the pay-slip differences. He says he always paid overtime correctly.

Yin reported Dehsabzi to head office shortly after he quit his job in April 2016. The long hours, poor pay and heat exhaustion finally got to him.

He never heard back from Domino’s and never received back pay.

Domino’s says “the complainant, who advised they were a current employee, was adamant they did not want to be identified in relation to their complaint.”

It says an investigation identified a “limited number of discrepancies with our management policies, which were rectified.”

Meanwhile, on January 19, 2017 another worker in another store wrote to Dehsabzi asking him to “please pay them [staff] on time and correctly”. He said “last week our labour is 27 per cent but you deduct lots of our staff salary ... today is my day off ... But after I know you hold our pay, I have to come back to the store and spend more than an hour to write this email.”