For the last couple of weeks, the question on everyone’s lips has been, “What’s happening with Grill’d?”
At the end of November, we reported the burger company’s CEO Simon Crowe had sent out an email to all staff warning them about a “pending media story” which would, in his words, “wrongly claim we have worked against the interest of our franchise partners, and our restaurant teams.”
The email didn’t make clear what exactly was being alleged or who was spearheading the story, but given the glut of reports in the media about the hospitality industry, it was a reasonable assumption Grill’d might be under the microscope for underpayment and wage theft.
That ended up being right – but there’s also more. Over the weekend, the Sydney Morning Herald (SMH) and The Age have published five stories from their investigation into the burger chain, led by journalist Adele Ferguson, alleging a number of serious issues.
These are the five key allegations.
1. Grill’d is accused of using a government-subsidised traineeship program to pay staff less.
The SMH and The Age allege Grill’d uses low-paid “traineeships” – which are subsidised by the government – in order to pay staff below-ward awages. Business Insider Australia has heard similar allegations for current and former staff at Grill’d.
The trainees are ostensibly pursuing a Certificate III in hospitality, and can be paid a lower wage on the proviso they spend 20% of their paid hours studying for the qualification online.
As an example, a 21-year-old working Saturdays as a trainee would be paid $18.50 per hour, as compared to $21.75 if they were not part of the traineeship programme.
According to the investigation, 95% of staff surveyed Canberra Students for Fair Work were not given time by their managers to complete that study. Additionally, it’s alleged the program was not operational for three months but staff were still paid trainee wages.
Grill’d employees, many of whom say they likely would not have gotten the gig without being part of the traineeship program, describe it as a “farce” and a “scam”.
In a statement to the SMH and The Age, the company said any assertion its agreements were anything but “lawful, valid or compliant” was false.
2. There is ‘constant pressure’ on managers of Grill’d to keep wages down.
According to the SMH, the “army” of store managers at Grill’d are pressured and incentivised to keep labour costs down. Managers can be paid bonuses of up to $12,000 if they hit wage targets.
As a result, many company-owned and franchised restaurants operate on very low labour cost to sales ratio. According to company documents seen by the SMH and The Age, only three restaurants out of a total of 136 paid an average wage of more than $20 – with one paying an average wage of only $14.16.
As above, Grill’d asserts any suggestion its agreements with staff are anything but “lawful, valid or compliant” are false.
3. There have been ‘serious’ food safety concerns at 1-in-10 company-owned Grill’d restaurants.
Internal audit reports seen by the SMH and The Age dating back to 2017 show that 1 in 10 company-owned Grill’d restaurants had been warned about serious food safety concerns.
Among these breaches were failures to keep track of cooking temperatures for meat, buildups of food and mould on the assembly bench, out of date and unlabelled food, and evidence staff members hadn’t washed their hands during food prep and service.
NSW and Victorian restaurants were considered the worst with regard for food safety. A single restaurant in Malvern, Victoria reportedly received 14 “critical” ratings for non-compliance with health regulations.
In a statement, Grill’d said food safety was a top priority.
“Grill’d has made significant investments in systems, processes and people to ensure our food safety and team safety is best practice in our industry,” the company said.
“This includes compulsory food handling and safety training and a monthly third party audit.”
4. Some franchisees claim they are unfairly treated by the company.
The majority of Grill’d restaurants are company-owned – with 105 of 137 owned and operated by Grill’d. The remainder are franchised.
According to the report, some franchisees are disgruntled with Grill’d, arguing they are subjected to “questionable” practices and muscled out in favour of the company-owned restaurants.
There is “widespread concern” Grill’d may terminate the franchise agreements with its partners.
Grill’d said in a statement that “while selling franchises or territories is not our business model per se”, it “works closely with our franchise partners to build successful and profitable businesses.”
5. Grill’d co-founder Simon Crowe allegedly fabricated signatures on applications for liquor licences.
The SMH and The Age allege the company’s CEO on two separate occasions between 2011 and 2012 forged two signatures of cofounder Simon McNamara, who sold his stake in the business in 2012.
The signatures were for liquor licences for restaurants in Perth. The Department of Racing, Gaming and Liquor in Western Australia was made aware of the forgery in 2016.
Crowe wrote to the department and apologised in 2016.
A statement issued by Grill’d said: “Simon Crowe signed a particulars form including the name, date of birth and address of his business partner on his behalf without first seeking his consent as his business partner was uncontactable at the time.”
Business Insider Australia has reached out to Grill’d for comment.
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