United Petroleum forced Pie Face on franchisees; ex-franchisees say it wrecked them

ABC News reported in June 2021 on a dispute between United Petroleum and former franchisees. In 2017, the same year a Fair Work Ombudsman report found United had no system to check that franchisee staff were paid correctly, United bought the Pie Face bakery chain out of receivership for the second time and planned to revive it through its service stations. Franchisees were told Pie Face would be there 'either with you or without you', and several said they wrote to say they were already struggling to make a profit.

Former franchisees told ABC the Pie Face rollout destroyed profitable fuel and convenience businesses: extra staff, higher electricity bills, new standards and few pie sales. One showed monthly food waste over $8,000; another said he binned over $70,000 of unsold pies in six months and that some products were wrongly labelled halal, which United said it fixed within 24 hours. Breach notices followed over underpayment, food safety, pies kept too long in the warmer and litter, and several were terminated. They are suing; a lawyer says United did not disclose Pie Face in franchise documents.

United says the franchisees were terminated for deliberately, fraudulently and repeatedly paying staff incorrectly, that Pie Face was 'overwhelmingly welcomed', and that claims of systemic underpayment are false. A spot audit it commissioned at 12 of 15 sites found no substantiated evidence of underpayment, but did not say whether it checked cash-in-hand pay. The Fair Work Ombudsman confirmed its investigation, begun in 2017, was continuing. These accounts are allegations and disputed.

Ex-franchisees say they lost $465,000 or more and threw out thousands in unsold pies; they are suing for hundreds of thousands in damages.

United acquired a failing chain and required its stations to sell it whether franchisees wanted it or not, according to the former franchisees.

The pies sold poorly, so franchisees bore the cost of wasted stock, electricity and extra labour, they say.

Franchisees allege the franchise documents did not disclose Pie Face, so they could not make an informed decision.

United enforced breach notices and audits against franchisees, which they say led to terminations that handed United the sites.

Imposing an unwanted product on franchisees and then enforcing the rulebook against them creates disputes; disclose the economics first and keep compliance monitoring consistent.

As of ABC's report, several former franchisees had sued or were preparing to sue United, and about half a dozen protested at its head office. United denied wrongdoing and said it moved away from franchising after the 2017 Ombudsman report. The Fair Work Ombudsman was still investigating.