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Domino’s share price drops lower on class action news

The Domino’s Pizza Enterprises Ltd (ASX: DMP) share price has dropped lower today after Phi Finney McDonald announced a class action against the pizza chain operator funded by Therium.

At the time of writing the Domino’s share price is down 1.5% to $38.50.

What legal action is being taken?

According to the class action website, Phi Finney McDonald is conducting a class action against Domino’s Pizza for widespread underpayment of delivery drivers and in-store workers employed at franchise stores.

The class action alleges that Domino’s improperly told its Australian franchisees to pay delivery drivers and in-store workers under the inapplicable employment agreements.

It alleges that delivery drivers and in-store workers are owed the difference between the wages paid under the employment agreements and the amount they should have been paid under the Award.

Domino’s response.

This morning Domino’s responded to reports of the potential legal action, advising that it “has not been served with any claim or received any prior contact about this matter.”

However, it noted that one press article has “reported that the matter relates to whether the pay and conditions of drivers and in-store workers employed by franchisees should have been determined by reference to a series of industrial agreements rather than the Fast Food Industry Award 2010.”

It advised that it is of the view that those industrial agreements applied to its franchisees at all relevant times.

Adding that it “takes the proper payment of its team members seriously. Any formal proceedings received will be reviewed and actioned in the ordinary course.”

Domino’s isn’t the only company that Phi Finney McDonald has in its crosshairs. Over the last 12 to 18 months the law firm has launched class actions against embattled financial services company AMP Limited (ASX: AMP), mining giant BHP Group Ltd (ASX: BHP), and struggling food and beverage company Retail Food Group Limited (ASX: RFG).

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Domino's Pizza Enterprises Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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