A group of 61 current and former Vodafone franchisees in the UK has filed a legal claim against the company, seeking over £120 million.
They allege that Vodafone made significant cuts to their commission payments and remuneration since 2020, often with little notice or explanation, according to Reuters.
According to the claimants, these actions have caused severe financial and personal distress, with some facing bankruptcy.
Vodafone, one of the world’s largest mobile operators, acknowledged the claims in a statement, asserting that it took them seriously but denied any wrongdoing.
The claimants accuse Vodafone of acting in bad faith and breaching franchise agreements.
They further allege that the company improperly benefited from government business rate reliefs intended to support franchisees during the financial strain of the COVID-19 pandemic.
Andrew Kerr, a franchisee from Northern Ireland, alleges that Vodafone’s decision to cut his commission with just 14 days’ notice wiped out nearly a third of his revenue, ultimately causing him to lose his business.
“While we have acknowledged challenges were faced by some franchisees, we strongly refute claims that Vodafone has ‘unjustly enriched’ itself at the expense of small businesses,” Vodafone said.
Vodafone stated that its franchise model operates as a commercial relationship, emphasizing that while franchise partners are offered support, their commercial success is not guaranteed.
“We maintain that where issues have been raised, we have sought to rectify these and believe we have treated our franchisees fairly,” Vodafone said.
