KFC and over 80 franchise operators across the country have agreed to pay $28.8 million to settle a class action lawsuit over employees’ missed rest breaks.

The settlement was announced in the Federal Court last week, after the applicants and KFC reached an agreement following months-long negotiations.

Gordon Legal, together with Shine Lawyers, commenced the class action in 2023, seeking compensation for employees who did not receive 10-minute rest breaks over six years. The case is supported by the Shop, Distributive and Allied Employees Association (SDA), the union for employees in the fast food and hospitality industry.

The lawsuit claimed that the chain failed to provide the rest pauses that employees were legally entitled to, and thus contravened the Fair Work Act 2009.

Approximately 90,000 current and former KFC team members are expected to be eligible for compensation if the settlement is approved by the court.

At a further hearing next month, the court will be asked to order a ‘registration period’, during which affected workers must register their interest to receive compensation.

“This is a large settlement which will compensate many thousands of workers, and one which we think will send a powerful message to the fast-food giants and other employers of inexperienced workers,” said Guy Tiffany, senior associate at Gordon Legal.

“We are pleased that KFC and franchisees have taken a sensible approach to this case which will result in a fair outcome for thousands of young workers.”

Gerard Dwyer, national secretary of the SDA, said the union welcomes the settlement, adding that “the SDA urges McDonald’s, which is in a similar position, to settle with the SDA on behalf of their current and former employees who did not receive the paid rest breaks to which they are entitled.”