The popular hamburger chain Grill'd has been accused of misleading customers over a tree-planting donation campaign, with the consumer watchdog launching federal court action against the restaurant.
ACCC Takes Legal Action
The Australian Competition and Consumer Commission (ACCC) on Tuesday announced it had initiated legal proceedings against Grill'd, alleging the burger retailer engaged in greenwashing by overstating how much money it was donating towards its Tree Day Tuesday campaign.
The ACCC alleges that between January 2021 and April 2024, Grill'd represented to customers that it would donate $1 from every burger purchased on a Tuesday towards planting trees. However, while the chain sold more than 5 million burgers during this period, only about 4% of these resulted in a donation due to restrictive terms and conditions.
On Tuesday, Grill'd acknowledged it had donated just $250,000 to tree planting as a result of the promotional campaign.
Restrictive Conditions
The ACCC alleges that Grill'd did not adequately disclose the fine print that dictated which orders would qualify for the $1 donation. Among the conditions were that customers had to be members of the chain's Relish loyalty program, and only dine-in orders made at the front counter of a Grill'd store qualified. Online orders, takeaway, and orders made via QR code at a table did not count.
ACCC chair Gina Cass-Gottlieb said the regulator considered the conduct a form of greenwashing. "Grill'd is a large fast-food chain and operates across Australia, meaning that its conduct had the potential to mislead many consumers nationwide about the environmental benefits of their purchase," she said.
Grill'd's Response
A spokesperson for Grill'd said the Tree Day Tuesday promotion was "undertaken with positive intent" and resulted in the planting of 100,000 trees and restoration of over 40 hectares of forests. "Grill'd takes Australian Consumer Law very seriously, and our reputation is forged in trust and doing the right thing in the communities where we live," they said.
The spokesperson added that Grill'd had worked internally and with all stakeholders, including the ACCC, to ensure that brand and sustainability initiatives are clear and cause no confusion.
Previous Controversies
The restaurant chain, which operates 180 stores, has previously faced controversies over pay and conditions, including employing young people under a training program that paid them less than minimum wage via a legal loophole. The company is also facing a separate class action by Gordon Legal, with support from the retail workers' union SDA, on behalf of workers who allegedly did not receive their 10-minute paid rest breaks on shifts of four hours or more.
When the class action was launched in December last year, Grill'd CEO Simon Crowe said the company took its obligations to staff very seriously and noted that its recently approved enterprise agreement made Grill'd among the highest-paying employers in the industry.
On Tuesday, Grill'd said it had a "proud history" of supporting and donating to community groups across Australia. "We are an Australian business, and supporting Australian communities and those in need has and will always be part of who we are," the spokesperson said.
