Claims that Woolworths encourages its pub staff to spy on pokie players

Dozens of Woolworths pubs are being investigated over claims staff illegally gave free drinks to pokie players to keep them gambling longer, as a whistleblower alleges staff were instructed on how to cover up the practice. Costello noted that Woolworth’s announcement will see the Mathieson family’s influence significantly reduced, saying: “It is good to see Woolworths regularise the corporate structure of its pokies empire, diluting the power currently held by billionaire joint venture partner Bruce Mathieson, who owns 25 per cent of the current ALH joint venture but has management control through his son, ALH CEO Bruce Mathieson Junior. Woolworths has become the biggest pokies operator in Australia, buying a total of 330 pubs in order to dominate the liquor market. Now they make $1.2 billion a year from gaming. The video poker (pokies) operations of Australian retail giant Woolworths have been penalized by New South Wales regulators for plying customers with free booze in a bid to keep them gambling.

An interview with a Woolworths whistleblower released by MP Andrew Wilkie.Source:Supplied

WOOLWORTHS has been accused of “spying” on poker machine players at hotel venues and keeping a secret database of their personal information to assist staff in encouraging increased gambling.

Tasmanian MP Andrew Wilkie has released screenshots of internal Google Drive documents, viewable to staff across Australian Leisure and Hospitality Group’s 400 venues — which collectively run more than 12,000 pokies — along with an interview with an ALH whistleblower.

On one shared document titled “Gaming Daily Briefing Sheet”, bold letters read, “We have a massive weekly target to beat last year. We need to be out on the floor really pushing drinks. It’s tax time so people will have more money to spend. Hand out drink cards, be out there as much as possible. Do whatever you have to do to keep people in the room!”

Underneath, handover notes from morning shift staff read, “A few faces (not regulars) came back today that were in yesterday for Sunday Funday, pushing drinks and sandwiches/cakes to keep them coming back!”

They later note a regular gambler “came in at midday”. “1:50pm: We’ve had a few big hitters in the room for about an hour now! Young couple betting $3 and $4, as well as [the regular] hitting his usual $5! Could be a great hour!”

The notes go on to say the room took in $18,700 in the hour. “Smashing out drinks to keep everyone in the room,” it said. “Another great hour for 2pm, $18,000 again.”

On a separate sheet, staff are reminded of incentives available, including a $20 gift card “when you beat your shift target”, and a $50 gift card for every staff member that beats their target that week “if we exceed the turnover target of $1.7 million”.

“Slow start to the day in gaming,” morning handover notes read. “Extremely busy in restaurant. Gaming drink/coffee rounds consistently offered throughout the day with only small punters in the room. Only one hot platter supplied during the day. A lot of elderly people in however not a lot of T/O [turnover].”

Evening shift staff then added, “Started slow, picked after nine, coffees, drink shouts and toasties trying to keep them in, a lot of promo tickets going out.”

Staff at ALH share notes on pokies players.Source:Supplied

“They just think that you are having a general chitchat.”Source:Supplied

In the interview released by Mr Wilkie’s office, the whistleblower said a lot of people in the industry felt uncomfortable with the “predatory tactics”.

“It’s unethical, and essentially you are looking over people’s shoulders, and documenting what people are doing and they don’t know that you are doing that,” he said. “They just think that you are having a general chitchat with them but you’re actually profiling it.

“It used to be an unwritten thing, you’d talk to patrons in a genuine sense. But now those genuine interactions aren’t what they used to be. We’re actually writing it down so that we can get people to stay for as long as possible to put as much money into the machines as possible.

“You know the ins and outs of their life. You’re writing down what they do, what time they normally come in, the teams they barrack for, and then you can go and have a conversation with them very, very easily because you’ve got that background information. The longer people stay there, the more they lose, that’s how pokies work.”

He said the more people bet, the more attention staff would pay to them.

“If you’re betting $5, the company is going to look after you because you’re going to lose the most amount,” he said. “So we’ll spend more looking after you to keep you there longer because you’re important.”

The whistleblower added, “Over the years I’ve seen people crying at their machines or urinating on their chairs because they have been playing for so long, they’ll stay all day and even sometimes wet themselves. It’s not right, how can that be right?”

In a speech to Parliament on Wednesday morning, Mr Wilkie slammed the behaviour as “immoral” and “possibly illegal”. “In all these venues, there are some staff who record personal information about poker machine players, without their knowledge, and share it electronically with the other venues,” he said.

“This isn’t just basic information — we’re talking things like jobs, times people come in, favourite drinks, favourite football teams, whether they have a partner and what their preferred bet level is.”

Mr Wilkie said in Tasmania alone, Woolworths owned five poker machine venues at which Tasmanians lost $10 million every year, including $4 million in his electorate.

“This makes a complete and utter mockery of the ridiculous claims being made by the poker machine industry in Tasmania as part of the ‘Love Your Local’ campaign, because these revelations show that these aren’t loveable local pubs but rather very big business that shares its customers’ most private details,” he said.

“And not only are they big business, they’re also a part of a co-ordinated campaign to spy on unknowing patrons so they can fleece even more money out of their pockets, including the gambling addicts who make up 15 per cent of people who play weekly.”

Mr Wilkie said the revelations “demonstrate just how low the poker machine industry stoops to create addicts”. “We already know this is an industry that is prepared to lie to the community, whether it’s about jobs or the rates of gambling addiction,” he said.

“And now we know the industry is prepared to abuse the trust of their customers to make money. This is disgraceful behaviour and they should be called out.”

In a statement, ALH head of regulatory and corporate affairs David Curry said the company “takes its obligations for the Responsible Service of Gaming and the Responsible Service of Alcohol in all its venues extremely seriously”.

“Our industry and operations are robustly regulated by independent authorities in each state and our compliance with all laws and regulations is not negotiable,” he said.

“ALH must put its customers’ interests first. There is a line which must be respected between legitimate customer service and loyalty initiatives that are part and parcel of every hospitality business and the requirements of the RSG and RSA codes.

“If there are instances where that line has been crossed ALH is committed to taking the necessary steps to rectify any breach and address any non-compliant behaviour.

“To this end we have notified the independent regulator in Queensland where the matters canvassed today originated in mid-2017 and stand ready to provide any assistance or further information if the regulator requires.”

In a statement, Woolworths Group chairman Gordon Cairns said the company was “concerned” about the allegations. “We and ALH take our responsibilities in gaming and the service of alcohol very seriously,” he said.

“At Woolworths, our priorities and values must always match those of our customers and communities we operate in and this includes taking important steps to ensure we, through ALH, are a responsible gaming operator.

“At its last Annual General Meeting, Woolworths reaffirmed its commitment to being the leader in responsible gaming which is conducted through its joint venture with ALH.

“In late 2017 ALH engaged Canada’s Responsible Gambling Council, an independent non-profit organisation dedicated to problem gambling prevention, to conduct an independent review of ALH’s gaming operations.

“ALH will expand RGC’s review to include the allegations raised by the former ALH employees and Mr Andrew Wilkie. We would encourage them, Mr Wilkie and any others with relevant information to be part of the independent review.”

ALH has been contacted for comment.

Woolworths is reported to be instructing staff to ply gamblers with food and drink and to keep dossiers on the private lives. And while Woolworths has been singled out for systematically requiring these kind of practices from their staff, the company is hardly alone in putting profits ahead of gambler’s well-being.

Poker-machine operators have good reason to treat their customers like this. Their primary goal is to take as much money from their customers as possible, and with poker machines, this means easing gamblers “into the zone”.

Read more: FactCheck: are 'around 5,000 jobs' at risk if pokies are removed from pubs and clubs in Tasmania?

“The zone” is the term that frequent poker-machine gamblers often use to describe the altered state they enter into when gambling on pokies. The experience of entering the zone - and even the term itself - has been independently described by gamblers in studies in Australia and the United States.

Woolworths Pokies Pics

Gamblers describe it as an out-of-body experience. As one gambler put it:

You aren’t really there, you’re with the machine and that’s all you’re with.

Or in the words of another gambler:

I feel connected to the machine when I play, like it’s an extension of me, as if physically you couldn’t separate me from the machine.

Woolworths Pokies Revenue

But the zone is also an expensive state to access. Gambling on pokies costs - on average - around A$120 per hour, or up to A$1,200 per hour if machines are played to their maximum capacity.

It’s when their customers are in the zone that poker-machine venues are at their most profitable.

Easing gamblers into ‘the zone’

Poker-machines are specifically engineered to ease people into the zone and to keep them there, according to emerging evidence. But in order for people to enter the zone, people must play the machines, and preferably play uninterrupted. This is where the tactics of venues like Woolworths loom large.

Venues use a wide range of tactics to get gamblers in through the door and in front of machines.

First of all, poker-machine venues are located in convenient locations, near to high traffic transport routes, shopping centres and the like. This facilitates frequent visits, and venues try to decrease the distance from your home to the closest poker-machine venue.

For the same reasons, gambling venues are open very long hours. Operators want poker machines to be available should you need somewhere to go at 3am.

Indeed, poker-machine operators also go to extraordinary lengths to make their venues feel comfortable and welcoming. Operators have known for decades that the venue environment is crucial to facilitate profitable gambling. A cottage industry of research has sprung up in recent years to better help casino managers understand what sort of venues will keep gamblers feeling at ease.

Read more: 'No pokies' Xenophon goes for 'some pokies', but does his gambling policy go far enough?

For example, a 2011 study of pokie venue gamblers in Australia found there were certain gambler-friendly qualities of the venue which could be improved on to attract more gamblers. These included free refreshments; attentive customer service; safety and security; loyalty programs; and comfortable seating.

Casino design manuals go into great detail about how the manipulation of casino atmospheres can encourage people to stay and play. These manuals state that lighting should be steady and even, and should be angled away from gamblers faces.

Smells are said to affect gamblers’ decisions to continue gambling or leave, and so venues regulate them. Special attention is given to keeping out bad odours. In casinos, even architectural decisions such as ceiling height are calibrated to maximise gamblers’ “cognitive satisfaction”.

Ambient music shouldn’t be too loud or too soft, and should be deflected, reverberating off walls rather than directed into gamblers faces. And music coming from the poker machines themselves shouldn’t be too jarring lest it distract the gambler, or attract too much attention to a win.

All these amount to providing what one study has termed “social accessibility”, the degree to which venues provide safe, friendly and easy places to visit - and to stay. The relationship with venue staff is central to this, as one problem gambler from the same study put it, “[In] all my preferred venues they [the staff] know me quite well”. It is this social accessibility that appears to be being manipulated by unscrupulous operators.

On a grander scale, US casinos use big data to devise tailored marketing strategies which will pull people back in. Recent court findings have shown that US casino giant Caeser’s values its customer database at more than US$1 billion dollars.

While Australian pubs and clubs are not allowed to promote poker machines directly, they are able to cross-promote other events that might serve as vehicles to bring patrons into the venue, and thus facilitate a gambling session.

Venues also offer a place where children are encouraged to come and play. Not only does this facilitate the gambling of their parents and carers, but hearing or seeing adults gamble may serve to normalise the practice for the next generation. In particular, new research has found that marketing, especially of family-friendly events, is influential in shaping children’s and adults’ perceptions of gambling venues and products and thereby increase the likelihood that children will gamble when they grow up.

When good hospitality becomes harmful

All of these measures are designed to make gamblers as comfortable and relaxed in venues as possible. So why is this a problem?

In short, poker machines are highly addictive and cause a great deal of harm. Subtle manipulation of gambling venues are tested and tweaked by operators to maximise the chance that someone will come in, play the poker machines, and keep on playing.

What may look like good hospitality, is in effect a subtle - or in the case of Woolworths not so subtle - attempt to keep people gambling after the point at which they would otherwise have stopped.

The Woolworths revelations demonstrate once again that poker-machine venues can’t be trusted to self-regulate in the best interests of their patrons.

Woolworth Poker

Industry practices such as codes of conduct - and the “responsible gambling” mantra - are simply inadequate when venues have a business model reliant on harmful levels of gambling.