Former employees of Doughnut Time, which went into voluntary administration last Friday, claim they are owed up to $200,000 in wages and hadn't been paid for weeks before they were fired.
None of the doughnut chain's workers were told by senior management that the company had gone into administration, the ABC reports.
Instead, employees were emailed by middle management just before the weekend.
"Today has been the last day of Doughnut Time," Victoria state manager Vanessa Gaddi-Chmielewski wrote, according to the ABC.
"I just received the news from [company chief executive] Dan [Strachotta] that the deal with the new company has been blocked by [founder and director] Damian [Griffiths].
"He will not sign the Doughnut Time trademark to Dan.
"As a result, the entire company will go into liquidation - including the stores that Dan was supposed to take over. The sale has not been completed."
Disgruntled employees are now taking to social media to vent their frustration, claiming their queries are going unanswered.
"I am owed 150 hours of work and all of my super payments since joining the company in June," Reddit user The Rainbow Muffin wrote on Friday.
"I worked as a driver taking the doughnuts from the kitchen to the stores, and in the last month was promised a full time contract as Logistics Supervisor under the new ownership under Strachotta.
"It is my understanding that the deal between Griffiths and Strachotta did not take place, hence the liquidation."
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A GoFundMe campaign has been launched to raise $200,000 in funds for workers who are now out of a job.
"On the 4th of March Doughnut Time Pty Ltd abruptly closed half the stores without warning," the campaign statement reads.
"This left lots of staff unknowingly without jobs ... All outstanding wages vanished, totalling over $200,000.
"They also haven't paid any superannuation to staff for the last 15 months, which would see the total amount owing, rise closer to an amount which some people would be scared to know."
The GoFundMe campaign alleges that some staff members had gone more than seven weeks without pay, "waiting for that light at the end of the tunnel."
"DT staff were taken advantage of," the statement continues.
"Their trustworthiness and work ethic were abused and they are left with nothing to show for it ... Doughnut Time employed more than 60 per cent of internationals, from holiday workers to students, and professional visa holders.
"This has left hundreds of workers with no hope of ever seeing their hard-earned money."