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Labor Promises To Crack Down On Illegal Phoenixing If Elected

Labor promises to crack down on illegal phoenixing if elected

If elected next year, the Labor government has promised to introduce tough new legislation to crack down on illegal phoenixing activity.

Under the proposal, company directors found to have engaged in phoenixing will be ‘named and shamed’ by the Commissioner of Taxation.

The announcement is the latest addition to the opposition’s anti-phoenixing platform, which also includes longstanding support for director identification number measures currently being considered by Treasury.

Phoenixing is a form of wage theft

Illegal phoenixing is a form of wage theft, where a director transfers assets to a new business and then liquidates the old company before starting to trade the new business, leaving employees who are owed unpaid wages and entitlements like annual leave and superannuation with no way of recovering what they are owed.

“These proposals are great news for vulnerable workers,” said Miles Heffernan from Industrial Relations Claims.

“For too long, dodgy bosses have been able to liquidate a business and effectively wipe out what they owe their workers, and then re-start their business under a new name.

“In some cases, the new business simply re-hires the same employees that worked for the old business – it’s wrong, and it shouldn’t happen.”

Dodgy directors could be disqualified

The new measures will also see the commissioner given the power to apply to ASIC to have disqualification orders drawn up for directors found engaging in or overseeing “serious non-compliance”.

“To boost productivity, protect vulnerable workers and secure the tax base, Labor will take tough new measures to crack down on dodgy phoenix directors,” said Shadow Assistant Treasurer Andrew Leigh.


If you have not been paid your proper wages and entitlements, we can help.

Please call our team at Industrial Relations Claims today on 1300 853 837.

For more information on phoenixing, click here.

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