Victorian Labor to jail bosses for deliberate and reckless wage theft
The Victorian Labor Party has announced plans to jail bosses for wage theft if it wins the upcoming election.
Miles Heffernan, Litigation Director at Industrial Relations Claims, welcomed the decision.
He says criminal penalties for wage theft are long overdue.
“This is the first solid promise by a government in Australia to do something about the scourge of wage theft,” he said.
“The problem is rife in many industries and Fair Work has proven ineffective in stamping it out.
“Last financial year, for example, the regulator managed to launch less than 50 prosecutions, and that’s with a budget of $110 million.”
Victorian Labor to jail bosses for wage theft
Premier Daniel Andrews made the announcement at the party’s state conference.
As a result of the new laws, Victoria will be the first jurisdiction in the country to lock up bosses convicted of deliberately underpaying workers.
Under the new proposal, employers will face a maximum jail term of 10 years, and businesses will also be penalised up to $950,000 for failing to pay proper:
- minimum award rates;
- penalty rates;
- overtime; and also
- superannuation.
The penalties will also apply to employers who fail to keep proper paperwork or falsified payment records.
Additionally, the government will fast track the legal process to recover wages with cases heard within 30 days.
There will also be a new agency called the Victoria Wage Inspectorate which will enforce the new laws.
“Every worker has the right to get a fair day’s pay for a fair day’s work,” Mr Andrews told Fairfax.
“The simple fact is underpaying workers is theft and it’s time it’s treated like that in our laws.”
Union pushed for new laws
The proposed tougher penalties came as a result of pressure from the United Voice Union.
Victorian secretary Jess Walsh said:
“The choice will be clear – pay the legal minimum award, or otherwise face jail time.
“Employers won’t be able to just ignore or intimidate their staff when they speak out, because the stakes will be a whole lot higher.”
Existing laws adequate
However, business groups oppose the the proposed laws.
Australian Industry Group chief executive Innes Willox maintains existing laws are enough to address the problem.
“The Fair Work Act already contains very large penalties for employers who underpay workers and also for those who do not keep the required pay records,” he told Fairfax.
“Underpaying workers is not acceptable behaviour. However, ‘wage theft’ is an emotive term coined by the union movement designed to tarnish all employers. It describes something which is already comprehensively addressed in legislation.”
Wage theft is theft
Mr Heffernan, from IR Claims, rejected that argument, however.
“What else do you call it when an employer steals wages from their employees – other than exactly what it is – ‘wage theft’?” he said.
“And considering wage theft is now rife in many industries, including hospitality, it is clear that current penalties are ineffective.
“If an employer does the right thing, they’ve got nothing to worry about.”
Call our team at Industrial Relations Claims today on