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Criminal penalty for wage theft under government’s reform plan

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The Indian Telegraphhttps://theindiantelegraph.com.au/
Established in 2007, The Indian Telegraph is a multi award winning digital media company based in Australia.
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Employers who commit wage theft will face criminal penalties for the first time if changes proposed by the Morrison Government go ahead.

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Employers who have stolen workers’ wages will face up to four years in prison and fines of more than $1 million under tough new penalties being proposed by the Morrison government.

Industrial Relations Minister Christian Porter announced the first criminal penalty as part of the omnibus bill being introduced into the parliament on Wednesday.

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“The offence would apply in circumstances where a national system employer dishonestly engages in a deliberate and systematic pattern of underpaying one or more of their employees,” Mr Porter said.

He said the new offence would carry a maximum penalty of a $1.11 million fine and/or imprisonment for up to 4 years for individuals, and a $5.55 million fine for a body corporate.

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People convicted of the offence would also be banned from managing corporations for five years.

“I wouldn’t say that the business groups were necessarily enthusiastic about that concept, or this part of the legislation,” Mr Porter said.

“But we considered with the raft of underpayments and the scale of some of them that a much clearer a message needed to be sent.”

The criminal offence will not apply to one-off underpayments, inadvertent mistakes or miscalculations.

Civil penalties for individuals and corporations will also be increased by 50 per cent, with maximum fines rising to $19,980 for individuals and body corporates including small businesses facing penalties of $99,900.

“For underpayments by bigger businesses, maximum penalties will now be based on the higher of either ‘two times the benefit obtained’, or $99,900,” Mr Porter said.

Infringement notice fines and maximum penalties for sham contracting, and for failing to comply with a Fair Work Ombudsman compliance notice, will all also increase by 50 per cent.

The government on Monday announced it would also create a definition of casual employment under the Fair Work Act, and casuals who work regular shift patterns for a year can become part time or full time if desired.

It will also prevent casual workers who have been paid a loading from claiming back leave benefits in a court.

But ACTU secretary Sally McManus said those changes would take rights off workers and entrench casualisation.

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