Millions of fines await 'rogue employers' that intentionally underpay employees
Intentionally underpaying employees their wages and entitlements is now a criminal offence in Australia thanks to changes that took effect at the beginning of the year under the Closing Loopholes law.
According to the Fair Work Ombudsman, intentional conduct includes:
"We can investigate suspected criminal underpayment offences and refer suitable matters for criminal prosecution," the FWO said. "If a person is convicted of a criminal offence, a court can impose fines, prison time, or both."
A company that is found guilty of intentionally underpaying employees may face fines of up to $7.85 million, or three times the amount of the underpayment, whichever is higher.
Individuals found guilty of this may also receive up to 10 years in prison. They can also get fined up to $1.65 million, or three times the amount of the underpayment, whichever is higher.
The new criminal underpayment laws took effect in the face of criticism from employers.
The Australian Chamber of Commerce and Industry ACCI said the laws are complex, while the Ai Group said the move will further prevent employers from disclosing and rectifying wage underpayments.
But Employment Minister Murray Watt said they have designed the laws to ensure that honest mistakes won't be subject to criminal prosecutions.
According to Watt, there are "rogue employers" who go out of their way to knowingly underpay their employees.
"Now, if employer groups want to get out there and argue that bosses who deliberately underpay their workers should get away with it scot-free, then good luck to them," Watt told ABC in an interview. "I think they'd have a fair bit of trouble convincing Australians that that's a fair way to go."
