What is wage theft in QLD?

Wage theft costs Queensland workers more than $1 billion every year.

You may have seen this week’s media reports of the Fair Work Ombudsman securing a record $10.34 million in penalties against the Commonwealth Bank of Australia (CBA) and its subsidiary CommSec in response to the companies underpaying employees more than $16 million.

According to the Fair Work Ombudsman’s own media report, CBA and CommSec failed to put adequate checks and safeguards in place to ensure their employees were receiving their basic lawful minimum entitlements.

CBA also breached workplace laws by misrepresenting to some workers that they were better off under Individual Flexibility Arrangements used for their employees.

This resulted in a total of 7,402 employees’ entitlements being undercut and employees being left worse off for several years.

While the financial penalty is significant, it remains to be seen whether any personal penalties are applied to individuals within the CBA or CommSec for deliberate actions but this one leads us on to today’s topic: wage theft.

What is wage theft?

Wage theft can take various forms such as the deliberate underpayment of wages, having entitlements such as leave and penalty rates deliberately withheld, and an employer deliberately not making required superannuation contributions on an employee’s behalf.

Is it a genuine issue?

A Queensland Parliamentary Committee inquiry into wage theft in Queensland found that wage theft is widespread, affecting around 437,000 (approximately one in five) Queensland workers each year and costing more than $1 billion every year in unpaid or underpaid wages.

When is wage theft a crime?

The Queensland Criminal Code at section 391 (‘Definition of stealing’) includes deliberate, intentional behaviour leading to under or non-payment of entitlements as a criminal offence.

This could include where deliberate wage theft occurs through:

• unpaid hours or underpaid hours
• unpaid penalty rates
• unreasonable deductions
• unpaid superannuation
• withholding entitlements
• underpayment through intentionally misclassifying a worker including wrong award, wrong classification, or by ‘sham contracting’ and the misuse of Australian Business Numbers (ABN)
• authorised deductions that have not been applied as agreed.

What are the penalties for wage theft?

Employers engaging in deliberate wage theft from their employees face the risk of up to 10 years imprisonment.

Paying employees correctly is something you can’t afford to get wrong

We get that you’re busy and sometimes, the HR side of business is tempting to put off until “things quieten down a little”.

But this recent case should provide all employees a wake-up call that getting your house in order with regards to paying your employees correctly is not a “should do”…it’s a must.

After all, do you want to end up handing over your hard-earned dollars in court fines and legal fees or worse yet, staring at the sunset through prison bars?

Contact us for HR advice

If you’re not one hundred per cent sure you’re paying your employees correctly, it might be time to find someone with the right experience to ensure you are.

Bare Bones Consulting is a leading Gold Coast HR Consultancy. We also provide HR services in Brisbane and can help business owners Australia-wide.

Check out our HR Compliance page and then give Greg a call at 0401 279 065 or contact us online.