Should wage theft be criminalised?

03-Aug-2018

The non-payment or under payment of salary and wages is commonly referred to as wage theft, and unfortunately wage theft is endemic across all sectors of the Australian economy. It is also a problem in NSW Health.

It is so common in NSW Health that ASMOF has won back over $9million in payments for members over the last five years.

Recently there have been calls for a Royal Commission into wage theft and for the states to consider new wage theft laws involving not only significantly higher penalties for systematic and blatant exploitation, but also gaol for those involved and benefiting from such behaviour.

The logic is simple. If an employer did an audit and found an employee had been taking tens of thousands of dollars, do you think repayment would be adequate or would the police be called? If the ATO found an individual tax payer had not been declaring all income and paying tax on it for years again would repayment be enough, or would there be stiff penalties or even proceedings brought?

Why is the systematic and blatant taking of money from workers seen differently and more leniently? It is a matter at least worthy of discussion.

The NSW Opposition Leader, Luke Foley has announced that if elected in March 2019 a NSW Labor government will introduce a new wage theft law to address systematic, ongoing and widespread failure to pay money and other employment conditions to workers. The new law would place criminal penalties, including fines and the possibility of jail for up to 14 years, in the NSW Crimes Act for individuals who are found to be purposefully taking part in systematic, ongoing and widespread failure to pay money and other employment entitlements.

The Victorian Andrews Labor Government has pledged to criminalise deliberate wage theft if it wins the state election in November 2018.

In a submission to a Queensland parliamentary inquiry, labour law firm Hall Payne (the law firm ASMOF uses) argues that State governments need to bring the treatment of wage theft by employers into line with thefts by employees.

Hall Payne argue there is inequity between the way "stealing as a servant or a clerk" is treated and the approach to underpayment by an employer.

The submission recommends the intentional or reckless failure to pay entitlements and the international destruction of concealment of records should be subject to criminal sanction under Schedule 1 of the Queensland's 1899 Criminal Code Act. The submission argues that s24 of the Queensland Criminal Code has a defence that would be available to employers who make honest mistakes pertaining to underpayment, as opposed to engaging in deliberate wage theft.

The Hall Payne submission is not yet on the parliamentary inquiry's web page, but is quoted in a separate submission (see pages 38-39) from the Queensland Council of Unions.

Furthermore, the submission argues that the reasons for low-wage growth overlap with those for wage theft, particularly through restrictions on union entry rights and the ability to inspect pay records.

Inquiry into wage theft in Queensland, Education, Employment and Small Business Committee, Queensland Parliament