Wage theft is rampant in Aussie workplaces

A report has detailed just how common wage theft issues are across Australian workplaces, with certain demographics more likely to run into exploitation.

Unlawful workplace practices like wage theft are very prevalent throughout Australia. In fact, according to Legal Aid NSW’s Employment Law Service, the number of people inquiring about their pay and entitlements in relation to wage theft increased 43 per cent between 2022 and 2023.

Wage theft encompasses a range of illegal activities, including underpayment of wages, non-payment of overtime, and denial of entitlements like leave or superannuation. Legally, these practices contravene the Fair Work Act and other employment laws and often result in significant penalties for the offending employers.

The overall consequence of wage theft goes beyond the realm of individual financial losses. It also extends into broader economic and social inequities, affecting the standard of living and undermining trust in the employment system.

Giles Fryer, solicitor in Legal Aid NSW’s employment law team, said wage theft and exploitation are particularly common among migrant workers, who hold 26 per cent of all jobs in Australia.

Migrant workers are often concentrated in industries such as retail, hospitality and agriculture and are more likely to be casual and seasonal workers, which can open them up to various forms of exploitation.

“Migrant workers such as fruit pickers in regional areas are particularly vulnerable to underpayment and exploitation, so we want to ensure people know help is available. Many migrant workers don’t report exploitation because they are fearful they could lose their visa rights; however, we want people to know that there are new protections in place if they choose to take legal action,” Fryer said.

“Migrant workers are now entitled to the same employment law rights and entitlements as other employees working in Australia. These changes are applicable regardless of migration status.”

Lazy payroll procedures by employers can hurt the pockets of employees, with some examples highlighting the fact that some businesses fail to provide payslips – a legal requirement.

“We often see employees who are paid below award rates and not given payslips, despite this being a legal requirement. That makes it harder to identify if they are owed unpaid overtime and penalty rates, annual leave or superannuation,” Fryer said.

Furthermore, it places ethical businesses at a competitive disadvantage, distorting market dynamics as their competitors are making money by underpaying their staff and perhaps deterring talent from entering the industry based on the knowledge of wage thefts.

“We encourage people to check their wages and entitlements like leave and loading by using the Fair Work Ombudsman’s online Pay and Conditions Tool to make sure they’re above board and to reach out for help if there are any red flags or they are unsure. There is a six-year time limit to commence a court claim; it is best to seek advice about your issues as soon as possible after they happen,” Fryer said.