Employers could be forced to name and shame themselves over wage theft

Dana McCauley

February 18, 2020

The Age

Employers who underpay workers could be forced to name and shame themselves with public signs admitting their wage theft as part of industrial relations reforms Attorney-General Christian Porter is considering.

Businesses which fail to prevent wage underpayment could also be banned from hiring migrant workers for a period of time, and company directors disqualified from holding office.

Mr Porter, who will introduce legislation to criminalise the worst cases of wage theft in the coming weeks, is seeking feedback from unions and employers on further changes to tackle underpayments – including a beefed-up Fair Work Ombudsman and “streamlined” small claims court process.

Adverse publicity orders – forcing an employer to “display a notice admitting to having underpaid their employees” – are one option flagged in a discussion paper that Mr Porter, the Morrison government’s industrial relations minister, will release on Tuesday.

The proposed tough approach is based on the recommendations of the Migrant Worker Taskforce, set up in response to the Sydney Morning Herald and The Age’s 2015 revelations of systemic wage underpayment by 7-Eleven.

It is expected to provoke resistance from the business community, with employer peak body the Australian Industry Group already on the offensive over what it sees as an “overblown” and “divisive” union campaign against wage underpayment it argues is mostly unintentional.

The group’s chief executive Innes Willox last week blamed the hit to former Masterchef star George Calombaris’ reputation, after his company admitted underpaying $7.8 million in unpaid wages, for the collapse of the celebrity chef’s restaurant empire.

Mr Porter said the government had been “appalled” by the recent string of wage underpayment scandals and was acting to ensure “corporate Australia lifts its game when it comes to paying its workers properly”.

Professional services firm PwC has estimated 13 per cent of Australian workers are underpaid a total of $1.35 billion a year.

The minister said his wage theft bill would include “significant jail terms and fines” and further changes being consulted on were to “help deter other types of wage underpayments and non-compliance that do not meet the threshold of criminal conduct”.

Major employers including Qantas, Bunnings and Woolworths have admitted to underpaying workers after auditing their books.

“More still needs to be done to motivate companies to improve their performance, such as disqualifying directors of organisations that continue to get it wrong,” Mr Porter said.

He said while the “vast majority” of underpayments were not deliberate, they were “incredibly serious and border on negligence given we are talking about sophisticated organisations that should be capable of meeting their obligations under workplace law”.

The minister said speeding up the recovery of unpaid wages for employees was a “high priority”, with the discussion paper asking if the small claims processes in the courts “could be streamlined to encourage greater participation and at reduced costs”.

The paper also asks whether a formal role should be conferred on the Fair Work Commission to help mediate and conciliate in disputes between employers and employees, as a way of delivering faster and cheaper outcomes.

Labor had promised to introduce a small claims tribunal for workers to pursue unpaid wages if it won the 2019 federal election.

Mr Porter will also release a separate discussion paper on ways to improve the operation of the building code that governs Commonwealth-funded building and construction projects, including potential changes to “prevent multiple secondary/environmental boycott demands and behaviour”.

John Setka’s Victorian branch of the Construction, Forestry, Maritime, Mining and Energy Union was fined $1 million in 2015 for a secondary boycott of concrete supplier Boral, which it targeted as part of its industrial dispute with builder Grocon.

The building code discussion paper will also look at ways to “reduce unlawful activity” by unions more broadly, slash red tape, improve safety on building sites and boost productivity, jobs and workplace co-operation.

The paper said while fatalities in the industry were falling, safety remained “a key concern and focus” of the government as “every death on a building and construction site is a tragedy”.