War of Wages: Recent Changes to Wage Theft Legislation

Speak to a Specialist HR Consultant

Fill out the form below and we will call you back to organise a meeting with one of our HR Specialists.

This field is for validation purposes and should be left unchanged.
Home > Blog > War of Wages: Recent Changes to Wage Theft Legislation
default-blog

It was recently announced that the State Government will introduce legislation to make wage theft a criminal offence. This decision comes as a result of a Queensland Parliamentary inquiry which found that wage theft affects approximately 437,000, or one in five, Queensland workers. Employers who commit wage theft in the future may be liable to a maximum term of imprisonment for 10 years for stealing or 14 years for fraud.

Wage theft doesn’t just refer to the underpayment of nominal hourly rates, it also refers to having entitlements such as leave and penalty rates withheld, or an employer not making the required superannuation contributions.

In a lot of cases, annualised salaries or flat hourly rates are behind underpayments. For some employers and Council’s, it is common practice to pay their employees an all-inclusive salary or hourly rate. However, employers have an obligation to ensure that annualised salaries fully compensate employees for all entitlements payable under the applicable stream award.  An annualised salary can cover entitlements such as minimum weekly wages, allowances, penalties and overtime.

Case in Point

Lately, there have been some high-profile cases of wage theft in the Federal workplace relations system. In February 2020, Coles announced that they have underpaid employees an estimated $20million dollars in entitlements. Coles announced that so far, they have found approximately 5% of managers who were paid a salary from their supermarket and liquor stores were not paid correctly. Coles was just one of a growing list of major companies that announced they failed to pay employees their lawful entitlements. In October 2019, Woolworths also revealed it had underpaid nearly 6000 workers over a period of 9 years an estimated $300 million. The company has also identified other underpayments for employees working at its Big W, Dan Murphy’s and BWS stores.

Generally, for Council’s, wages will increase in accordance with the state wage case published by the Queensland Industrial Relations Commission or in accordance with a Certified Agreement. The state wage case usually decides to increase Queensland minimum wage rate and wage or salary rates in modern awards from the 1 September each year. Regardless of whether a Certified Agreement applies to employees, it must not include a provision or wage rate that is inconsistent or less favourable than the Queensland Employment Standards, or relevant modern award.

If there has been an underpayment of wages, the Industrial Relations Act 2016 allows an employee up to six years to recover an amount. Therefore, it is essential for Council’s to review their pay structure and banding each year once the state wage increase is announced to ensure they comply with their obligations.  

If you need assistance in reviewing Council’s pay structure, get in touch with Danielle Turner at Preston HR on 4052 0709.