Australia has emerged as a leader in the fight against wage theft, taking decisive action to criminalize the deliberate underpayment of workers. This reform movement represents a significant shift from treating wage theft purely as a civil matter to recognizing it as a serious criminal offence.

New Laws Coming 1st January 2025

The new laws apply to deliberate underpayments from the start of the new year, and are part of the Fair Work Legislation Amendment (Closing Loopholes) Act 2023.

Wage theft will become a criminal offence – penalties include:

• Up to 10 years in prison for individuals
• Fines of up to $7.825 million for employers, or three times the underpayment amount

What does Wage Theft look like in Australia?

• Underpayment of award rates
• Non-payment of superannuation
• Withholding penalty rates and loadings
• Unpaid overtime
• Unauthorized deductions
• Misclassification of employees as contractors
• Abuse of internships and trial periods

Which Australian workers are most vulnerable?

The criminalization of wage theft is particularly significant for migrant workers, international students, young workers, casual employees and gig economy workers.

Industry hotspots for wage theft include:

• Hospitality
• Retail
• Agriculture
• Construction
• Cleaning services
• International student employment

Your business can stay vigilant by:

• Reviewing your record-keeping practices and internal audit processes
• Using enhanced payroll systems, such as Astute Payroll
• Running training programs for managers and recruitment consultants for understanding award rates, entitlements and correct classification of workers
• Creating your job rates through wage compliance software such as RatesCalc

Australia's move to criminalize wage theft represents a significant advancement in worker protection to send a clear message that deliberate underpayment of workers is a serious crime with significant consequences. The success of these reforms will depend on continued commitment to enforcement, education, and support for both workers and compliant businesses.

RatesCalc is here to help you out – and keep you, your business and your candidates safe from wage theft.