Wage Inspectorate Victoria (the Inspectorate) has laid Australia’s first criminal wage theft charges under the Wage Theft Act 2020 (Vic) (Act). The Act, which has been in operation in Victoria since 1 July 2021, imposes a number of wage theft offences on Victorian employers and their officers.
Legislative context
Section 6 of the Act makes it unlawful for employers in Victoria to dishonestly underpay employees or withhold their entitlements. An underpayment or withholding of entitlements will not be considered dishonest for the purpose of this section if due diligence is exercised to pay and attribute entitlements to employees.
The Act empowers the Inspectorate to investigate and commence proceedings into possible employee entitlement offences. The commission of an offence under section 6 of the Act (among other offences in the Act) may lead to liability up to:
- 6,000 penalty units (or $1,109,250 as at the date of publication) in the case of a body corporate (such as a company); or
- 10 years’ imprisonment in the case of a natural person (such as a company director).
Criminal wage theft charges
On 29 November 2022, the Inspectorate announced it had filed 94 criminal charges in the Magistrates’ Court of Victoria against a Macedon restaurant and its officer. The Inspectorate’s full announcement can be found here.
The relevant employer and its officer allegedly breached section 6 of the Act between July and November 2021 by dishonestly withholding over $7,000 in employee entitlements, including wages, penalty rates and superannuation, from four young former staff members.
It is expected that more prosecutions will follow as the Inspectorate completes investigations that take many months, if not years, to finalise before charges can be laid.
How and who the Inspectorate focuses on should be of interest to Victorian employers who are now covered by federal workplace legislation, which imposes civil penalties, and Victorian legislation which imposes criminal penalties, for the same conduct.
Victorian employers are reminded about their obligations to proactively manage compliance with their employment obligations including federal awards and enterprise agreements. The Act provides for some defences for employers who have exercised due diligence to ensure compliance. Some steps for due diligence include:
- being aware of changes to minimum pay and entitlements (including changes to instruments such as modern awards) and updating payroll systems;
- regularly reviewing and auditing its pay compliance;
- actively listening and responding to queries from their employees about their pay and entitlements;
- maintaining clear decision-making lines to determine who is responsible for authorising payments and entitlements; and
- seeking assistance to manage actual (or suspected) underpayments.
How we can help
Our workplace relations team can assist you to:
- audit your industrial instrument interpretations and compliance more generally;
- respond to regulator investigations; and
- manage any actual or suspected underpayment in your workplace.
Contact us
Please contact us for more detailed and tailored help.
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