Senate inquiry to examine tougher laws to tackle “exploding” wage theft among Aussie businesses

The root causes of wage and superannuation theft will be probed by a parliamentary committee tasked with examining whether new laws are needed to stem the tide of employers stealing from workers in Australia.

The Senate yesterday voted to refer a wide-ranging inquiry into wage theft to the economics references committee, setting the stage for corporate bosses to be hauled in to explain themselves following a string of high-profile underpayment scandals recently.

The committee, successfully moved by Labor senators despite government opposition, will consider how workplace laws could be enhanced to better protect workers from wage thieves, including whether supply chain liability should be extended to drive better compliance.

The committee will also consider whether wage theft is seen as ‘a cost of doing business’ by Australian companies, amid union criticism that businesses are cheating workers to get a competitive edge.

It comes just weeks after supermarket giant Woolworths admitted it shortchanged thousands of workers to the tune of $200-300 million, revelations which were themselves nothing new, with widespread wage theft in the food, retail and hospitality industries cited repeatedly by the Fair Work Ombudsman (FWO).

Dozens of other independent businesses have been pulled up by the Fair Work cop in recent years for underpaying workers, with more than $40 million worth of wages recovered last financial year alone.

The economics references committee is chaired by Labor Senator Alex Gallacher and has two other Labor members, in addition to two Coalition senators and Centre Alliance’s Rex Patrick.

Labor pushed for the inquiry yesterday after opposing the government’s second attempt to introduce an amnesty scheme for superannuation thieves in recent weeks.

Opposition Senator Glenn Sterle said his desk was brimming with examples of companies failing to meet their modern award obligations.

“Wage theft in this nation is exploding,” he said.

But the government has derided the inquiry. Coalition Senator Jonathon Duniam said it would be “yet another talkfest”.

“Now is the time for action. We know the issues, we have seen the evidence and it is this government that is actually doing something about it,” Duniam said.

The government is moving forward with migrant worker taskforce recommendations from earlier this year that will see criminal penalties introduced for serious and intentional wage theft.

However, it is not clear whether the reforms will address systemic causes of wage theft, which the parliamentary committee has been given the leeway to examine, at least to some degree.

Relatively broad terms of reference will enable Senators to examine what wage theft is, why it happens in Australia, and what the government can do to turn the policy knobs to properly address the problem.

It comes as Minister for Industrial Relations Christian Porter works on a review of industrial relations laws, including considering the view of employer lobbyists that workplace laws are overly complex.

This argument has been hotly contested by academics, industry experts and opposition members of parliament in recent months.

The committee is slated to report in June next year.