In a first use of the new Victorian Wage Theft Act the business and the Director are facing criminal charges, with the Director facing up to 10 years jail time for deliberate underpayment of 4 junior staff to a total of $7,000.
This week the Wage Inspectorate of Victoria has laid 94 criminal charges at the operator of The Macedon Lounge at both a business and Director level for dishonestly withholding wages, penalty rates and superannuation over a 5 month period in 2021.
The charges mean the Director is facing 10 years in jail and the business is facing fines in excess of $1 million.
The Wage Inspectorate Victoria has been in place for a year. In that time it has recovered more than $1 million in unpaid long service leave and other entitlements for over 15,000 workers.
While this is the first business to be charged under the new laws the Commission has made it clear that all businesses will be targeted and where they are found to be engaging in Wage Theft they will face criminal charges.
“[the inspectorate is] doggedly investigating wage theft reports and intends to bring further appropriate matters before the court”.
Learnings for all businesses
“Wage theft is wrong and it is a crime. It is as simple as that. Wage theft is a crime. There is simply no place for it and no excusing it.” explains ACAPMAs Elisha Radwanowski
“Dodgy businesses should be on notice that the regulator is coming for them. But at the same time honest operators should be aware that employment compliance is difficult and ignorance is no excuse for failing to get wages and entitlements right”.
“Honest mistakes are not Wage Theft, but wilful ignorance is not an honest mistake. Employers should take the time now to check in with a qualified, experienced and insured third party to ensure that they are meeting employment requirements”.
“The word ‘Audit’ is one that sends some business operators hiding under the covers, but ‘Audit’ or ‘Health Check’ it means the same thing – a check on the current systems and practices to ensure that the employees are receiving everything they are entitled to, and that the business is not at risk of prosecution”.
“All businesses should be engaging with their trusted advisers and the Registered Organisation in their industry (like ACAPMA) to not only investigate current systems and outcomes to ensure there is no issues, but to collaboratively develop appropriate resources to address any issues that are identified”.
“In the fuel retail and wholesale industry ACAPMA can provide a full assisted compliance audit that identifies issues and then delivers the advice, guidance and resources to address issues”.
“The time of self check, or the businesses usual accountant doing a check are done. The requirements in employment compliance are so detailed and shifting that expert advice, that is specific to the industry, is absolutely vital”, concluded Elisha.
In short, honest mistakes will not land a Director in jail, but a lack of proactive investigation of current compliance status may do.
Here to Help
This article is general in nature and covers things to consider, implement and watch out for in your business. It is provided as general advice and you should seek further advice on your situation. ACAPMA Employment Professionals are available to assist ACAPMA members via firstname.lastname@example.org. ACAPMA membership is affordable at only $810inc GST per year for a single site and valuable with sites gaining HR advice support and representation as well as a raft of other benefits and discounts. Visit: https://acapma.com.au/membership/ to learn more or to apply for ACAPMA membership.
Elisha Radwanowski BCom(HRM & IR)
Executive Manager for Employment and Training