There’s a tough new wage theft cop on the beat and she’s already put big business on notice to get their payroll systems in order.
She has warned employers against blaming “overly bureaucratic” or “complex payroll systems” for regular wage theft.
In fact, she’s termed those excuses as “a bit of a furphy” reports Jessica Yun in Nine Newspapers.
Tough new wage theft cop on the beat
Anna Booth took up her five year post as Fair Work Ombudsman last month.
She believes the scourge of wage theft starts at the top of businesses and therefore she intends to hold corporate leaders to account.
Ms Booth told Nine Newspapers that she believes that chief executives and board directors are directly responsible for failures to pay correct wages.
“I don’t think there is any excuse for it,” Ms Booth said.
“Boards of companies, whether they be for profit or not for profit, have a business concerning themselves with the integrity of their payroll.
“I don’t intend to go around offending people, but at the same time, I want to be plain: it is not acceptable to take your eye off the ball and not set up proper time and wages record systems, not confer with your own employees.”
In fact, Ms Booth has warned that Fair Work will “on occasion” seek the maximum penalty to serve as a warning to other employers.
“It does present a wake-up call to the boardrooms of Australia,” Ms Booth said.
‘Bit of a furphy’
For a long time now, the business lobby has blamed ‘red tape’ and complicated awards and enterprise agreements for wage theft.
Ms Booth isn’t buying it.
“I do think that the red tape is a bit of a furphy,” she said.
“Let’s say we’re in the care sector and we’re looking at one support worker. We do know what time they started work; we do know what time they finished work. Even if they had a split shift, we know exactly when that first shift finished and the next shift started. We do know what level they should be paid at. We can multiply hours by the rate of pay and that gets you the quantum.
“It is sometimes an easy defence mechanism to blame complexity or blame red tape,” Ms Booth said.
Big companies engage in big wage theft
In the past few years, the wage theft ‘shame file’ has continued to grow – and now features some of Australia’s biggest companies.
For example, Coles, Woolworths, BHP, the ABC, 7-Eleven, Dominos, the University of Melbourne, the Red Cross and Super Retail Group.
And you can bet there’ll be more added to the list next week.
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Australians underpaid $850 million
A recent analysis of wage theft by the McKell Institute has revealed employers are underpaying Australian workers nearly $850 million a year.
The result: a staggering $330 million in economic activity is ripped from the country’s economy.
The think tank analysed Fair Work Ombudsman business audit campaigns dating back to 2009, finding an average of five wage victims per business ended up repaid $610.83 each.
Across Australia, 269,728 businesses collectively ripped off more than 1.3 million workers, or roughly 11.5 percent of the country’s workforce, a collective $847.25 million annually.
The McKell Insitute’s findings are based on an International Monetary Fund analysis of economic multipliers that found every $1 increase in Australian workers’ pay results in a 39c boost to the economy. Using that formula, the economic cost of unpaid wages is $330 million.
(Source: McKell Institute)
Tough workplace cop ready to crack down
Ms Booth said she’s ready to crack down and fight hard for workers, but she also assured employers that the regulator will assess each case on its merits.
One key area Fair Work will focus on this coming year is large corporations and universities.
Agriculture, construction, care and also hospitality sectors top the list of priorities.
Ms Booth warns employers to get ready – and make sure their payroll systems are in place – leaving no room for error.
‘Breath of fresh air’
Meanwhile, industrial relations advocate Miles Heffernan, who has long fought against wage theft, has welcomed Ms Booth’s appointment.
“For a long time now, we have argued that the ‘oh it’s all so complicated’ excuse for widespread wage theft is just that – an excuse,” Mr Heffernan said.
“It is a breath of fresh air to hear Ms Booth express the same sentiment.
“It is also fantastic to hear her plan to hold those higher up the chain in responsible for ripping off workers.”
Mr Heffernan believes the regulator has not been effective in the past resulting in the widespread wage theft we see today.
“I once accused Fair Work of running a ‘foot massage department’ because they seemed to be more focused on education, and letting employers off the hook, rather than enforcement,” Mr Heffernan said.
“That’s why I believe wage theft is now a built-in business model for many businesses across the country and why so many workers are ripped off.”
Ms Booth concedes Mr Heffernan is on the money, telling Nine Newspapers there are many businesses that deliberately and systematically commit wage theft.
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An advocate for workers
Previously, Ms Booth worked as a deputy president at the Fair Work Commission resolving unfair dismissals and other workplace matters.
“It’s very satisfying because I spent most of my life in workplace relations in some way,” she said.
Her early career in the trade union movement helped clothing workers win the right to afternoon tea breaks in 1981.
That led to her becoming vice president of the Australian Council of Trade Unions in the 1990s.
Ms Booth, 68, is also the mother of a daughter with an intellectual disability.
She hopes to see Australian workplaces become more welcoming and inclusive of people with disabilities.
She is particularly pleased with the addition of the care sector to the Fair Work Ombudsman’s list of priority industries.
Investigations back-paid 7,242 workers in the industry a total of $17.7 million.
Protecting migrant workers will also continue as an “enduring priority” for the government agency.
This will be important as Australia receives an influx of migrants to help plug skill shortages.
Closing the Loopholes legislation
Meanwhile, the government’s closing the ‘Closing Loopholes’ legislation will beef up maximum penalties for wage theft to $7.8 million.
It will also and lead to employers who deliberately underpay staff face up to a 10 year jail sentence.
Unsurprisingly, business groups who continue to deny wage theft is a serious problem continue to vigorously fight that legislation.
“Ms Booth is clearly an outstanding choice for Fair Work Ombudsman,” Mr Heffernan said.
“I look forward to seeing her make the lives of all working Australians fairer and better, which I know she will do.”
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