Small business owners raise concerns about wage theft law


As it is seen in mainstream discussions in recent years, wage theft is the practice of denying workers their rightful wages or benefits in contemporary workplaces. It is recognised in various forms, including failing to pay wages, overtime, “off-the-clock” works and refusing employees’ entitlements such as vacation times and sick leave.

Featured | Workplace

By Darcy Song

As it is seen in mainstream discussions in recent years, wage theft is the practice of denying workers their rightful wages or benefits in contemporary workplaces.

It is recognised in various forms, including failing to pay wages, overtime, “off-the-clock” works and refusing employees’ entitlements such as vacation times and sick leave.

Since last year, prominent cases of wage theft have been identified, amongst which are big names such as 7-Eleven, Woolworths and Commonwealth Bank.

Celebrity chef, George Calombaris, was also penalised for shockingly underpaying his workers almost $8 million in 2019.

However, the situation for small businesses tends to be more complicated.

Honest mistakes?

Since the government decision was made to criminalise wage theft last year, small business owners fear that those who are making honest mistakes may be unfairly punished for their actions.

Some also worry that the nation’s perplexing award system makes it very possible for small businesses to accidentally underpay staff.

Although employers who made genuine mistakes are exempt from the punishment of criminal law, it is hard to ignore the impact that underpayment has on the image of businesses.

Read more: Wage-stealing bosses to face criminal laws

An unfair label

Australian outsourced HR provider, Employsure, recently launched a new service, Wage Guarantee, that protects small business owners from the risk of underpayment.

In launching the service last week, Employsure Managing Director Ed Mallett said the national conversations around “wage theft” had unfairly tarnished small business owners as “thieves”.

“They are operating in a complex and convoluted system that creates so much risk and almost no margin for error, then punishes them for mistakes,” he said.

“As we’ve seen recently, some of Australia’s biggest companies with immense HR resources can’t get wages correct. What hope is there for a small business?”

A system of prevention

Ed believes that there is another way for small business owners to navigate through laws and regulations.

“There are all manner of systems trying to catch underpayment, but very few that try to prevent it in the first place. We are offering that solution.” He said.

Through auditing an employer’s pay records and providing a report on risks and errors, the company offers advice and guidance for employers to work through the payment process.

“These are honest and hardworking people who have taken a risk by starting a business. They need protection in this difficult system and we want to stand up for them.”

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