Hiring and Firing Podcast 5: Wage Theft

Jan 02, 2022 • JOHN WALTON

  • Recovering wage theft: new model for big businesses
  • Wage theft now a crime in Queensland (Sep 2020)
    • According to Queensland’s Industrial Relations Minister Grace Grace, wage theft affects one in four Queensland employees
    • New laws in Qld will see employers facing a max of 10 years in jail for wage theft - including underpaid wages, withholding leave and penalty entitlements, or not making the necessary super contributions
  • NSW?
    • Hospo voice (hospitality union) has urged the NSw government to follow VIctoria, which passed a landmark law criminalising the most serious cases of wage theft
    • United Workers Union president, Jo-anne Schofield has said that NSW is worse than Victoria and the state government should criminalise wage theft
      • “Sydney is ground zero for wage theft…. But the NSW government keeps burying its head in the sand on the issue.’
  • Scandals:
    • Some of Australia’s largest companies have been embroiled in major scandals over the underpayment of workers
    • Investigations by the Age have exposed underpayments at businesses including 7 Eleven, McDonal’s, Coles and many more
    • Professional services firm PwC has estimated 13% of Australian workers are underpaid a total of $1.35 billion a year

Other examples:

  • Dinner by Heston - fronted by Heston Blumenthal oews employees at least $4.5 million in what appears to be the worse case of underpayment yet in the high end restaurant sector
  • Rockpool Dining Group
    • Law firm acting for Hospo Voice has lodged detailed complaint with workplace watchdog alleging Neil Perry’s Rockpool Dining group destroyed and doctored timesheets to cover up underpayment
    • “Most egregious cases of wage theft” seen in Australia
    • Rockpool Australia’s largest high-end restaurant group and includes 16 restaurant brands and more than 80 restaurants across Australia
  • George Colambaris’ MAdE Establishment
  • 7 Eleven scandal
    • Employees of the franchise have been paid back $173 million in underpaid wages, interest and superannuation, according to the fair work ombudsman.
    • 2016 report found that some franchises had “deliberately falsified records to disguise the underpayment of wages
    • The fair work ombudsman (FWO) said that between September 2015 and February 2020, 7-Eleven Stores Pty Ltd paid back $144.5m in wages, $19.5m in interest and $9.6m in superannuation.
  • Coles underpayment:
    • Could note in podcast: when you go to google search coles one of the very first recommended links that comes up is ‘coles underpayment’ - showing how inextricably the two are linked now
    • Coles revealed in Feb 2020 that it had underpaid about 600 salaried stagg $20 million over the past six years. 5% of the company’s liquour division salaried managers were also underpaid, flagging $3 million in provisions for backpayment and an additional $1 million in interest and costs.
    • More than 5000 former and current workers at Coles.
    • Could be as high as $200 million

I think there are two categories:

1.On purpose (ie. 7/11); and

2.By accident (ie. Woolworths etc).

The fact is, whether on purpose or not, the fines are:XXXX

Do we have statistics on the number of cases being brought, or fines being handed out?

Whatever little nuggets or little stories you can uncover will be great.You can even put in your own experience – we don’t need to name the café.

Purposeful underpayment:

  • Subway:
    • More than a dozen Subway fast-food outlets were caught underpaying staff across Australia’s east coast as part of a lengthy investigation in September
    • Fair Work Ombudsman recovered %81,638 for 167 current and former underpaid employees at 17 franchises
    • Among breaches it was found that Subway failed to pay employees minimum wages, casual loadings, holiday and overtime rates, and did not issue proper payslips or proper employment records