No‑one has been prosecuted for wage theft since it became a crime. 2 inquiries want answers
- Written by Irene Nikoloudakis, PhD Candidate in Law, Adelaide University
Another day, another Senate inquiry – this time into Australia’s federal laws dealing with “wage theft”.
Wage theft became a federal crime on January 1 2025. Employers who deliberately “steal” from their workers’ pay can now be prosecuted and subject to hefty criminal fines, even jail time.
But in the 15 months since the law came into effect, the Fair Work Ombudsman has reported only two criminal investigations into wage theft and there have been zero prosecutions.
This has raised questions about whether the new criminal wage theft offence is really having an impact.
Senator Fatima Payman has secured a new Senate inquiry into the laws. But the Labor government has opposed this inquiry, pointing to another review that is already underway.
Wage theft remains a problem in Australia, and there are issues with enforcement the country must address. But there are also concerns about whether this Senate inquiry is actually needed and if it’s going to yield useful insights.
Missing wages
There have been several high-profile cases of underpayment in Australia. It’s hard to forget the 7-Eleven wage-theft scandal of 2015. That resulted in reported back-payments of more than A$170 million, but only around $1.8 million in penalties.
But this case and others played out before wage theft was made a crime. Estimates of the true scale of deliberate wage theft across Australia are unknown.
There have been other high-profile underpayment cases from recent years – such as at Coles and Woolworths – but they did not involve employers deliberately seeking to underpay their workers, which is part of the new criminal offence.
Difficult to police
There are a few reasons enforcement can be tricky. For one, it relies heavily on workers making complaints.
Workers reluctant to make a complaint are usually those who are most vulnerable, such as younger workers. A recent survey found a third of workers aged between 18–30 were paid well below the minimum wage.
Dodgy employers are also good at concealing their underpayments, such as by falsifying documents and making sure no paper trail is left behind.
Already under review
In December last year, Amanda Rishworth, the federal minister for employment and workplace relations, announced an independent review into various aspects of Australia’s workplace laws.
The government has appointed a former Fair Work Commissioner, Susan Booth, to conduct the review and report by mid-June this year.
The Booth review will consider how some of Australia’s “newer” workplace laws have been operating and whether they need to be changed – including the new criminal wage theft offence and some other laws dealing with worker underpayments.
This is the very reason Labor opposed the Senate inquiry – it’s unclear what additional value it can add.
An unclear scope
But the inquiry’s scope – the boundaries around what it is allowed to investigate – is also unclear.
The Senate inquiry has been explicitly asked to address how much the “wage theft framework”, and the operation of the wage theft offence, has actually reduced wage theft in Australia. It’s also been asked to consider “any other related matter”.
But it’s not clear what the “wage theft framework” and “any other related matter” mean in this context. The other review has clearer questions to consider.
The problem with revealing investigations
The inquiry appears to be part of a broader initiative for details of criminal wage theft investigations to be released.
In February this year, the Senate sought to obtain detailed information about criminal wage theft investigations underway.
But when dealing with criminal investigations, full transparency isn’t in the public interest, as disclosing details could negatively impact the investigations.
That’s the reason a representative from Australia’s workplace regulator – the Fair Work Ombudsman – previously dodged answering questions in Parliament about their criminal wage theft investigations.
The danger is that an employer could find out they’re being investigated, and change their behaviour to avoid being prosecuted.
A better way forward
It’s still important we assess the operation of the criminal wage theft offence. By June, the government will have the findings from both the Booth review and the Senate inquiry into how Australia’s criminal wage theft laws are working.
The Booth review is much better suited to make this assessment.
It’s independent, being conducted by an industrial relations expert, and its terms of reference make clear that it’s addressing three key issues when it comes to the criminal wage theft offence:
- are these laws appropriate and effective?
- have the laws produced any unintended consequences?
- do the laws need further amendments?
At this stage, there have been far more submissions to the Booth review than the Senate inquiry.
For workers who are still being deliberately underpaid, ensuring these laws are working must not end with this review or the Senate inquiry. The laws are relatively new, so it will take more time to understand where they work well and where they fall short.
To make this assessment properly, further reviews must be independent, tailored and clear in scope.
Authors: Irene Nikoloudakis, PhD Candidate in Law, Adelaide University
