Around 400,000 Australians – one in five workers aged under 25 – are paid below the legal minimum wage for their age, according to ACTU analysis of ABS data.
The analysis is released on the first day of early voting for the upcoming federal election, along with Demos polling showing that stopping wage theft is important or extremely important as an issue in the upcoming federal election for 81 per cent of undecided voters aged 18-24.
Young people in insecure work are disproportionately impacted by wage theft, with 30 per cent of 18-year-old casual workers paid less than what they should be under the relevant junior award rate.
For an 18-year-old casual worker employed for 20 hours a week, the underpayments are worth $1,560 a year in lost wages.
From January 1, 2025, new laws criminalising wage theft came into effect following Australian Union campaigns to tackle the normalisation of wage theft as a business model in Australia.
The Federal Parliament passed the Closing Loopholes Bill in late 2023, which also made it easier for underpaid workers to access the small claims jurisdiction in the Federal Court by lifting the cap on claims from $20,000 to $100,000.
Peter Dutton and the Coalition voted against the legislation, following pressure from employer groups that raised concerns about the unintended consequences of more ‘red tape’ for businesses.
AEC records for the 2023-24 financial year reveal that hospitality billionaire Justin Hemmes – who settled a $126 million wage underpayment class action lawsuit – donated $300,000 to the Coalition.
Young workers face various barriers to wage justice, including the expense and time required to bring a matter to court, fears of employer retaliation, limited knowledge of workers’ rights, and the Fair Work Ombudsman’s enforcement limitations.
Young workers are increasingly turning to Australian Unions to address underpayment issues and to support them in taking legal action to recover lost wages.
The latest ABS data shows that union membership grew by almost 200,000 members from 2022 to 2024, powered by a 53 per cent boost to union membership among workers aged 15 to 24.
Estimates of the overall value of wage theft vary widely, given efforts by employers to cover up evidence of underpayment. Audits by the Fair Work Ombudsman estimate the figure is between $850 million and $1.55 billion in stolen wages each year.
Quotes attributable to ACTU Secretary, Sally McManus:
“Wage theft is a hidden epidemic that is worsening people’s cost-of-living pressures, and young workers are bearing the brunt of it. One in five Australians aged under 25 go to work, do their job, and then get ripped off by their boss.
“The targets of wage theft tend to be those with less power in the workplace, so we see a clear pattern of dodgy bosses going after the pay packets of younger people, especially casual workers.
“Almost one in three 18-year-old casual workers are getting paid below the legal minimum wage. For someone working 20 hours a week in that age group, that adds up to more than $1500 a year. That money should be in the bank accounts of young Australians, not in the pockets of bosses.
“Unions campaigned and won wage theft laws because we know the difference that every dollar makes to a person’s financial security and wellbeing, particularly if you’re in the very early stages of getting into the workforce.
“Peter Dutton and the Coalition followed the marching orders of their big business mates and tried to block wage theft laws. If wage theft remained legal, the issues we’re seeing now would be even worse. It’s clear that the only incomes Peter Dutton cares about are those of his billionaire donors, like pub baron Justin Hemmes.
“The Albanese Government made it easier for wage theft victims to seek justice, but unions recognise there’s more to be done. Young people are tired of being underpaid and undervalued at work, so it’s a positive sign that increasing numbers of young workers are joining their unions.”
