Wage Theft

Wage Theft

Overview

The ACTU is the peak trade union body and only national confederation representing working people and their unions in Australia.   It consists of affiliated unions and State and regional trades and labour councils, collectively representing more than 1.5 million union members engaged across a broad spectrum of industries and occupations in the public and private sector.  For more than 90 years, the ACTU has played the leading role in advocating in the Fair Work Commission, and its statutory predecessors, for the improvement of employment conditions of employees.  It has consulted with governments in the development of almost every legislative measure concerning employment conditions and trade union regulation over that period.

Australian policy makers have created the conditions for widespread non-compliance with remuneration related obligations in employment instruments.  This has occurred through numerous channels including excessively high numbers of people trapped in insecure work, quasi-bonded labour through the migration system, poor supervision of the franchising industry, zero regulation of the labour hire industry, a “hands off” approach to the “gig economy”, and incremental restrictions on union organising activity and collective bargaining.    

This form of noncompliance has now permeated virtually all sectors of the economy and has become a matter of public importance and a priority industrial and economic issue.  Federal industrial relations regulation in this country has transitioned from genuine tripartism to an unbalanced system favouring corporate power, intent on denying organised labour the necessary rights and capacity to expand into new areas while implementing new strategies to frustrate union activity in traditional areas.  If we as a country are to begin to address the wage theft crisis, it is necessary to abandon the ideologically tinged conceptions of the role of unions in ensuring that workers’ rights are respected and adhered to in the current industrial relations framework.   The current review presents an opportunity to do that, but only if it is free from the anti-union biases that have characterised most of the “announceables” and associated talking-points in the industrial relations policy portfolio during the term of the Abbott-Turnbull-Morrison Government. 

We have carefully considered the discussion paper “Improving protections of employees’ wages and entitlements: strengthening penalties for non-compliance” (hereafter, ‘Discussion Paper 1’) in consultation with our affiliates.   In our view, the appropriate regulatory responses merited by the wage theft crisis are those that tackle the drivers of wage theft. These drivers are:

  1. Competitive pressure where it has become common practice to underpay workers in order to obtain a market advantage
  2. The potential for high profits that flows from underpaying workers
  3. The perception that the risk of being caught is low
  4. The belief that the consequences of being caught are minimal

A focus on just one of these drivers will inevitably fall short of community expectations that the scourge of wage theft can and should be stamped out.  It is with this in mind that we express our concern at the risk of a piecemeal approach to wage theft with a narrow focus on penalties that ignores the other drivers of the problem.

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