Jail bosses who underpay workers

May 20, 2017

The Transport Workers’ Union (TWU) has called for jail terms for employers who deliberately underpay their staff.

TWU national secretary Tony Sheldon said this was “wage theft” and it was time to treat bosses with the same rules as employees.

The call follows a string of scandals at franchise operators 7-Eleven, Caltex, Domino’s Pizza and Pizza Hut, where employees have been underpaid by tens of millions of dollars. 7-Eleven has so far paid out $90 million for non-payment of wages while Caltex has set up a $20 million fund to repay their workers.

Sheldon made the call in a speech at the TWU National Council on May 16. He said: “When a boss steals from workers it's quaintly referred to as ‘underpayment’. They may reach a settlement with the Fair Work Ombudsman to repay the money. Worst comes to worst, companies will simply be asked to pay back what they owe. This is actually an incentive for employers to see what they can get away with.

“Malcolm Turnbull needs to be called out on his vow to make unions as accountable as employers. Union officials face jail terms, therefore employers should also be held accountable to the same level with jail terms if they steal from the pay-packets of their employees.”

Sheldon told the ABC there was no easy way to hold a business to account and have a court “properly deal with this criminal activity”.

“It’s seen in corporate life as just another part of business,” he said. “If you don't get caught, you get away with it. If you get caught, well, you pay some people some money if they're game enough to go ask for it.”

Sheldon said under the Fair Work (Registered Organisations) Amendment Act 2016, harsh penalties are imposed on union leaders who breach their duties. But the Act was “clearly failing to hold employers to account”.

“If an employee, or an organisation, takes up an underpayment claim — a wages theft claim — there is no jail term attached, or potential jail term attached to that particular case,” he said. “[The business] should be held to account, just as an employee would be if they were to steal those sums of money.”

The union will push for it to become official Labor Party policy to change the law to ensure wage theft by employers is made an offence at the party's next national conference.

[A full copy of the speech is available here.]

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