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NSW ALP backs ‘wage theft’ criminalisation

TWU sees traction on non-payment campaign with Foley pledge


The Transport Workers Union (TWU) has seen its push to criminalise deliberate non-payment endorsed by New South Wales opposition leader Luke Foley.

The Australian Labor Party (ALP) move marks progress in the nation’s most populous state and is likely to resonate in other states.

And though a specific link with tackling ‘phoenix’ company practices has not been made, the Transport Workers Union is sensitive to that path to avoiding entitlements and points to recent ALP work on that issue.

“It hasn’t been specifically mentioned in our motions but the legal changes would cover the underlying phoenixing issue,” a union spokesperson tells ATN.

ALP position

Foley announced the move in the ALP NSW/ACT conference address at the weekend as the first item of a general five point plan “to eliminate the exploitation of vulnerable workers”.

A future state ALP government would “criminalise the deliberate failure to pay wages and other entitlements.

“There’ll be punishing fines for companies and jail terms for individuals guilty of systematic wage theft.

“Theft is theft.

“We will not allow a rogue minority to get away with ripping off their workers.”

The other four wages and conditions initiatives would be a:

  • Franchise network laws overhaul that would make head franchisors liable
  • Young workers’ protections boost through increased workplace inspectors’ powers
  • Hire company licensing scheme under the industrial relations commission that would include a ‘fit and proper person’ test on labour hire operators, owners and directors
  • Reinstatement of Sunday penalty rates.

TWU national secretary Tony Sheldon praised Foley for his position on the issue.

“The Labor Party has clearly listened to the community on this issue and decided to address the scourge of wage theft,” Sheldon says.

“When an employer refuses to pay the correct rates, allowances or superannuation the worst that can happen is that the Fair Work Ombudsman asks them to pay it back.

“This is not a deterrent: it’s an invitation to see what you can get away with.

“Billions of dollars are being taken out of employees pay checks every year through unpaid wages and superannuation.

“This doesn’t just hurt affected employees, it hurts the entire economy,”

The union says its TWU branch has “so far this recovered over $750,000 in unpaid wages and allowances for members”.

“Every industry has horror stories of wage theft,” Sheldon adds.

“The TWU is pursing hundreds of cases, including one company which underpaid three truck drivers by over $100,000.

“Meanwhile, our WA branch have uncovered a scandal with a trucking company paying drivers a flat hourly rate – so no penalty rates at the weekend and no over-time despite the fact that the drivers are working up to 70 hours a week.

“If these workers had stolen this money from their employers they would probably be in jail right now.”

Anti-phoenix pledge

Tackling phoenixing has been ALP policy before this year and it got a significant boost in late May, when Labor employment spokesman Brendan O’Connor announced prospective reforms.

These would:

Require all company directors to obtain a unique Director Identification Number with a 100-point identification check

  • Increase penalties associated with phoenix activity
  • Introduce an objective test for transactions depriving employees of their entitlements
  • Clarify the availability of compensation orders against accessories
  • Consult on targeted integrity measures based on the Melbourne Law School / Monash Business School Phoenix Research Team recommendations.

“Existing and prospective directors would be required to acquire a Director Identification Number with a 100-point identification check,” O’Connor  said at the time.

“The unique Director Identification Number is integral for small businesses, liquidators and enforcement agencies to access information on directors including accurate information about director histories.

“At present, the registration of an Australian company simply requires the name, address, and date and place of birth of each proposed officeholder.

“This makes it easier for fraudulent directors to escape their obligations.”

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