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Victorian Wage Theft - The New Laws

The Wage Theft Bill 2020 was passed by Parliament on the 16th June, 2020.

Effective 1 July, 2021, it will be a criminal offence for employers to underpay employees’ wages and entitlements. These laws will also extend to parties who are deemed to have been involved in the offence for example, a franchisor involved in the franchisees dishonesty in withholding employee entitlements will also be deemed to have committed an offense.

Whilst honest mistakes by an employer will not be subject to the new laws, employers who are deemed to have acted in a dishonest manner and who withhold either all or part of an employees entitlements such as wages, allowances, superannuation or other entitlements, could face fines of up to $991,320 for companies, and $198,264 for individuals.  Penalties can also include imprisonment of up to 10 years.

As part of these new laws, a new authority, the Wage Inspectorate Victoria will be established to enforce, investigate and prosecute employers.  The authority will have the ability to enter workplaces to obtain and seize evidence and execute search warrants.

The new laws further involve offences relating to records.  If employers are found to have falsified employee entitlement records or fail to retain records in order to gain a dishonest advantage or prevent exposure of a dishonest advantage, they will face the same penalties detailed above.

Examples of record offences may include; falsifying pay slip hours or rate of pay to obtain a financial advantage; or not keeping record or hours work by an employee.

Whilst Victoria is the only state to pass this legislation, the Government have confirmed via a recently announced IR review that legislation is being considered at a federal level.

You now need to ensure that you are paying your employee’s correctly including all entitlements.  For assistance with this, please contact us on advice@hradviceonline.com.au or 1300 720 004.

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