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Issue #1786      July 19, 2017

Make wage theft a crime

Employers and company directors must be held criminally responsible for wage theft violations. If a worker took money out of the till at work, they’d be sacked and could be charged. If the boss underpays their staff, the consequences are often minor.

After scandals at 7-Eleven, Caltex, Dominoes and Pizza Hut it is clear there is a need for harsher penalties, says the Victorian Trades Hall Council.

Just last week, it was alleged UniLodge have stolen almost $700,000 from two young workers, Kasun Rajapaksha and his wife Sandeepani Warnakulasooriya in Melbourne, charging them thousands and thousands of dollars for “rent”.

Stealing is wrong and yet every year thousands of workers in Australian are robbed. They are victims of wage theft. Wage theft, where companies deliberately underpay workers or refuse to pay superannuation, is affecting thousands of workers every year. It’s literally big business stealing money from workers’ pockets.

The current laws make wage theft too easy and the punishment is too light. Wage theft is now so common that in some places it’s the business model. There are business owners right now in Australia getting rich by stealing from their staff and the current industrial laws make it far too easy.

We need to hold companies to account for their theft.

George Calombaris – The MasterChef celebrity was recently caught underpaying staff $2.6 million in overtime across his restaurant empire. Calombaris and his business partners were putting employees on low salaries and then pressuring them to work long hours with no overtime so that their pay would be less than a casual worker being paid on an hourly basis. Calombaris also failed to pay superannuation to workers.

7-Eleven – The international company was systematically underpaying thousands of workers and then, once caught, pretended to pay workers full wages but was actually making employees pay back a portion of their wages in cash. A 7-Eleven internal survey taken in July and August 2015 indicated that 69 per cent of franchisees had payroll issues, including fraud. It was remarked at the time that “the business model will only work for the franchisee if they underpay or overwork employees”.

Some franchise owners were accused of physically threatening workers who complained. The amount of stolen wages in 7-Eleven was estimated at over $110 million.

Domino’s – Systematically underpaid workers by hundreds of thousands of dollars over years.

Pizza Hut – Deliberate underpaying, misclassification and denial of entitlements for delivery drivers. Of the 34 franchisees, 24 were found to be breaching workplace laws, while only two were meeting all of their legal obligations to delivery staff. Some staff were being paid as low as $5.70 an hour.

Caltex petrol stations – An audit of franchise stations found that almost 80 per cent were underpaying their staff. Caltex was required to establish a $20 million fund for repayment of workers, but didn’t admit to any wrong-doing.

Bakers Delight – by using an outdated EBA, Bakers Delight was paying some staff as little as $8 an hour.

Next article – Cricket pay dispute – Union busting exercise

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