When Will Intentional Underpayment Of Wages Become A Criminal Offence?
1 January 2025
Employers Will Commit A Criminal Offence If:
- They’re required to pay an amount to an employee (such as wages), or on behalf of or for the benefit of an employee (such as superannuation) under the Fair Work Act, or an industrial instrument.
- They intentionally engage in conduct that results in their failure to pay those amounts to or for the employee on or before the day they’re due to be paid.
Are There Any Exceptions?
These provisions don’t apply to certain employees for:
- Superannuation contributions.
- Payment for taking long service leave payments.
- Payment for taking leave connected with being the victim of a crime.
- Payment for taking jury duty leave or for emergency services duties.
These laws also don’t apply to employers who:
- Unintentionally underpay their employees.
- Pay incorrect amounts by mistake.
What Are The Potential Penalties?
For Companies:
- If the Court can determine the underpayment, the greater of 3 times the amount of the underpayment and $7.825 million.
- If the court can’t determine the underpayment, $7.825 million.
For Individuals:
- Maximum of 10 years in prison.
- If the court can determine the underpayment, the greater of 3 times the amount of the underpayment and $1.565 million.
- If the court can’t determine the underpayment, $1.565 million.
Take Out Point: Don’t be caught out. Call us if you need any help working out correct entitlements.