University of Wollongong student claims Illawarra employer underpaid him by $20,000
Calls for wage theft to be criminalised have been renewed, after an Illawarra student claimed he was underpaid $20,000 in wages by his employer.
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Businesses across the Illawarra have been put on notice that those who exploit workers could soon face criminal penalties, after a University of Wollongong student claimed he’d been cheated out of almost $20,000 by his employer.
Given the region’s high population of students, the Illawarra has been identified as a wage theft hotspot, with young people often missing out on penalty rates and overtime from their employers.
Zac Jory claims to be one of these young people. For two and a half-years, the student was employed as a casual worker at a local Illawarra business.
During the busy period over summer, he claims he worked long hours, and at times worked for 20 days straight. After looking at his pay slips, Mr Jory realised things weren’t adding up.
“It took me about a year to realise I’d been underpaid,” he said. “From my estimations I think it was about $15,000 to $20,000.”
Mr Jory said he was being paid below the minimum hourly wage, and didn’t receive any overtime or penalty rates for his after-hours or weekend work. As a young man juggling a university degree and a job, Mr Jory said it took him a while to work up the courage to confront his employer about the underpayment.
“I left my job, spoke to Fair Work, then I approached them [my old employer],” he said.
What followed the confrontation was “intimidating” for Mr Jory, as he was forced into mediation with Fair Work and two of his ex-employer’s lawyers.
Mr Jory said that he felt pressured to accept a lower amount than what he was owed.
No action was taken against his employer and there’s no suggestion his employer knowingly underpaid him.
While he was paid back some of the money allegedly owed to him, the experience lead Mr Jory to investigate other instances of underpayment and wage theft across the Illawarra, finding dozens of young people had been in a similar position.
In June, The Fair Work Ombudsman revealed it had recovered almost $130,000 for 458 employees at 36 businesses across the Illawarra, after conducting surprise audits at workplaces across the city.
Wollongong was one of three locations targeted by Fair Work inspectors, given its huge population of university students and the large number of anonymous tip-offs received from workers.
Inspectors audited 97 businesses in the city, with only 38 per cent found to be complying with workplace laws.
Wollongong MP Paul Scully said in the Illawarra, instances of wage theft and underpayment were largely being committed by small businesses.
“Over the last couple of years Fair Work has done a number of investigations and audits in the Illawarra that have found some systemic underpayment of employees, particularly in small businesses and there’s been fines and warnings issued as a result,” he said.
“The one thing that every business wants is competition on a level playing field, if competitors are seeking competitive advantage by ripping off their workers, that’s unfair.”
Labor Shadow Minister for Finance, Small Business and the Gig Economy, Daniel Mookhey said the scale of exploitation of mainly young workers in the Illawarra showed the need for the criminalisation of wage theft in NSW.
“The problem with wage theft is that it robs two people, it robs the workers who aren’t getting paid what they are legally entitled to, and it robs every other small business who is complying with the law,” he said.
“If a business is knowingly taking part in wage theft they should face criminal sanction. Put simply, I can’t go and pick someone’s pocket, businesses shouldn't be able to knowingly under pay its workers and do it systemically as a business model.”
While Mr Mookhey said the exact form of penalty for employers doing the wrong thing was yet to be decided, something urgently needed to be done about the wage theft crisis.