Burke examining safe haven for accidental underpayments
Employers who inadvertently underpaid workers and agreed to quickly repay them could get immunity from prosecution.
Employers who inadvertently underpaid workers and agreed to quickly repay them would get immunity from prosecution under changes to the federal workplace laws being considered by the Albanese government.
Sources familiar with the proposal described it as a “safe haven” for companies that made honest payroll mistakes and agreed to a speedy return of the money owed to employees.
The expedited process would ensure accidental underpayments did not have to go through the courts, repayment of money to workers was not delayed by legal proceedings and the employer would not suffer any brand damage by being named publicly in court proceedings.
A similar proposal has been previously backed by the Business Council of Australia, while unions have privately indicated in-principle support, saying their priority was to ensure unpaid workers got back money as quickly as possible.
Business representatives said the scheme would encourage employers who currently feared prosecution to come forward.
Sources stressed that while the change was under consideration by the government, it had not evolved into a formal proposal.
A spokesman for Workplace Relations Minister Tony Burke declined to comment.
It is understood the government is yet to land on a position on its proposed expansion of wage theft laws, which include a fivefold increase in maximum penalties and criminalisation of underpayments.
Sources said the government was supporting criminalisation where employers had knowingly underpaid workers but there was no agreement on whether the provisions should be extended to reckless behaviour by companies.
That extension is being strongly resisted by employers.
Asked for comment on the safe haven proposal, ACTU secretary Sally McManus said on Friday that “wage theft is a massive problem, and leaves working people out of pocket”.
“This is their money, and it needs to be returned to them. The union movement is committed to solutions that result in immediate action and returning money to workers as simply and as quickly as possible,” she said
In a recent “fact sheet” about the government’s wage theft proposals, the BCA said employers needed to be actively encouraged to find and fix problems, to ensure employees got what they were owed.
“We must create a safe haven or system of deferred prosecution to support employers to self-report and rapidly back pay employees, with no fine or penalty imposed,” it said
University of Adelaide law professor Andrew Stewart expressed cautious support for the idea of a safe haven but said there should be a distinction between an understandable error and a lack of commitment to compliance. “The basic concept, seems to me, to be a sensible one,” Professor Stewart said.
“In my own professional work, I’ve certainly come across cases which I put into the category of an inadvertent error where an employer’s just been tripped up by the complexity of our regulatory system.
“Maybe they have received some incorrect advice at some point in the past and when they have realised, they have been willing to fix the problem.
“If you do have the safe harbour arrangement, that also then removes the possibility of the employer trying to hush up a problem or ignore it because they fear that if they admit to the problem and fix it, they’re still liable for penalties.”
With the government intending to introduce the second wave of workplace changes into parliament in September, BCA chief executive Jennifer Westacott called for more open and detailed discussion with business and the broader community about the proposed legislation.
She released BCA-commissioned polling that she asserted showed the public strongly rejected the government’s same job, same pay proposals.
According to the polling, 77 per cent of people agreed they would feel frustrated if someone who had less experience, or didn’t work as hard, was paid the same amount as them. Seventy-five per cent of the respondents agreed that companies should be able to hire temporary labour workers to fill surge capacity,
Ms Westacott said the polling showed the public did not support the proposed changes, although the government and unions would argue that the questions asked did not accurately reflect the policy.
“If we end up with changes that aren’t grounded in serious analysis of the problem, we’ll be making a complex system even more difficult to navigate,” Ms Westacott said
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