ALP’s one-stop shop to fight wage theft

Labor will announce plans to set up a small claims jurisdiction to help workers reclaim unpaid wages.

Labor employment spokesman Brendan O’Connor. Picture: Gary Ramage

Ripped-off workers will be able to make individual claims for up to $100,000 in unpaid wages to a new small claims jurisdiction under a federal Labor plan to crack down on wage theft and avoid costly court action.

In the latest policy pledge ­designed to make Saturday’s election a “referendum on wages”, Labor will today announce plans to set up a small claims jurisdiction to give workers an efficient and ­effective avenue to reclaim unpaid wages.

The jurisdiction, which will cost $51.1 million over the forward estimates, will sit alongside the Fair Work Commission. Claims by a group of workers against a single employer will also be allowed.

Bill Shorten said there had been too many examples of systemic wage theft, but lengthy and costly court proceedings often deterred workers from taking action.

“It shouldn’t be too hard, it shouldn’t be too costly, to get what you are owed for a day’s pay,’’ he said, adding that the new jurisdiction would be designed so most claims could be resolved in a single day.

The cost of the jurisdiction would be $10m a year while a further $3.7m would be made available annually to assist workers and employers bringing forward claims.

“Scandal after scandal has made it clear that workers exploitation and systemic wage theft is widespread, but the Abbott-­Turnbull-Morrison government has failed to act,’’ Mr Shorten said.

The Opposition Leader said the Fair Work Ombudsman recovered just under $30m in underpayments last ­financial year “but we know the problem is much worse” as evidenced by the widespread underpayment in 7-Eleven franchises that saw the backpayment of more than $160m in entitlements to 3628 employees.

As Labor promised to support an above-inflation pay rise for 2.3 million minimum wage and low-paid workers, the party refused to say whether unions and workers would be able to take legal strike action in support of ­industry-wide wage claims. Labor employment spokesman Brendan O’Connor stressed the multi-­employer stream would be focused on low-paid industries such as childcare and cleaning, or where enterprise bargaining had failed.

He said ­issues such as whether unions could take protected industrial ­action in support of multi-­employer claims would be determined following consul­tations with stakeholders.

Employers yesterday pushed for the minimum wage increase to be confined to 1.8 per cent, warning that the ACTU claim for 6 per cent this year was unaffordable. The Australian Chamber of Commerce and Industry claims awarding the ACTU claim would cost billions of dollars a year.

Chamber chief executive James Pearson said employers were concerned “this election has not delivered answers on significant questions for the future of our workplace relations system”.

“Business is worried that proposals for a return to industry bargaining, restrictions on flexible forms of work such as labour hire and casual employment, and significant increases in minimum and award wages, would add to the cost of employing people,’’ he said.

ACTU president Michele O’Neil will today address the Fair Work Commission and ask it to support the union movement’s “modest” 6 per cent claim. “The Fair Work Commission is charged with the responsibility of establishing and maintaining a safety net of fair minimum wages,’’ she will say. “In circumstances where working people can work full-time hours and still be left in poverty because their wages are too low, it is apparent that the safety net is failing for those workers.”

Mr Shorten will today ramp up his attack against United Australia Party leader and Queensland Senate candidate Clive Palmer at a West Australian business breakfast, using the billionaire as an example of an employer who, he claims, plays “fast and loose with the rules”.

“It’s not just workers who suffer,” Mr Shorten will tell The West Australian’s Leadership Matters breakfast. “He’s insulting all the workers to whom he owes money, he’s insulting all the Australian taxpayers who are effectively subsidising his billboards and text messages and his endless, baseless TV ads.”

This comes as Bob Hawke writes an open letter to voters endorsing Bill Shorten as the next prime minister, declaring the Opposition Leader’s union background, like his own, is an asset.

“In my view, Australia needs a Labor government led by Bill Shorten and his team,” Mr Hawke says in the letter.