The Fair Work Ombudsman has released a report highlighting widespread wage theft and non-compliance with workplace laws in regional Australia.

According to the Regional Campaigns Report, only 57 percent of the 1,385 businesses audited in Gippsland and Shepparton in Victoria, the Southern Highlands and Shoalhaven in NSW, and Wide Bay and Ipswich in Queensland were found to be fulfilling their obligations towards their employees. Twenty-one percent of businesses audited did not comply with their payslip and record keeping obligations, and 28 percent were not “paying their employees correctly”.

The report found the most common breaches to be underpayment of the minimum hourly rate (41 percent of all breaches), failure to provide pay slips in the form prescribed by the regulations (30 percent), failure to pay penalty rates (10 percent) and overtime (7 percent) and inadequate record keeping (6 percent). 

Businesses in the hospitality sector were found to be the least compliant, but the audit also looked at employers in retail, manufacturing and construction.

Workers in regional areas are not the only ones suffering wage theft. Last May, the hip Mitte Cafe in the Melbourne suburb of Fitzroy North was reported to have underpaid 32 staff members a total of $38,000. In the same month, a chain of up-scale bars on Melbourne’s Chapel Street were found to be paying wages in cash at well below the award rate. Three of the bar workers estimate their combined underpayment to be $50,000.

In 2018 the FWO reported receiving more than 20,000 anonymous tip-offs about dodgy employers over an 18-month period. 

The amount of money stolen from some of the lowest paid workers is simply staggering. Some of the worst offenders are the largest companies in Australia. Woolworths, for example, is currently facing a back pay claim worth $1 billion from five years of wage theft. In 2015, Coles was exposed for underpaying 75,000 workers more than $20 million per year. A report by the ABC revealed that as many as a third of all workers in Australia are not receiving the full superannuation contribution they are entitled to, which amounts to a total of more than $6 billion in stolen wages every year.

Wage theft is not a problem of a few bad apples; it is a conscious business strategy for many employers.

Despite the Fair Work Ombudsman’s claim to be an independent umpire seeking to “ensure compliance with Australian workplace laws”, it has frequently taken union activists and journalists to expose cases of wage theft.

Nevertheless, the Ombudsman’s regional campaign did recover $581,976 in stolen wages for 951 employees. But to the 597 employers found to be in breach of the law, only eight compliance notices, 27 infringement notices and 39 formal cautions were issued. No fines or any other penalties were mentioned, and the report ends with suggestions as to how employers might better acquaint themselves with workers’ minimum entitlements. Such leniency is rarely shown to our side.

Wage-stealing bosses should be slapped with hefty fines, their assets seized and the worst offenders subject to jail time. That’s what happens to workers and unions caught stealing. 

But that’s not how capitalism works. 

The problem of wage theft won’t be solved by the Ombudsman. It will require organisation and the rebuilding of strong unions. It is no coincidence that the industries in which union organisation is weakest – fast food, retail, hospitality, farming – are the worst affected by wage theft. Shady bosses may not have too much to fear from the Ombudsman, but the idea of workers organising certainly keeps them up at night.