The Victorian Government is the first state in Australia to pass laws establishing criminal penalties for employers who deliberately underpay or don’t pay employees.

Employers who withhold wages, superannuation or other entitlements will face fines of up to $198,264 for individuals, $991,320 for companies and up to 10 years’ jail.

Offences will also capture employers who falsify employee entitlement records, such as payroll records, or who fail to keep employment records.

Attorney-General Jill Hennessy said yesterday the new record keeping offences are aimed at employers who attempt to conceal wage theft by falsifying or failing to keep records. 

“No longer will employers be able to avoid being held accountable through deliberate dishonest record keeping practices,” she said.

“We promised to criminalise wage theft and we have delivered on that promise – employers who steal money and entitlements from their workers deserve to face the full force of the law.”

The Wage Inspectorate of Victoria will be established as a new statutory authority with powers to investigate and prosecute wage theft offences.

“Employers who make honest mistakes or who exercise due diligence in paying wages and other employee entitlements will not be subject to the legislation,” Hennessy said.

The Government has also consulted with employer groups and unions, and in February this year released a consultation paper seeking public feedback on the proposed legislation.

Work is underway on reforms to make it faster, cheaper and easier for employees to recover money they are owed through the Magistrates’ Court.

The Victorian Chamber of Commerce and Industry said in March that wage theft laws put Victoria's business environment at risk. The new laws begin next year.

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