BHP, Suncorp, Sharetea, and others: Understanding Wage Theft

Worker Underpayments in the Spotlight – June 2023 

 
 
 

BHP

BHP has admitted to underpaying almost 30,000 employees since 2010 due to incorrectly deducting leave on public holidays. The company estimates it will need to pay back employees $430 million. 

This came a week after BHP criticised the federal government’s proposed ‘same job, same pay’ legislation which would require labour-hire workers to be paid at least as much as company employees performing the same job.  

 
 

Suncorp 

Suncorp has back-paid workers $32 million following self-reported breaches to the Fair Work Ombudsman (FWO) in 2020. It underpaid 15,800 employees’ minimum wages between 2014 and 2020 due to inconsistent use of the term ‘Rostered Employee’ in its Enterprise Agreement, leading to underpayment of entitlements.  

“This matter demonstrates the importance of employers placing a high priority on compliance, including with all clauses in their Enterprise Agreements. Suncorp’s incorrect application of particular clauses has led to underpayment of basic employee entitlements and a large back-payment bill.” 
— FWO 

 
 

Sharetea 

The FWO has recovered almost $90,000 in unpaid wages for 36 workers. In April 2022, the regulator investigated 14 outlets of the bubble tea chain nationwide. Along with tip-offs of potential underpayments, intelligence confirmed that the stores employed a significant number of vulnerable workers, namely Mandarin-speaking visa holders.  

Breaches included failures to pay the casual minimum wage, engage casual workers for the required minimum hours, and keep adequate records. 

 

RMB Café - Degraves St, Melbourne 

Former operators of RMB Café face over $42,000 in court penalties and back-pay orders. Not only do they still owe employees for underpayments outlined in a 2020 Compliance Notice, but they have been fined further for failing to comply with this Notice.  

“When Compliance Notices are not followed, we are prepared to take legal action to ensure workers receive their lawful entitlements, in addition to pursuing court penalties.” 
— FWO 

 

Rika Foods – North Melbourne 

A former director and operators of a juice and coffee bar face court-imposed penalties of $30,000 after they kept over $14,000 in JobKeeper payments instead of paying them to an employee. 

“The whole point of JobKeeper payments to employers was to enable them to pay their staff when business was slow or non-existent...not for employers to retain the money for their own benefit, as has happened in this case.” 
— Judge Heather Riley

What is wage theft? 

On 1 July 2021, it became criminal offence for an employer in Victoria to: 

  • Deliberately and dishonestly underpay employees 

  • Deliberately and dishonestly withhold wages or other employee entitlements 

  • Falsify employee entitlement records to gain a financial advantage  

  • Avoid keeping employee entitlement records to gain a financial advantage  

Convicted individuals face fines of around $200,000 and up to 10 years’ jail; companies can be fined over $1 million.  

Honest mistakes made by employers who exercise due diligence in paying wages and entitlements are NOT considered wage theft. 

Wage Inspectorate Victoria 

Wage Inspectorate Victoria is an independent body designed to promote and enforce Victoria’s:  

  • Wage theft laws 

  • Child employment laws 

  • Long service leave entitlements 

  • Owner driver, forestry contractor, hirer, and freight broker obligations 

They conduct independent, impartial investigations and have strong, coercive powers. 

Are you doing the right thing? 

In politics, media, trade unions, and business forums, a major topic today is how to best engage and work with employees and contractors. There are MANY problems – sometimes, the law can confuse and not clarify, and trade unions and business have clear objectives which are not always consistent. This makes it tricky for employers, even if you are fully aware of the many factors involved engaging and remunerating workers correctly.  

 
 

Part of our iSuite Risk Management Program, iEngage is a high-level assessment of where your risks might be. It is designed to identify areas that may require further analysis and support.  

Put your mind at ease. Contact us or click below to find out more.  

Alicja Gibert