I rise to make a contribution in relation to the Wage Theft Bill 2020, which seeks to introduce criminal penalties for wage theft. At the heart of this issue, it seems to me, is power imbalance when it comes to wage theft, and I think that is something really important to consider. Recent cases brought to light by the media overwhelmingly showed so-called underpayments occurring at the low annual income end of the spectrum, impacting workers in construction, health care, retail, food services and notably—even in my own electorate, in the Shepparton district—in the fruit-picking industry, something that none of us can be proud of and that we have seen quite regularly across the horticulture industry across northern Victoria. Fortunately it is not widespread, but it does happen from time to time. I think it is something that does need to be stamped out because it impacts on our ability to attract workers to jobs that are often very hard. Working out in the hot sun all day long, picking fruit and vegetables is something that is physically very arduous. We have seen cases where people have been really significantly underpaid.
The 2019 KPMG report estimated that the annual rate of wage theft in Australia is a staggering $1.35 billion, impacting 13 per cent of the total workforce and 21 per cent of those in vulnerable industries. To put that in perspective, one in five low-income workers in vulnerable industries have reportedly had part of their wages misappropriated by employers. Tellingly, none of the recent prominent wage theft cases featured any high-wage earners. Doctors, lawyers and politicians need not fear wage theft. For shop assistants, however, and for waiters and fruit pickers it is a real concern. Repeatedly, those affected are those least able to afford that sort of theft. Recent notable cases that prompted the formulation of this legislation include $20 million at Coles; $315 million at Woolworths; $7.8 million at George Calombaris’s group of restaurants; Qantas, $7.1 million; the Commonwealth Bank, $53 million; and Wesfarmers, $30.1 million.
In 2018 the Age reported on the case of 50 Vanuatu fruit pickers near Shepparton being paid less than $9 an hour—less than half of what they should have been paid. In 2019 the labour hire company who employed these workers was forced to pay more than $50 000 after the company admitted no records were made or kept of the hours that were worked by these individuals over a four-month period. And this is just one of those rare cases where we did see a prosecution. So often there has not been adequate enforcement of laws and people have got away with it, and that does create an environment where it happens more regularly.
There can be little doubt that wage theft is an issue in our community and even more so now with more than 1 million people who are newly unemployed and the threat of more to come if the federal government’s JobKeeper program winds up in September. It is a fear that so many people that I speak to have—that once JobKeeper does finish many more people will be made redundant from their jobs. Just this week we have seen the Grattan report on Shepparton showing that our region has the third-highest rate of unemployment across the whole of Australia. Now, these figures are always troubling. Whether we are third or fourth or fifth does not really matter—what does matter is that so many people have lost their jobs, so many people are unemployed.
One of the things I have noticed, talking to people about all of this recently, is how invisible people are, and at the moment they are invisible because they are at home. They are not actually out on the streets. They are not out looking for work in the way they normally would be, and it is almost as if they are a hidden group of people. So this is something we really need to think about as we continue to be somewhat restricted in our behaviours and remember that all of those people are out there in our communities. They are without work, and it is really important that their needs are taken into account and, for those who do have work and are coming back into work in many low-paid jobs, that they are still properly paid, just as we are.
There have been those who have argued that this bill and the measures in it go too far, that mistakes happen and that criminalising wage theft will punish employers for accounting errors, but the bill attempts to address those concerns. At the heart of the bill is the concept of dishonest behaviour, where it can be demonstrated that an employer deliberately and wilfully stole wages owed to an employee or employees.
Falsifying records is also targeted. As someone who ran a business for many years before coming into politics, there is no doubt that mistakes can be made, that there is a lot of red tape and that you need to be right across these things in your business. But there is an obligation to do that. To see an outcome whereby people are working an honest day’s work but are not being honestly paid for that labour is something that does warrant being looked at and does warrant, ultimately, punishment, especially if it is done in any form where an element of dishonesty comes into it.
I am informed that the burden of proof will be high in these offences and prosecutions difficult to achieve. Five years imprisonment is the maximum penalty for the worst cases of offending that can actually be imposed under this bill. The term matches the federal government’s proposed response. It is a fact that the federal government is proposing to legislate in this area, as are other states that are looking at the problem that exists. People might say, ‘Why are we bothering to do this when in fact the commonwealth will step into the breach and enact laws to deal with wage theft?’. One of the reasons is that it has been happening for a long time. There has been very little done about it. It is still happening, and nothing is being done about it at the commonwealth level. Until such time as it is, we actually have a deficit, we have a gap, and something needs to be done.
So should the time come that the commonwealth pass laws that we can be satisfied with as Victorians, maybe we will be here one day repealing legislation—and there is a good argument for doing that on a more regular basis—but I think in this case to put in the protections that this bill seeks to do is important, and it is important to do it now. Perhaps it is even more important when the vulnerability of so many out there in our community is so much greater, when their fear is so much greater. It perhaps sends a message to those people that there is a level of concern for them, that we do understand their vulnerabilities and that this is a protection that will be there for them.
On the duplication of laws that is perhaps argued, I think while on a practical level it exists, I am quite content that we go ahead and see a bill like this become law in Victoria until such time as it is no longer needed. As I said, other states are supporting it. Again, we do see the incidence of this too regularly to ignore it. I have mentioned all of those outstanding big cases where millions and millions of dollars have been held back over the years. I recall when my daughter was working in a dress shop as a university student and she was contacted some months after finishing that work only to be told that that employer had short-changed quite a number of workers and she was to receive some compensation for it. She was lucky in the sense that someone found out about it, someone did something about it and there was a level of compensation for those young workers who worked part time in that sort of employment. But many miss out completely. Many contractors or employers disappear and they are simply not there to pay the compensation that they ought to pay—the wages that have been lost by people who have not been rightfully paid. It is an important piece of legislation, and I would like to indicate that I do support this bill.