From 1 January 2025 employers will be held criminally liable for intentional underpayment of wages. The offence only applies to intentional underpayment that occurs after the provisions take effect.
Elements of the offence
To establish an offence, it must be shown that an employer was:
- Required to pay an amount to, on behalf of, or for the benefit of an employee (including wages, leave entitlements or superannuation); and
- The employer has intentionally done something that intentionally results in those amounts not being paid on or before the day they are due.
The intention of the employer must be assessed to determine whether it meets the requisite criteria under section 5.2 of the small business need not comply with every factor in the Code, but the FWO will look holistically at the circumstances to determine whether they comply with the Code. Where this is found, the FWO cannot bring charges against the small business.
Civil penalties for contraventions increased
As of 1 January 2025, there will also be an increase in the maximum penalty payable for civil contraventions of Australian workplace laws. The maximum penalty for companies with 15 or more employees will now be as follows:
- The greater of $495,000 or three times the underpayment amount per contravention; or
- The greater of $4,950,000 or three times the underpayment amount for serious contraventions.