Originally published in The Advertiser, February 10, 2021.
WORKERS in South Australia are routinely underpaid. Two of our senators can end it.
At just $9.90 per hour, the pay at my first job was pretty meagre. It didn’t matter much at the time – that rate, the legal award for a 14-year-old cashier in 2005, didn’t have to stretch far. Dad drove me to work, and the $60 I earned per week was more than enough for the school canteen.
Fast-forward 15 years, it’s hard to imagine anyone, let alone an adult, earning so little.
But the shameful truth is it happens every day.
In 2018, a Fair Work Commission investigation found 29 per cent of businesses audited in the Adelaide CBD were underpaying staff. And in September, an investigation identified workers in Gouger Street earning as little as $6 per hour. Caught on candid camera, one employer admitted the underpayment, bragging that he could get away with it.
Wage theft occurs throughout the national on farms and in restaurants, on construction sites and in offices. It doesn’t just hurt underpaid workers, it hurts all of us.
Research by the McKell Institute found wage theft costs SA workers more than $500m per year. Every dollar taken from a workers’ pocket is one less dollar circulating in our economy. And every SA small business that is paying their staff what they’re owed is being undercut by those employers who brazenly cut corners on wages.
Fortunately, fixing wage theft isn’t rocket science. All it takes is some political will.
We could fund more enforcement – there is currently only one workplace inspector for every 65,000 workers in Australia. We could make intentional wage theft punishable by real prison sentences, not just slaps on the wrist. And we could reign in fly-by-night labour-hire firms, which are often the worst wage theft offenders.
In December, I released research that found some workers in Australia earn as little as $3 per hour due to exploitation. The Attorney-General Christian Porter said the findings were “disgraceful”.
Unfortunately, a new piece of industrial-relations legislation, that Christian Porter wrote, is unlikely to bring about serious action to end deliberate underpayment. The Bill does create a criminal penalty for wage theft. But the criteria is so broad that is unlikely to ever lead to persecution.
And the Bill does nothing to improve enforcement. But here’s the good news: SA is in the box seat to improve the legislation. The passage of the Bill may rest on the deciding votes of SA Senators Rex Patrick and Stirling Griff.
Politics is about solving big problems. Wage theft is one of them, and SA has the loudest voice at the table to tell Canberra enough is enough.
Ed Cavanough is manager of policy at the McKell Institute