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Wage Theft Costs Queensland More Than Car Crashes & Natural Disasters

Wage theft costs Queensland more than car crashes & natural disasters

Wage theft costs the Queensland economy $1.2 billion annually, more than car crashes and natural disasters, according to a new report.

The McKell Institute research also found that 437,000 workers in the state are victims of wage theft.

Wage theft costs Queensland

The McKell report describes wage theft as a “manifestly unfair scourge” that:

  • is a serious problem;
  • is vastly under-reported; and also
  • causes a major economic liability for individual workers, federal and state governments.

In fact, the research found that wage theft costs the Queensland community more than other major economic liabilities.

For example, road crashes, material theft of goods, and even more than the clean-up after devastating Cyclone Yasi.

The report concludes that wage theft is widespread, and as a result, demands serious policy intervention at both state and federal levels.

Fair Work is ‘hopeless’

The release of the report comes just days before a parliamentary inquiry is due to hand down its report into wage theft in Queensland.

Industrial advocate Miles Heffernan, who recently appeared before the committee, has helped hundreds of clients recover stolen wages.

He said he is not surprised by the McKell findings.

“These figures do not surprise me at all,” he said.

“We know that wage theft is rampant in Queensland – we get up to 80 calls a week from people who want help to recover stolen wages.”

Mr Heffernan said the Fair Work Ombudsman – responsible for enforcing workplace laws – is hopeless.

“The evidence shows that the regulator has failed spectacularly in its task to police wage theft,” he said.

“For too long it has focused on education, rather than enforcement, and as a result, wage theft is out of control”.

Wage theft in Queensland policed by just 38 inspectors

According to the McKell report, Fair Work is hopelessly underfunded.

There are just 38 inspectors on the ground in Queensland, to police tens of thousands of businesses that employ people.

Six audits in five years

Fair Work completed 28 wage theft audit campaigns in Queensland between 2009-2013.

The regulator only completed six audits in the following five years, however.

“No wonder employers steal wages from their workers,” Mr Heffernan said.

“It’s really easy, and the chances of getting caught are remote, and the chances of Fair Work commencing legal action is virtually zero.”

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Meanwhile, the McKell report found the non-payment of superannuation is particularly prevalent, because it is easy for employers to get away with.

The report says the system is makes it difficult for workers to monitor if their employer is making payments on time.

Moreover, even when they do, the tax office is slow to respond.

Industry Super Australia estimates that employers fail to pay super to over 580,000 Queenslanders.

The average underpayment is $1,915.

This equates to more than $1.1 billion a year in unpaid superannuation.

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