Read The Times Australia

Daily Bulletin

wage theft has become a culturally accepted part of business

  • Written by: Sarah Kaine, Associate Professor UTS Centre for Business and Social Innovation, University of Technology Sydney

Many Australians are shocked by celebrity chef George Calombaris being caught for underpaying employees A$7.8 million. It didn’t help, of course, that the television personality was also reported to be seeking a huge pay rise for appearing in the television program MasterChef Australia.

But what should not be a surprise is the prevalence in Australia of wage theft – typically underpaying award rates and entitlements such as overtime, superannuation and penalty rates.

Calombaris is not alone. In recent years there have equally large cases of wage theft involving household brand names such as Caltex, 7-Eleven, Pizza Hut and Domino’s Pizza.

The Australian Taxation Office estimated that in 2014-2015 Australian workers had been short-changed A$2.5 billion on superannuation payments alone .

Workplace audits by the federal Fair Work Ombudsman over the past decade suggest wage theft is rising. Most vulnerable are the young, the low-skilled and temporary migrants.

Read more: We've let wage exploitation become the default experience of migrant workers

And the sector where wage theft appears most common: food services (evident in more than 45% of audits).

Structure, culture, enforcement

The evidence points to wage theft being more associated with certain types of business structures. In particular, franchise operations, outsourcing, insecure work and the gig economy.

Calombaris has had a hard time denying he knew what happened in his companies. Bigger brands have gotten away with minimising costs through supply-chain arrangements where there’s exploitation somewhere along the line. It’s the very same problem that enables modern slavery to flourish around the world. These companies can deny responsibility because they have no direct legal obligations.

wage theft has become a culturally accepted part of business George Calombaris with his fellow celebrity judges on Network Ten’s Masterchef Australia. Network Ten/AAP

The problem isn’t just structural. It is also cultural.

Wage theft seems to have become accepted as a fact of life, maybe even a necessity, in certain sectors and workplaces. As a result, employers have developed a sense of impunity, while workers have become resigned to underpayment as unavoidable.

More than three-quarters of international students and backpackers, for example, know they’re being underpaid but accept it because they believe it’s standard treatment for anyone on their type of visa.

Cultural acceptance translates into weak enforcement rules. Wage theft is not considered a criminal offence, in the same way as stealing money from a company. Those caught face low penalties. Calombaris, for example, has to pay his employees what they are owed, but his penalty is limited to a $200,000 “contrition payment”).

Finally, a reform agenda

In this context – practices and attitudes making wage theft rampant – the only positive thing about Calombaris’ case is that, combined with other high profile cases, it has triggered enough outrage to make politicians get serious about reform.

The federal government has indicated it will propose new laws to make wage theft a criminal offence, punishable with prison time.

Along with tougher laws, more resources for enforcement are also needed.

Read more: Five myths about the informal economy that need debunking

Other reforms could help too. Supply chain certification, similar to the schemes used to guarantee fairtrade coffee or sustainably caught fish, are an example. The Fairwork Ombudsman has partnered with business and unions to create a pilot certification scheme for the cleaning industry.

Modern slavery legislation now requires large companies to report on their efforts to keep their supply chains slave-free. Acceptance of such reporting obligations could pave the way for the expectation that companies more attention to stamping out all forms of worker exploitation.

Community responsibility

There is one other notable point to make about the Calombaris case. It is about our own responsibility.

As a community we have collectively accepted wage theft for too long.

Collectively we seem to have higher tolerance for the mistreatment of workers at the fringes of the labour market – such as migrants, young workers and the low-skilled.

It is time to take stock. Work will change drastically in coming decades. More of us face the prospect of being among the vulnerable, with the jobs we do now being taken over by AI and automation.

Read more: Artificial intelligence-enhanced journalism offers a glimpse of the future of the knowledge economy

Technology has also facilitated “uberisation” and the growth of the gig economy, in which companies minimise their obligations by denying workers are employees.

Considering the breadth of change to come, we need more than ever to reflect on what we accept and enable.

Authors: Sarah Kaine, Associate Professor UTS Centre for Business and Social Innovation, University of Technology Sydney

Read more http://theconversation.com/shocking-yet-not-surprising-wage-theft-has-become-a-culturally-accepted-part-of-business-121038

Business News

Cost Savings and Benefits of Using Used Pallets in Logistics

In today’s competitive logistics and supply chain industry, businesses are constantly looking for ways to reduce operational costs without compromising efficiency and reliability. One of the most prac...

Daily Bulletin - avatar Daily Bulletin

How Fulfilment Services in Australia Help Businesses Scale Efficiently

The growth of e-commerce and modern retail has transformed customer expectations. Consumers now expect fast shipping, accurate order processing, and seamless delivery experiences regardless of where...

Daily Bulletin - avatar Daily Bulletin

Practical Ways Australian Workplaces Can Reduce Operating Costs

Reducing business costs doesn’t always mean cutting staff, shrinking services or making the workplace feel bare-bones. In many cases, the smarter savings are hiding in everyday operations: the light...

Daily Bulletin - avatar Daily Bulletin

Executive Recruitment Solutions That Help Organisations Secure Exceptional Leaders

Leadership has a direct impact on organisational performance, employee engagement, strategic growth, and long-term success. Businesses operating in increasingly competitive environments require experi...

Daily Bulletin - avatar Daily Bulletin

Why A WooCommerce Website Designer Matters For Online Growth

Running an online store today requires more than simply listing products and waiting for customers to arrive. Businesses need a website that is fast, reliable, easy to navigate, and designed to suppor...

Daily Bulletin - avatar Daily Bulletin

Turning Your Empty Tables into Revenue

The rise of AI demand tools in hospitality, the EatClub–CommBank partnership, and seven trends reshaping Australian dining  A growing number of Australian venues are turning to AI-powered demand ma...

Daily Bulletin - avatar Daily Bulletin

High-Impact Dental Marketing Strategies That Are Driving Real Practice Growth Today

The landscape of dental practice growth in Australia has shifted dramatically over recent years. Standard, broad-spectrum advertising campaigns no longer yield the return on investment they once did. ...

Daily Bulletin - avatar Daily Bulletin

How Telematics Helps Australian Companies Improve Productivity

Operating a commercial fleet in Australia is a uniquely demanding endeavour. Between the sprawling urban sprawl of cities like Sydney and Melbourne and the immense, unforgiving stretches of the Outb...

Daily Bulletin - avatar Daily Bulletin

Inside the Icon: The BridgeMuseum Officially Opens at the Sydney Harbour Bridge

A bold new way to experience one of Australia’s most recognisable landmarks has arrived, with BridgeClimb Sydney officially opening the all-new BridgeMuseum.  Located inside the Sydney Harbour Bridge...

Daily Bulletin - avatar Daily Bulletin

The Daily Magazine

Traffic Light System Solutions For Safer And More Efficient Traffic Management

Modern cities and growing communities rely heavily on effective traffic management to ensure safety...

Gold Migration Lawyers in Liquidation: How the Closure Affects Your ART Appeal

If your appeal was with Gold Migration Lawyers, a recent change to how the Tribunal decides cases ...

The pressure cooker: life in urban Australia in 2026

Australian cities have always been demanding. Long commutes, rising housing costs, busy schedules a...

What Actually Makes a Good Criminal Lawyer in Melbourne

Most people only think about this question once. That is usually too late. Most people charged wi...

Why Working With A Chatswood Tutor Can Improve Academic Performance

Academic expectations continue increasing for students across primary school, high school, and senio...

Is It Worth Getting Solar Panels in Melbourne?

The real question is not whether solar works in Melbourne. It works. The question is what it is co...

How A Diploma Of Project Management Builds Practical Skills For Modern Work Environments

Developing the ability to plan, execute, and deliver outcomes efficiently is a key requirement in to...

How to Choose the Right Football for Every Level

Choosing a football may seem straightforward, but the right option depends on who will be using it a...

What to Ask a Wedding Photographer Before You Book

Booking a wedding photographer can feel deceptively simple: you like the photos, you like the vibe...