Back in October last year, when the hospitality industry was in the spotlight for its egregious and systemic wage theft abuses, celebrity chef Matt Moran had this to say
: “Making any hospitality company 100 per cent compliant is hard because there are so many different awards. It takes a lot of resources. The whole thing should be simpler.”
You hear this a lot from business owners, usually right after they’ve been caught with their hands in their workers’ pockets. Woolworths boss Brad Banducci said something similar the same month, describing awards as “a very complex issue
” and arguing that we need to “talk about the lack of flexibility”. He said this on the same day that his company ‘fessed up to pinching $300 million in wages from its staff.
Small Business Ombudsman Kate Carnell, a former Liberal Party politician, came to the defence of hard-done-by business owners in November in a press release
cynically titled “Ombudsman calls for better protections of employee wages”. “While the vast majority of small businesses fulfil their obligations to their employees, the award system itself is overly complicated and fluid, which can sometimes lead to the employer making honest mistakes.”
“Honest mistakes.” Here, as a refresher, is an incomplete list of some of the poor organisations who just couldn’t quite work out how not to rip off their staff: Woolworths, Coles, Wesfarmers (Bunnings and Target), Qantas, the ABC, Domino’s, Subway, Commonwealth Bank, Caltex, Grill’d, Rockpool Dining Group, 7-Eleven, Coffee Club, Michael Hill, Super Retail Group and Crust Pizza.
All told, one in five
Australian businesses are estimated to be engaged in wage theft. PwC estimates that 13% of Australian workers are underpaid
$1.35 billion each year.
It seems weird, to me at least, that these large, sophisticated and highly profitable organisations, who seem otherwise capable of managing countless transactions, supply chains, and a genuinely convoluted tax code, are strangely inept when it comes to their payrolls.
Could they be right? Could the award system really be that complicated and onerous?
In short: nope.
For one thing, it’s telling that these supposedly accidental screw-ups always favour the employer. For another, if these underpayments were the product of genuine error you would expect there to be an even distribution across employees. But as Bernard Keane
[$] in Crikey
points out, that’s not the case at all: migrant workers, who comprise 6% of the workforce, account for 20% of Fair Work Ombudsman disputes; and young workers, who make up 15% of the workforce, are involved in 28%.
Also, many of the reported instances of wage underpayment over the last couple of years have been clearly deliberate: in Neil Perry’s Rockpool fine-dining empire timesheets were tampered
with; 7-Eleven franchisees were intentionally rorting
workers; Caltex falsified
Businesses have been able to get away with this much more since 1996, when the Howard government abolished award-based right of entry, preventing unions from conducting regular inspections of time records (now they must give 24 hours notice and sometimes fight off legal action by bosses to block access).
And don’t forget how much the award system has been simplified already. The Howard government’s Work Choices legislation was a raw deal for workers but the Rudd government retained the national framework when it repealed Work Choices in 2009. That consolidated thousands of state and federal awards into a huge and terrifying total of 122.
Anthony Forsyth, a professor of workplace law at RMIT, says it’s not the awards that cause complication but the use of annualised salary arrangements
(a tactic used by organisations to avoid the award in the first place), which require “regular checking and monitoring”.
The bottom line is that there should be no excuses, and that complaints about award complexity are a diversion and a stalking horse for undermining the award minimums.
University of Adelaide associate professor in law Joanna Howe said businesses whose business models depend on underpaying workers “should not exist”.
“Stealing is a crime no matter how it happens or who does it.”