Employers should face criminal action for deliberate exploitation of employees, says NSW opposition

Scathing: Fair Work Ombudsman Natalie James strongly criticised a labour hire company manager over a Scone abattoir 'wage theft' case.
Scathing: Fair Work Ombudsman Natalie James strongly criticised a labour hire company manager over a Scone abattoir 'wage theft' case.

A LABOUR hire company’s exploitation of 10 workers at a Scone abattoir was further proof of the need for deliberate wage theft to be criminalised, the NSW Opposition said.

Raying Holding general manager Zu Neng Shi underpaid more than $41,000 to 10 Chinese migrant workers who spoke little or no English, with one worker owed more than $10,000. He exercised “an element of practical control” over the workers by organising their accommodation and transport to and from the abattoir and isolating them from the Australian community, Federal Circuit Court Judge Robert Cameron found.

Mr Shi was fined $43,000 after Fair Work Ombudsman Natalie James rejected Mr Shi’s argument he was unaware of Australian awards, and said the Raying Holding case was another concerning example of a “business operator from a culturally and linguistically diverse background underpaying workers from within his own ethnic community”.

NSW Labor industrial relations spokesperson Adam Searle and Country Labor Upper Hunter candidate Martin Rush said the Scone case reinforced the need for stronger state laws when employers deliberately underpay employees and deny entitlements.

Reforms: NSW opposition industrial relations spokesman Adam Searle says NSW needs new laws to criminalise employer exploitation of workers.

Reforms: NSW opposition industrial relations spokesman Adam Searle says NSW needs new laws to criminalise employer exploitation of workers.

A NSW Labor government would introduce new wage theft laws to crack down on businesses that exploit workers because “current penalties are not tough enough”, Mr Searle and Mr Rush said.

The laws would criminalise the deliberate failure to pay wages and entitlements, hold head franchisors accountable for the actions of franchisees and protect Sunday penalty rates in all state awards and agreements, they said.

Labor would also give workplace inspectors wider powers to undertake wage audits and introduce a licensing scheme for labour hire companies to ensure they comply with labour laws and provide safe, fair and reasonable work conditions.

Mr Searle said the Scone abattoir case and recent media exposure of widespread underpayment of workers at well known Australian companies was evidence of “systematic exploitation of workers” across NSW.

“We need stronger laws and better enforcement because there are still a number of unscrupulous employers that aren’t getting the message,” Mr Searle said.

Plan: Country Labor Upper Hunter candidate Martin Rush said the Scone abattoir case was proof of the need for a tougher penalty regime in NSW to protect workers.

Plan: Country Labor Upper Hunter candidate Martin Rush said the Scone abattoir case was proof of the need for a tougher penalty regime in NSW to protect workers.

Mr Rush said vulnerable Upper Hunter workers were being “cheated out of a staggering amount of wages by crooked bosses and it has to stop”.

“A Labor Government would see dodgy employers pay correct wages and entitlements to staff or face the consequences,” he said.

Judge Cameron found Mr Shi, who headed Raying Holding until it went into liquidation in 2015, forced two full-time employees to be classified as independent contractors and failed to provide employees with pay slips for more than eight months.

The record-keeping and pay slip contraventions were serious, Judge Cameron said.

“The failure to keep proper records and to provide employees with pay slips strikes at the heart Australia’s industrial law system because it compromises employees’ ability to monitor their employers’ compliance with industrial laws and the regulator’s ability to investigate breaches of industrial laws,” he said.

Mr Shi displayed no remorse and “misleadingly painted himself as a victim of circumstance”, Judge Cameron said. 

This story Labor flags new ‘wage theft’ laws when workers underpaid first appeared on Newcastle Herald.