Chantelle Zentveld, 17, was thrilled when she got an after-school job at the fast-food franchise Subway, but she soon suspected she was being underpaid.
"I calculated how much I was meant to get paid if I got paid the legal amount. And it was close to $300 for eight weeks of work."
The teenager is now taking Subway to the Fair Work Commission to terminate the enterprise agreement she was working under, which had an expiry date of 2015, and covers around 60 Subway employers in three states.
Such "zombie" agreements are based on outdated award conditions, with workers still paid under the old enterprise agreement.
Chantelle and her union, the SDA, argue the agreement included wages and conditions that had not kept up with modern awards, leading to underpayment.
“The motivating factor for challenging it was seeing my other co-workers be so oblivious to it all. And knowing that I had more knowledge than they might have inspired me to take action and help others,” Chantelle says.
This week, a senate inquiry set up in 2019 to look at wage theft after a string of high-profile cases, quietly tabled its report.
It found the unlawful underpayment of employees in Australia was systemic, sustained and shameful.
Most workers are too scared to speak out about underpayment, because they’re fearful of the repercussions, but it’s a huge problem, and is estimated to cost workers around $6 billion a year in lost pay and superannuation.
'I felt afraid'
Migrant workers and international students such as Carla are at a higher risk of exploitation. She was fired from her traffic control job when she asked why she had not been paid.
“I felt afraid. I worried. I was just a traffic control girl. I work and I felt intimidated.”
Redfern Legal Centre helped Carla pursue her former employer in the Fair Work Commission in an unfair dismissal claim and in the Federal Court to recover the money she was owed.
“After nine months, [her former employer] finally paid me,” says Carla.
Lawyer Sharmilla Bargon — the coordinator of The Employment Rights Legal Service, which is a collaboration between Redfern, Kingsford and Inner City Legal centres — agrees with the report’s findings that the current regulatory framework is inadequate for pursuing wage and superannuation theft.
"The entire system allows for both the conditions that give in to exploitation and then creates incredible barriers for people to pursue their own underpaid wages using the existing legal structures."
However, Ms Bargon says the report does not go far enough when it comes to improving protections for temporary visa holders, who face rules around their working conditions.
“If they are on temporary visas, they won't even want to raise the possibility of underpayments with employers for the perceived risk to their visa, which can be more important to them than any other payment.”
She also says there is a lack of enforcement action against dodgy bosses and, instead, it is typically the visa holder who is punished.
"It’s critical that migrant workers be given a bridging visa or space to allow them recover unpaid wages.
While wage theft is more common in lower-paid industries such as hospitality, retail, horticulture and cleaning, some of the nation's largest employers have also been caught up in underpayment scandals including Qantas, Coles, Woolworths, CBA, Westpac, NAB, 7-11, Super Retail Group and the ABC.
The senate inquiry's key recommendation is for the federal government to outlaw wage theft. Several states already have laws criminalising wage theft.
University of Melbourne law school Associate Professor Tess Hardy supports the report’s recommendation but says it is largely a symbolic move, particularly when an employer is a corporation.
“Criminal penalties available with respect to wage prosecutions are very, very rare and they're expensive, they're resource-intensive. And it's not necessarily about assisting the person who's been underpaid recover that back payment. It's about the penalty that's ultimately imposed.”
Dr Hardy is disappointed there were not clear recommendations for administrative sanctions to strengthen the power of the Fair Work Ombudsman or unions.
“Because unions don't have any powers to issue on-the-spot fines, for example, or other types of notices [that] can be really effective delivering these small but regular doses of deterrence — which the evidence suggests — is more effective [at] raising the perceived risk of getting caught,” she says.
'I can't plan for the future'
Wage theft is also widespread at universities. Natalia Maystorovich is part of a wage theft claim against The University of Sydney.
The casual academic is paid for 28 hours of preparation and face-to-face teaching a week, but says to get the job done she needs to work between 40-45 hours a week.
“It's placed as your responsibility because you failed in being able to do it within the hours that are allocated to you.”
Natalia alleges she is owed more than $20,000.
"They're relying on the fact that we're going to do it anyway, we'll just get the job done. Because, if we don't get it done, we also won't have a job next semester."
She says her work situation makes it hard to plan for the future or to further her career.
“Because I'm so busy working all these extra hours that I'm not paid for … to do the preparation and the lesson planning, and dealing with students, that I don't have time to do my own research to publish.”
Employer groups say small businesses at risk
Alex McKellar from the Australian Chamber of Commerce and Industry says underpayment is unacceptable but often happens by mistake.
He says small employers don’t necessarily have access to a HR department, legal advice and payroll that the big companies have.
“If we are going to eradicate the worst issues here, then the most important thing to do is look at how we can simplify the system.”
Alexi Boyd, chief executive of the Council of Small Business Organisations Australia (COSBOA), agrees.
“The Fair Work Act is longer than Crime and Punishment — we can’t expect the average small business employer to have read it all,” she says.
“For example, you might have a shop that falls under the General Retail Award but, if you expand your business by adding a coffee machine or food or alcohol, you’ll find yourself juggling the General Retail Award, the Fast Food Award, the Restaurant Award and the Hospitality Award.”
A spokesman for Subway said anyone working in a Subway restaurant was entitled to fair pay and conditions, and Subway has zero tolerance for deliberate wage theft.
The fast-food chain says all enterprise agreements are approved by the Fair Work Commission and the agreements can lawfully operate until a party applies to end an agreement.
The University of Sydney says it cannot comment on individual staff matters due to privacy concerns.
However, it says, it is committed to staff receiving their full entitlements, and that it investigates and resolves issues as appropriate.
