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New Study Finds Australian Workers Underpaid Nearly $850 Million Annually

The McKell Institute has lifted the lid on the Australian wage theft issue, disclosing that workers are being underpaid nearly $850 million a year.

The think tank examined business audit campaigns by the Fair Work Ombudsman dating back to 2009, discovering an average of five workers per business who were owed $610.83 each in wage repayments.

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More than 40 per cent of the businesses audited fell foul of the Fair Work Act, while more than a quarter recorded breaches of monetary obligations such as award rates and agreements.

Aidan, one of the victims of wage theft, has been working as an enthusiastic chief for some famous restaurants. Despite working extra hours and dedicating himself to work, his hard work never paid off. 

“I worked for some big-name restaurants where I’d do 45 to 50 hours a week and would be paid for a 37-38 hour week,” he told the research institute.

Aidan is not the only victim of wage theft. In Australia, there were around 269,728 businesses collectively ripping off more than 1.3 million workers.

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McKell Institute CEO Ed Cavanough said the total amount of actual wage theft is likely much higher.

“The analysis puts a conservative figure on the cost of wage theft that is rampant across Australia, equivalent to a 0.01 per cent loss in GDP,” Mr Cavanough said.

The analysis breaks down wage theft by state and territory, with Sydney having the highest average amount owed to workers, based on FWO reimbursements. 

In Melbourne, more than 28,500 workers missed nearly $17.5 million. 

“This is an extraordinary amount of money being stolen, and it’s unacceptable. Being unaware is not an excuse. The onus is on employers to understand their obligations to their employees.

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