Victorian Attorney-General Jill Hennessy said existing wage theft laws had failed to stop the problem,making a criminal approach necessary.Credit:AAP
Victorian employers wanting to self-report staff underpayments would probably have to deal with both agencies,University of Melbourne labour law expert Professor John Howe said.
Melissa Kennedy,a PhD scholar working under Professor Howe,said there was a risk business owners would be less likely to come forward once the Victorian scheme was in effect because they faced being prosecuted at both a state and federal level.
She said the Fair Work Ombudsman tended to prioritise the repayment of workers,reducing penalties for business owners who self-reported errors and co-operated with investigations.
"Whereas with the Victorian scheme,it prioritises the punishment angle rather than repayments,"Ms Kennedy said. Research showed the number of claims pursued by authorities tended to be a stronger deterrent than the severity of punishments,she said.
Some of Australia's highest-profile businesses including Woolworths and Qantas have disclosed underpayments worth tens of millions of dollars in recent years but many more egregious cases are from smaller businesses.
Professional services firm PwC has estimated 13 per cent of Australian workers are underpaid a total of $1.35 billion a year.