What Are the New Wage Laws?
Starting 1 January 2025, deliberately underpaying employees will be treated as a criminal offence. This means if a business intentionally short-changes staff on wages, superannuation, or other entitlements, it could face serious penalties, including fines and possible criminal charges.
It’s important to note these laws focus on deliberate underpayments. If you make an honest mistake, it’s not a criminal offence, but you’re still responsible for fixing the error as soon as possible.
How the Compliance Code Can Help Small Businesses
To support small businesses, the Fair Work Ombudsman has introduced the Voluntary Small Business Wage Compliance Code.
The Code is designed to help small business owners get their payroll right. It provides simple steps to set up processes that ensure employees are paid correctly. If a small business follows the Code and an underpayment still happens, the Fair Work Ombudsman won’t refer the case for criminal prosecution.
This gives small business owners some reassurance while helping them meet their legal obligations.
Steps for Small Business Owners
To prepare for these new laws, small business owners should:
1. Check Payroll Processes: Ensure your systems are set up correctly to calculate wages, superannuation, and entitlements without errors.
2. Provide Training: Make sure staff responsible for payroll understand how to manage employee entitlements and comply with workplace laws.
3. Consider the Compliance Code: Signing up to the Voluntary Small Business Wage Compliance Code can provide a practical framework to follow.
4. Seek Advice If Needed: Talk to a payroll expert or workplace advisor if you’re unsure about your obligations.
Why This Matters for Small Businesses
These changes aim to protect workers and ensure businesses that pay employees correctly aren’t at a disadvantage. Staying compliant doesn’t just help you avoid penalties—it also builds trust with your staff and ensures your business is doing the right thing.
For more information, visit the Fair Work Ombudsman’s website: