The criminalisation of intentional wage underpayment marks a significant shift in Australia’s employment law framework. While the offence applies across all sectors, its practical and symbolic impact is particularly pronounced for businesses engaging migrant workers, a cohort historically overrepresented in underpayment and exploitation matters.
This reform goes beyond payroll compliance. It sits at the intersection of employment law, migration regulation and worker protection, fundamentally reshaping employer risk exposure.
Why Migrant Employment Creates Higher Risk Exposure
Many Australian businesses rely on migrant labour, particularly in hospitality, construction, agriculture, aged care and professional services. However, employing migrant workers introduces additional legal and operational complexity.
Migrant employees may be subject to:
- Employer-sponsored visa conditions
- Work-hour limitations (such as student visa caps)
- Award classification risks
- Language and communication barriers
- Limited understanding of workplace entitlements
When payroll systems are not precisely aligned with modern award obligations and visa conditions, the risk of underpayment increases. If warning signs are ignored or if underpayment is deliberate, exposure may escalate beyond civil penalties to criminal prosecution.
The Legal Threshold: Intent Is Central
The criminal offence targets intentional underpayment. Genuine payroll errors or inadvertent misinterpretations of awards are not automatically criminal. However, intent may be inferred where an employer:
- Knows the correct award classification but applies a lower rate
- Disregards internal warnings or employee complaints
- Fails to rectify systemic underpayments
- Manipulates time records or misclassifies employees
Where migrant workers are involved, regulators may apply heightened scrutiny if there is evidence of power imbalance or exploitation of vulnerability.
Importantly, liability is not confined to the corporate entity. Directors, managers and decision-makers who are knowingly involved may face personal exposure.
The Migration Compliance Dimension
The criminalisation of wage theft also aligns with broader federal efforts to protect the integrity of Australia’s migration system. Employers who exploit migrant workers undermine both workplace standards and visa program credibility.
Recent policy developments — including strengthened protections for visa holders who report exploitation — are designed to reduce fear-based silence and encourage complaints. As a result, non-compliance is increasingly likely to attract multi-agency attention.
For organisations employing migrant labour, the risk profile now includes:
- Criminal exposure – deliberate underpayment may result in prosecution.
- Cross-regulatory consequences – breaches may affect sponsorship status or visa approvals.
- Reputational impact – allegations of exploitation attract significant public scrutiny.
Where employment obligations intersect with migration compliance, regulatory oversight can become layered and complex.
How Employers Can Protect Themselves
Moving From Risk Exposure to Risk Control
In the current enforcement climate, wage compliance cannot be treated as a back-office function delegated solely to payroll. Where migrant workers are engaged, pay practices operate within a broader regulatory ecosystem involving sponsorship duties, visa conditions and heightened scrutiny.
Protection is not achieved through isolated policies. It requires integrated oversight and demonstrable governance.
Boards and business owners should be asking:
- Do we have clear visibility over how migrant workers are classified and paid?
- Are visa conditions reconciled with actual work patterns?
- If an issue were identified tomorrow, could we demonstrate systems designed to prevent underpayment?
The focus must shift from reactive correction to proactive control.
Where underpayments are identified, response strategy is critical. Delay, minimisation or informal rectification can significantly increase exposure. A structured, legally guided remediation process is often the difference between contained resolution and escalated enforcement.
Strategic Legal Protection for Employers
NB Employment Law Lawyers for Employers works with businesses to mitigate risk before it becomes regulatory action.
Our approach goes beyond payroll review. We assess the broader compliance framework , including employment contracts, award interpretation, sponsorship obligations and internal reporting structures to ensure alignment across employment and migration law.
Our support includes:
- Privilege-protected compliance audits
- Risk assessments for employers of visa holders
- Strategic representation during Fair Work or multi-agency investigations
- Structured remediation planning
- Advice to directors and executives regarding personal liability
The objective is to place employers in a defensible position, supported by documented systems, informed oversight and legally sound processes.
In a landscape where deliberate underpayment constitutes criminal conduct, early and strategic legal involvement is a protective measure — not a reactive step.
A New Enforcement Landscape
The criminalisation of wage theft reflects a clear enforcement shift: deliberate underpayment particularly where vulnerability is involved will be treated seriously.
For employers, the safest position is a defensible one. Transparent systems, documented compliance processes and proactive legal oversight are now essential components of responsible workforce governance.
If your business employs migrant workers or sponsors visa holders, now is the time to assess your exposure.
NB Employment Law Lawyers for Employers is ready to assist you in navigating this evolving regulatory environment with clarity and confidence.