From 1 January 2025, intentional underpayment of wages or entitlements can be a criminal offence.

The Fair Work Ombudsman (FWO) can investigate suspected criminal underpayment offences and refer suitable matters for criminal prosecution. If a person is convicted of a criminal offence, a court can impose fines, prison time, or both.

There are protections in place for businesses to avoid criminal prosecution. This includes the Voluntary Small Business Wage Compliance Code (Code) and cooperation agreements.

Code and Guide

FWO can’t refer a small business employer’s conduct for possible criminal prosecution if they’re satisfied the employer complied with the Code in relation to an underpayment.

The Code and the FWO’s supporting guide are now available for download at Voluntary Small Business Wage Compliance Code.