Fair Work Ombudsman
New criminal underpayment laws start 1 January 2025
Published 16 December 2024
From 1 January 2025, intentionally underpaying an employee’s wages or entitlements can be a criminal offence. The Voluntary Small Business Wage Compliance Code and our supporting guide is now available to help businesses prepare and protect themselves.
On this page:
- What’s changing
- Code and Guide
- What you can do now
- Other 1 January changes
- Recent changes that have started
- Stay up to date
- Related information
What’s changing
From 1 January 2025, intentionally underpaying an employee’s wages or entitlements can be a criminal offence. This doesn’t include honest mistakes.
We 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
We can’t refer a small business employer’s conduct for possible criminal prosecution if we’re satisfied that they’ve complied with the Code in relation to an underpayment.
Check you’re paying employees correctly
Businesses of all sizes can download the Code and our supporting guide to prepare and make sure employees are being paid correctly.
A small business employer will comply with the Code if they don’t intend to underpay their employees. This will be assessed by looking at several factors. These factors aren’t new to compliant employers. Instead, they’re steps many already take as part of good business practice.
Find out more at Voluntary Small Business Wage Compliance Code.
Guide to help you understand the Code
Our Guide to paying employees correctly and the Voluntary Small Business Wage Compliance Code Guide to paying employees correctly and the Voluntary Small Business Wage Compliance Code can help businesses to understand the Code. It offers practical advice and tools including a handy checklist, examples and best practice tips.
What you can do now
We’ve updated our website and resources with information about the upcoming changes.
You can:
- use the Code and our supporting guide to make sure you’re paying employees correctly.
- use our free tools and resources, including our calculators to check pay rates.
- make sure you’re prepared by learning more about:
Other 1 January changes
There are other workplace changes starting from 1 January 2025. They include:
- an increase to the maximum penalty for underpayment contraventions for a non-small business employer. Learn more at Litigation.
- new definitions and minimum pay rates for entry-level classifications in some awards. Learn more at Changes to entry-level classifications in awards.
- changes to classifications and minimum pay rates for some employees in the aged care sector. Learn more at Aged Care Work Value Case: Changes to awards.
Recent changes that have started
There have been other recent changes to workplace laws. These include:
- changes to casual employment
- a new right to disconnect
- independent contractor changes
- new regulated worker rules.
Find out more at Closing Loopholes.
For a visual snapshot of all the Closing Loopholes changes and when they start, check out our easy-to-read timeline.
Stay up to date
We’ll continue to keep you informed about important workplace changes that affect you.
To keep updated and to receive alerts, subscribe to our email updates. It only takes a few moments to sign up.
You can also follow us on social media for other announcements and reminders.
Related information
Changes to breaks between work periods in the Retail Award
Published 23 May 2024| Updated 24 May 2024
Find out how an employee’s pay is calculated when they’re not given at least 12 hours break between shifts under the Retail Award.
On this page:
What’s changed
The Fair Work Commission (the Commission) has made changes to the wording of the Retail Award concerning the pay rate for employees when they don’t get the minimum break between shifts.
An employee gets a higher pay rate if they work a shift without getting a 12 hour break between their shifts (or 10 hours by agreement). All hours worked without this necessary break are paid at 200% of their minimum hourly rate until they get the minimum break of 12 hours (or 10 by agreement).
All ordinary hours performed on public holidays is paid at the penalty rates prescribed in clause 22.1.
Casuals also get their casual loading, calculated on their minimum hourly rate.
These changes took effect from the first full pay period on or after 14 May 2024.
Example: Employee starts work without having minimum break between shifts
Felix is a part-time employee working:
- 3pm – 8:30pm Thursdays
- 8:30am – 4pm Fridays
- 9am – 3pm Saturdays
There’s no agreement for a shorter minimum break period between shifts. Felix is entitled to a minimum of 12 hours break between shifts.
Felix is asked to stay back and close shop on a Thursday. Felix finishes work at 9pm. The next day, Felix starts work at their usual time without getting a 12 hour break between shifts.
For the hours worked on Friday, Felix gets 200% of the minimum hourly rate because Felix doesn’t get a 12 hour break between their shifts.
Starting work later the next day to get 12 hours break between shifts
If Felix is asked to start later on Friday so they get the minimum break, Felix is still paid from the time they usually start work until the conclusion of their shift at the ordinary pay rate.
Find out more by using our industry filtered content at Breaks.
Award resources
Access the below resources for more information:
To learn more about these award changes, access the Commission’s decision.
Keep up to date
To stay up to date and be notified with updates that are relevant to you, subscribe to our email updates. It only takes a few moments to sign up and will help you stay in the loop with changes to workplace laws.
You can also follow us on social media for other announcements and reminders.
Related information
- Commission’s decision
- Commission’s final determination
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