Victoria has become the first state in the country to pass laws establishing criminal penalties for employers who deliberately underpay or don’t pay their workers.

The new laws deliver on the Andrews Labor Government’s commitment to establish new criminal offences targeting employers who deliberately withhold wages and other employee entitlements.

Employers who dishonestly withhold wages, superannuation or other employee entitlements, will face fines of up to $198,264 for individuals, $991,320 for companies and up to 10 years’ jail.

Offences will also capture employers who falsify employee entitlement records, such as payroll records, or who fail to keep employment records.

New record keeping offences are aimed at employers who attempt to conceal wage theft by falsifying or failing to keep records. No longer will employers be able to avoid being held accountable through deliberate dishonest record keeping practices.

The Wage Inspectorate of Victoria will be established as a new statutory authority with powers to investigate and prosecute wage theft offences.

Employers who make honest mistakes or who exercise due diligence in paying wages and other employee entitlements will not be subject to the legislation.

The Government has also consulted with employer groups and unions, and in February this year released a consultation paper seeking public feedback on the proposed legislation.

Work is underway on reforms to make it faster, cheaper and easier for employees to recover the money they are owed through the Magistrates’ Court.