One in five workers aged 25 and under are reportedly paid below the legal minimum wage for their age.
This is according to analysis by the Australia Council of Trade Unions (ACTU) over Australian Bureau of Statistics (ABS) data, which they claim amounts to around 400,000 Australians.
The analysis was released on the first day of early voting for the upcoming federal election, along with Demos polling showing that stopping wage theft is important or extremely important as an issue in the upcoming federal election for 81 per cent of undecided voters aged 18-24.
Young people in insecure work are disproportionately impacted by wage theft, ACTU continued, with 30 per cent of 18-year-old casual workers paid less than what they should be under the relevant junior award rate.
For an 18-year-old casual worker employed for 20 hours a week, the underpayments are reportedly worth $1,560 a year in lost wages.
From January 1 this year, new laws criminalising wage theft came into effect following Australian Union campaigns to tackle the normalisation of wage theft as a business model in Australia.
The Federal Parliament passed the Closing Loopholes Bill in late 2023, which also made it easier for underpaid workers to access the small claims jurisdiction in the Federal Court by lifting the cap on claims from $20,000 to $100,000.
Following this, the ACTU is further calling for the establishment of a new tribunal to make it easier for workers to reclaim funds from possible underpayments.
ACTU secretary Sally McManus said wage theft is a hidden epidemic that is worsening people’s cost-of-living pressures, with young people bearing the brunt of it.
“One in five Australians aged under 25 go to work, do their job, and then get ripped off by their boss,” McManus said.
“The targets of wage theft tend to be those with less power in the workplace, so we see a clear pattern of dodgy bosses going after the pay packets of younger people, especially casual worker.
“The Albanese Government made it easier for wage theft victims to seek justice, but unions recognise there’s more to be done. Young people are tired of being underpaid and undervalued at work, so it’s a positive sign that increasing numbers of young workers are joining their unions.”
In response to the tribunal proposal, the Australian Industry Group CEO Innes Wilcox said this would be another stick to beat employers with.
"We already have new wage theft laws and a dramatically expanded 'small claims' jurisdiction that enables workers to simply and efficiently recover underpayments of up to $100,000,” Wilcox said. “This is underpinned by a well resourced Fair Work Ombudsman as well as radical new powers and rights for unions that were supposed to help them enforce the laws.
"We don't need another avenue for unions to drag employers into costly litigation. We need to see if the recently introduced legislative changes work.”
Wilcox added that the government also needs to urgently clarify the “complex and confusing” award system which regulates pay rates.
"In recent years we have seen a parade of employers ranging from universities and law firms to the ABC as well as the Department of Employment and Workplace Relations inadvertently misapply our laws,” he said.
"Frankly, many small employers have no realistic prospect of properly understanding our system let alone keeping up with the swathe of changes recently introduced.”
According to the ACTU, young workers are increasingly turning to Australian Unions to address underpayment issues and to support them in taking legal action to recover lost wages.
The latest ABS data showed that union membership grew by almost 200,000 members from 2022 to 2024, powered by a 53 per cent lift to union membership among workers aged 15 to 24.
The ACTU added that estimates of the overall value of wage theft vary widely, given efforts by employers to cover up evidence of underpayment.
Audits by the Fair Work Ombudsman estimate the figure is between $850 million and $1.55 billion in stolen wages each year.