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.
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