A group of young Australians are preparing for a call action against fast food giant KFC, alleging that their employer did not provide mandatory breaks during their working shifts.
The Fast Food Union is behind the class action, which has invited all workers employed by KFC from October 2017 onwards to join.
It once again highlights the issue of wage theft in Australia, despite our nation having some of the most stringent workplace laws in the world.
The Fair Work Ombudsman website details that anyone working in the fast-food industry for more than 4 hours consecutively, but less than 5 hours in total, is entitled to a rest break.
An employee who works for 5 or more hours but less than 9 hours is entitled to a rest break and a meal break, and a person who works more than 9 hours should be entitled to at least two breaks.
A rest break is a 10 minute paid break, which counts as time worked, and a meal break can be 30–60mins but doesn’t count as time worked.
Vital rest breaks
These are the minimum standards – employers are entitled to provide more if they wish to do so, and breaks should be dependent on actual hours worked, rather than rostered time working.
The fast food union has highlighted the fact that many people working in the fast food industry are typically young people, or students, experiencing their first ‘job’ .
In fact, it estimates that those who are most likely to be affected and therefore eligible for the class action are likely to be under the age of 24 – they don’t necessarily know their rights, or have the confidence to pursue their rights, for fear of losing their job.
Figures show that working in fast food industry is also rife with sexual harassment – a study by the human rights commission in 2018 showed that the retail and fast food industries are ranked with some of the highest prevalence of sexual harassment experienced by workers:
In the retail industry, 42% of employees experienced sexual harassment. In the Fast food ranked 39% reported experiencing sexual harassment.
KFC has not yet responded publicly to news of the class action.
Workers receive back pay
In the meantime, underpaid workers in other industries across Australia are receiving justice, Fair Work Ombudsman releasing information that more than half-a billion dollars has been paid back to workers this year, after intervention by the FWO.
FWO bares its teeth
251,475 workers have been reimbursed, totalling $509 million. The FWO has also some of Australia’s biggest employers including large corporates and universities.
In the year 2022-2023, the FWO filed 81 litigations and 2424 Compliance Notices.
Fair Work Inspectors also issued 626 Infringement notices for record-keeping or payslips breaches.
There are several cases before the courts, including against the University of Melbourne, separate cases against franchisors 85 Degrees Coffee and Bakers Delight Holdings, and proceedings against holding company Super Retail Group and four of its subsidiaries.
There’s been a push in recent years for employers to use technology which streamlines directory with the ATO to ensure that both employee and employer tax obligations are met, and that superannuation guarantees are paid on time by employers.
And there is no question that taxes, as well as award rates and entitlements and accounting for overtime can be complex, but the FWO and the ATO are no longer listening to excuses. Businesses are under increasing pressure to do the right thing by their employees, or face litigation or hefty fines.
Wage theft can amount to a crime, but not in New South Wales
Wage theft is a crime in Victoria and Queensland, but no such criminal offence exists in New South Wales.
The Victorian offence of wage theft was introduced on 1 July 2021 and prescribes a maximum penalty of 10 years in prison and/or a fine of up to $230,772 for individuals or $1,153,860 for companies where an employer:
- deliberately and dishonestly underpays employees,
- deliberately and dishonestly withholds wages, superannuation or other employee entitlement,
- falsifies employee entitlement records to gain a financial advantage, or
- avoids keeping employee entitlement records to gain a financial advantage.
The Queensland offence of wage theft similarly prescribes a maximum penalty of 10 years in prison where an employer deliberately and dishonestly:
- underpays wages,
- withholds entitlements such as leave and penalty rates deliberately, or
- fails to make required superannuation contributions on an employee’s behalf.
There was momentum for a similar offence to be introduced in New South Wales before the onset of COVID-19, but the impetus appears to have subsided over the past few years.
And while there is currently no discrete crime of wage theft in our state, it is important to be aware that dishonestly obtaining a gain or causing a loss by deception can amount to fraud – which, like Victorian and Queensland wage theft offences, carries a maximum penalty of 10 years in prison.