Wage theft: When ‘chief people officers’ forget workers and their rights

Coincidentally, we now see a reliance on management consultants and law firms for advice and services relating to industrial relations matters, rather than building such capability in-house.

Maybe HR is overlooking its primary role … looking after its “human resources” (and their rights)?

Today, HR and “people & culture” professionals appear preoccupied with meeting the needs of executives at the top end, ensuring HR strategy is aligned with company goals (and effectively cementing their own legitimacy).

By flouting the “bread and butter” roles and failing to keep up to speed with “the IR system”, we now see problems of award and agreement compliance, all at the expense of the worker.

Wage theft is often explained away by employers as an innocent mistake or an oversight because the system is too complex, which is aggravated by the diverse and growing array of work arrangements in the gig economy.

But is it perhaps really due to a skills shortage in the IR profession?

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Wage theft is not new. Yet it still elicits widespread attention because it persists, and in fact is getting worse. In the last financial year alone (2021-22), the Fair Work Ombudsman reported record recoveries of $532 million in unpaid wages and entitlements for 384,805 workers (more than 2.5 times the previous financial year, and more than three times the year prior to that). Let’s face it, we know we have a conundrum when our own public service and government agencies are falling prey.

The media has been replete with stories about wage underpayments including at the ABC and the Reserve Bank. The higher education workforce is not immune, with reports unveiling the ugly truth behind the university sector.

We often hear claims that IR is stuck in a time warp, driven too much by policies and procedures and reliant on its legacy founded on the industrial era.

IR, it is said, fails to reflect the new digital age or rapidly changing contexts, which require agile and adaptable firms and equally agile and adaptable workers. However, this sentiment, and the new catchy HR titles popping up everywhere, appear to be missing one key focus… the worker and their rights. Indeed, COVID unveiled the importance of the continued legitimacy of the IR profession in the world of work and employment, witnessing many issues become central to the wider public.

It begs the question: should we go “back to the future” and bring back the IR professional – or is it time to revamp our IR system and labour laws altogether?

Dr Betty Frino is a lecturer in management, school of business at the University of Wollongong.

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