Understanding Australia’s New Wage Laws 2025

From 1 January 2025, new wage laws in Australia will enforce strict penalties for underpayment of wages, including imprisonment and significant fines. These laws aim to eliminate intentional underpayment of wages, penalty rates, and allowances.

Employers may face:

  • Up to 10 years imprisonment or fines up to $1.65 million for individuals.
  • Fines up to $8.25 million or three times the underpayment amount for companies.

What Is the Wage Compliance Code?

The Wage Compliance Code helps small businesses (under 15 employees) avoid criminal prosecution for unintentional underpayment. To access these protections, businesses must:

  • Conduct regular payroll reviews.
  • Backpay employees promptly when errors are identified.
  • Implement measures to prevent future mistakes​

Learn more about the Code on the Fair Work Ombudsman’s website.


How Small Businesses Can Stay Compliant with Australia’s New Wage Laws

1. Understand Obligations

Familiarise yourself with awards, enterprise agreements, and wage laws. Use the Fair Work Pay Calculator to confirm pay rates​.

2. Review Payroll and Record-Keeping

  • Provide accurate pay slips within one working day of payment.
  • Maintain complete records of hours worked, wages, and entitlements​Wages Theft Implementat…​Wage Criminalisation – ….

Find more tools on record-keeping.

3. Educate Your Team

Train payroll and HR staff about wage compliance requirements. Stay informed with the Fair Work Ombudsman’s updates

4. Correct Mistakes Quickly

  • Conduct regular payroll audits.
  • Fix errors immediately and backpay employees.
  • Communicate transparently about resolutions​Wages Theft Implementat…​Wage Criminalisation – ….

Visit fixing underpayments for guidance.


Benefits of Compliance

Complying with Australia wage laws 2025 not only avoids legal penalties but also builds trust with employees and strengthens your business’s reputation​.


Get Expert Help

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Telephone: 1800 HR Smartz (1800 477 627)

Email: hrsupport@peoplesmartz.com.au

Website: https://peoplesmartz.com.au/contact

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