Table of content
- What are the New Criminal Underpayment Laws for 2025?
- Why is Underpayment Still a Risk in Aged Care?
- What Makes the Aged Care Award Complex for Employers?
- How Do Criminal Underpayment Laws Affect Aged Care Employers?
- When Does Underpayment Become a Criminal Offense?
- Where Do Most Aged Care Underpayments Occur?
- Which Aged Care Workers Are Most Affected by Underpayments?
- What Steps Can Aged Care Employers Take to Prevent Underpayments?
- How Workstem Simplifies Aged Care Award Compliance
- FAQs About the Aged Care Award
With new criminal underpayment laws taking effect from January 1, 2025, aged care employers operating under the aged care award (MA000018) face unprecedented risks for wage violations. Understanding these changes is critical for maintaining compliance and avoiding severe penalties.
What are the New Criminal Underpayment Laws for 2025?
The Australian government has introduced criminal penalties for intentional underpayment of wages and entitlements. From January 1, 2025, employers who deliberately underpay workers can face criminal charges, including potential imprisonment and substantial fines beyond traditional civil penalties.
Why is Underpayment Still a Risk in Aged Care?
The aged care award contains complex provisions that make underpayment risks particularly high. With complex shift patterns, penalty rates, and allowances, aged care employers often struggle with accurate wage calculations, leading to unintentional compliance breaches.
What Makes the Aged Care Award Complex for Employers?
It includes numerous variables that increase underpayment risks:
- Complex penalty rate structures
- Shift allowances and broken shift payments
- Sleepover allowances and overtime calculations
- Public holiday and weekend premium rates
- Annual leave loading and superannuation requirements
How Do Criminal Underpayment Laws Affect Aged Care Employers?
Under the new legislation, aged care award violations can trigger criminal prosecution when underpayment is deemed intentional. This represents a significant escalation from previous civil penalty frameworks, making MA000018 compliance more critical than ever for aged care operators.
When Does Underpayment Become a Criminal Offense?
Underpayment becomes criminal when employers:
- Intentionally fail to pay minimum wages under MA000018
- Deliberately withhold entitlements covered by the aged care award
- Systematically avoid paying required allowances and penalties
The new laws specifically exclude honest mistakes, focusing on deliberate underpayment practices.
Where Do Most Aged Care Underpayments Occur?
Common underpayment areas under the aged care award include:
- Incorrect penalty rate calculations for weekend and public holiday work
- Missing shift allowances and broken shift payments
- Inadequate overtime compensation
- Unpaid travel time between client locations
- Incorrect annual leave and long service leave calculations
Which Aged Care Workers Are Most Affected by Underpayments?
Underpayment under MA000018 typically affects:
- Personal care workers with irregular shift patterns
- Casual employees working varied hours
- Workers covering multiple locations
- Staff performing sleepover duties
- Part-time employees with complex rosters
What Steps Can Aged Care Employers Take to Prevent Underpayments?
Preventing underpayment under the aged care award requires:
- Clear award understanding: Ensure fully understanding of requirements, including all allowances, penalty rates, and special provisions.
- Regular payroll audits: Conduct systematic reviews of wage calculations to identify potential underpayment issues before they become systemic problems.
- Automated payroll systems: Implement technology solutions that automatically calculate aged care award entitlements, reducing human error risks.
- Staff training: Educate payroll teams about award complexities and update training when award modifications occur.
How Workstem Simplifies Aged Care Award Compliance
Simplify award interpretation and payroll processing with Workstem, the all-in-one workforce management & payroll software designed for every industry. Our system supports 122+ modern awards & 34 EAs, including the Aged Care Award 2025, and keeps you up-to-date with changes in wage rates, penalty rates, and overtime rules.Workstem offers:
- Automated award interpretation
- Real-time wage calculations and timesheet syncing
- Employee self-service app for rosters and payslips
- Seamless integrations with Xero, NetSuite, and more
Choose from our Standard or Advanced plan to suit your business needs, and stay Fair Work compliant with confidence.
Book a free demo with our payroll experts and experience how Workstem can streamline your payroll and workforce operations.
FAQs About the Aged Care Award
Q1: What are the criminal penalties for aged care underpayments in 2025?
A1: Criminal underpayment under the aged care award can result in imprisonment and substantial fines for individuals and businesses who are caught intentionally violate the
Q2: How can aged care employers avoid accidental underpayments?
A2: Implement automated payroll systems that understand aged care award complexities, conduct regular audits, and ensure staff are properly trained on award requirements.
Q3: Do the new criminal laws apply to all aged care underpayments?
A3: No, the criminal penalties only apply to intentional underpayment. Honest mistakes under the aged care award remain civil matters, though employers must still explain any underpayment discovered.
Q4: What should aged care employers do if they discover an underpayment?
A4: Immediately calculate the full underpayment amount under MA000018, pay back wages with interest, and implement systems to prevent future violations of the aged care award.
Q5: How often should aged care employers review their payroll compliance?
A5: Monthly payroll reviews are recommended, with comprehensive aged care award compliance audits conducted quarterly to identify potential underpayment issues early.
Read More：
Updated Aged Care Award Pay Guide
