More than 70% of Victorian brothels have been found to have breached workplace laws, following an audit campaign by the Fair Work Ombudsman.
The industry was scrutinised following reports that most clerical staff in brothels were likely to be females from non-English speaking backgrounds and unlikely to complain about exploitation for fear of reprisal.
Sixty-two brothels, mainly based in metropolitan Melbourne, were audited and 44 were found in breach of workplace law.
A total of 51 employees across the brothels had been underpaid $65,508.
The largest incident of underpayment was the discovery of $12,800 for 10 employees at a Melbourne brothel who had been underpaid their minimum hourly rate and penalty rates for shift, weekend and overtime work.
A Geelong brothel was also found to have underpaid five employees $3635, while an operator on the Mornington Peninsula owed three staff $2126.
Other breaches which occurred included record-keeping, pay slip and technical contraventions.
There were also incidents of sham contracting, with some brothels misclassifying employees as contractors.
Of the different conventions, the most common types were underpayment of employees’ hourly rates and breaching their payslip obligations.
Fair Work Ombudsman Natalie James said in a statement most of the errors appeared to be genuine mistakes rather than deliberate attempts to mistreat staff.
The audits commenced in May last year after consultation with bodies such as the Australian Federal Police, the Victoria Police Sex Industry Co-ordination Unit and the Australian Adult Entertainment Industry Inc.
In a report by the FWO, it says the industry was targeted after receiving a number of enquiries from brothel managers about correct wages and conditions.
“These enquiries seemed to indicate a general lack of knowledge and compliance with award conditions in the industry,” it says.
“Further, we received advice that workers were reluctant to complain for fear that this could result in them losing their jobs and that it would be difficult for them to find further work.”
Since the FWO was established in March 2006, it has recovered more than $200 million in underpaid wages and entitlements for more than 100,000 employees.
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