Digging Into Deterrence: An Examination of Deterrence-Based Theories and Evidence in Employment Standards Enforcement

International Journal of Comparative Labour Law and Industrial Relations, 2021

Posted: 8 Jun 2021

See all articles by Tess Hardy

Tess Hardy

University of Melbourne - Law School

Date Written: May 25, 2021

Abstract

In a bid to curb employer non-compliance with wage and hour regulation, policy-makers across many different jurisdictions are seeking to deliver greater doses of deterrence. This trend stems from a series of common assumptions. In particular, it is often assumed that introducing stiffer sanctions, such as criminal penalties for wage theft, will automatically amplify the relevant deterrence effects. This article seeks to unpack these assumptions to better understand: a) how deterrence is conceptualized and understood in the context of wage underpayment; and b) which tools or approaches are likely to be most powerful in enhancing deterrence and promoting compliance. Drawing on recent developments in Australia, the article argues that alternatives to enforcement litigation – such as voluntary agreements or undertakings – may hold critical, albeit under-appreciated, deterrence value. This analysis also reveals that the perceived risk of detection, the speediness of the relevant sanction and the publicity it ultimately generates may all serve to heighten deterrence in ways that encourage and entrench employer compliance with wage and hour laws.

Keywords: Deterrence, Enforcement, Compliance, Employment, Labour, Regulation

Suggested Citation

Hardy, Tess, Digging Into Deterrence: An Examination of Deterrence-Based Theories and Evidence in Employment Standards Enforcement (May 25, 2021). International Journal of Comparative Labour Law and Industrial Relations, 2021, Available at SSRN: https://ssrn.com/abstract=3852481

Tess Hardy (Contact Author)

University of Melbourne - Law School ( email )

University Square
185 Pelham Street, Carlton
Victoria, Victoria 3010
Australia

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