Tough new penalties under laws to protect vulnerable workers

For two years, Pranay Alawala worked at a 7-Eleven store in Brisbane.

He says he was paid below-minimum wage and did not get penalties or meal breaks.

"I used to work the night shift most of the times. We get no breaks, nothing, and you have to do a lot of jobs by yourself."

Giri Sivaraman, from Maurice Blackburn Lawyers, says Mr Alawala's experience is not unique.

"If you look at certain industries like agriculture and hospitality, you will find rampant exploitation of migrant workers. It really is a terrible indictment on this country."

Now the government is taking steps to protect vulnerable workers against dodgy bosses and franchise-owners.

Under changes to the Fair Work Act, passed by the Senate, businesses will no longer be able to exploit workers or turn a blind eye to their mistreatment.

There will be harsh new penalties of up to $126,000 for individuals, and more than $600,000 for companies, that breach the Fair Work Act.

The bill was introduced following recommendations from former Australian Competition and Consumer Commission chief Allan Fels.

Professor Fels, who's now chair of the Migrant Worker Taskforce, says he witnessed widespread mistreatment of employees in his role running a compensation scheme for underpaid 7-Eleven workers.

"Half-paying or less migrant workers, that's been very, very widespread. There have been thousands of cases. In the 7-Eleven case alone, the numbers were above ten thousand."

The 7-Eleven scandal revealed some franchises underpaid migrant employees, falsified records and pay slips, and coerced workers into paying back a portion of their wages.

The business has so far repaid about $150 million in compensation to staff.

Professor Allan Fels says franchisors should have no excuse for ignoring employee exploitation.

"The law says that if a franchisor knows, or ought to know, about exploitation and has done nothing about it, they themselves are liable. That will have a powerful effect on franchisor behaviour."

Labor supported the bill but only after the Coalition agreed to drop a clause giving the Fair Work Ombudsman authority to fine workers who did not give evidence against their employer.

Australian Council of Trade Unions President Ged Kearney says such powers would have been unreasonable.

"The coercive powers clause would have given the Fair Work Ombudsmen the power to force a worker to dob in a mate for doing behaviour that the Fair Work Ombudsmen thought needed attention by them. And if you refused to dob in a mate, then you could get fined over $100,000 which was ridiculous."