The Daily Telegraph carried a front page story about Amy and her friend Ashleigh, who declared they had no desire to get jobs.
They were branded a new breed of "dole bludger", sparking a media debate about NEETs, young people "not in employment, education or training".
The treasurer had vowed to personally look into their unemployment benefits.
The young women spoke to the newspaper in the car park of a welfare centre car park in Mount Druitt, a western Sydney suburb negatively stereotyped as having high levels of poverty.
They told the paper they preferred to spend their days "chilling" at McDonald's and driving an old hatchback off road than working.
"They pay you nothing so why would I rock up?" Amy said.
"I call in sick when I'm over it and then they just get rid of me. Not fair really because I just want to have a good time and chill but I don't want to be fired."
A public backlash ensued after they rejected job offers from McDonald's saying: "Can't get there... I have no car."
But Amy's father, Steven, revealed this week that his daughter has actually been employed for the past seven months.
"She's just a silly little teenager who was acting up and wanted her five minutes of fame," he told the Daily Telegraph.
"She made the whole thing upâ€¦ She's a good girl and has been depressed recently. I'm sending her to see a counsellor."
"I do work," Amy said. "I don't know why I made it up, I thought I was being cool."
According to the OECD, 580,000 young Australians are classified as NEETs - an increase of 100,000 since the 2008 global financial crisis.
Social Services Minister Christian Porter has been resisting calls to increase the A$38 (Â£28; $28) per day youth welfare allowance, which he described as purposely low in order to make it "challenging to subsist".
"The encouragement is there to move off those payments quickly," he said
But the opposition Labor party says the government needs to invest in the unemployed to get them into work.
"Cutting benefits for young people and leaving them with nothing to live on is not investing in them," said Jenny Macklin, the opposition social services spokeswoman.
A Sydney teenager portrayed as the face of youth unemployment in Australia has revealed she fabricated her story.