Study Finds Majority of International Workers Silent on Wage Theft

Newly published research has shown that Australia’s unpaid migrant worker crisis is significantly worse than originally thought.

The study from two Sydney universities suggests that the majority of temporary foreign workers experience intentional underpayment—and are aware of it—however only one in ten undertakes action to recover lost wages.

According to the study—which was co-authored by the University of Technology, Sydney (UTS) and the University of New South Wales (UNSW)—the reason for the underreporting of wage theft has little to do with the workers lack of familiarity with Western legal rights, or a limited command of English.

Instead, workers were found to have been discouraged from pursuing legal action primarily because they fear effecting their immigration status. The amount of time and effort required to lodge an official claim with the Fair Work Ombudsman (FWO)—along with its low likelihood of success—was also cited as reasons for the low levels of wage theft reported.

Out of over 2250 workers surveyed, only three per cent were found to have contacted the FWO in an attempt to recover lost wages, and three out of five of those claims were unsuccessful.

A previous report undertaken by the same team also suggest that one out of every three international students and backpackers are paid approximately half the legal minimum wage.

One of the report’s authors, UTS senior law lecturer Laurie Berg, said that the study’s findings are proof that “the system is broken”.

“It is rational for most workers to stay silent.”

“The scale of unclaimed wages is likely well over $1 billion,” she said.

Berg is now calling for the introduction of a new law that would prevent the FWO from sharing information with the Department of Immigration, along with the creation of a new remedial mechanism accessible to individual foreign workers.

“Against a culture of impunity, predicated on employers’ assumptions that migrant workers will remain silent, these mechanisms are critical to detecting wage theft and holding employers accountable,” the report read.

Berg’s co-author, UNSW senior law lecturer Bassina Farbenblum, claimed that farm workers and fruit pickers were often the worst paid, with 15 per cent earning less than $5 per hour.

“It’s certainly the lowest of any of the industries we looked at, and we’ve heard plenty of horror stories of people walking away sometimes with nothing at the end of the day,” Farbenblum said

Farbenblum also noted that the requirements for lodging a claim were typically too complex for the majority of individual migrant workers. She said that the FWO chooses to instead focus its’ resources on larger scale cases that may serve as a warning to employers, rather than attempting to respond to every complaint.

“They’ve had some really fantastic wins against exploitative employers, but they’re not really there to act on behalf of every migrant worker who approaches them,” she said.

The chairman of Bundaberg Fruit and Vegetable Growers, Allan Mahoney, has also campaigned on this issue for several years.

“Third parties [are] actively putting on jobs for hire under the award rate and nowhere close to the award rate. And you have 150 people on social media begging for the job,” Mahoney said.

“What we need is enforcement. We need to set examples of the criminal element that is still within the industry.”

“We’ve got Fair Work, the Australian Federal Police force, the state police force, and yet none of these crimes seem to be acted upon. In the Lockyer Valley at the moment they’re having a massive problem, and Fair Work is half an hour away, yet nothing is being done,” he said.

The CEO of Absolute Immigration, Jamie Lingham, was critical of the Australian government’s ongoing failure to protect exploited visa workers, agreeing that they are unlikely to come forward until they can be given amnesty from the Department of Immigration for violating their visa conditions.

This has been a genuine issue for foreign nationals for way too long, and the small number of reports of underpayment demonstrate that visa holders have no confidence in the wage recovery process. Successive governments have been aware of this, and there has not been one that has followed through on promises of taking a serious stance on exploitation,” Lingham said.

“At Absolute Immigration we often deal with victims of exploitation and see the personal hardship that visa holders face, mostly through fear of losing their visa and status in Australia. The employers know that the system is a toothless tiger, and until the government takes significant action, this practice will continue.”

“Our advice to visa holders who have a pathway to permanent residency and are being exploited by their employer is to keep records of every hour worked and all under-payments. Once they have their permanent visa, then they can claim underpayment and go through the correct channels to recoup this money. It’s only a half-solution to a bigger issue, but until there is a process to protect the status of temporary residents, it is all that can be done,” she said.

If you have any questions or would like us to assist with your global immigration queries, simply click this link to schedule a call with one of our Registered Migration Agents OR call 1300 ABSOLUTE (1300 227 658).