Australia’s silent underclass of underpaid workers

By Portner Press on December 12th, 2018
  1. Industrial Instruments
  2. Fair Work Act


A study by the University of New South Wales (UNSW) and University of Technology Sydney (UTS) “confirms that Australia has a large, silent underclass of underpaid migrant workers” who are owed “likely well over a billion dollars”, UNSW senior law lecturer and report co-author Bassina Farbenblum said.

The Wage Theft in Silence report is based on a survey of 4,322 temporary migrant workers from 107 countries working across Australia.

It was found that only three out of 100 migrant workers who had been underpaid approached the Fair Work Commission.

Out of those, less than half were able to recover any pay.

“The system is broken,” UTS senior law lecturer and report co-author Laurie Berg said.

“It is rational for most migrant workers to stay silent. The effort and risks of taking action aren’t worth it, given the slim chance they’ll get their wages back,” she said.

A previous report by the same authors found that the majority of international students and backpackers are underpaid, with a third earning only about half the legal minimum wage.

This latest report stresses the need for urgent structural reforms to address the drivers of this exploitation, in addition to remedial mechanisms that individual migrant workers can access.

Up to 11% of Australia’s labour market is made up of temporary migrant workers, where severe underpayment is commonplace.

The survey showed that about three-quarters of the temporary migrant workers earning $15 per hour or less knew that the Australian minimum wage was higher.

However, 86% of these respondents believed that underpayment was endemic for workers on the same visa as them and that many, most or all of the other workers on this visa are paid less than the basic national minimum wage.

“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 said.

The report concludes “It is often assumed that the vast majority of migrant workers are simply unwilling to seek to recover unpaid wages in Australia and that reforms would therefore have limited impact. The NTMW [National Temporary Migrant Work] Survey clearly dispels this assumption. Almost half of underpaid participants (45%) indicated that they were open to trying to recover unpaid wages in the future.”

“[I]f resources are invested in reducing the practical barriers to wage recovery and increasing the possibility of achieving a satisfactory outcome, a greater number of migrant workers would report underpayment and seek to recover the wages they are owed.”

The walls are closing in for employers who exploit workers

The Fair Work Ombudsman (FWO) can and will take action if you fail to meet your award obligations.

Learn about the circumstances where it will litigate in chapter F5 Fair Work Ombudsman in the Employment Law Practical Handbook.

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