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A Wage Theft Culture

BY Dessy Rosalina / Macquarie University | 10-Oct-2018
Wage theft culture is widespread throughout Australia with a quarter of international students and backpackers receiving $12 or less per hour, around half legal minimum salary.
Two unicorn statues greet customers who walk pass by the front of the shop. On Monday afternoon, two unicorn statues greet a seven years old girl who wears pink stripe dress and black legging. The girl pulls out her companion left hand, an old lady with short white hair and beautiful blue eyes. The girl looks her granny and lifts her two hands, form a begging expression to the white hair Australian lady.

“Can I get this squishy granny?” asks the girl while her hands playing with squishy.
“You can get it after we find a onesies for you. We come here for onesies,” an old lady answers.
“We have a lot of cute onesies. How old is your granddaughter?,” asks Anna*, greets her customer with a big smile.
“For seven years old please. Thank you,” the lady replies.


For about 15 minutes later, Anna serves her granny and granddaughter customers. That day, Anna spends eight hours of her life to welcome and serve customers, at eighty meters square toy shop, alone. By herself at the store, Anna acts as cashier and sales assistant as well. She also manages all toy stocks at the storage room. At 5 pm, she closes the shop’s door and goes fast to storage room which is located at back, near a fitting room. She moves a huge plastic bag consist of tons of onesies and toy and starts to refill the stock to the counter.

At 5.30ish pm, Anna finally finishes her work. With all that responsibilities, she brings only $ 102 for her 8.5 hours hard working at that Monday. Anna tells me she only gets $ 11 per hour, far away from minimum wage salary regulation. Anna is not alone. The latest report has found wage theft culture is widespread throughout Australia with a quarter of international students and backpackers receiving $12 or less per hour, around half legal minimum salary.

A quarter of international students get paid only $12 per hour or less and 43% earned $15 or less. Two thirds or 64% of international students reported that they worked between 9 and 20 hours per week, and 13% worked 21 hours or more. The research that published on November 2017 explained two in five people surveyed by law academics from the University of Technology Sydney and University of NSW accepted their lowest rate wage while working in cafes, restaurants and takeaway food outlets. Almost a third of these group workers were paid $12 per hour or less.

At the time of the survey, the legal minimum wage for a casual worker was $22.13 per hour, but many temporary migrants would have been entitled to higher rates based on penalty rates and entitlements under relevant awards. For example, a 21-year-old standard fast food worker should have received at least $24.30 per hour, and $29.16 on a Saturday.

Underpaid participants in that survey believed underpayment is endemic among people on their visa. The report challenges educational institutions regarding their international students and raises questions about how university support services the sector should provide. It also shows an urgent need for providing legal services, community organisations and unions to provide greater levels of support to underpaid international students.

Let’s hear more stories about Anna’s experience. After Anna locks the shop, we walk throughout the mall. We pass a small garden which is outside of a mall. Many Fiji-Australian play there. Some Fiji-Australian teenagers sit on a white chair and talk loudly while watching their friends playing skateboard. On the other chair, some old Fiji-Australian have a serious chat about religion. At one corner, a 40ish-year-old man stands among many adult Fiji-Australian, preaching about Jesus.

While we see the religious Fiji-Australian group, Anna opens her green sport bag. Her hands are looking for something inside the bag. After a while, Anna holds her smartphone and send me a picture. I open my Whatsapp application and download the picture from her. I am shocked. Anna sent me a salary table written by the Chinese language. The salary table shows that Anna only gets $11 per hour if she can’t reach minimum sales $600 per day. If she gains more than $600, she brings home $12 per hour. Further, she can get $13 to $14 per hour if the sales reach $900 to $1.200.

“It is almost impossible for me to book $900 or even $1.200 on weekdays. Numbers of visitors in this mall quite low. Also, mostly customers in here always bargain which makes my job harder,” says Anna.

Anna also shares her latest problem. She tells me that her boss didn’t adjust her salary even though she should move to another branch shop. Previously, Anna worked at a shop nearby her house, so she can reach the shop by walking. Now, Anna spends about 1 hour 40 minutes from her place. "Because I got this experience, now I have a different perspective about Australia. Before coming to Australia, I think I can get a job easily and high salary like many people talks about. After I live here, I think it is not easy as I thought before," Anna says.

On the other day, I meet Anna again at her house. She welcomes me at a train station. We walk about 15 minutes from station to her less than 3 meters bedroom. Anna doesn’t have many things in her room. There is only one thin bed on the floor and old wood desk on the right side. Anna sits and takes off her glasses and green tosca sport shoes. She tells me she lives at her brother apartment, so she can live there free.

Her older brother arrived in Sydney in 2011, got married and rent the house. Anna says that her brother plans to move to near Sydney CBD. The plan makes her confused because if her brother only rents a one-bedroom apartment, she should find another place and pay for rent. For now, in her calculation, she needs to earn at least $150 per week to live a tight budget living in Sydney. That calculation excludes paying rent for a room around $200. “As an international student, I have to work even though my salary only $11 per hour because it is really expensive to live in here,” Anna says.

Since years, Australia cited as one of the most expensive countries in the world to live. The latest Worldwide Cost of Living 2018 Report shows, Sydney is among the top 10 most expensive cities in the world. The report that conducted by Economist Intelligence Unit shows the cost of living in Sydney goes up four ranks to 10th place. In other words, living in Sydney is now much higher than in New York and London. The report based on comparison of the prices of 160 products and services such as food, clothing, rent, transport, utility bills, private school fees, domestic help and recreational costs.

Melbourne is also ranked as one of the most expensive cities. In 2018 Cost of Living Index, compiled by price aggregation website Numbeo.com, living cost in Melbourne rose to 64, up from 77. Meanwhile, according to the report, Sydney has risen to 32 from 41 last year. Additionally, The Department of Home Affairs requires a financial deposit as much as $20,290 for 12 months living cost an international student in order to get a student visa.

Moreover, expensive living cost forces international students work very hard to have an adequate life. It also triggers a wage theft endemic throughout Australia, especially Sydney and Melbourne as the most popular city to study for international students. “I think it is common practice in Australia that international students get paid less than $18 per hour because many employers think that they have many international students who need money and part-time job to survive in here,” Anna speaks to me with a sad voice.

Anna thinks even though it is illegal to pay worker under minimum wage, the practice is massive. According to Anna, she has a lot of friends that receive wage under $18 per hour. A minute later, she stops her story. Anna asks me to wait for her at the room while she goes to the kitchen to check whether her brother left food or not for her dinner.

After warming up fry pork mix chicken meat, vegetable and rice, Anna sits at a dining table. She is ready to continue her story. She invites me to sit at the table as well. While we start to have our dinner, she resumes her experience. Anna believes many people in Australia know about how business owner exploits international students. Like many people, she says, the government also knows about the common practice, but they do nothing. She also considers the illegal thing in workplace which is salary payment by cash on hand is a huge common practice in the Land of the Kangaroo.

The ironic fact of underpaying employee is it involves a big chain company. One of the biggest wage theft scandals is 7-Eleven case. The scandal was breaking for the first time in 2014. Major media outlets reported that 7-Eleven Head office is not just turning a blind eye. “It’s a fundamental part of their business. They can’t run 7-Eleven as profitably as successfully as they have without letting this happen,” said a whistleblower on Sydney Morning Herald investigation report in 2015. Until today, Fair Work Australia has done 10th investigation into the operations of 7-Eleven Store since the case was raised in 2014. This week, sixth 7-Eleven store owner in Brisbane has been fined more than $32,000 and his business $160,000 for underpaying staff, according to Fair Work Australia investigation statement.

Recently, multimillion-dollar wage theft group actions filed in the Federal Court on Monday. The legal action on behalf of hundreds of Australian door-to-door and direct sales workers. According to Sydney Morning Herald, many young employees were allegedly paid under the legal minimum wage for sales and charity fundraising for international direct marketing companies AIDA and Credico. Another shocking news comes from The Melbourne Cricket Ground (MCG) cleaners.

An underpaid scandal of MCG cleaners is involving ISS Facility Services Australia — the company that held the contract to provide cleaning services at the MCG — and subcontractor First Group. ISS was fined $132,217 in the Federal Court and First Group, were fined over $35,000, bringing the total fines to $168,070. The two companies fined after Fair Work Ombudsman conducted an investigation. The investigation found 11 workers — mostly international students from India, the Philippines, Colombia and Brazil — were underpaid $37,471 for a cleaning job at the MCG after AFL games in 2014.

Thus, even though many scandals were drawing public attention, the practice of international students exploitation still happens. Let’s meet Sudi*, an Asian 27 years old who arrived at Sydney earlier this year. Sudi says to me that he came to Australia with a huge hope that he can get a part-time job quickly. After what he has experienced for months, he has a bad perspective about the job industry in Australia. He expresses his disappointment with Australia. Now he realizes that get a standard wage part-time job not as easy as people talk to him before he arrived in Sydney. He tells me that his bad experience at his first work not only underpaying wage but also other several unfair treatments.

“Up until now, my ex-boss did not pay me yet after I worked for about three weeks,” says Sud to start his bad experience.

Sud lives at two levels apartment. At a glance, the apartment looks great. I thought he is a rich guy and doesn't really need a part-time job. Later he explains to me that he shares the house with four other students. He invites me to his bedroom to show that he is not rich at all.

Sud shares his bedroom with two other guys. I see there are three small beds lay down at the floor. After showing his room, Sud takes me back to the living room. We seat at two classic peach old mini sofa with pink flower mix with green stripe pattern. The living room has an old brown medium couch. Sud tells me he and his housemates took the sofa from the street. He wears a white transparent jacket that he picked from the street near his apartment as well when he shares his story. He says one of the best things about Australia is people throw their stuff when they move to another place, so he can get a lot of things that he needs to start a new life at Aussie without spending money for it.

Sud tells me that a friend introduced him to his ex-boss. On the first day, his ex-boss told him that she needs someone to work there and said that he will get a salary.

“But when I did ask her about my salary, she did not mention that and just told me that she will talk about it later. Up until now she never mentions about the rate, the hourly salary that I get,” says Sud to me.

Besides didn’t get a salary for three weeks of working, Sud explains that he received bad treatment. His ex-boss yelled and cursed at him for several times because he did a mistake. He tells me that for couple first days, his ex-boss trained him as a masseur. That was his first-time experience as a professional masseur. He says he was very tired at first day as pro masseur and felt like his hands almost broke.

“I guess because Australians has a very hard, thick and big body. I felt like I was doing massage for a cow,” Says Sud with a big laugh while shares his memory. After two days worked as a masseur, Sud told his ex-boss that he can’t do massage because his hands hurt, and he offered himself to do a receptionist job. In that new role, Sud helped customers to get ready for a massage and help them for payment.

“She kept yelling at me because I did a mistake. She never gives me training for a receptionist job, so it is normal for me to do mistake,” explains Sud to me.

Let us back to Anna’s story. On that night, at a tiny bedroom, Anna continues shares her anxiety. She worries that she can’t survive in Australia because she can’t get a decent wage. She tells me that she has tried to get a new job but meet no success result yet. On the other hand, she gives up being exploited by her boss with underpaid salary. She explains to me that she has no options. For now, she stays at the same job, so she can get money to buy food and things.

Surprisingly, knowing that she is still under exploitation and illegal treatment, Anna never think to report her boss to Fair Work. She explains to me that situation will be harder for her future as an international student if she submits a report to Fair Work. “Maybe it will make myself in more trouble situation in Australia. So, I don't have the intention to do that,” Anna tells me. Sud embraces the same fear. He admits that he planned to report his ex-boss to Fair Work.

“But I do not know how to do that, and I choose not to do any further action towards.

I am kinda afraid because I just don’t want to have a problem and my boss might do something bad to me, so I decided to forget about it,” Sud explains.

While underpaid international students hold fear, in contrast, Australia’s university enjoys billion dollars from high economic growth overseas students. The whole quantity of international students registered in Australia has increased dramatically. In early March, the number of international students in Australia reached 800,000, almost 3.5 per cent of the total population. Australian Trade and Investment Commission latest report shows, international students are third in the export rankings, and the highest earning non-resource export, which generated $28 billion in full-year 2017, or 7.5 per cent of total export revenues.

Even though overseas student carries huge money to the Australian economy, the most astonishing thing is most international student doesn’t know their work rights in here. Anna says she never heard and read about work rights regulation for international students. She tells me that her university doesn’t provide specific information or consultation services for a student about work rights.

Sud doesn’t know about international student’s working rights as well. He says his university gave a short session seminar about working in Australia but there is no detailed information regarding the latest work regulation or regarding Fair Work Australia. He hopes Australian university can give more information about working rights as international students because he believes there are more students who have bad experiences like him.

“University should give contact person or email about who in charge about work rights issue so students can contact them if we get underpaid or receive any other unfair treatment from our boss,” tells Sud.

Start from 1 July this year, Fair Work Commission increased the national minimum wage by 3.5 per cent, to $719.20 a week or $18.93 per hour. Will the new regulation affect 800,000 international students fate in Australia?

*Names have been changed.