The Wage Theft in Australia report, which surveyed over 4,300 international students and working holiday makers, found 43% of all students within workplaces were paid $15 per hour or less; significantly below the minimum wage of $18.29 per hour.
“It’s clear that at some point, probably everyone in this country has enjoyed food or services that involve serious underpayment of an international student or backpacker”
A first of its kind for Australia, the report’s co-author, University of Technology Sydney law lecturer Laurie Berg, said that while the results were not altogether surprising, it was concerning to see the degree to which the problem of workplace exploitation had spread.
“I think we’ve known about a lot of media reports on exploitation of overseas workers in a couple of 7-Eleven stores or farms around the country, but we haven’t known how far it goes,” she said.
“It’s striking that we now have hard data that shows that we’ve got a large, silent underclass of invisible temporary workers in this country and they’re made up of international students and backpackers who are being paid well below minimum wage.”
Speaking with The PIE News, Berg said the report also went a long way toward dispelling several assumptions around the exploitation of migrant workers.
“It wasn’t just one industry, it wasn’t just a region and it wasn’t just a nationality. Severe underpayment was experienced by every major nationality of backpackers and international students,” she said.
Concerningly, however, the report also dispelled another common myth that international students were being taken advantage of because of their naivety, with 73% indicating they were aware of the minimum wage.
Rather than prove international students are intentionally gaming the system, however, Berg said their level of awareness revealed a more disturbing problem.
“It wasn’t just one industry, it wasn’t just a region and it wasn’t just a nationality”
“The reason why many of them are getting these low paying jobs and staying in these illegally low paying jobs is that they believe everyone else on their visa is also being paid less than the minimum wage, too,” she said.
“They don’t see much chance of getting a better paying job.”
The report also found that 13% of international students were working above 21 hours per week and therefore likely to be working above the 40 hours a fortnight allowed on their visa, but this figure jumped to almost a third for those who indicated they received below minimum wage.
IEAA chief executive Phil Honeywood said rising costs, such as accommodation in major cities, could be contributing to students compromising wages for more hours.
“Unfortunately, if they believe that they need to work for more than the legal limit of 20 hours per week they will sometimes enter into a ‘devil’s compact’ with their employer,” he said.
“This creates an imbalance in the work relationship with students being afraid that they will be reported to [DIBP].”
Adelaide University law professor Alex Reilly, who earlier this year co-authored the International Students and the Fair Work Ombudsman report with Berg, agreed with Honeywood’s observations, adding it provided additional fodder for an ongoing debate around work rights and exploitation.
“One recommendation a lot of academics have been suggesting is that [students] can work an unlimited number of hours,” he told The PIE.
“We’ve got a large, silent underclass of invisible temporary workers in this country”
“This report partly supports that but it also partly raises concerns about that… There’s a huge number of students who are being exploited when they’re working under 20 hours a week, so taking the limit on work rights away just means you’ve got more international students doing work and therefore a higher level of exploitation overall.
“That’s a really interesting policy dilemma we need to grapple with.”
Berg said she hoped the report would help empower international students and backpackers to demand better conditions from employers, as well as open a dialogue with the general public.
“It’s clear that at some point, probably everyone in this country has enjoyed food or services that involve serious underpayment of an international student or backpacker,” she said.
“We need to really take a look at the implications of ever-increasing consumer demand for cheaper and cheaper goods and services and food,” she continued, adding larger businesses needed to look at their supply chains to ensure wage theft was not occurring down the line.
Earlier this year, Australia’s Fair Work Ombudsman entered an agreement with DIBP to prevent international students from automatic deportation if they had violated their visa conditions in a bid to encourage more to report employers for exploitation.