Foreign students, backpackers face 'endemic wage theft in Australia'

International students and backpackers working in Australia are subjected to systemic wage theft.
International students and backpackers working in Australia are subjected to systemic wage theft. PHOTO: AFP

SYDNEY - A landmark study has revealed the extent of “wage theft” and mistreatment of foreign students and holidaymakers in Australia, including many visitors who believed gross underpayment was simply part of the job.

The study released on Tuesday (Nov 21) by researchers at the University of Technology Sydney (UTS) and University of New South Wales (UNSW)  surveyed 4,322 migrants and exposed the extent to which visiting international students, working holidaymakers, and temporary migrants are being underpaid and exploited by employers. 

This included revelations that 67 per cent of foreign students had been paid less than the minimum wage for a casual worker of about A$22 per hour – and that 25 per cent of students were paid less than A$12. Overall, 62 per cent of migrant workers had received wages of less than A$18 an hour.

“The study confirms that wage theft is endemic among international students, backpackers and other temporary migrants in Australia. For a substantial number of temporary migrants, it is also severe,” the researchers said.

Australia last year took in over 900,000 temporary arrivals with work rights - making up to 11 per cent of the workforce. These numbers have been bolstered by surging numbers of international students, which are at record levels and delivered about A$28.6 billion to the economy last year.

But there have been growing questions about the abuse of these workers, who often take low-paid casual jobs such as kitchen hands and waiters, farmhands and fruit-pickers, cleaners, store assistants, carers and factory workers. Many are unaware of their rights or are concerned that lodging a complaint may affect their visa status.

The study, by Dr Laurie Berg from UTS and Ms Bassina Farbenblum from UNSW, followed multiple media reports of slave-like conditions for some visitors and was an attempt to address the lack of data about wage theft, especially among international students and holidaymakers.
Almost half of the participants surveyed – 47 per cent - were from countries in Asia, including 15 per cent from China (including Hong Kong), 8 per cent from South Korea, 6 per cent each from the United Kingdom and Germany, and an unspecified number from Singapore. 
In total, citizens of 107 countries participated. Aside from English, the survey was conducted in twelve languages, including Indonesian, Mandarin, Japanese and Korean. 

The results showed that workers from non-English speaking countries were among nationalities who tended to receive lowest wages, with 81 per cent of Chinese receiving less than A$17 an hour. The proportions for Taiwan and Vietnam were 79 per cent and 75 per cent respectively, compared with just 35 per cent of migrants from the United States.

Interestingly, 73 per cent of students knew they were being underpaid but believed this was “endemic” and they were powerless to challenge their pay.

“International students and backpackers were aware of the Australian minimum wage and knew they were being underpaid, but believed that few people on their visa can expect to receive that wage,” the study said.

Some of the worst-paid jobs were cleaners, with 56 per cent receiving pay of less than A$ 15 an hour. In addition, 52 per cent of farm workers and 49 per cent of restaurant workers received pay of less than A$15 an hour.

Alarmingly, some of the workers were subject to criminal exploitation. About 3 per cent had their passport confiscated by their employer and 4 per cent were required to pay money back to their employer after receiving their wages.

The researchers said the “bleak” revelations showed authorities need to urgently oversee workplace conditions, noting that the large-scale exploitation of students may be driving down wages across the country. They said governments, universities and businesses all need to do more, including overseeing workplaces and ensuring that foreign arrivals understood their rights and how to exercise them.

“With notable exceptions, temporary migrants do not often have a voice in public debate and policy formulation concerning them,” the researchers said.“This is in part because they are often in Australia for short periods of time, live and work on the fringes of Australian society, are often not native English speakers, are young and, for many, are fearful of losing their job or jeopardising their visa if they speak out about working conditions.”

Chinese migrants – some 65 per cent - were the most likely to be paid in cash. Such payments are not illegal but are more prone to exploitation because they are much harder to check. In many cases, workers paid cash do not pay proper taxes but are then less likely to raise exploitation with authorities.

Australian trade union leader Ged Kearney  called for urgent action, saying the study showed that big businesses were importing “a slave labour class of workers on temporary visas”.