vested interests

In contrast to its constant railing against unions and the CFMMEU, the government is almost completely silent on the issue of wage theft. A union official only has to jaywalk for a minister to condemn their lawbreaking and link Bill Shorten to it. But literally industrial-scale wage theft by business gets nary a mention from the government. Last year, government senators dissented from a Senate committee report examining wage theft and superannuation non-payment and failed to mention the issue at all, instead attacking — you guessed it — the CFMMEU and accusing Labor of allowing unions to abuse Senate committee processes.

In 2018 alone, the Fair Work Ombudsman has issued 76 media releases about separate cases of underpayment by employers, including repeated mass audits that have found massive levels of underpayment. Right now, the FWO is conducting a mass audit of 600 businesses in the Northern Rivers region of NSW.

This week the FWO also revealed the result of another mass audit of 638 businesses in the farming sector along the Harvest Trail, uncovering widespread underpayment of workers and over half of businesses breaching workplace laws. As so often happens with underpayment, the victims were often migrants, people of non-English speaking background, or students, who are more isolated, struggle to communicate and can be threatened with deportation if they complain. “The inquiry found that almost 70 per cent of harvest trail businesses employed visa holders. Working holiday subclass 417 visa holders (aged 18-31 years old) were the most common migrant workers on the trail,” the FWO said.

Perhaps that’s also why the Coalition doesn’t care that much about wages theft, as well?

This is Coalition heartland — the agricultural sector that so often has its hand out for government assistance when times get tough — even while exploiting previous schemes designed to help them when times get tough. Perhaps the government could make it a condition of drought relief that anyone found to have underpaid workers is automatically disqualified from receiving it? Or, given the massive scale of wage theft, would that knock off too many recipients?

Wage theft doesn’t directly affect wage growth indices like the Wage Price Index, which is compiled by surveying employers, not employees. But it affects wages more generally: if employers can get away with underpaying workers — foreign or not — then it puts additional downward pressure on wages elsewhere in the sector and, indirectly, across the broader economy. And the tens of millions — perhaps more — that employers underpay each year usually comes from the pay packets of the lowest-income workers, who spend a far higher proportion of their income than the rest of us. Wage theft undercuts demand as well as wage levels.

Still, it’s a non-issue as far as the government is concerned.

What should the federal government be doing about wage theft? Write to [email protected] and let us know.

Peter Fray

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Peter Fray
Editor-in-chief of Crikey

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