Alan Fels said it, so it must be so:
- The Turnbull Government’s Migrant Worker Taskforce chief, Allan Fels, said major reforms were needed to confront the growing problem.
“There is enough evidence to say that it is systemic,” Mr Fels said.
“Significant numbers are really exploited.”
Finally in response to the 7-Eleven scam, where workers were being paid as little as $5 per hour, the Government has established from early October a Migrant Worker Taskforce with Alan Fels at the helm.
The Taskforce will run for 18 months. From the Government media release, other measures include:
- Increasing penalties that apply to employers who underpay workers and who fail to keep proper employment records. A new higher penalty category of ‘serious contraventions’ will be introduced, and will apply to any employer that has intentionally ripped off workers, regardless of the employer’s size.
- Introducing new provisions that capture franchisors who fail to deal with exploitation by their franchisees.
- Delivering a $20 million funding increase for the capabilities and workforce of the Fair Work Ombudsman.
- Strengthening the powers of the Fair Work Ombudsman so that it can more effectively deal with employers who intentionally exploit workers by compelling them to produce information and answer questions.
The Migrant Workers’ Taskforce website links to the Fair Work Ombudsman’s site where workers can check their minimum wages and conditions, and make an anonymous complaint if they wish.
What is missing seems to be a means of putting offending labour hire firms out of business.
The quote at the top of the post comes from a report on an undercover investigation that
- infiltrated the underworld of illegal workers and labour hire syndicates operating in northern Victoria and southern NSW.
Dozens of illegal labourers on the farms said they were being underpaid by about $9 an hour to pick and package fresh produce that ends up being sold by Australia’s big supermarkets.
Malaysian journalist Saiful Hasam was paid $110, which was reduced to $40 after $70 rent was taken out, for working 23 hours over several days.
In June this year ABC’s Background Briefing did a program Taken to the cleaners, which suggested “a huge labour black market in cleaning and hospitality ripping off international students.”
Most of the program is padded with the details of a cleaning company scam which seemed to systematically stop paying people towards the end of their visa period, on the expectation that students would not be able to follow up when they returned to the country of origin.
The program interviewed the Redfern Legal Centre which specialises in international student cases, and reports widespread scamming.
There is a feeling that property and business owners hiring service firms know that the workers are being mistreated, but close their eyes.
At risk is our international reputation and a $19 billion tertiary education export sector, not to mention horticulture and tourism.
There was another ABC report I can’t find that from memory investigated scam labour hire practices that affected Australian citizens also, and included non-payment, later claiming the worker had volunteered. In many cases people who were clearly wage earners and treated as employees were paid as contractors, to avoid paying on-costs, such as sick leave, holiday leave and super.
It’s hard to be proud of a country where such systemic scams of workers’ rights exist.
I haven’t investigated 457 visa scams, but they are sure to exist.
If you want someone who really goes off about foreign workers, check out Bob Katter, who claims that 620,000 457 visa workers and students come each year, and mostly they don’t go home.
Katter is one of the most diligent users of the Parliamentary Library Service. I would not challenge his facts unless I’d done my research.
Deliberately underpaying people is theft and should be penalized in a similar way to stealing from employees homes.
John, that would certainly help.
There has been a steady stream of reports in the media in recent years, such as this one on worker exploitation at one of Australia’s most powerful chicken companies, Baiada Poultry.
The problems are not limited to migrant workers. Anna Patty (SMH 5/12/16 – “Rogue bosses short-change 2.4 m workers on super, report shows”) says that “Close to a third of Australian workers are missing out on $3.6 billion a year of superannuation entitlements.”
This is just one of a steady string of employer rip-offs that we see in the media.
We need real checks and balances with teeth to protect ordinary workers.
John, on the TV Kelly O’Dwyer said that employers not paying super can be subject to financial penalties.
That may be so, but the real issue is whether there is a tough cop on the beat, or whether the penalty regime is being enforced at all.
“Can be subject to penalties” ….. how many prosecutions have there been? What penalties applied??
A series of prosecutions might be very beneficial “pour encourager les autres“. as an encouragement to all employers not to thieve.
Down in Victoria, dramatic photos of asparagus farm workers trying to flee across fields at Koo Wee Rup, as Border Force arrives to ascertain whether workers hold correct visas. One guess.
Koo Wee Rup (no, really, that’s it’s name) is blessed with black, peaty soil ideal for asparagus growing. Centre of the now drained Great Swamp, north of Westernport Bay, and southwest of Melbourne (a largeish town that prides itself but houses large numbers of low paid workers: including illegal migrants, casuals, recent legal immigrants, and the barely employed).
The AFR today says they have a unit of 150 staffers to oversee at super compliance and non-compliance. Sounds a lot, but probably not when it’s happening at the scale it is.
Seems unless someone tells them they may not know it’s happening, unless they can do some computer matching trick. They are said to be “looking” at the latest report.
Yes, maybe they need a tip-off.
How many of us would be unsure whether an employer was paying the correct amount?
***
Back in the nineties our daughter, working in casual food retailing (coffee and sandwich bar, Melbourne CBD) suspected she and co-workers were being underpaid. She went to Vic Consumer Affairs.
Had to produce as many old payslips as possible; luckily had kept most of them. It took ages for the Dept. to investigate.
Outcome?
Employer was told what each worker was owed in back pay.
Employer had to phone each one and “make an offer”.
To avoid court case, further delay, employees accepted less than 100% of amounts owed.
Further outcome?
Story passed on by workers to every new employee, as “oral history”!!!
No union ever involved, sadly.
As an Employer, I’m as dirty as anyone that my competitors can gain an input cost advantage by the non-policing of Superannuation law.
Might I also say, hopefully without becoming a target of wrath, “Deliberately underworking is theft and should be penalized in a similar way to stealing from employers homes is.”
It’s fairly straight forward to determine if someone has been deliberately underpaid, given that pay rates are defined.
I’ve not heard of an equivalent for underworking.
Is there somewhere within the awards an industrial definition of working rates?
I ask purely out of curiosity with no hint of wrath.
Under paid employees mean that there is less money available to spend on the products and services other employers produce. Result? A lower GDP than we would have had if all employers paid their employees properly. Unfortunately we have a government that automatically thinks that reducing wages is good for the country.
The untouchable holy cows in all these frauds are the labour hire companies and the visa marketers. The reason they are untouchable seems to be corruption – and probably within the much political parties – much the same as it seemed to be in the so-called war on drugs.
The obvious first steps would be to re-nationalize Immigration and to have mandatory long-term prison sentences for further criminality by the labour hire companies. Fat chance of that ever happening.
As I’ve said before, now that social media can keep miles ahead of the mainstream media, Australia’s reputation as a fair work destination and as a good place in which to study is going right down the gurgler.
Yes, zoot and John.
My point was that in a non-union workplace, the Vic Dept was not visiting to check that correct wage rates were being paid. It may be easier now for employees to check rates on Internet?
Yes, Jumpy, unfair competition.
Asparagus pickers weren’t 457s, I think.
Here on non-working visas no doubt.
Farmer may have known??
John
Easy fix, just triple wages right ?
Keynesian demand side economists rarely point out the downsides of this.
Well, ” properly ” is just an arbitrary number that doesn’t take production into account, at all.
If we legislated tripling of the Australian award wage today, what would the overall effect for this Nations economy be in 1, 5 and 10 years, positive or negative ?
No, in the context of the discussion, “properly” meant award wages, fixed by a legislated award system. It’s the way many employees’ wage rates are established here in Australia, as you know. (If there is no “award rate” for a very special kind of work, I dunno what happens.)
Wage rates move fairly slowly here in the real world, Jumpy.
I would not advocate any rates tripling overnight. It’s a straw man you’re attacking so valiantly, Sir Jumpalot.
Wage rates as negotiated and awarded take into account a large range of factors, including productivity. Read the AFR or any metropolitan or national newspaper.
Please.
The context of Johns comment was higher wages leads to higher GDP ( crap metric but that’s the one used in this context ), is that true or not ?
It’s a yes or no.
Or…… Does a higher GDP ( crap metric ) lead to higher wages ?
I’m on the chicken side of economics till convinced otherwise.
No.
Dec 5th, 4.40pm John wrote about employers not funding super entitlements correctly.
Elsewhere folk mentioned
– illegal foreign workers underpaid
– casual workers not paid award rates
– deliberate underpaying workers
which I understood as “deliberately paying lower than the legal award rate”.
This social practice is widely understood: the existence of award rates. The question is, how is compliance policed and how is non-compliance punished?
It matters because underpaid employees are not being treated fairly.
It has nothing to do with some phantasy about wages tripling overnight, with respect, your Honour.
My instinct is that it would be negative, neutral, then positive, but I’m not an economist. Of course, if we just increased award rates by, say, 10% today I think the answer would be positive all the way.
But a better way of stimulating the economy would be to double unemployment benefit immediately. The increase in economic activity would mean an increase in the number of jobs and a corresponding drop in the unemployment/underemployment rate. With a bigger tax base the Govt could afford tax cuts for low and middle income workers. Everybody wins!
(Waits for Jumpy’s howl of derision.)
Oh no derision zoot , just questions are raised.
For your scenario to be workable we have to know that the unemployed buy vastly more Australian produced goods than imported. I’m doubtful of this but have nothing to convince me either way.
I remember with seafood many years ago that we imported about 70% of what we consume and export around 70% of what we produce.
If you’re suggesting welfare payment could somehow only be spent on Australian made we may be on common ground, but I’d have to look into that further.
Why? What’s so special about unemployed people’s spending?
The economy thrives when money changes hands. If more exchanges happen (not the same as more money changing hands) the result is positive for the economy. I seem to remember someone saying a rising tide lifts all boats.
Jumpy: In case you were asleep, Australia missed most of the damage from the GFC because Rudd injected money into the economy as a one off injection of money that was directed to the poorer part of the population. It worked because the people who got the money went out and spent it which is what the economy needed then and now.
At the time Turnbull for some strange reason wanted to solve the problem by, you guessed it, reducing the taxes of the rich. Wouldn’t have worked because the rich are most unlikely to spend the money on Australian goods and services and unlikely to invest unless they can see new markets to sell their products too.
Right now Australia needs to push down the value of the Aussie $ and increase inflation. Printing money to build infrastructure and improve education, welfare etc has a reputation for achieving these things.
Dude, it was your idea,
And this ?
Taking a bucket full from the port side and tipping it over the starboard side does nothing to raise the tide. Gotta get the water from somewhere else. ( because your framing our economy as a lake rather than the ocean )
John
We handled the GFC because of red, black and yellow rocks.
The Venezuela solution ? Hmm, let’s think about this for a bit longer.
.
No thanks.
Jumpy: Problem is that countries like Zimbabwe have given printing money a bad name. Second problem is that people like you don’t want to ask yourselves whether a limited printing of money may actually be the smart policy at times like the ones facing Australia right now.
OK, let me look at this metaphor:
Taking a bucket full from the port side and tipping it over the starboard side does nothing to raise the tide. Gotta get the water from somewhere else. ( because your framing our economy as a lake rather than the ocean )
I see a difficulty: water is (on a short timescale), a ‘conserved quantity’. Piaget experiments with small children: some kids don’t recognise that if they pour 500mL into a different shaped container, or a couple of containers, it’s STILL 500mL. You do recognise this.
But the “amount of money” is NOT a conserved quantity! Not because Govts sometimes print money or because banks haul some in from overseas…..
It’s because (amongst many factors) the RATE of circulation is the key thing.
That $900 spent tomorrow may appear in wages two weeks later, be spent again the next week; be recirculated as wages or payments to other businesses, some of which circulates AGAIN quickly.
It’s conceivable that the $900 might circulate 10 times (say) in a year. [I don’t know the average in Australia.]
There are ‘sinks’ of course.
$1 that is put under a mattress stays out of the economy, for the time being.
$1 taken as GST or income tax might recirculate more slowly. If it’s PAYE income tax, and much of it goes to public service wages, it might reappear quite soon.
$1 saved in a bank deposit doesn’t disappear, most is lent to borrowers. Depending on the type of loan (residential mortgage, business loan etc.) it may recirculate more slowly…. for a while.
Where does money come from? Through profits, dividends, wages, useful goods extracted (minerals, oil), useful goods grown (timber, fruit, edible meat, wool).
It’s called an economy. It is complex.
But the so-called “velocity of money” is an important factor, not often discussed. Probably my understanding of this is flawed and my attempt at an explanation quite woeful.
Nonetheless, it’s one of the reasons the zoot Dictum:
The economy thrives when money changes hands.
is key to the questions Sir Jumpy is approaching.
And I believe the idea of “the velocity of money” goes a long way to understanding the effects of (e.g.) the Rudd stimulus package, so ably and pertinently explained by JohnD, above.
Cheerio.
Thank you Ambigulous. Put so much more eloquently than I could.
No, just no.
Lets imagine zoot agrees to dig a hole if Ambigulous pays him $100,000.
Money changed hands.
Ambigulous agrees to fill that hole in for $100,000.
Money again changed hands.
They agree to do this 10 times a day, every day.
Over 1 year 2 men have created $ 3.65 Billion of economic activity without accomplishing a damn thing.
Except tax….
ops, public education regrettably, please move decimal point one place to the left.
Seriously, how much benefit to Australia was the $900.00 stimulus if spent on overseas activity and produce ?
This churn for the sake of churn, without production, is futile.
Now ” Zoots Hole Diggers Pty Ltd ” are up for %30 Company Tax ( less deductions ), so lets say $500 for shovels over the year.
Plus he pays himself $1k/week as Director of ZHD.
There’s PL insurance to pay ( deductible, yay! )
Union fees ( deductible, yay ! )
Uniform ( spiffy ) and laundry.
Luckily he doesn’t hire any employees, he does it himself ( phew !)
What is zoot personally and ZHDs ” fair share ” to the ATO ?
Jumpy at 8.31,
Jumpy, zoot and Ambigulous would never do what you suggest, they are Australian and not that stupid.
However, we all do that very thing everyday many times simply by opening and closing doors. Except we do it for free, and the tax man never gets a cent.
In the US on the other hand one might expect there to be a doorman for that task with hand outstretched for a tip, and the taxman may get some money from that.
Just like buying and selling pork belly futures.
And Jumpy can probably tell us where the money goes when the All Ordinaries Index drops and x billion dollars is wiped off the stock exchange. It’s gotta be somewhere – am I right, or am I right?
The
*zoot Dictum*
is destined to survive all assaults.
It is fundamental to the operation of the economy, and to our (rudimentary) understanding of its functioning.
I am reluctant to discuss the operations of ZHD in this forum for fear of breaching “insider trading” and disclosure laws, but not being a millionaire, my share of any purported expenditure would be entirely borrowed from an Australian bank, and therefore would generate circulation, interest earnings, etc.
I too am sceptical of GDP as a reliable indicator of national well-being, but sometimes when someone mentions “GDP growth” I think it’s serving as shorthand for:
economic activity, production, circulation of money, healthy flow of tax dollars, and generally strong zootian business.
Yes, Sir Jumpy, you heard it first here.
Another title to add to “Keynesian”, and it’s
zootian.
You must be so proud to have assisted at its birth, so to speak. Mother and infant both well. 8.7 kg, family extends thanks to Mr Adam Smith and the nursing staff.
8 lb 9 oz!!!!
Damn metric system, still not acclimatised to it.
Apologies to Mater Dictorum
It was a pleasant labour, by all accounts.