Investigation reveals extent of exploitation of low paid overseas workers in Australia

by Ray Clancy on April 13, 2016

in Jobs in Australia

A franchise of stores across Australia that regularly employs international students has been heavily criticised for paying below the minimum wage and exploiting workers who speak limited English.

Some 7-Eleven, whose franchisees are predominantly from non-English speaking backgrounds, particularly China, Pakistan and India, paid their employees $10 to $12 an hour, an investigation by the Fair Work Ombudsman has found.

The investigation report reveals that the FWO has received regular reports alleging widespread compliance issues across the 7-Eleven network since 2008 and uncovered serious and deliberate manipulation of visa holders.


“Frankly, I’m sick and tired of seeing matters come before us where people are being paid $10 and $12 an hour, well below the minimum wage. We have minimum pay rates in Australia, they apply to everyone, and they are not negotiable,” said Natalie James, Fair Work Ombudsman.

“Employers cannot undercut minimum wages, even if their employees offer to accept lower rates and they must keep accurate time and wages records at all times. It is not acceptable for an employer to take advantage of any worker, especially overseas workers who speak limited English and have limited understanding of their workplace rights,” she added.

She also pointed out that so far this financial year more than 70% of the matters the FWO has placed before the courts involve alleged underpayment of visa holders but she believes that the vast majority of visa holders are reluctant to come to the regulator for help.

While international students can legally work 40 hours a fortnight while they are studying in Australia, the investigation found many working up to 50 hours a week. And as a result they were breaching their visa conditions and so were reluctant to report not being paid properly due to a fear that other government agencies would investigate them.

Indeed, some employers who found out their staff were co-operating with the FWO, or thought their staff might seek assistance from officials, threatened to contact the Department of Immigration and Border Protection (DIBP) about the employee breaching their visa conditions.

“During the course of this Inquiry, we encountered a common misconception among franchisees and their employees that the obligation to comply with the terms of a visa falls solely to the employee. It does not. DIBP makes it clear that employers are obliged to check and confirm that any foreign national working for them has a valid visa with work conditions that provide permission to work,” James said.

The investigation found that false record keeping appears to be ingrained within aspects of the 7-Eleven network. “And if some 7-Eleven franchisees have built the underpayment of employees, particularly vulnerable workers, into their business model, this culture will be difficult to address,” James explained.

She pointed out that it may be that chronic underpayments and associated behaviour will not be entirely eradicated as long as these operators continue to be part of the network. “While not legally responsible for the entitlements payable to employees of its franchisees, it is our view that 7-Eleven has a moral and ethical responsibility for what has occurred within its network and is capable of taking steps to prevent this occurring again. However, this conduct is not likely to be rectified quickly and comprehensively overnight. It can only be stamped out through persistent, resourced and ongoing accountability measures,” James added.

She also revealed that the FWO is receiving more requests for assistance from visa holders than ever before. “We will continue to actively encourage overseas workers who have concerns that their workplace rights are being compromised to contact us,” she said.

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