Ann Arnold: In­side Australia’s over­worked, un­der­paid econ­omy

In­side Australia’s over­worked, un­der­paid econ­omy

The Monthly (Australia) - - FRONT PAGE - Ann Arnold

To­moe* flew home to Ja­pan in Novem­ber af­ter a two-year work­ing hol­i­day in Australia. She had six em­ploy­ers in that time. All bar one of them had ei­ther un­der­paid or not paid her, or had avoided tax and other obli­ga­tions by pay­ing cash. By To­moe’s ac­count, a Ja­panese restau­rant in the in­ner-Syd­ney sub­urb of New­town paid her $12 an hour as a wait­ress. In cash. No payslip. A cafe in Padding­ton paid her $19 an hour as a pas­try chef. In cash. No payslip. Only Fratelli Par­adiso restau­rant, in Potts Point, paid To­moe for­mally.

With that ex­cep­tion, To­moe’s Aus­tralian stay was funded through the take-it-or-leave-it terse­ness of our grow­ing black econ­omy. And, apart from a cou­ple of bright spots, she had a rough ride.

There has been a cul­tural shift in Australia. In some sec­tors, un­der­pay­ing is the new nor­mal – not just in the black econ­omy, where there’s no su­per­an­nu­a­tion or work­ers com­pen­sa­tion or an­nual leave, but also in the for­mal econ­omy, through the shirk­ing of award rates or penal­ties. Brien Trip­pas, a for­mer NSW pres­i­dent of the Restau­rant & Ca­ter­ing In­dus­try As­so­ci­a­tion, be­lieves 80% of restau­rants and cafes are pay­ing off the books, at least partly. And un­der­pay­ing. “If you were a new em­ployee and you said, ‘I’ve got a tax file num­ber and I want to be paid on the books,’ I think the ma­jor­ity of em­ploy­ers would say, ‘You’re in the wrong place.’”

It’s a trend that is hard to quan­tify, and harder still to po­lice, mostly oc­cur­ring in small busi­nesses, like thou­sands of lit­tle spot fires that the un­der-re­sourced Fair Work Om­buds­man (FWO) can­not keep up with.

Oc­ca­sion­ally there will be a flare-up. 7-Eleven, Cal­tex. Large em­ploy­ers with sys­temic cul­tures of ex­ploita­tion. Or com­pa­nies us­ing labour-hire con­trac­tors (in poul­try or clean­ing, for in­stance) and turn­ing a blind eye to how staff are paid. Brands that are part of the suburban land­scape – Bak­ers De­light, Swim­land, Pizza Hut, the newer Grill’d – have been ac­cused of trans­gress­ing awards or en­ter­prise agree­ments. There’s cur­rently a test case of “sham” con­tract­ing: De­liv­eroo and Foodora, the food de­liv­ery ser­vices, have been taken to court in Melbourne to test the fair­ness of their em­ploy­ment of driv­ers and cy­clists with­out sick leave, su­per­an­nu­a­tion and other em­ployee ben­e­fits. And there are the ex­tremes: ef­fec­tively bonded labour in car washes, nail sa­lons and mas­sage par­lours.

Of­ten, the ex­ploita­tion is by small em­ploy­ers tak­ing short­cuts. They have at their dis­posal a ca­su­alised, non-unionised, young and/or mi­grant work­force, and pre­sume that labour

costs can be kept low by cir­cum­vent­ing the wage sys­tem. That is, by break­ing the law. Call it the new busi­ness model.

In a new book ti­tled Tem­po­rary Labour Mi­gra­tion in the Global Era, Melbourne aca­demics Iain Camp­bell, Joo-Cheong Tham and Martina Boese nom­i­nate hos­pi­tal­ity, chil­dren’s ser­vices, agri­cul­ture, con­struc­tion, clean­ing, cloth­ing and footwear as “haz­ardous in­dus­tries”, for mi­grant work­ers in par­tic­u­lar.

Ex­ploita­tion of clean­ers, by con­trac­tors and sub­con­trac­tors, is so en­trenched that one clean­ing busi­ness in Syd­ney, Haven­cab, ad­ver­tises award pay­ment of staff as a point of dif­fer­ence. Its web­site warns po­ten­tial clients that “there is a huge is­sue in the clean­ing in­dus­try with al­most weekly prose­cu­tions of com­pa­nies that have failed to com­ply”, and that some­times both the clean­ing con­trac­tor and the client have been named in the me­dia.

It goes on to say that “all of our staff are di­rectly em­ployed and re­ceive Award wages and en­ti­tle­ments as set out by the Mod­ern Clean­ing Ser­vices Award 2010”. Imag­ine!

To­moe was 23 when she came to Australia in 2015. She had worked in a preschool in Ja­pan, and wanted “to study English and get more ex­pe­ri­ence”. She con­sid­ered Canada but fig­ured Australia would be warmer. Like many trav­ellers, she started with a one-month English course and home­s­tay with a fam­ily in Syd­ney. That was the easy bit.

She did not want her real name used in this story, and af­ter some de­lib­er­a­tion chose the pseu­do­nym “To­moe”. Later I would read that To­moe was the name of a fear­some fe­male samu­rai warrior in the 12th cen­tury. This 21st-cen­tury To­moe is no warrior. She does have the req­ui­site strong build, but her un­world­li­ness and ten­dency to ac­cept what be­falls her per­haps made her easy prey.

To­moe foot­slogged around in­ner-city cafes and restau­rants with her mea­gre ré­sumé and lim­ited English, ask­ing for work. There were no tak­ers. A friend put her on to a web­site for Ja­panese peo­ple in Australia, where there were job ads.

She scored the Ja­panese restau­rant job in New­town and was grate­ful, be­cause she was get­ting des­per­ate. She says she was paid $12 an hour. The na­tional min­i­mum wage then was $17.29. It’s now $17.70 an hour for per­ma­nents, or $22.13 for ca­su­als. (It is re­viewed an­nu­ally by the Fair Work Com­mis­sion and eval­u­ated as a pro­por­tion of the me­dian wage.)

The Restau­rant In­dus­try Award, which over­rides that, be­gins at the same rate and there are penalty rates for af­ter 10 pm and week­end work. To­moe said that noth­ing was ex­plained to her about pay­ment sys­tems or tax when she started at the restau­rant. She blamed her­self. “I didn’t speak English.”

She fig­ured the pay rate was nor­mal. “Other friends work­ing in Ja­panese restau­rants in Syd­ney also say that $10 or $12 an hour is nor­mal. So I just ac­cepted it.”

She worked five or six days a week. “Every week­end, they would hand me the cash.” There was another Ja­panese wait­ress, and To­moe thinks the chefs were from Thai­land, China and Korea.

The restau­rant owner, Chen*, is from main­land China. She had done a bit of restau­rant work her­self, and ten years ago when a friend at church said she was sell­ing this Ja­panese restau­rant Chen de­cided to buy it.

Chen says she could find no record of To­moe’s em­ploy­ment, and did not re­mem­ber her. “We have a lot of Ja­panese girls.”

“I think she did not work here very long. With all the staff we record their tax file num­bers. It’s pos­si­ble that we did not get a chance to record her de­tails.” To­moe says she worked there for two to three months.

Pre­vi­ously, at To­moe’s English lan­guage school, a teacher had helped set her up with a tax file num­ber. “She told me if you work in Australia you need a tax file num­ber. But I didn’t use it.”

Chen says all staff had payslips. So why not To­moe? “Maybe it was a trial or train­ing. Or maybe there is an is­sue with her visa and she does not have the right to work. And when I ask for her tax file num­ber she does not give it.”

Would Chen have paid To­moe $12 an hour? “I don’t think so, be­cause I pay the award. It was a year ago, so it should have been around $16 or some­thing.”

Whether it was $12 or $16, it did not help much with Syd­ney ac­com­mo­da­tion. To­moe was in a crowded Chip­pen­dale ter­race house, shar­ing with 11 others, mostly young Euro­peans. There were four peo­ple to a bed­room, with one toi­let and laun­dry in the only bath­room for 12 peo­ple. Each per­son paid $155 a week. The house next door was set up sim­i­larly. Both houses would later be de­clared il­le­gal ac­com­mo­da­tion and closed down, but not be­fore To­moe had left with­out get­ting her key de­posit and bond back from the land­lord.

Australia’s tem­po­rary-visa mi­gra­tion pro­gram is huge. Every year, visas are granted to ap­prox­i­mately 300,000 stu­dents, 200,000 work­ing-hol­i­day trav­ellers and up to 150,000 skilled work­ers. The stu­dents, in par­tic­u­lar, are gold. Our higher ed­u­ca­tion in­dus­try is worth $19 bil­lion. It is our se­cond-big­gest ex­port in­dus­try af­ter nat­u­ral re­sources. But Stephen Clib­born from the Univer­sity of Syd­ney Busi­ness School says Australia risks sig­nif­i­cant rep­u­ta­tional dam­age from the em­ploy­ment ex­pe­ri­ences that some stu­dents have here, while they strug­gle to pay their way through ex­pen­sive de­grees and high liv­ing costs.

Clib­born has un­der­taken the only sub­stan­tial sur­vey of in­ter­na­tional stu­dent em­ploy­ment. Early last year, 60% of 1433 ter­tiary stu­dents were be­ing paid be­low the min­i­mum

wage, and 35% were paid $12 an hour or un­der. Most were work­ing in restau­rants or cafes, or in re­tail. For the waiters and kitchen hands, not one was paid week­end award rates. For the shop as­sis­tants, no one was paid award rates for week­ends or week­days.

And these em­ploy­ees are un­likely to com­plain. If their English and ex­pe­ri­ence are lim­ited, they don’t have many op­tions. If the em­ployer pro­vides a meal, or is in other ways “nice”, many are grate­ful. Some em­ploy­ers, Clib­born found, liked to re­mind their waiters or shop as­sis­tants that there were many more stu­dents look­ing for jobs.

And of­ten work­ers feel trapped. On stu­dent visas the max­i­mum per­mis­si­ble hours of work is 40 per fort­night. If the stu­dents are not earn­ing enough, they work more hours and are then pet­ri­fied that a com­plaint or a chal­lenge to the boss about pay rates could re­sult in trou­ble with Im­mi­gra­tion.

More re­cently, Clib­born also sur­veyed lo­cal ter­tiary stu­dents. The re­sults are less dra­matic, but still there was sub­stan­tial un­der­pay­ment: 15% of the 959 re­spon­dents were paid un­der the na­tional min­i­mum wage. Around half of those in hos­pi­tal­ity and a third in re­tail were be­ing paid un­der the award rate.

It an­noys Brien Trip­pas, the ebul­lient chair of the Trip­pas White Group, which man­ages hos­pi­tal­ity and ca­ter­ing for schools, hos­pi­tals and air­port lounges, as well as restau­rants such as the ro­tat­ing Syd­ney Tower Buf­fet. Trip­pas does not claim to al­ways get pay­ments right. “We oc­ca­sion­ally mis­pay peo­ple and we find out and we act and fix it. ‘We didn’t re­alise you’d turned 19.’”

But the pat­tern of un­der­pay­ment at other work­places raises his hack­les. “I ab­hor it be­cause it puts my busi­ness in an un­fair com­pe­ti­tion.”

Many of his staff are sur­prised, when they be­gin work, to be told that “yes, tax will be taken out and yes, you will get it back at the end of the year”. It’s not what they are used to. The temp­ta­tion to avoid the for­mal­i­ties is there for both em­ployer and em­ployee. Trip­pas says a stan­dard le­gal arrangement for a waiter and a small em­ployer might be an hourly day­time rate of $20, of which $3 would go to the gov­ern­ment in pay-as-you-go tax. So that’s $17 for the em­ployee. The em­ployer would have 20% on-costs above the $20 per hour: su­per­an­nu­a­tion, work­ers com­pen­sa­tion, hol­i­day pay. Young em­ploy­ees in par­tic­u­lar, he says, will think it’s eas­ier to get the full $20 in cash (or just the $17 that they would oth­er­wise have got af­ter tax). “It’s only when you get older that you start to think about su­per­an­nu­a­tion.”

And the black econ­omy can be a black hole. Sara Charlesworth, a work­place spe­cial­ist at RMIT Univer­sity in Melbourne, says “peo­ple think that when they’ve ac­cepted cash they’ve be­haved il­le­gally. Em­ploy­ers prey on that.”

Charlesworth has no truck with em­ploy­ers who take ad­van­tage of em­ployee naivety. “Who has the divine right to make prof­its? Peo­ple cook well so they open a restau­rant. They pay the rent and elec­tric­ity that’s re­quired. But some­how wages are ne­go­tiable.”

I ven­ture that em­ploy­ers, es­pe­cially small ones, are un­der many pres­sures, and it can be dif­fi­cult to do the pa­per­work and keep up with em­ploy­ment reg­u­la­tions.

“They are em­ploy­ers!” Charlesworth is frus­trated. “They have to ap­prise them­selves of their obli­ga­tions, just as they do about the busi­ness.”

Young em­ploy­ees are also loath to com­plain. Of Charlesworth’s three adult chil­dren, who have all worked in hos­pi­tal­ity, only one of them has ever been paid award wages. She once tried telling one of her chil­dren who wasn’t paid over­time: “They’re ef­fec­tively re­mov­ing $40 from your wal­let each night.” There was lit­tle re­sponse. And like­wise for Trip­pas, whose high school–aged chil­dren work in a lo­cal pizza place for $10 an hour, cash. “I say, ‘Well, go and talk to the bloke.’ And they say, ‘Please, Dad. I don’t want to, I’ll lose my job.’” And, Trip­pas says, they’re happy.

Although young peo­ple are of­ten only in these jobs tem­po­rar­ily, Stephen Clib­born urges them to not ac­cept un­der­pay­ment, be­cause they are bring­ing down stan­dards for peo­ple whose liveli­hoods de­pend on those same jobs.

To­moe left the Ja­panese restau­rant be­cause she wanted to do the req­ui­site 88 days of agri­cul­tural work to ex­tend her work­ing hol­i­day visa for another year. This was the change in­tro­duced in 2005 to the Work­ing Hol­i­day visa (sub­class 417), to help meet a labour short­age in re­gional ar­eas.

“I picked a nice place to im­prove my English,” To­moe says hap­pily. She chose King­fisher Cit­rus, a fruit and veg­etable farm on the Mur­ray River between Swan Hill and Mil­dura.

“Peo­ple think that when they’ve ac­cepted cash they’ve be­haved il­le­gally. Em­ploy­ers prey on that.”

Every week­end, mem­bers of the ex­tended Fisher fam­ily head off to Melbourne farm­ers’ mar­kets, four and a half hours away, to sell their pro­duce. To­moe would go with them. And work with them. But she didn’t get paid. To­moe was fine with that.

“It’s like home­s­tay. I can live with the fam­ily, get food. They don’t need to pay.”

The 417-visa re­gional work rule has, for most of its ex­is­tence, in­cluded vol­un­tary work. Trav­ellers who wanted a coun­try ad­ven­ture – or who would do any­thing to get that ex­tra year on their visa – ac­cepted food and board in ex­change for their labour. There was in­evitably ex­ploita­tion, so the gov­ern­ment changed the visa rule just over a year ago to pre­clude vol­un­tary work.

Back in 2015, be­fore the rule change, To­moe felt pretty lucky. She was the Fisher fam­ily’s first in­ter­na­tional worker. “We loved her!” ex­claims Glenda Fisher, who runs King­fisher Cit­rus with her hus­band, Lex, and their two sons and daugh­ters-in-law.

“[To­moe] was an in­cred­i­bly re­spon­si­ble, hard­work­ing, easy-to-get-along-with young lady.” Fisher de­scribes evenings with the telly off, dis­cussing “ev­ery­thing you can imag­ine” to help To­moe de­velop her English.

To­moe spent three months with the fam­ily. While there she was in­jured, fall­ing off the back of a truck at a Melbourne mar­ket. “She was naughty, and I told her that,” Fisher says. “She was hold­ing too much in her hand when she climbed on the truck.” To­moe put her hand out to pro­tect her­self as she landed, and damaged her wrist. The Fish­ers took her to a doc­tor. X-rays found no bro­ken bone, but the wrist was badly sprained. Medi­care cov­ered some ex­penses and To­moe’s travel in­sur­ance cov­ered the rest.

As she was not for­mally em­ployed there was no work­ers com­pen­sa­tion, and the in­jury would cur­tail To­moe’s next job.

Else­where in the agri­cul­tural sec­tor, eerie im­ages were emerg­ing of ex­ploited Tai­wanese poul­try work­ers pre­par­ing for work in the pre-dawn in South Australia, un­der­paid hor­ti­cul­ture work­ers in Gipp­s­land, and al­le­ga­tions of sex­ual abuse, all ex­posed by the Na­tional Union of Work­ers in the ABC Four Cor­ners pro­gram ‘Slav­ing Away’.

The year­long Vic­to­rian In­quiry into Labour Hire and Inse­cure Work, which ended last Au­gust, found the three stand­out in­dus­tries in terms of award breach­ing were hor­ti­cul­ture, meat pro­cess­ing and clean­ing. The lat­ter two had many Aus­tralian work­ers as well as mi­grants.

RMIT’s An­thony Forsyth, who chaired the in­quiry, says that in agri­cul­ture the pur­pose of a visa scheme to pro­vide a tran­sient labour sup­ply is prob­lem­atic. “These back­pack­ers are in a vul­ner­a­ble po­si­tion, of­ten quite des­per­ate to get the 88 days [and] many are not aware of their rights.”

Sarah McKin­non, the act­ing CEO of the Na­tional Farm­ers’ Fed­er­a­tion, says there has al­ways been labour hire in agri­cul­ture, but now there are many more small op­er­a­tors. It’s what’s known as the fis­sured work­place, where farm­ers – and em­ploy­ers in a range of in­dus­tries – are in­creas­ingly dis­con­nected from the peo­ple work­ing for them.

“It’s the farmer’s re­spon­si­bil­ity to watch what labour-hire con­trac­tors are of­fer­ing,” McKin­non says. At the same time she ac­knowl­edges that “the whole point of us­ing a labourhire com­pany is so that you don’t have to get in­volved, at the busiest time of year”.

Dur­ing the in­quiry, Forsyth heard ev­i­dence that the dom­i­nant Aus­tralian su­per­mar­kets were putting pres­sure on re­gional pro­duc­ers with high labour costs. That was one of the rea­sons pro­duc­ers had moved away from di­rect em­ploy­ment and to­wards out­sourc­ing. “Most of them know it in­volves non­com­pli­ance with the awards,” Forsyth says.

Whether wil­fully in­dif­fer­ent or sim­ply ne­glect­ful, the arms-length con­cept of labour hire is test­ing no­tions of re­spon­si­bil­ity. For a Back­ground Brief­ing pro­gram on ABC Ra­dio Na­tional, I cov­ered a case where a group of Mon­go­lian men and women had not been paid a cent for the ini­tial clean of a newly con­structed apart­ment block. It was dusty, dif­fi­cult work. The con­trac­tor who hired them seemed

to have dis­ap­peared. The Mon­go­lians’ at­tempts to con­tact the com­pany that used the con­trac­tor brought no re­sponse. Af­ter I rang that com­pany, a di­rec­tor said he did not want the com­pany name as­so­ci­ated with non-pay­ment of labour. Con­tact was made with lawyers for the Mon­go­lians and a set­tle­ment was reached.

In his in­quiry re­port, Forsyth rec­om­mended a reg­is­tra­tion sys­tem for labour-hire con­trac­tors, where there are cur­rently “very low or no bar­ri­ers to en­try”. He wanted to im­pose some im­ped­i­ments, he told the Monthly, to “wipe out that dodgy, rogue end of the con­tract­ing in­dus­try”.

Vic­to­ria’s min­is­ter for in­dus­trial re­la­tions, Natalie Hutchins, has said her gov­ern­ment is com­mit­ted to reg­is­tra­tion, and a spokesper­son for the min­is­ter said it would likely be im­ple­mented in 2018, al­low­ing for the pas­sage of leg­is­la­tion. Both Hutchins and Forsyth are urg­ing a na­tional ap­proach, but a fed­eral De­part­ment of Em­ploy­ment spokesper­son said only that the de­part­ment’s Mi­grant Work­ers’ Task­force would con­sider ways to pre­vent ex­ploita­tion through rogue labour-hire com­pa­nies.

Mean­while, the Na­tional Farm­ers’ Fed­er­a­tion in­sti­gated a round­table in mid De­cem­ber, at which con­sen­sus was quickly reached among gov­ern­ment, farmer and union reps to have an op­tional cer­ti­fi­ca­tion scheme for labour-hire providers in hor­ti­cul­ture. It would be in­dus­try-led, and used as a guide for farm­ers about which con­trac­tors of­fered the “least risk”.

The back­packer in­come tax is pre­dicted to push more tem­po­rary mi­grant work­ers into the black econ­omy, although that’s mit­i­gated at least for those want­ing to stay a se­cond year by the need to show payslips for their 88 days of re­gional work.

Joo-Cheong Tham from the Univer­sity of Melbourne warns that the risks to work­ers are about to in­ten­sify, and that north­ern Australia will be­come the hot spot in more ways than one. Changes are happening “un­der the radar”, Tham says, to ad­dress the labour short­age across the north, as part of the fed­eral gov­ern­ment’s “de­vel­op­ing north­ern Australia” mis­sion.

In late 2015, the rule for 462- and 417-visa work­ing-hol­i­day trav­ellers changed for the north: it al­lowed visa hold­ers to work more than six months for one em­ployer, and in an ex­panded group of in­dus­tries, in­clud­ing hos­pi­tal­ity. This provided a new, and more sta­ble, work­force. And now, af­ter a change late last year, 462-visa hold­ers, who are more likely to be from de­vel­op­ing and/or Asian coun­tries, can also stay a se­cond year.

Crazy, says Tham. “Hos­pi­tal­ity is ex­ploita­tive. It’s haz­ardous. We know al­ready that agri­cul­ture has been haz­ardous to its work­ers, and now we’re repli­cat­ing those cir­cum­stances across hos­pi­tal­ity as well.”

Some of those work­places will be a long way from scru­tiny.

Fratelli Par­adiso is a buzzing con­tem­po­rary Ital­ian restau­rant in Syd­ney’s Potts Point, with mono­chrome ton­ings and an en­tire wall used as a su­per­sized black­board menu. To­moe wanted to work there in the kitchen. She didn’t have the ex­pe­ri­ence but at a job in­ter­view ex­plained that she loved cook­ing and that her brother was an Ital­ian chef. She was in­vited to try out – she thinks it was for two or four hours – and given the job. Most of the staff were Ital­ian, and she liked work­ing there. For a month of train­ing she was paid $800, and was then pro­moted. There were, for the first and only time for To­moe, pay slips. It was a bona fide job.

There was heavy knife work in­volved, though, and To­moe said it was caus­ing too much pain in the wrist she had in­jured in the fall. Af­ter three months, she had to quit.

When her wrist had im­proved, she got a job at a Padding­ton cafe. They needed a pas­try chef and To­moe now had kitchen ex­pe­ri­ence.

Here she says she was given a choice – pay­ment off the books or pay tax. To­moe thought be­cause she was not Aus­tralian she could not get a tax re­turn. “So I chose cash. It’s eas­ier.” It was $19 an hour, roughly the en­try-level award for kitchen staff. No tax, and no su­per or work­ers com­pen­sa­tion ei­ther.

The cafe’s owner, Mira*, did not want to con­firm what To­moe was paid – only that it was “more than $18”. She says she asked To­moe for her pa­per­work – tax file num­ber, a copy of her visa – but To­moe never provided it. Mira is also clearly an­gry that To­moe has spo­ken about her il­le­gal em­ploy­ment. “She was a bit of a bum­bling id­iot who did not ap­pre­ci­ate how much train­ing we put into her.”

One day, dur­ing her six months at the cafe, To­moe was mak­ing caramel pop­corn. She was tired, and dropped the big pan, the molten con­tents splash­ing onto her arm and leg. A col­league drove her to hospi­tal. Ac­cord­ing to To­moe, Mira gave her a spe­cific in­struc­tion be­fore she left. “She said: ‘Don’t tell at hospi­tal that it hap­pened at work! Say it was cook­ing at home.’”

The al­leged mes­sage to lie had not reached the co-worker who brought To­moe to the hospi­tal, and she ex­plained at re­cep­tion that it was a work ac­ci­dent. To­moe pan­icked. She says she rang Mira, who told them To­moe could not see a doc­tor there.

Mira says she can­not re­call any­thing about the in­struc­tions. What she does re­mem­ber is mak­ing sure To­moe ran cold wa­ter over the burns be­fore she left the cafe. “She had tried to cover up the burns – that’s how stupid she was.”

To­moe left the hospi­tal un­treated and phoned an Aus­tralian friend, Joshua*. To­gether they rang around to find a med­i­cal clinic.

It was four hours be­fore her burns were fi­nally treated. With no work­ers com­pen­sa­tion, To­moe had to pay for the med­i­cal care – about $600. Her travel in­sur­ance cov­ered a third of it. To­moe was off work for a cou­ple of weeks, un­paid. She asked

Mira to pay for the med­i­cal treat­ment, but her boss re­fused.

Mira says that she un­der­stands her hus­band, the chef at the cafe, gave To­moe sev­eral hun­dred dol­lars. He had “put a lot of time into train­ing [To­moe], of­ten gave her lifts home and even took her to get her gui­tar fixed.” I asked Mira if she felt there was an obli­ga­tion to cover To­moe’s ex­penses from an ac­ci­dent at work. She did not an­swer.

Most of To­moe’s burns are not too vis­i­ble now, apart from a thick, raised scar on her up­per arm – a bob­ble of tis­sue that’s shaped a bit like a piece of pop­corn.

Julie War­ren is a cheery, straight-talk­ing or­gan­iser and pres­i­dent of the Vic­to­rian branch of the Na­tional Union of Work­ers (NUW). She trav­els around Vic­to­ria and New South Wales train­ing del­e­gates – and lis­ten­ing to their work­place sto­ries. Here’s how she has seen the em­ploy­ment land­scape change.

“For the first 15 years of my work­ing life, ‘nor­mal’ would be ev­ery­one em­ployed on a 38-hour week, with a per­ma­nent ros­ter, a ca­reer path. Then em­ploy­ers started talk­ing about flex­i­bil­ity. The flex­i­bil­ity to have peo­ple come in and do work that others didn’t want to do. Un­load a con­tainer, pick­ing and pack­ing. Sea­sonal work or shitty work.”

War­ren says that the NUW would agree for a small group to be brought in to pro­vide flex­i­bil­ity. “And to be hon­est, our mem­bers were prob­a­bly not recog­nis­ing that this was treat­ing another worker badly.”

But then, as War­ren ex­plains, “that pool of work­ers in­creased, and em­ploy­ers worked out that, ac­tu­ally, ‘it’s cheaper if we get a labour-hire com­pany’. In the last five years we’ve seen this rapid change in the way peo­ple are em­ployed, and in­equal­ity in the work­place.”

Ca­su­al­i­sa­tion, sit­ting at around 20% of the work­force, is a com­mon thread for vul­ner­a­ble work­ers. Flex­i­bil­ity and choice can work in favour of the em­ployee, but it opens a fat loop­hole for ex­ploita­tion. War­ren cites the “bar­baric” ex­am­ple of some­one on four-hour shifts, ex­pected to be avail­able 24/7. “If you’re not avail­able, you don’t get shifts.”

Others talk about the power play of ros­ter­ing, of giv­ing ca­su­als in­suf­fi­cient hours so that they are “hun­gry” for more and pre­pared to do the un­pop­u­lar shifts.

RMIT’s Iain Camp­bell, whose re­search spe­cialty is ca­sual em­ploy­ment, says that ca­sual sta­tus is like an of­fi­cially sanc­tioned gap in the labour law sys­tem. “It al­lows for the min­i­mum wage, but not much else.” He also says it slips very eas­ily into un­de­clared em­ploy­ment.

Now in that mix is the labour-hire con­trac­tor, who has of­ten won their con­tract be­cause they promised the cheap­est labour. An­thony Forsyth says that dur­ing the Vic­to­rian in­quiry into labour hire he “heard from so many work­ers that ca­sual work through a labour-hire com­pany is their only op­tion. Em­ploy­ers are right in say­ing that the drive for flex­i­bil­ity is im­por­tant, but peo­ple would pre­fer to get a home loan and care for their chil­dren.”

Un­der­pin­ning this pic­ture is a grow­ing in­equal­ity. Wage growth is at a his­toric low – 1.9% in the Septem­ber quar­ter last year. Last De­cem­ber, the shadow as­sis­tant trea­surer, An­drew Leigh, ad­dressed an in­equal­ity fo­rum or­gan­ised by think tank Per Capita. He said that un­der Prime Min­is­ter Robert Men­zies wage growth was rapid. “Australia once had a Lib­eral Party that worked to de­liver strong real wage growth.”

The fo­rum was held in a Syd­ney of­fice tower, and glass el­e­va­tors could be seen slid­ing up and down the build­ing next door. There was no such so­cial mo­bil­ity in the pic­ture that Leigh painted. The stark­est form of in­equal­ity, he said, is between those who own no as­sets and earn their liv­ing by sell­ing their labour, and those who can live off the pro­ceeds. The mid­dle level of the labour mar­ket is dis­ap­pear­ing. There is an in­crease in de­mand for baris­tas and se­cu­rity guards, but no in­crease in pay for them.

A cou­ple of months ear­lier, an Aus­tralian Coun­cil of So­cial Ser­vices re­port con­cluded that poverty was grow­ing, with 13.3% of Aus­tralians be­low the poverty line. Of those, 20% were em­ployed full time.

In ad­di­tion, em­ployee vul­ner­a­bil­ity has in­creased while

union­i­sa­tion of work­places has de­creased, along with union abil­ity to en­ter work­places. “For most of the 20th cen­tury, Australia did not have a ded­i­cated em­ploy­ment-law en­force­ment agency,” says the Univer­sity of Melbourne’s JooCheong Tham. “The ac­tive pres­ence of trade unions was suf­fi­cient pres­sure to en­force the laws.”

Now we have the Fair Work Om­buds­man, an agency that has around 230 in­spec­tors to cover mil­lions of work­ers.

Be­fore last year’s elec­tion, the gov­ern­ment promised that it would give greater pow­ers to the FWO, and bring in higher penal­ties for of­fend­ing em­ploy­ers. A De­part­ment of Em­ploy­ment spokesper­son has con­firmed that the min­is­ter for em­ploy­ment, Michaelia Cash, will in­tro­duce leg­is­la­tion “early this year” to amend the Fair Work Act. It would make penal­ties ten times higher than they are for “em­ploy­ers who de­lib­er­ately and sys­tem­at­i­cally un­der­pay work­ers and fail to keep proper records”. Another amend­ment would make fran­chisors, such as 7-Eleven, and par­ent com­pa­nies li­able “where they should … have been aware and could have rea­son­ably taken ac­tion to pre­vent breaches”.

The Univer­sity of Syd­ney Busi­ness School’s Stephen Clib­born wel­comes any strength­en­ing of the Fair Work Act, and is also calling for more fund­ing for com­mu­nity le­gal cen­tres to help em­ploy­ees pur­sue stolen wages.

But he says pre­ven­tion of il­le­gal em­ployer be­hav­iour is equally im­por­tant, and the gov­ern­ment has failed there, by re­duc­ing the role of unions. “They’ve pri­ori­tised leg­is­la­tion and other mea­sures aimed at re­duc­ing the in­flu­ence of unions. But unions are im­por­tant in en­forc­ing em­ploy­ment laws.” Jo-anne Schofield, the na­tional sec­re­tary of the United Voice union, which rep­re­sents clean­ing, hos­pi­tal­ity and care work­ers, among others, says that too of­ten there is ha­rass­ment of work­ers seek­ing union sup­port, and that leg­is­la­tion needs amend­ing to re­in­force work­ers’ rights to ac­cess their union.

But the union move­ment has been damaged by one of its own, with con­tin­u­ing rev­e­la­tions of the deals that the Shop Distribu­tive and Al­lied Em­ploy­ees As­so­ci­a­tion made with large em­ploy­ers such as McDon­ald’s, Coles and Hun­gry Jack’s, which cre­ated col­lec­tive agree­ments that paid wages be­low the min­i­mum wage. In late Novem­ber the Greens in­tro­duced the Pay Pro­tec­tion Bill, in a bid to amend the Fair Work Act, so that no work­place agree­ments in fu­ture could un­der­mine the wages safety net. Schofield says it is a huge chal­lenge for her union to or­gan­ise in high-turnover in­dus­tries, where “too many peo­ple are forced to string to­gether mul­ti­ple short-term ca­sual jobs”. That chal­lenge will in­volve work­ing in dif­fer­ent lan­guages and work­ing with in­dus­try on eth­i­cal labour sup­ply chains.

Ac­cord­ing to Trip­pas, the grow­ing black econ­omy is at­trib­ut­able to “just the pres­sure on busi­ness”. Be­fore com­pul­sory su­per, he says, a cafe owner would ex­pect a three­way equal split in costs between wages, food and “other”. But wage costs are now 46%. It was once stan­dard to ex­pect a 10% profit. Now, Trip­pas says, it is more likely to be 2% to 5%.

Others, in­clud­ing RMIT’s Iain Camp­bell, see a cul­tural shift in em­ployer at­ti­tudes. “It’s the sense that the em­ployer has the right to do what they want with their busi­ness in or­der to main­tain com­pet­i­tive­ness … It’s a sense of en­ti­tle­ment. ‘It’s our busi­ness, we’ve worked on it, we can do what we like with it, why should we have to pay the min­i­mum wage.’”

Camp­bell puts it down to a per­va­sive ne­olib­er­al­ism in both pri­vate and pub­lic sec­tors, and dis­misses ar­gu­ments about com­pet­i­tive pres­sures. “There’s al­ways been com­pe­ti­tion. It’s the way cap­i­tal­ism op­er­ates, based on units of cap­i­tal. Each em­ployer seeks a cost ad­van­tage over com­peti­tors. But this is why we have min­i­mum-wage laws … to pre­vent the de­struc­tion of liv­ing con­di­tions for the mass of the pop­u­la­tion.”

Some­times mis­steps are at­trib­ut­able to em­ploy­ers’ poor man­age­ment skills. But Camp­bell says it’s more than that. “Em­ploy­ers still see them­selves as [good] em­ploy­ers even if they’re not pay­ing the min­i­mum wage. ‘He pays me $15 an hour but he gave my par­ents a free lunch. And he doesn’t yell as loudly as the guy down the street.’ Em­ployer cul­ture has shrunk, in hu­man terms.”

Mean­while, the fed­eral gov­ern­ment has been forced, through grit­ted teeth it seems, to re­spond to the pub­lic out­cry around the be­hav­iour of 7-Eleven and Cal­tex. In ad­di­tion to the pro­posed changes to the Fair Work Act, task­forces are mush­room­ing. Late last year, the fed­eral gov­ern­ment an­nounced plans for a black econ­omy task­force. There’s also the Mi­grant Work­ers’ Task­force (har­ness­ing in­for­ma­tion to bet­ter pro­tect work­ers) and Task­force Cadena (tar­get­ing crim­i­nal ac­tiv­i­ties as­so­ci­ated with over­seas work­ers).

The Fair Work Com­mis­sion’s highly an­tic­i­pated re­view of penalty rates will only be rel­e­vant to the em­ploy­ers who

“Australia once had a Lib­eral Party that worked to de­liver strong real wage growth.”

cur­rently pay them. For those in the black econ­omy it will be busi­ness as usual.

There is, too, a catch-all Se­nate in­quiry into Cor­po­rate Avoid­ance of the Fair Work Act, cover­ing labour-hire prac­tices, wage lev­els, awards and “legacy is­sues re­lat­ing to WorkChoices”, among other is­sues. The in­quiry is due to re­port in Au­gust.

It re­mains to be seen how se­ri­ously the gov­ern­ment will re­spond to these var­i­ous in­quiries and task­force find­ings. The plan to in­crease penal­ties for com­pa­nies who “should have been aware” or who “de­lib­er­ately un­der­pay”, for in­stance, would ap­pear to leave sig­nif­i­cant scope for em­ploy­ers to claim ig­no­rance or ar­gue it was a one-off er­ror. Com­pared to the alacrity with which Cen­tre­link-re­lated in­fringe­ments (or per­ceived ones) are pur­sued, the gov­ern­ment’s ac­tions and rhetoric about rogue em­ploy­ers have ar­guably been min­i­mal. 2017 is shap­ing up to be a year of reck­on­ing for em­ploy­ment rights.

To­moe had a han­ker­ing to care for an­i­mals, and as her burn wounds healed she headed north to work on a farm near Townsville. She fed an­i­mals and cleaned the house, un­der the di­rec­tion of another young Ja­panese woman who’d been there longer. To­moe was not paid – sim­ply fed and housed. She said she didn’t mind about the an­i­mal work be­cause she wanted that ex­pe­ri­ence, but clean­ing the house was “a lit­tle an­noy­ing”. That was for about a month.

Back in Syd­ney, she worked at an in­ner-city bak­ery. She set the bread, and made sand­wiches and cof­fee. The pay was $15 an hour, cash. This time, To­moe asked if she could give her tax file num­ber and pay tax. She was told “it takes time”. She never got a pay slip.

To­moe was chat­ted up by a worker at a nearby fish shop, where she some­times had to make de­liv­er­ies for the bak­ery. He in­vited her out. She was lonely, and she went. She was sex­u­ally as­saulted.

Her al­leged as­sailant is in jail, on re­mand, and the case is ex­pected to be heard in the first half of this year.

Af­ter the as­sault, with its at­ten­dant po­lice in­quiries and time off for To­moe, the bak­ery cut To­moe’s five shifts a week back to two. “She [the owner] was nice be­fore the in­ci­dent.”

To­moe turned to her friend Joshua. His fam­ily took her in, and urged her to ac­cept the NSW Po­lice of­fer of counselling. To­moe re­fused, pre­fer­ring to try, she said, to put bad things be­hind her.

Just be­fore she flew back to Ja­pan, I said I’d no­ticed a big dif­fer­ence in her over the two years I’d known her. She seemed older and wiser.

She nod­ded, ex­pres­sion­less. “I learned a lot in my time in Australia.”

* Names have been changed

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Seren Dal

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