How businesses are ripping off international students by paying below the minimum wage

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International students are routinely being underpaid by businesses who are relying upon the workers not knowing their legal rights or being scared to raise it with authorities if they have been party to such a breach.  

Those students who have reported breaches have said they were being paid as little as $6 an hour. 

The minimum wage in Australia is $19.84 an hour – or $753.80 for a 38-hour week – before tax.

Abbey Kendall, the director of Working Women’s Centre in South Australia, said her organisation has dealt with countless wage theft cases – at least ten queries a week. 

‘In the last 3 months, we have met with dozens of international students who tell us they are being paid between $6 and $15 an hour,’ she told Daily Mail Australia.  

‘Most of these students should have been earning $25 an hour. Many of these students are still in employment, being paid $15 less than what they’re entitled to but they cannot afford to lose their jobs.’

Abbey Kendall (pictured), the director of Working Women's Centre in South Australia, said her organisation has dealt with countless wage theft cases

Abbey Kendall (pictured), the director of Working Women’s Centre in South Australia, said her organisation has dealt with countless wage theft cases

Ms Kendall said she encourages students to make complains to the Fair Work Ombudsman and keep a record of their hours and wages, since dodgy employers often do not.    

‘I encourage these students to get in touch with their student associations and consider joining a union,’ she said.

Ms Kendall said that wage theft is an issue that needs structural reform and not litigation. 

‘Further to that, international students are paying thousands of dollars in tuition fees to their University or education institution. Students should be complaining to their universities and asking the education institution to advocate on their behalf,’ she said.

WHAT ARE THE WAGE THEFT REG FLAGS? 

Abbey Kendall, the director of Working Women’s Centre in South Australia, revealed some of the red flags people should look out for when applying for jobs. 

She told Daily Mail Australia: ‘There are plenty of red flags. Students should look out for unpaid trial shifts, especially where it is more than one trial shift. 

‘It is not illegal to pay a worker in cash, but it’s often a sign that the employer is not paying the legal wages. 

‘Another red flag is where the employer doesn’t provide payslips.’

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‘We also encourage students to get behind the campaign to criminalise wage theft, as they have done in Victoria.’

She said it is a pervasive issue in every workforce across Australia. 

‘When dodgy bosses do the wrong thing, they make it much harder for law abiding businesses to prosper,’ she said.

‘It’s a race to the bottom. It’s also a reputational issue for Australia, international students make a huge part of our national economy – do we really want to send the message to prospective students that they should expect to earn $6 an hour because they’re not Australian. 

Why don’t we just shoot ourselves in the foot, that’s a better strategy than letting wage theft prevail.’

Edward Cavanough, manager of policy at the McKell Institute, told Daily Mail Australia there were a few factors that determined why international students were targeted when it came to wage theft.

‘With international student’s visa conditions, most are only permitted to only work 20 hours a week. However in reality, they often work much more than this,’ Mr Cavanough said.

Ms Kendall is handling the case of a 25-year-old woman who moved to Australia from China in 2018 to study and began working at a restaurant (stock image)

Ms Kendall is handling the case of a 25-year-old woman who moved to Australia from China in 2018 to study and began working at a restaurant (stock image)

‘Those additional hours aren’t on the books and they might be done as cash-in-hand deals.’

He said that means this can give employers the ability to pay their staff whatever they want.

Mr Cavanough said there have been circumstances where people are paid as little as $5.

He said language barriers and not knowing their rights in Australia have also contributed to this. 

Mr Cavanough said this impacts the economy, with an estimated $270m lost every year in South Australia alone because of this. 

Nationally, there have been estimates that the economy has been shorted between $1.5billion to $6billion. 

Edward Cavanough, manager of policy at the McKell Institute, said while it happens in every industry two of the biggest offenders are hospitality and horticulture and agriculture jobs such as fruit picking (stock image)

Edward Cavanough, manager of policy at the McKell Institute, said while it happens in every industry two of the biggest offenders are hospitality and horticulture and agriculture jobs such as fruit picking (stock image)

He said the McKell Institute has been looking at wage theft for years but there has been limited data.

Mr Cavanough said there weren’t only issues of vulnerable people being targeted – but the economic impacts and the issue of fairness also came into play. 

He said while it happens in every industry two of the biggest offenders are hospitality and horticulture and agriculture jobs such as fruit picking. 

‘The most important thing is we know how to fix wage theft,’ Mr Cavanough said.

He said the government not giving enough funding to the Fair Work Ombudsman and the policy changes of trade unions – who typically advocate in these cases – has led to an increase in wage theft over the last seven years.  

‘That is why dodgy employers know they can get away with it,’ he said.

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