Magazine of Socialist Action in Australia

Australia’s wage theft epidemic

Reading Time: 3 minutes

A recent report from the workforce management company Kronos has confirmed that wage theft is a growing problem in Australia. The report found that 43% of Australian workers had worked for an Australian employer who had paid them less than the minimum wage throughout their working life.

The same report also showed that more than a million workers either rarely or never receive the legal minimum wage. The minimum wage in Australia is already low at $18.29 per hour, but even when workers are paid this amount they have already been robbed.

Under capitalism workers receive only a portion of the wealth they create. The rest is siphoned off in the form of profits by capitalists who own and control industries. That thousands of employers go a step further and pay workers even less that what is legally required is particularly perverse. It can only be described as super-exploitation.

There are multiple ways that workers complain of being cheated at work: they range from not being paid the correct rate to not being paid for overtime or training. In some of the worst cases reported overseas workers have been forced to pay a portion of their wages back to their employers in cash.

The problem is that we face a race to the bottom. If some bosses can get away with underpaying workers then more and more will seek to follow suit in order to compete. There is a desperate need to stop wage theft before it puts even more downward pressure on our living standards.

Vulnerable sections of the workforce are the most likely to suffer from wage theft. These include young people, migrant workers and those with disabilities. The majority of them work in industries such as hospitality, retail and agriculture where most jobs are casualised and workers are often not organised in unions that fight for their interests.

The Australian Council of Trade Unions (ACTU) is currently pushing for the government to make wage theft a crime, punishable with up to 10 years jail. Socialists support this, pointing out that the system is currently rigged in favour of the bosses.

If a worker is caught stealing at work they will most likely be charged and risk being sent to prison. Yet most wage theft cases are not even taken to court. It is very rare that a boss is ever sent to prison. On occasion, employers are fined but they just factor this into the costs of doing business.

While a stiffening up of penalties would be a step forward, a key issue is that employers are not even bothering to adhere to the current laws. The ACTU admits that the process to recover wages through the courts is expensive and arduous. Workers will always face an uphill battle against bosses who have huge resources at their disposal.

The only real way to shift the balance in favour of workers is through collective action. The unions need to be seen as useful weapons in the fight against wage theft and wealth inequality. They need to be imbued with a fighting approach.

A glimpse of what a fighting approach could achieve was seen during a recent dispute at the Melbourne café called Barry. In this case the workers got organised and demanded that their boss pay them the legal rates of pay.

When the boss refused, they organised a protest and exposed the business’s dodgy practices to their customers. Within days of this action the boss backed down, agreeing to pay them correctly including backpay.

If the resources of the union movement were directed towards amplifying this sort of campaigning hundreds of millions of dollars could be recovered in no time, and we could begin to create our own regime to ensure minimum standards were adhered to.

Unions could utilise their call centres for workers to report dodgy bosses, and ‘hit squads’ could be set up to target thieving employers with flying pickets and protests on a weekly basis. Rather than relying on inadequate laws we could rely on working class solidarity and our own collective strength.

On this basis the union movement would immediately become relevant to millions, especially young people. A fighting approach would reverse the decline in membership and revitalise the movement in a way that we haven’t seen in decades.

By Triet Tran


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