Foreigners are working for less than half the minimum wage in Melbourne restaurants. One international student was even paid in sushi.
By TESSA RAMANLAL
International students and foreign workers in Melbourne restaurants are routinely paid less than half the minimum wage, sometimes even in food.
A Chinese student from Deakin University worked for five hours at a Melbourne franchise sushi store, receiving no pay except for four sushi hand rolls she had made herself.
“The hand rolls themselves were nice, but with no pay I was not very happy,” she said.
“The boss was so mean and said because I had no experience I needed to learn for a period of time without any salary.”
“They work long hours without breaks – up to 10 hours at a time – without night or weekend rates or overtime. International students have become our invisible army of low-paid, highly exploited workers,” she said.
While the minimum wage for a full-time adult is $16.87 per hour, many employers at ethnic restaurants are paying cash-in-hand wages as low as $7 an hour, without making tax deductions or superannuation contributions.
The owner of a Chinese restaurant in Box Hill said: “New workers are paid $8 cash and over time that goes up to $10.”
“Staff pay depends on daily profit and our profit is very low.”
International student Vhiheng Liu, 24, was employed as a kitchen hand and waiter at that restaurant in Box Hill and said he felt forced to accept an $8 flat rate as his poor English made it difficult to secure work elsewhere.
“I had to work there because I needed money to support myself and even though I knew it was low pay, it was still money,” he said.
“Even if I asked for higher pay, I’d just lose my job because somebody else would take it.”
The director of a popular city dumpling restaurant that has a high rating on Urbanspoon said paying the minimum wage would see a dramatic increase in dish prices.
“A plate of dumplings could go up from something like $10 to $20,” she said.
“There’s a real dilemma here because we sell our dishes at a very low price. The only way we could pay that higher wage is if the whole market put their prices up at the same time, otherwise we’d just go out of business,” the director said.
The manager of a Japanese café in a large suburban shopping centre boasted about paying his employees $12 an hour, without realising it was gross underpayment.
“The market rate in similar restaurants is around $10 to $11 per hour and I know that in Chinatown the rates are generally lower,” he said.
“I prefer to cut back on the number of staff, as opposed to the pay because they also need to look after their homes and families.”
Australian Institute of Employment Rights executive director Lisa Heap said this underpayment was not confined to small, low-price restaurants.
“It’s interesting because I’ve had experience with an upmarket, expensive Japanese restaurant in Hawthorn where profit margins are huge but they only pay flat rates of $9 per hour,” she said.
“Patrons are paying premiums for services in these restaurants, but the employees are subjected to all sorts of exploitation, including underpayment, lots of split shifts, lack of notice for their shifts, cancellation of their shifts at the last minute, and sitting beneath this, I have real concerns about health and safety in these workplaces.”
Last financial year the Fair Work Ombudsman finalised 2018 complaints from visa holders nationally and recovered more than $1.4 million for underpaid visa holders through complaint investigations.
A spokesperson for the Fair Work Ombudsman said it had established the Overseas Workers’ Team, based in Adelaide, consisting of 14 specialist Fair Work inspectors nationally that follow up complaints from foreigners.
“Complaints … from overseas workers come most frequently from South Korean, Chinese, Vietnamese and Japanese workers,” the spokesperson said.
“The Fair Work Ombudsman has a strong focus on protecting the rights of overseas workers because we know they can be vulnerable to exploitation or unintended underpayments as they’re often not fully aware of their workplace rights and can be reluctant to complain.”
Footscray Legal Centre Employment Law Project solicitor Catherine Dow works directly with people in refugee and newly arrived communities to improve their working experiences.
She said foreign workers were often afraid to question their wages.
“These workers are really vulnerable, especially when this lack of knowledge is combined with language barriers and the challenge of securing work in the first place,” Ms Dow said.
“Our clients with refugee backgrounds also have huge pressure on them to earn money and support family members living in extreme poverty, perhaps in refugee camps. So all of that combines to create a picture where it’s really intimidating and difficult for workers to challenge the exploitative practises.”
However, Dr Carolyn Sutherland, from Monash University’s Department of Business Law and Taxation, warned that, realistically, employees making official complaints ran the risk of losing their jobs.
“From my time in practice, representing both employees and employers, the reality is, if you want to keep your job, legal proceedings are not helpful as they will bring the job to an end,” she said.
Additionally, there are concerns that the current inspectorate work is insufficient.
Ms Heap, from the employment rights institute, said: “Given there’s not a lot of inspectorate resources for bodies to inspect restaurants, employers know underpayment is a fairly safe risk.”
Opposition spokesman on employment and workplace relations Brendan O’Connor echoed this unease.
“The Abbott Government has already significantly reduced funding to the Fair Work Ombudsman,” he said.
“Labor has confidence in the Fair Work Ombudsman but is very concerned that the Abbott Government is cutting funding to this important body.”
The Fair Work Ombudsman receives approximately 500 complaints a week. A spokesman said inspections could not be the only method of combatting underpayment.
“With about one million workplaces in Australia and 10 million employees, Fair Work inspectors cannot visit every workplace or check every pay packet, nor should we,” the spokesperson said.
“Education is equally as important as deterrents in achieving compliance with workplace laws.”
Ms Heap supported this call for further education.
“Information and education is power so we need to work on a system where when we know people are coming in on student visas there is a process in which they are educated on the accepted standards in Australia, so they know this is not what has to be,” she said.
“There needs to be an exploration of a union-like model that can bring these exploited workers together so they can at least talk about what’s going on and talk through strategies that they could implement.”
Chocolate Buddha, a successful Japanese restaurant in Federation Square, has many foreign employees and pays wages in accordance with the Restaurant Industry Awards 2010.
However, restaurant general manager Ezra Tepania joked that his staff are all too familiar with their working entitlements.
“You could pay them $50 an hour and they’d still be wanting more,” he said, laughing.
“But whether the staff appreciate it or not is secondary to us doing the right thing. I’m shocked to hear there are people paying as low as $8. I don’t think I could sleep at night knowing I was doing that.”
Paul Strickland, from Latrobe University’s Tourism and Hospitality Research Unit, said many ethnic restaurant owners would feel entirely comfortable with underpayment because, to them, it was a cultural norm.
“Many of these cultures exploit their own people,” he said. “They’re used to dealing cash in hand and would have no problem working their employees to the bone for less than the minimum wage.”
Adopting a vastly different approach to the issue of underpayment is the Institute of Public Affairs, which has called for the abolition of the minimum wage in a submission to the Fair Work Commission.
The institute’s Dr Julie Novak, who co-wrote the submission, said: “As soon as employers are free to contract with prospective employees over whichever level of wages they mutually agree to, they will be capable of employing more staff and providing a greater number of valuable opportunities.”
“Most people in Australia have sufficient skills to earn far higher than the minimum wage, so those affected include young people and migrants who desperately need a foothold – a door into the labour market to build up some skills and build up a career where they can eventually earn very high wages,” Dr Novak said.
Ms Heap rejected this proposal, saying exploitation should not be taken as a given in society, and was not part of Australian tradition since Federation.
“Do we want people coming here and working in poverty? What goes with that is that they have to work more than one job to makes ends meet. They’ll end up doing other things in order to sustain themselves and their families, including criminal activity. We’ll end up with an underclass of people who can’t afford healthcare. They’ll accept that they’ll be injured or killed in the workplace. That is not who we are,” she said.
“Would you really feel comfortable eating at a restaurant where the person who brings you your meal is on $9 an hour and has been working 12 hours straight?” she said.
Melburnian Rose Denby, 22, admitted to loving a cheap and tasty meal but said she’d think twice if informed a restaurant was paying workers illegally.
“I would be conflicted if it was somewhere with great food and it meant they could keep their prices down but I probably wouldn’t eat there if I knew they were being paid particularly low wages,” she said.
Anyone experiencing exploitation in their workplace can contact the Fair Work Ombudsman on 131394 or visit its website.