What happens when you take the slaves out of the franchise?

By in Australian Economy

| 27 comments

This:

And this:

Recalling this:

It was December 9 and Jon had just finished reading about the franchisee scandal at Retail Food Group, the company behind iconic brands including Brumby’s, Donut King and Crust Gourmet Pizza, and decided to make a call.

The call was in response to an ad placed in Mandarin in Chinese newspaper Sydney Today, asking for delivery drivers at Crust.

The franchisee, who runs a Crust Pizza franchise in Sydney, told him he had two options: he could be paid in cash at $15 an hour plus up to $2 for each delivery or $17 an hour, plus $2 for each delivery, if he wanted to go on the books and pay tax.

Either deal required him to use his own car and pay associated costs including petrol and insurance. Both offers were below the minimum wage for an adult in Australia.

What the franchisee didn’t know was that the caller, Jon, a Chinese student on a visa, was posing undercover for Fairfax Media.

“Underpayment still goes on everywhere,” he says. “We are getting more than we used to but we still get less than we should. I sometimes imagine what it would be like if everyone could be paid correct in future”…

And today, more:

Two multimillion-dollar wage theft group actions will be filed in the Federal Court on Monday on behalf of hundreds of Australian door-to-door and direct sales workers.

The young workers were allegedly paid well below the legal minimum wage for sales and charity fundraising for international direct marketing companies AIDA and Credico.

Affected workers sold products door to door and in shopping malls for large corporates, including Telstra, Optus and Foxtel, as well as raised funds for major charities.

Charities included Clown Doctors, World Wildlife Fund Australia, Prince of Wales Hospital, Amnesty International and the Cancer Council NSW.

The court action is on behalf of 100 members of the National Union of Workers but the union says this is just the start and wage underpayments for workers in the group action are estimated to be in the millions of dollars.

NUW assistant branch secretary Godfrey Moase said the anti-wage-theft campaign will also investigate Global and PCA, which are part of the long-term campaign but are not part of the initial action.

“It will end up being thousands of workers,” he said. “It really comes down to young workers’ lives. There are two related issues, one is wage theft, where a lot of these workers were paid $3 to $5 an hour and the second is theft of time, they were often working 60-70 hours a week to try to make any sort of living.”

Also work popular with, wait for it, itinerant foreign workers.

Since the 7-Eleven migrant worker scandal broke in 2015, there has been a regular flow of stories emerging about the systemic abuse of Australia’s various migrant worker programs and visa system.

Here is a sordid summary of what has occurred, as documented on this site:

  • The issue culminated in 2016 when the Senate Education and Employment References Committee released a scathing report entitled A National Disgrace: The Exploitation of Temporary Work Visa Holders, which documented systemic abuses of Australia’s temporary visa system for foreign workers.
  • Mid last year, ABC’s 7.30 Report ran a disturbing expose on the modern day slavery occurring across Australia.
  • Meanwhile, Fair Work Ombudsman (FWO), Natalie James, told Fairfax in August last year that people on visas continue to be exploited at an alarming rate, particularly those with limited English-language skills. It was also revealed that foreign workers are involved in more than three-quarters of legal cases initiated by the FWO against unscrupulous employers.
  • Then The ABC reported that Australia’s horticulture industry is at the centre of yet another migrant slave scandal, according to an Australian Parliamentary Inquiry into the issue.
  • The same Parliamentary Inquiry was told by an undercover Malaysian journalist that foreign workers in Victoria were “brainwashed” and trapped in debt to keep them on farms.
  • A recent UNSW Sydney and UTS survey painted the most damning picture of all, reporting that wages theft is endemic among international students, backpackers and other temporary migrants.
  • Last month, Fair Work warned that most of Western Sydney had become a virtual special economic zone in which two-thirds of businesses were underpaying workers, with the worst offenders being high-migrant areas.
  • Dr Bob Birrell from the Australian Population Research Institute latest report, based on 2016 Census data, revealed that most recently arrived skilled migrants (i.e. arrived between 2011 and 2016) cannot find professional jobs, with only 24% of skilled migrants from Non-English-Speaking-Countries (who comprise 84% of the total skilled migrant intake) employed as professionals as of 2016, compared with 50% of skilled migrants from Main English-Speaking-Countries and 58% of the same aged Australian-born graduates. These results accord with a recent survey from the Bankwest Curtin Economics Centre, which found that 53% of skilled migrants in Western Australia said they are working in lower skilled jobs than before they arrived, with underemployment also rife.
  • The Australian Bureau of Statistics (ABS) latest Characteristics of Recent Migrants report, revealed that migrants have generally worse labour market outcomes than the Australian born population, with recent migrants and temporary residents having an unemployment rate of 7.4% versus 5.4% for the Australian born population, and lower labour force participation (69.8%) than the Australian born population (70.2%).
  • ABC Radio recently highlighted the absurdity of Australia’s ‘skilled’ migration program in which skilled migrants have grown increasingly frustrated at not being able to gain work in Australia despite leaving their homelands to fill so-called ‘skills shortages’. As a result, they are now demanding that taxpayers provide government-sponsored internships to help skilled migrants gain local experience, and a chance to work in their chosen field.
  • Then there is new research from the University of Sydney documenting the complete corruption of the temporary visas system, and arguing that Australia running a “de-facto low-skilled immigration policy” (also discussed here at the ABC).

The above bullet points are only a fraction of the various cases of migrant abuse that MB has documented. But you get the picture.

There is no governing, regulating or policing the tsunami of migrants, both temporary and permanent, that Australia is sucking. It’s not systemic corruption, it has become the system itself, as we import emerging market conditions into the Australian labour market it drives a proliferation of ever more ‘cheap labour’ businesses, while robbing developing nations of their talent.

The scam is so huge that it has lowered Australian wages and inflation plus interest rates, driving up house prices and allowing us to over-consume these very same services. It’s become a structural adjustment. And it demands root-and-branch reform, not window dressing.

Cut immigration.

Houses and Holes

David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the fouding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal.

He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.

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Comments

  1. Super Phoenix

    “Cut immigration”

    Well, guess what will happen if you cut immigration from “the system itself”.

      • MichaelMEMBER

        We don’t do “adjustment with all the bullshit blown away” anymore.

        No one, currently in power, has any interest in being at the helm when predictably awkward but potentially avoidable (on my watch) “adjustments” are needed in the national interest.

        Net migration should be cut to approximately zero to allow us the time to work a way out of the mess we’ve already created but that isn’t going to happen unless we elect Pauline.

        And, to be honest, our polity is now so corrupt that it’s more rather than less likely that if One Nation were in power, Pauline would be “persuaded” by the “process” to support immigration.

        Actually, I don’t think anything’s likely to improve before we’ve banned all political donations and have prevented ex-pollies from being able to parlay their Canberra experience into another, conflict of interest, high paying position.

      • skippy

        The Balance the Budget Pauline wrt C-corp tax cuts, ummm…. cut immigration to zero whilst rolling out austerity because brexit looks so inviting thingy.

        Some should remember the boat people memes, who used them, whilst doing just the opposite manifold. Yet we are to believe these are the same people or groups which have the knowlage to fix anything?

  3. JasonMEMBER

    The Crust “off the books and pay tax” comment suggests a criminal offence.

  4. kiwikarynMEMBER

    Well duh! The only point of having a flood of low skilled migrants into the country is so they can be exploited. Why else bring them in? If you wanted to pay Australian wages and provide Australian working conditions, you’d just hire Australians. Of course, it has the added advantage of putting pressure on actual Australians to accept worse wages/conditions as well thus driving down overall wage costs, but that’s just a bonus.
    As I’ve said many a time, immigration will only stop when conditions in the developed world have deteriorated to the same conditions on offer in the third world, thus eliminating any incentive to immigrate. Although with free healthcare and eventual welfare benefits available for immigrants, that might tip the balance for some time to come.

      • Researchtime

        Spent years picking fruit for piece work, it put me through collage and Uni. Earned more than the minimum wage. because I worked hard.

        Famers have a tough time getting workers…

      • skippy

        rt…

        There is little or no correlation between time lines besides romantic ideology – per se the two income trap changes, wages and productivity diverging, global markets, and a cornucopia of others. So are you saying you went to uni when it was privatized, run by MBA’s, expected to run at a profit necessitating becoming an IP and white paper mill et al.

        Oops whilst experience wage theft.

  5. AlbyMangles

    innes willox of the migrant council will fight for them….to continue being slaves

  7. mackakMEMBER

    All that needs to be done is the enforcement of Australia’s minimum wage rates. This will collapse demand for labour in enterprises that require very low wages in order to make a profit. With no job prospects the temporary workers will not be enticed to migrate.

    • skippy

      Some would say this is actually an affront to capitalism…. if you can’t run a profitable business without resorting to illegalities, in a race to the bottom, then why do it and yet claim your a capitalist.

    • davidjwalsh

      ‘report to police’ & ‘police are investigating ???????????????????

      where’s the crime ???????????

  11. rentsailor

    Sh!t is getting real everywhere and the message is getting through.
    200+ k a year of shake and bake downward pressure on wages agents (migrants). Is crushloading everyone else, workforce and infrastructure.

    It’ll be all about the reaction not the causation.

    Such posters are only reflex to what is palpable everywhere immigrant influx has put pressure on.

  12. fisho

    What happens when you take the slaves out of the franchise?

    of wait oh wait …I know the answer to this
    – The franchise owners make a fortune. (oh yea that’s not happening)
    – oh yeah wait …The Franchisers make a fortune (oh but their stocks are all in the toilet the whole business model sucks nobody is buying their stocks)
    hmmm
    -The employees get paid more (yeah right bankrupt small business operators dig into their own pockets to pay back packers award wages…(good luck with that model)
    – Maybe the customers get better service (no wait that’s not happening either)

    Alright I give up what does happen?

  13. mike mb

    Not ‘exploited migrants’ on temporary or tourist visas.

    ➡️Willing participants.

    They know exactly before they come what the score is.

    They borrowed and were in loan debt to a foreign agent procurer (to pay back some family crisis or criminal activity in their home country)
    BEFORE they came.

    They paid huge money to organise fake partner visas (full work rights), pretext international education, fake business sponsors, fake documents, fake ID. Fake health checks, fake living & declared funds.
    BEFORE they came.

    They all got briefed and were fully aware from the loans agent procurer, peers & their entire ethnic group on how to sneak in, fake visa, fake docs, illegal accommodation & illegal jobs / cash in hand.
    BEFORE they got off the plane.

    The authorities in their country of origin also knew exactly.

    The Indian passport office bribed to facilitate the poor & useless in the Mumbai slums or Punjab rurals in India – to be our burden & their remittance income.
    They knew what was being sent & why.

    The Chinese in their massive programs of ‘slum clearance’ – Guangzhou, Muslim radicals from Xinjiang or Falung Gong in the north, or the Nepalese misfits or the Bangladeshi corrupt in top down programs to send their burden to western countries and get back the remittances.
    They all know the score.

    Or the Brazil petty corrupt, or Arab & Turkish Fake ID & urban poor, or the Somali Sudanese war criminals & family etc – those countries authorities also knew before they arrived what was coming in here.
    .
    Or in Taiwan, Japan or Korea – (eg the Seoul Mayor) who routinely threaten to name & shame the carry trade of tens of thousands old end of life Asian prostitutes to be sent to Australia as ‘international students’ & ‘tourists’ in deliberate social cleansing & remittance income.
    They know what’s coming into Australia.

    Or in Thailand – whole regions (eg Isan) who live off the export of their rural poor to the Australian black market & prostitution industry to Australia. It’s Isan province second largest income after the rice crop.
    They all know exactly.

    Or Malaysia & Indonesia the clearance of the anti social Chinese subversive & in Malaysia the unwanted Indians – send them to Australia.
    Or Muslim radicals for Hiraj & infiltration as ‘students of other visa pretexts. They all know.

    Is it only dumb naive Australians who don’t know ?

    • Third world slum & rural poor are sent off to Australia to work in the underground & vice industry.
    • Fake visa
    • Fake courses
    • Fake ID, opaque & proxy address details.
    • Straight into a dirty squalid bunk in a room in older ex Australian housing now run as migrant only slum share.
    • Then straight into the black market job or vice in a job organised long before they came.

    ➡️ Every one a willing participant.

    When they get caught “oh I was exploited”.

    When their visa starts to run out or they have a dispute with the black market employer or brothel owner.
    ‘Oh I’m a victim. Give me a protection visa & let me stay’..

    After paying $50k for a fake Marriage or false employer sponsor credentials & the agent procurer does not come thru with the PR – ‘oh I was exploited, let me stay’

    How many ?
    2.7 million. 11% of onshore population.
    Sydney 1.4 million, 1 in 4 in Sydney.
    Melbourne 1.0 million, 1 in 5 in Melbourne.
    Elsewhere 0.3 million.

    ➡️ 2.2 million temporary visa holders, most third world. Almost all unskilled, a huge parasitic burden on our economy & social structure, destroying housing, employment & wages.

    ➡️ 440,000 ‘tourist visa’ holders working illegally.
    (5% of 8.8 million tourist visitors / ABF). Completely illegal, all organised by foreign criminal syndicates.

    ALL EXPLICITLY AWARE & WITH THE INTENTION BEFORE ARRIVAL TO BREACH THEIR VISA, WORK ILLEGALLY.

    The largest, most ineptly stupid, corrupted and economically & socially destructive migrant guestworker program* in the world today.

    -/-
    *Gaddafi in Libya at his peak had 2.2 million migrant guestworkers. They were bonded, controlled, tracked & productive.
    We have 2.7 million unbounded, uncontrolled, untracked and non productive migrant guestworkers.
    Third world, unskilled, run by foreign criminal syndicates, illegally occupying Australian housing, congesting & corruptiom our cities in vast migrant slums, Fake ID, untaxed. And the money pours out in their foreign debt repayments & remittances.

    • Super Phoenix

      Well, sounds like an eminently suitable scheme for a fake and corrupt country.

      We both know that there is nothing ethical or moral about the “skilled migration” scheme – there has never been. If anything, the unskilled migration scheme has a higher moral standard than the genuine one.

      A genuine skilled migration program would deprive the third world of the invaluable talents that would have helped them develop after their governments had invested in raising them. So the program is nothing other than a theft on our part.

      An unskilled migration program would not deprive the third world of anything valuable other than us taking some trouble off their hands. So it is more ethical than the genuine skilled migration program.

      In any case, both are purely strategic on our part without any moral or ethical component whatsoever. It is just that the targets are a little different between the two programs.

      • mike mb

        This is true (your point – the unskilled migrant intake including refugees at least present themselves more honestly than the so called skilled or ‘educated in Australia) intake.

        Our own convict settlement past with the poor, criminal and political (Irish etc) oppressed being cleansed out of Britain and sent to Australia in colonisation is often raised by Indians & Chinese as the reason why it’s now ok for them to do the same.

        Seen it here on MB in comment replies : “you all colonised & invaded the aborigines, so ok for us to do the same”

        What irks me is Turnbull / Dutton et al claiming it’s a skilled & talented intake.

        Nothing could be further from the truth.
        72% skilled
        (so 28% of the total were not),

        But 34% of this skilled category are dependents & partners. So only 38% primary skilled.

        Of the primary skilled – 30% do not have a high skill or professional high income work history.

        So only 8% genuine high skilled unique.

        Of which only 3.8% gain employment in Australia in some high income professional role. Less than half.

        And that’s exactly what we see in our unemployment and census data – we are a dumping ground for Asian & Indian misfits, low skills, amoral & criminal, vice workers & social dissidents..
        All being actively cleared out by their governments of the Indian & Asian slums, packaged up with loan debt, Fake documents, Fake student or sponsor visas..

        All organised BEFORE THEY COME to work & libs illegally, send back the money, secure a PR and drag inn more like them.

        So 96.2% of the total 200,000 intake are actually meet negative and drag down Australian skills & productivity.

        That’s 1.9 million of 2 million intake over 10 years that lower Australian skills, wages, society.
        –
        Maybe we would be better off shutting down the entire PR skilled intake, and slighly increasing the refugee intake.

        At least then it’s clear what’s coming in has more honest credentials & and they would be organised for in housing & help – and maybe less social & economic impact.

    • davidjwalsh

      unpalatable truths mikemb – keep it up and just maybe some might hear you and spread some enlightenment ………….

      but don’t hold your breath – so many are involved and think they benefit from the PC globalist agenda that, IMHO, nothing will change until there are literally riots in the streets (as we can expect to see with increasing frequency in the EU over the next few years)