Migration Council chair slams migrant wage protections


Innes Willox has just jumped the shark. The Australian Industry Group CEO and Chair of the Migration Council of Australia today pens a piece slamming attempts to prevent migrant wage exploitation:

Anti-business rhetoric in Victoria has reached fever-pitch, risking jobs and investment.

By parroting overly emotive unions terms such as “wage theft”, the State Government is supporting a divisive agenda that will only serve to drive employers away.

Running businesses is risky, complex and tough. The populist race to the bottom with the unions to describe wage underpayments by a tiny minority of businesses as “wage theft”, effectively labels all employers, large and small, as potential “thieves”.

It is a divisive invitation by the unions to indulge in old-fashioned class warfare rather than supporting a serious conversation about building the economy for everyone’s benefit.

Such language may result in more internet hits but the implication that such activity is rife and that existing penalties are small or rarely imposed does not bear any scrutiny whatsoever. There is no need for this click-bait legislation.

Of course, underpaying workers is unacceptable behaviour and should not be excused. However, heavy penalties already exist to deter and punish those who break the law.

Under the Fair Work Act, penalties of up to $630,000 are in place for underpaying workers or failing to maintain the correct pay records. These penalties were increased just last year by up to 20 times.

A very well-resourced and active regulator, the Fair Work Ombudsman, is in place to investigate and prosecute underpayments. Indeed, in the past few days, an employer was fined more than $200,000 for underpaying two employees in a case pursued by the FWO. In such cases, the FWO typically takes action against directors and senior managers, as well as against the businesses. Where wrongdoing is identified the penalties are severe and effective.

I am not suggesting this, but, as an extreme parallel, does the Victorian Government also propose to label workers who illegitimately take repeated sick leave when they aren’t sick as fraudsters and thieves? Should this area be included in “wage theft” legislation?

More to the point, should amounts transferred to some unions from industry worker entitlement funds be included as “wage theft”? given that the amounts contributed to these funds were paid by employers for the benefit of their own employees – not for the benefit of unions? Why would this unacceptable behaviour not be included in the proposed Victorian legislation?

Three important points should be made about employee underpayments.

Firstly, where such underpayments deliberately occur the employers concerned should and do face harsh penalties.

Secondly, many underpayments are the result of genuine misunderstandings and payroll errors. There are 122 federal industry and occupational awards containing over 10,000 pages of award entitlements. This is on top of thousands of pages of workplace relations laws and regulations. It is not surprising that from time to time businesses, particularly small businesses without dedicated HR staff, are confused about their obligations.

Thirdly, wage underpayment is an area comprehensively dealt with under federal laws and further regulation under the Victorian Crimes Act is totally unnecessary. It was sensibly decided many years ago that workplaces should be regulated through national, not state legislation. Jurisdictions like Victoria ceded most of their workplace relations powers to Canberra in the early 1990s. Many businesses operate nationally and the implementation of State workplace relations laws, including underpayment laws, would be a retrograde step that would create confusion for employers and employees.

Labelling underpayments as a crime appears to be a thinly disguised tactic to give a State Government the ability to legislate for what is a federal matter.

Australia’s economic success, including employment and wages growth, depends upon the ongoing willingness of men and women to take risks to establish and build businesses. Often employers put their houses and life savings on the line. Labelling businesspeople as thieves and subjecting them to over-regulation, not only demonises them: it deters investment, job creation and growth.

State Governments should be doing all they can to make it easier to do business, not harder. They should be proactive about building a prosperous economy and an inclusive society rather than partnering with the unions’ misleading, divisive and anti-business agenda.

Let’s just ask the question: does the Migration Council exist as a lobby to benefit migrants and Australians or is it only there to enable business to exploit cheap labour to the detriment of migrants and the Australian community?

And let’s not forget that Willox is exactly the same bloke that the ACTU’s Sally McManus is in bed with with her Immigration Compact. What the hell is she thinking?


To wit, since the 7-Eleven migrant worker scandal broke in 2015, there has been a frequent 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 reportrevealed 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. There’s another episode today at The Guardian:


The parliamentary inquiry into the franchise sector has been handed a “chilling” succession of similar stories by small-business owners who claim franchisors suggested they should steal wages from vulnerable workers.

Labor senator Deborah O’Neill, who is deputy chair of the committee investigating franchising, told Guardian Australia the inquiry would need to look at how franchise business practices encouraged the exploitation of workers.

In a published submission to the inquiry, a former Muffin Break franchisee, Faheem Mirza, said he was told “to consider underpaying staff that I can trust”.

“The key message was that as migrants, I must be aware of other migrants or students who would gladly accept underpayments in lure of their first job and hence not report or complain,” Mizra said.


Another small business owner, from a different franchise group, told Guardian Australia he was advised by an associate of the franchisor that he should exploit staff on 457 visas by demanding kickbacks.

The business owner said he was later told by his staff that a wages rort – which involved paying foreign workers the standard rate, then demanding a portion be returned in cash – had been in place before he bought the business.

“The whole suggestion was that we could get away with it, because they wouldn’t speak out. We just said: ‘We won’t do that,’ ” he said.

O’Neill said there had been many confidential submissions to the inquiry and that stories about wage theft were common. Guardian Australia reported last month that many franchisees were afraid to speak publicly because of concern that doing so would violate agreements that were heavily weighted in favour of brand owners.

There is no governing, regulating or policing the tsunami of migrants, both temporary and permanent, that Australia is sucking in. 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.


On one thing we can agree with Willox. Regulation is not the answer. It’s too structural now for that.

The only answer is to halve immigration.

About the author
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 founding 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.