PART 11 - CONCLUSION

24 Apr

Part 11 — CONCLUSION

The Evolution of Migrant Exploitation in Australia Over the Past Decade

By Laurie Berg & Bassina Farbenblum. Published May 2026. ↑ Back to contents

It is clear that underpayment remains widespread and systemic among temporary visa holders in Australia. For many migrant workers, it is also severe. The average underpaid migrant in our survey was short-changed by close to $9 per hour. Figures from this survey suggest international students alone are underpaid by around $61 million every week and approximately $3.18 billion per year.

While our 2016 and 2019 studies show that underpayment of migrants is not new, the landscape of systemic exploitative practices appears to have shifted since we conducted those studies. In particular, businesses’ strategies to underpay migrant workers and evade detection have evolved, perhaps responding to government interventions to address noncompliance and changed conditions in the economy.

For instance, payment of wages to migrants in cash has decreased, although to a far lesser extent than the reduction of cash in the broader economy post-COVID (see Payment of wages in cash). One in four participants (23%) were still paid at least some of their wages in cash in their lowest paid job in 2024, compared with 44% in 2016.[i]

Many migrant workers in our survey referred to an employment category widely known as “cash jobs”, a category that is distinguished from jobs “on tax” by its sweeping noncompliance with the Fair Work Act without leaving an evidence trail. Though many of these jobs involve some cash payment, employers have also moved to new ways to pay migrants ‘off the books’.

Most notably, many employers are now concealing underpayment by misclassifying employees as independent contractors. Over a third (35%) of participants worked on an ABN in their lowest paid job which is nearly 4.5 times the prevalence of ABN work in the broader Australian labour market. One in every five survey participants (21%), were likely misclassified employees – migrants working on an ABN in an industry such as commercial cleaning, hospitality or retail where genuine independent contracting is uncommon. Noting that cash and sham contracting are often interchangeable, one participant observed, “I went to find jobs in several places they said the wage will be in abn or cash $15 or $18 per hour.” Only 11% of ABN workers in these industries were paid the minimum entitlements they would have had under the Fair Work Act if they were classified as a casual employee. This suggests that a substantial proportion were likely sham contracted in a deliberate attempt to evade minimum standards under the Fair Work Act.

Employer provision of payslips appears to have increased in the last ten years: in 2016, 44% of participants never received a payslip in their lowest paid job,[ii] while in 2024 only 16% of migrants received no payslips in their lowest paid job. As discussed in No payslips or misleading payslips, in 2017 the Fair Work Act was amended to apply a ‘reverse onus’ that presumes a worker‘s underpayment allegations to be correct when an employer fails to meet its record-keeping or payslip obligations.[iii] During this period the FWO has also conducted increased employer education, deterrence and enforcement activities, including issuing more compliance notices and sanctions for record-keeping breaches.[iv] It is possible that the heightened likelihood and consequences of detection in a FWO audit or inspection have contributed to the marked increase in provision of payslips. However, there is a dark side to this trend. Although provision of payslips has increased, a substantial proportion of employers are issuing payslips that conceal underpayment: 8% of participants received payslips which omitted some hours of work (making the hourly rate of pay appear falsely higher) and 40% received a payslip which reflected underpaid wages.

Employers’ engagement of 38% of migrant workers as casuals facilitates concealment of underpayment on a systemic scale, where workers cannot prove the hours and times that they worked. This is exacerbated by the fact that 85% of casual and ABN workers worked nights and weekends, times when their employment was less visible (and their workplaces and commutes were often less safe).

Each of these practices is directly and independently linked to increased likelihood of underpayment. The greater the underpayment, the more likely the participant was paid in cash, received no or misleading payslips, was not paid super, worked on an ABN or as a casual employee, and worked nights and weekends. Similarly, the greater the underpayment the more likely the worker was subjected to indicators of forced labour.

Casual employment and ABN work (generally misclassified) facilitate underpayment. Four in five casual and ABN workers were paid below their individual minimum entitlements under the Fair Work Act (for ABN workers, pegged at the equivalent minimum of a casual employee). An overwhelming 43% of ABN workers and 37% of casuals did not even receive the National Minimum Wage. Not only are they not receiving casual and penalty rates, they are also being paid beneath the National Minimum Wage floor at twice the rate of permanent employees. Casual employees were far more likely to receive no payslips or misleading payslips than permanent employees, and casual and ABN workers were far more likely to be paid in cash. They were also substantially more likely to report working conditions that were indicators of forced labour.

In our next report, we will address in detail the reasons why migrant workers do not speak up and do not seek to recover unpaid wages. It is clear that rising cost of living and migrants’ dependence on these jobs for basic subsistence, and to retain immigration pathways, give employers overwhelming leverage over these workers. Many feel they have no choice but to accept unlawful, and often unsafe, working conditions. For international students, this is compounded by the debt many take on to study in Australia driving them to work additional hours to compensate for underpaid wages, and the 48-hour per fortnight restriction pushing them into “cash jobs”.

It is therefore not surprising that the overwhelming majority of underpaid migrant workers take no action to recover unpaid wages. As our next report will show, migrants report that their main reasons for this were fear of job loss and fear of immigration consequences, followed by lack of knowledge and support to take action.

These findings indicate that migrant exploitation must be tackled by recalibrating the drivers of employers’ unchecked leverage over migrant workers. This must begin by addressing ways in which insecure work arrangements (casual employment or work on an ABN), and immigration settings, are used by employers to systematically avoid their responsibilities under the Fair Work Act. It must also include addressing the hurdles migrants face to proving underpayment, which can be compounded by other strategies deployed by employers (such as sham contracting, issuing no or inaccurate payslips and payment of wages in cash) to further evade detection.

These practices create an unlevel commercial playing field across numerous industries and place honest businesses at a significant competitive disadvantage. Addressing the drivers of migrants’ vulnerabilities to exploitation and holding dishonest employers to account is everyone’s business.