7-Eleven and Australia’s problem with labour regulation

By Cathryn Lee

The recent 7-Eleven wage scandal didn’t come as too much of a surprise to MLS Associate Professor Joo-Cheong Tham. Since 2013 he has been leading a research project into insecure work and employer non-compliance with labour regulation in Australia.

7-Eleven’s scam, which was unmasked by a joint ABC Four Corners-Fairfax investigation last year, exposed a long-standing, systematic process of doctoring time-sheets and severely underpaying workers, including temporary migrant workers.

This category of workers is the focus of Associate Professor Tham’s project, entitled Precariousness in Law and Labour Markets: The Case of Temporary Migrant Workers. Funded by the Australian Research Council, the project analyses the nature and extent of the insecurity experienced by temporary migrant workers – a group that makes up 10 per cent of the workforce in Australia and includes international students, working holiday-makers and 457 visa-holders.

As a former international student himself, the plight of this particular group is important to Associate Professor Tham.

International students are clustered in a narrow range of low-wage, low-skill jobs – as kitchenhands, waiters, cleaners, security guards or petrol pump attendants – and they are often subjected to poor treatment.

Some of his most startling findings concern the low wage rates paid to international student workers. Some students interviewed through the project were paid as little as $8 an hour, less than half the minimum wage, and some never received any payment at all. Poor conditions, racism and bullying were also reported.

The project takes stock of the current regulatory system and questions its effectiveness. In doing so, it highlights the culture of non-compliance in Australia – including the use of business models based on illegal working arrangements as was the case with 7-Eleven – and analyses its implications for labour markets and labour market regulation.

Associate Professor Tham also questions how the broader community has contributed to non- compliance with labour regulation, and whether as a society we have become accustomed to cheap products produced by exploited labour and therefore inured to the consequences of “everyday” exploitation. As he puts it, “many of us wouldn’t think twice about a friend working for ‘cash-in-hand’ or a daughter working without penalty rates.”

The outcomes of the study will have a significant impact on debates around temporary migrant labour and broader topics such as precarious work, according to Associate Professor Tham. He says the research will contribute to improved operation of Australia’s labour markets, more effective labour market regulation and improved quality of public debate relating to temporary migrant work.

Banner image: Associate Professor Joo-Cheong Tham

This article originally appeared in MLS News, Issue 16, October 2016.