Foreign workers in Australia who have entered on a 457 visa can now receive justice against gross underpayment. The Fair Work Ombudsman has started classifying serious underpayments as racial discrimination cases. This event has dealt a major blow to some Australian employers who are cutting costs. Under this condition, the Australian employers performing this malpractice will be liable to unlimited damages.
This initiative comes as a direct result of new laws in effect from September 2017. Under these laws, employers who practice underpayments on basis of race and culture have to face increased fines. Additionally, it is their burden to pay the balance due on account of failure to keep reasonable payroll records.
The ‘Asian Connection’
The first case ruled against a Tasmanian resort last week. The watchdog had found that the owner claimed two workers to be his ‘family’ and underpaid them. The Federal Circuit Court found this action unlawful and called this wage discrepancy as discrimination based on nationality and race. Judge Barbara Baker presided over the case.
Chang Yen Chang hired a Malaysian chef and his wife as replacements for a previous hire. But the wages were minimal to the point where they equalled penalty rates. Moreover, they worked 6 days a week for him instead of 5 days as the previous chef from Singapore worked.
Chang argued that they had ‘family connections’ since the chef was of Chinese descent. He also claimed that it’s in their culture to help out each other by working hard. So the Malaysian chef was doing him a favour anyway. According to him, people already worked 6 days a week in Malaysia. So it would be no different if they did the same here.
But Judge Baker was in no mood to have any of that. She refuted all his claims and also found that the Malaysian chef had no Asian cuisine experience. And Chang was actually paying him lower than the ones he replaced. Judge Baker ruled that the total amount that Chang owes this chef is more than $49,000.