BEN SCHNEIDERS Hard Labour: Wage theft in the age of inequality. Reviewed by Braham Dabscheck.
Ben Scheiders examines wage theft and challenges the notion that Australia is a fair-minded society.
Ben Schneiders is an investigative reporter with The Age. Since 2015 he has written hundreds of articles on wage theft with colleague Royce Millar. His object in this book is to bring these writings together to provide a broader overview of the widespread nature of this problem and contribute to a broader discussion of growing inequality in Australia. He points out he ‘has relied heavily on the work of the French economist Thomas Piketty’ (Capital in the Twenty-First Century, 2014; Capital and Ideology, 2019).
Schneider reports that ‘the top one per cent in Australia control more wealth than the bottom 60 per cent of households combined, or more than 15 million people’. He also cites data from the Financial Review’s rich list that found the wealth of Australia’s richest ten people increased from $60.7 billion in 2016 to $177 billion in 2021. He maintains:
Whether it is over access to private education, private health, private housing, adequate superannuation, or the jobs that people get to do, a whirring, self-perpetuating inequality machine has been created in Australia. It runs from the cradle to the grave, creating a parallel society for those who have the good fortune to access the gilded system or are born to it.
Schneiders estimates that approximately ‘one-quarter to one-third of the workforce is locked in a cycle of precarity through job insecurity, low pay, and often, wage theft’. He points out that approximately seven per cent of the workforce regularly perform ‘gig’ work in Australia. His major focus, however, is the 750,000 ‘guest workers’ – persons on temporary work visas with limited employment rights – and another 100,000 undocumented workers, who are most vulnerable to wage theft. Moreover, these groups are unlikely to complain about being cheated by employers for fear of losing their residential status and being forced to leave Australia. (For a guest workers, residential status is linked to an employer committing to maintain their employment.) On several occasions Schneiders refers to work for many in Australia as akin to slavery or indentured labour.
While Hard Labour provides valuable information on a widespread malady, its construction contains a major design flaw. Schneiders’ basic approach is to begin each chapter with an examination of wage theft in a particular micropart of the economy, launch into a general macrodiscussion of major events in Australian history, often going as far back as the nineteenth century. As interesting as this may be, the problem is that he repeats the same basic information again and again, which makes for dull reading. An alternative approach would have been to contain this information in an early chapter as an introduction to the more specific examples of wage theft, which would have made for a sharper, more concise narrative.
Schneiders examines wage theft in four major areas. They are ‘high class’ restaurants, fast food, supermarkets and agriculture. The most common ploy in restaurants is not to pay workers for compulsory overtime or penalty rates for working late nights and on weekends. In presenting information on the combination of long hours and low pay he draws comparisons with George Orwell’s Down and Out in Paris and London, published at the height of the Great Depression of the 1930s.
Schneiders documents a number of examples of workers who have been underpaid over many years for sums running into tens of millions of dollars. The most extreme example is hospitality group Merivale, which underpaid its staff $100 million over several years. Schneiders also points to how a number of high-profile restaurants enter into financial arrangements with offshore entities that involve transfers of high levels of income (profits?), while their ‘domestic’ restaurants operate at a loss, enabling them to avoid taxation and related obligations under Australian law.
Much of Schneiders’ discussion of fast food outlets and supermarkets is taken up with an examination of the Shop, Distributive and Allied Employees’ Association (SDA) and the operation of Australia’s industrial relations system. In theory, at least, working conditions are underpinned by a series of awards determined by industrial tribunals (currently, at the federal level, the Fair Work Commission). Unions and employers are able to negotiate enterprise agreements different from an award as long as the deal satisfies what is called a ‘better off overall test’ (the BOOT) – that is, no worker should be worse off than the underpinning award when they move on to an enterprise agreement. Such agreements need to be signed off by the Fair Work Commission to confirm they have satisfied the BOOT.
The SDA has negotiated a series of agreements where an increase in the hourly rate of pay for normal hours worked during the week was traded off for overtime pay and penalty rates for night-time and weekend work. Schneiders’ basic claim is that the SDA has entered into agreements, signed off by the Fair Work Commission, where large numbers of its members are worse off, especially those who work overtime and unsocial hours, which constitutes a large proportion of workers in supermarkets and fast food outlets in particular. (Think about that when you next make late-night purchases.) Schneiders comments:
Unlike most other unions, [the SDA] draws [its] membership strength from its closeness to major employers, and not from its militancy, its independence, or its ability to negotiate world-leading wages and conditions. The SDA has provided large employers with predictable wage increases, zero industrial disruption, and a cooperative single voice speaking for a large dispersed workforce … The SDA … had played a major role – as a partner, in effect – in establishing a system of widespread wage theft … Upwards of 250,000 workers were underpaid.
Such agreements enable the SDA to achieve high membership levels, which provide it with leverage within both the broader union movement and the Australian Labor Party to pursue a conservative right-wing agenda, antipathetic to progressive issues. Because of this numerical ‘bureaucratic’ strength within the broader union movement and the ALP, neither organisation is likely to call it out for neglecting the wages and conditions of its members. Schneiders is also highly critical of the Fair Work Commission for giving its imprimatur to such agreements.
As the result of the reporting of this situation, and the work of various other activists, a series of cases were mounted before the Fair Work Commission that have had these agreements set aside, with either a return to award conditions or an increase in rates of pay and improved working conditions. Subsequent agreements have resulted in Coles workers receiving an extra $100 million a year, Big W (which includes Woolworths) workers an extra $750 million, 7-Eleven $173 million, McDonald’s $100 million and Domino’s $30 million.
Undocumented workers are a mainstay of agricultural labour. Wage theft in this area takes the form of employers simply not paying award wages, workers being paid on piece rates (the more you pick/produce the more you are paid) and deductions for accommodation, transport and payments to agents for finding work. Agricultural work is also dangerous due to the use of chemicals. (For an excellent account of the dangers of farm work see Dvera I. Saxton, The Devil’s Fruit: Farmworkers, health, and environmental justice, 2021.)
In November 2021, the Fair Work Commission found that piece rates were not fit for purpose, rates were unilaterally determined by employers and substantial portions of workers earned less than the minimum wage. It stipulated that workers had to be paid at least the minimum award hourly rate.
The most damning insight in Hard Labour is that it is workers on the lowest levels of income who are the most likely to be the victims of wage theft. Receiving the pay they are entitled to would make a major difference to their quality of life and wellbeing – being able to afford more and better food, health care and other essentials.
Ben Schneiders casts a damning light on the nature of Australia’s political economy and the operation of its industrial relations system. He is highly critical of unions, the Fair Work Commission and political parties, especially the ALP, for allowing such widespread wage theft to occur in Australia. His reporting, with support from others, has helped to rectify some of the major instances of underpayment, for which he is to be congratulated.
Despite the criticisms concerning the organisation of his material, his Hard Labour: Wage theft in an age of inequality is an important work in documenting and exposing a major Australian scandal; a scandal which fundamentally challenges the notion that Australia is an egalitarian and fair-minded society.
Ben Schneiders Hard Labour: Wage theft in an age of inequality Scribe 2022 PB 208pp $32.99.
Braham Dabscheck is a Senior Fellow at the Melbourne Law School at Melbourne University who writes on industrial relations, sport and other things. He published two major books on industrial relations in Australia in the latter decades of the twentieth century: Australian Industrial Relations in the 1980s (Oxford University Press, 1989) and The Struggle for Australian Industrial Relations (Oxford University Press, 1995).
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