The Guardian • Current Issue

Fair Work Ombudsman finds wage theft in hotel quarantine

In July this year, the Fair Work Ombudsman (FWO), Sandra Parker, launched an investigation into thirty-seven companies who ran security for hotel quarantine in Melbourne and Sydney. On 1st October, she concluded her investigation, having recovered $303,299 in unpaid wages for 1,010 workers. Alongside the wage theft, the Ombudsman also found that fifteen of the businesses had breached various workplace laws and five had failed to meet payslip and record-keeping requirements.

However, the magnitude of the theft is likely much greater than the sum recovered. One shocking example of this is Unified Security Group, one of the contractors providing security services in Melbourne and Sydney. It is estimated that this company alone owed approximately $900,000 in unpaid wages when it went into liquidation earlier this year. This money was never recovered.

In all, Melbourne workers recovered $288,938 and Sydney workers $14,361. Hotel quarantine workers are some of the most at risk workers in this pandemic. The hotel quarantine scandal highlights just how endemic wage theft is in Australia. It extends even to the exploitation of frontline workers risking their lives and those of their families to protect others from COVID-19.

Last year, the Victorian Parliament passed a law making it a crime to underpay workers or to fail to meet record keeping requirements. As stated in Guardian #1970 “Wage Theft Laws Come Into Effect in Victoria,” thirteen per cent of Australian workers are underpaid, most of them casuals and young workers. A staggering eighty-two per cent of employees in the hospitality industry have been underpaid at some point in their working life.

While the Victorian laws focus on dishonest wage theft, FWO, a federal body, argues that ignorance is no excuse not to pay workers correctly:

“We expect all businesses at all levels of a supply chain to meet their obligations under workplace laws so that workers are paid the wages and entitlements they are lawfully owed […]Employers can use our range of free tools and resources, including on supply chains, if they need any assistance complying with the law. Any workers with concerns about their wages should contact us.”

The investigation into hotel quarantine was referred to the Ombudsman by the Liberal Party on 15th July. Since then, it has been used for political point-scoring against Daniel Andrews, using essential workers as pawns in a political manoeuvre to get into power at the next Victorian election. It is interesting that although wage theft also occurred in Sydney under Liberal Premier Gladys Berejiklian, the Liberal Party is silent on this point.

The interests of the Liberal Party do not align with those of the working class. Referring hotel quarantine conditions to FWO was not an altruistic act, but a cheap political ploy to undermine Labor and the Union Movement. Wage theft is built into the capitalist system. It will always be in the interest of employers to underpay workers, thereby increasing their own profits. Only a system which does away with the incentive to cut wages can truly address this issue. Until then, workers must unite and stand up for their rights at work.

The Guardian can also be viewed/downloaded in PDF format. View More