Introduction

The Migrant Justice Institute (MJI) report, Off the Books, identifies widespread workplace breaches among temporary visa holders in Australia. Drawing on a survey of nearly 10,000 participants (n=9,963), the research reveals that two thirds of temporary migrant employees were underpaid. One in four workers was underpaid by at least $10 per hour. Underpayment serves as a critical indicator for deeper harm, including forced labour as defined by the International Labour Organisation. The report notes that severe underpayment correlates with increased reports of forced labour indicators, such as being made to work long periods without breaks or in unsafe conditions.

Where underpayment hides: Common practices and how to check them

Chronic underpayment is a key driver of exploitation. The Australian Fair Work system provides a safety net of entitlements through National Employment Standards and the National Minimum Wage. However, migrant workers often face insecure employment structures that facilitate exploitation. Businesses are advised to treat underpayment not merely as a non-compliance or paperwork issue, but as a trigger for thorough due diligence across operations and supply chains.

Misclassification of employees on Australian Business Numbers (ABNs) and sham contracting

Over a third of temporary visa holders worked on an ABN, which is 4.5 times the rate of the general workforce. Approximately one in five worked on an ABN in industries where independent contracting is unusual, including retail, hospitality, and commercial cleaning. Findings show 43 per cent of ABN workers were paid below the National Minimum Wage, and 79 per cent were paid below the casual minimum wage. On average, these workers received $10.10 per hour less than casual employees during nights and weekends. Sham contracting is an offence with significant penalties. Suggested due diligence includes internal checks on the ratio of ABN workers to employees and verifying if contractors can negotiate pay or refuse work.

Casual employment

Casual employment accounts for 38 per cent of survey participants. While legitimate, it is a risk factor because employers can withdraw hours to retaliate against workers who raise concerns. In the survey, 37 per cent of casual employees were paid below the National Minimum Wage, and 85 per cent worked nights and weekends. Four in five casual employees were paid below their individual minimum entitlements. Red flags include casual work hours matching permanent staff or the absence of a 25 per cent casual loading.

Work during nights and weekends

Shifts during nights and weekends are typically less supervised, creating incentives for non-compliance. While only 21 per cent of the general labour force works night shifts, 83 per cent of survey respondents worked nights and weekends. Within this group, 75 per cent were underpaid by an average of $9.40 per hour. Recommended actions include reviewing rosters against site security systems and checking if penalty rates are accurately recorded on payslips.

Payslips and cash payments

Accurate record-keeping is fundamental to compliance, yet 16 per cent of participants received no payslip. Additionally, 8 per cent received payslips that omitted hours to make the hourly rate appear higher. The report found 23 per cent of workers were paid some or all wages in cash. Among those without a payslip, 90 per cent were paid below their individual minimum legal entitlements. Businesses should investigate deductions and check if payslips show uniform hours across many workers, which is a key red flag.

What to do when you have found a red flag

Upon identifying a red flag, businesses should verify information through multiple sources, including management and confidential worker interviews. Interviews must be strictly voluntary and conducted by trusted intermediaries. If issues are determined, remediation should be immediate, prioritising worker safety and confidentiality. Businesses are encouraged to work with suppliers to calculate backpay, reclassify misclassified workers, and address root causes like unsustainable pricing structures.

Case study: What this can look like in practice

A hotel chain engaging a supplier for housekeeping provides a practical example. Despite paper compliance, site visits might reveal workers on ABNs and flat-rate payslips. Triangulating evidence involves cross-checking operational data, such as housekeeping logs and swipe card records, against supplier payroll records. The focus should be on addressing root causes like labour pressures and disclosing remediation approaches in modern slavery statements.