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The fight for a minimum wage in 2021

Edward Cavanough on how Australia’s farming industry came to depend on wage theft, and whether this decision will finally end the exploitation of Australia’s farm workers.

In a landmark decision, the Fair Work Commission has ruled that every farm worker in Australia must be guaranteed the minimum wage. 

The decision comes after years of reports of underpayment and exploitation of workers, particularly in the horticulture industry. 

Today, Director of Policy at the McKell Institute Edward Cavanough on how Australia’s farming industry came to depend on wage theft, and whether this decision will finally end the exploitation of Australia’s farm workers. 

 

Guest: Director of Policy at the McKell Institute, Edward Cavanough. 

 
Show Transcript

[Theme Music Starts]

 

RUBY: 

From Schwartz Media, I’m Ruby Jones. This is 7am.

 

In a landmark decision, the Fair Work Commission has ruled that every farm worker in Australia must be guaranteed the minimum wage. 

 

The decision comes after years of reports of underpayment and exploitation of workers, particularly in the horticulture industry. 

 

Today, Director of Policy at the McKell Institute Edward Cavanough on how Australia’s farming industry came to depend on wage theft, and whether this decision will finally end the exploitation of Australia’s farm workers. 

 

It’s Thursday, November 11. 

 

[Theme Music Ends]

 

RUBY:
Edward, you - in your role at the McKell Institute - have been looking into situations where workers have been exploited. Can you tell me about why you began investigating this? 

 

EDWARD:
So we've been looking at exploitation and underpayment for several years, and the reality is in the kind of shocking thing is when you start researching wage theft in Australia, it's just how prevalent it is across the economy. 

 

Archival tape -- Four Corners report:
“First world country, third world bondage. Welcome to Four Corners. The idea that slave labour might exist in Australia is abhorrent, but get used to it.” 

 

EDWARD:
It's always been most acute in horticulture and in particular with fruit pickers. 

  

Archival tape -- Four Corners report:
“Tonight's programme will show how the nation's biggest supermarket chains are sourcing their produce from some suppliers who use shamefully exploited workers provided by labour contractors.” 

 

EDWARD:
So for the last couple of years, we've been sort of turning our attention to the fruit picker problem in particular, and it was largely because simply nothing was getting done. 

 

Archival tape -- “PsychoTraveller” YouTube vlogger:
“Until the Aus government crack down on this, on their regulations and stop people taking advantage of foreign workers and backpackers then don’t do fruit picking.” 

 

EDWARD:
But it was in 2020 when the McKell Institute was commissioned by the Australian Workers Union to take a specific look at what was going on in Coffs Harbour. 

 

Coffs Harbour is this beautiful part of Australia, which is sort of renowned for its banana industry, but over the last 15 or 20 years has become the epicentre of Australia's blueberry crop, and it was becoming pretty, pretty widely known that the area was rife with exploitation. 

 

So in early 2020, we were commissioned to do a big investigative report on what was happening on the ground in Coffs Harbour. 

 

RUBY:
OK, so can you tell me a bit more about that? Did you go to to Coffs in New South Wales and did you speak to people who were working on the farms there? 

 

EDWARD:
I did. So my team and I spent about four months in the start of the year on social media reaching out to people in any way we could who were either living and working in the Coffs Coast area or planning on travelling there and built up a whole range of relationships with these folks and learnt very quickly what was going on. And that paved the way for a trip, which I did for a few weeks towards the end of 2020, where I was actually on the ground in Coffs Harbour, living effectively alongside the workers, so staying in the backpacker hostels, staying in the share houses which they have, which are these extraordinarily crowded places and actually just going and socialising with them and learning about their experience. 

 

LAUTI:
I came to Australia almost one year and eight months ago. I'm on a working holiday visa. 

 

EDWARD:
So one of the workers I spoke to was Lauti. He's an Argentinian backpacker who was working in the Coffs Coast area, picking blueberries all through 2020. 

 

LAUTI:
It depended on how fast you were basically on it. On a good day for me. Maybe I could do I don't know 10 buckets. And I think they were paying them $7 each. 

 

EDWARD:
So the way that workers are paid in horticulture at the moment is typically on piece rates and piece rates is where a worker is paid a certain amount of money per kilogram or per quantity of fruit picked. 

 

LAUTI:
Yeah, of course, some people were very fast and it was good for them, was good money for them. But it wasn't the majority...

 

EDWARD:
What you quickly realise is that not only are the vast majority of these pickers getting ridiculously underpaid, I mean, some of them were getting as low as three or four dollars an hour routinely. But it wasn't just the underpayment that was exploitative, it was the entire system that had brought them there. 

 

LAUTI:
Sometimes they wouldn't even give you water. They didn't have toilets available. 

 

EDWARD:
There was dodgy accommodation. There were things being extracted from their wages. There were things like making the workers pay for equipment they had to use on the farms. 

 

LAUTI:
They told me I had to pay for my own buckets, for my own belt. I had to pay. I think it was $7 a day for the for the lift.

 

EDWARD:
And this is all being orchestrated by mainly labour hire firms and these other sort of dodgy actors that had descended on the coffs coast area. And they find ways to skim money off the top at basically, every single level of the workers' experience. And it meant that the workers themselves were, you know, not just getting underpaid, but were getting sort of exploited in their entire experience while in the Coff Coast area. 

 

LAUTI:
Every time you talk about Coffs Harbour or Belulga or those area with the blueberries, everyone knows that it's not good, you know, it's not good. It's not a secret. Everyone is kind of not happy about it. 

 

EDWARD:
And it was a really sad environment to be in. 

 

LAUTI:
You're like the reason why there is fruit on the supermarket is at some point, you know, and you're not from here, you're not Australian. I mean, you're doing it for the payslips.

 

It feels like you are forgotten.

 

RUBY:
OK, so after you went to Coffs Harbour and spoke to these workers, heard these stories of exploitation. What did you do with that information? 

 

EDWARD:
So in December 2020, we released a report called Blue Harvest and it got enormous attention. Its headline finding was that workers in the Coffs Coast area were earning just three dollars an hour routinely. 

 

Archival tape -- Sky News report:
“Just onto this report, minister by the McKell Institute that's been published in The Australian today. It's found fruit pickers in Coffs Harbour are getting paid as little as three dollars an hour. What's your reaction to that?” 

 

EDWARD:
And it caused a great deal of national attention for some time that we had responses from the agriculture minister calling our findings disgraceful.

 

Archival tape -- David Littleproud (Sky):
“It’s disgraceful. There's not another way you can. You can sugarcoat it. That is disgraceful and that is exploitation…”  

 

EDWARD:
And that was used by the Australian Workers Union to go to the Fair Work Commission and actually make the case that there should be a minimum wage introduced into the Horticulture Award.  

 

And just last week, the Fair Work Commission handed down that decision. 

 

RUBY:
We'll be back after this. 

 

[Advertisement]

 

Archival tape -- Channel 7 report:
“In what has been described as a historic decision, every farm worker in the country is to be paid a minimum rate of $25 an hour. The Fair Work Commission has made the ruling following evidence…” 

 

Archival tape -- Channel 7 report:
“The new pay laws are one of the most significant industrial decisions of modern times…”

 

Archival tape -- Channel 7 report:
“Following evidence that some fruit pickers received just three dollars an hour because their pay was based on the amount they harvested.”

 

RUBY:
Edward, last week the Fair Work Commission handed down a decision that will impact farm workers across the country. What it means is they will all now be entitled to be paid minimum wage - so 25 dollars an hour. Were you surprised by that result? 

 

EDWARD:
Look for me, it was very surprising. I mean, there were some people who had been pushing for this that were, I think, a little more optimistic than I was. I've probably become a bit too cynical about some of the industrial relations shifts that have been happening over the past few years. So it did catch me by surprise. 

 

But what was so important about the Fair Work Commission’s decision was, firstly, that it basically accepted the premise, which I think a lot of us would have hoped had been a pretty established norm by now that it accepted the premise that every worker in Australia should be entitled to the minimum wage. 

 

Fruit pickers were sort of the last section of the Australian labour market, for whom paying them under the legal minimum wage was actually kind of allowed. Now, it wasn't entirely allowed, but the way that the system worked previously effectively enabled that. 

 

So the decision at least set a floor on horticultural workers wages, which is an incredibly important step forward.

 

RUBY:
Hmm Edward I want to go back and understand how the conditions that enabled the exploitation in the horticulture industry arose. Can you tell me how it began, how this set up, where the agriculture industry is routinely underpaying workers arose? 

 

EDWARD:
So there's always been foreign workers coming into Australia, working in horticulture and agriculture. That's been sort of a key part of our agricultural history for probably over a century. 

 

In 1975, the federal government introduced what was called the working holiday visa and this particular visa allowed workers from the UK, Canada and Ireland to come over to Australia to live and work for up to a year. 

 

And over the 30 or 40 years after that that's actually grown to have 29 countries. 

 

But the biggest change was in 2005, and the Howard government actually amended the visas so that if you were a holidaymaker wanting to stay in the country for a second year, you had to actually complete a prescribed period of agricultural work. This is known as the 88 days clause. 

 

Now, once this condition was basically introduced into the visa, it created this requirement for workers to go out into the regions and to tick off these 88 days as a condition of staying in the country.

 

And that itself created this extraordinary power imbalance because workers were no longer working for the money they were working to make a visa obligation. 

 

RUBY:
Why was that visa obligation put in? 

 

EDWARD:
So there were a couple of reasons. I think one was, you know, there was a genuine desire by some of the working holiday makers to stay in the country for a second or third year, but it was clearly as a response to the need for more labour in the agricultural sector. 

 

And it's pretty evident that how this decision was made was in response to lobbying from the agricultural sector from some of those peak bodies and also the National Party that saw a benefit in creating this system, which would see more labour and frankly cheaper labour flooding to the regions and meet the genuine demands of farmers. 

 

RUBY:
Hmm. And so what impact will this decision from the Fair Work Commission have? Do you think that it is likely to solve the problem of exploitation, but because the visa system is still tied to the work that these people are doing? So do you think that as long as that's the case, there is still this risk of exploitation? 

 

EDWARD:
The commission's decision is extremely important and it is seismic. But you're right, it doesn't actually solve all of the problems in the horticulture industry at the moment. 

 

So long as we have a system where workers in Australia are tied to their employer and where if they abrogate their responsibilities with their employer, they can actually get kicked out of the country - that power imbalance is still going to be there. So there's a few things that still need to be done to make sure that exploitation is completely eradicated from the horticulture sector. But this is such an important step forward. 

 

RUBY:
And what about the employers, the people who are running these farms? What are they saying about the effect of this decision on their ability to run their operations? 

 

EDWARD:
Well, the farmer's perspective is a bit mixed and frankly, a little bit cluttered. I think there's some voices within the farming sector that are really outraged at this decision.

 

Archival tape -- Channel 7 report:
“The Farmers Federation has slammed a Fair Work decision.”

 

EDWARD:
And they worry that this is going to be the end of their capacity to you know, I employ people on the cheap, and it's going to lead to rising prices across the board. 

 

Archival tape -- Adrian Schultz (farmer):
“Wages are well over 50 percent of our costs already. The product is going to have to cost more for the consumer. Or we’re going to have farmers decide it’s just not worth it.” 

 

EDWARD:
But there's other farmers who have been doing the right thing the whole time. There's probably a majority of farmers who are doing the right thing. There's often jobs that you can get on farms that are hourly wage jobs, not piece rate jobs. And for these folks, you know, suddenly they're competing on a level playing field for those guys. You know, this is a really important decision, too, because it creates a level playing field in agriculture for the first time, really in decades.  

 

We have to remember with a crop like blueberries, every single individual berry has been individually picked by two fingers off a plant. Every single berry you eat has had the hands of a often exploited worker touch it. And that's something that you have to actually think about as you're eating and as you're consuming.  

 

But at the same time, it's not always the consumer's fault. There's a responsibility from the government to make sure it's not happening from the supermarket chains to ensure that their products aren't tainted with exploitation. And, of course, from the farming sector to get rid of this from their industry.  

 

RUBY:
Edward, thank you so much for your time. 

 

EDWARD:
Thank you. 

 

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RUBY:
Also in the news today...

 

A new report from the world’s top climate analysis coalition says that the globe is on track to reach 2.4 degrees of warming by the end of the century, despite the 2030 commitments countries have made at COP26 in Glasgow.

 

According to the research, which is based on countries’ short-term climate goals, the world is estimated to far exceed the temperature limits of the Paris climate accord required to avoid catastrophic levels of climate change.

 

**

 

And, Australia’s High Court has ruled that the Northern Territory constable Zachary Rolfe cannot argue in his defense that he acted in “good faith.” 

 

The officer was charged with the alleged murder of 19-year-old Kumanjayi Walker, but his trial was delayed to allow prosecutors to ask the court to throw out the defence, which provides a protection from civil and criminal liability for actions performed in “good faith” during the exercise of police power.

 

Rolfe’s trial has been pushed back multiple times, but is scheduled to take place in February.

I’m Ruby Jones, this is 7am. See ya tomorrow.

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