The young Aussies being underpaid

If you're a young person who's worked in retail, hospitality, or other casual jobs, you've probably wondered at some point whether you were not being paid fairly. Now, new research from the University of Melbourne suggests your suspicions are correct.

A major study surveying nearly 3,000 young workers has found that one in three have likely been underpaid, even when you account for junior rates. The findings are stark: around 10% of workers were paid just $10 an hour or less, more than half weren't paid overtime they were entitled to, and one in five weren't paid for work they'd done.

To help us understand these findings and their implications for young workers across Australia, we're joined on today’s podcast by Tom Dillon, Research Fellow at the Centre for Employment and Labour Relations Law at the University of Melbourne, who co-authored this report.

Hosts: Sam Koslowski and Billi FitzSimons
Producer: Orla Maher

Thanks to FoodSwitch for supporting this episode – head to foodswitch.com.au to download the free app and try it out at your next grocery shop.

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Episode Transcript

Speaker 1 (00:00):
Already and this is this is the Daily off.

Speaker 2 (00:03):
This is the Daily OS. Oh, now it makes sense.
Good morning, and welcome to the Daily OS. It's Friday,
the eighteenth of July. I'm Billy fitz.

Speaker 1 (00:19):
Simon's I'm Sam Kazluski.

Speaker 2 (00:20):
If you're a young person who's worked in retail, hospitality
or other casual jobs, you're probably wondered at some point
whether you are not being paid fairly. Now, new research
from the University of Melbourne suggests your suspicions are correct.
A major study surveying nearly three thousand young workers has
found that one in three have likely been underpaid. Even

(00:42):
when you account for junior rates, the findings are stuck.
Around ten percent of workers were paid just ten dollars
an hour or less, more than half weren't paid over
time they were entitled to, and one in five weren't
paid for work they're done. It doesn't stop there. Young
workers told researchers they are forbidden from taking breaks, forced
to complete unpaid trial shifts, and even being paid in

(01:04):
the form of food instead of money. At the heart
of it is a lack of education and awareness about
rights at work, and a lack of leverage to push
back to help us understand these findings and their implications
for young workers across Australia. Sam was joined on today's
podcast by Tom Dillon, research fellow at the Center for
Employment and Labor Relations Law at the University of Melbourne,

(01:25):
who co authored this new report. We'll get to that
chat just after a quick message from our sponsor.

Speaker 3 (01:36):
Tom.

Speaker 1 (01:37):
Thank you so much for joining us on the podcast
this morning.

Speaker 3 (01:39):
Oh my pleasure. Thanks for having me on.

Speaker 1 (01:41):
The first question I wanted to ask you about this
work that you've been doing is whether you framed low
pay to the subjects of your survey as a perception
and a feeling or as a standard.

Speaker 3 (01:55):
There's a few sort of ways to sort of conceptualize that.
The survey insisted of a number of questions which sort
of asked different things and with slightly different criteria. By
and large, it could be characterized as a feeling or
an opinion insofar as we didn't require production of evidence

(02:15):
for the respondent's conclusions. The questions were really just geared
around asking respondents about their perceptions of exploitation or their
experiences in the workplace.

Speaker 1 (02:27):
And so what you essentially found was about one in
three young people are feeling exploited or feeling underpaid. What
does that look like in practice?

Speaker 3 (02:38):
Yeah, well, unfortunately, in part it speaks for itself. There's
a number of alarming statistics that do arise from the survey.
As for what it looks like, I think that really
requires sort of a bit of a think about the
broader picture. And to that end, we did find that
forty three percent had been required to complete work without

(02:59):
additional pay right or complete additional work without pay. But
further to that is also a number of other things
which flow on not just from under payments, but also
other poor experiences. So for example, thirty six percent being
forbidden to take breaks they were entitled to, thirty five
percent having their timeshit hours reduced by their employer, twenty

(03:20):
four percent not being paid superannuation, and just under ten
percent receiving food or products in lieu of money.

Speaker 1 (03:27):
And that last stat really alarms me, as to did
the stat that one in ten workers reported being paid
ten dollars an hour or less. That's less than half
the minimum wage. So I guess my question with that
is how, I mean, let's take that and the food
in lieu of payment in one how are employers getting
away with this kind of thing.

Speaker 3 (03:48):
Really, it's sort of the result of it a number
of things. Young workers in employment relationships, they encounter power
and balances that are sort of inherent within them. Beyond that,
we also can that young workers are less likely to
sort of be informed of their rights.

Speaker 1 (04:05):
Whose job do you think that is? Whose job is
it to inform them?

Speaker 3 (04:09):
I would consider it to be a matter for regulatory authorities.
And that follows on to some of the conclusions we
made in the report where we really implored the regulators
to promote themselves and educate young workers, while also allowing
those young workers to see that the regulators can be
there to help them and that they do have those

(04:30):
statutory functions.

Speaker 1 (04:31):
Because it's an interesting point you raise, right in terms
of the statutory functions, the way that the law is
set out, the structures in place, particularly for casual employment,
might have something to answer for here as well. Is
the actual environment and rules that everyone's playing by aren't
actually fair? Do you think that that's a fair characterization.

Speaker 3 (04:51):
Yeah, Well, a real difficulty with part of the legal
framework as I see it, is sort of a lack
of concrete sort of easily referable standards and limitations. What
it states is that an employer can't ask an employee
to work additional hours that are unreasonable. But in reality,

(05:12):
a seventeen year old at a fast food chain will
have real difficulty enforcing something like that, because it's already
hard enough to come to a supervisor airing a grievance,
let alone, when all you have behind you is a
indefinite legal right that might on might not protect you,
and that might be a matter for a court to decide,
and it makes it really difficult and contributes to the

(05:34):
problem in my view.

Speaker 1 (05:36):
And a discussion with your employer about what the word
reasonable means and doesn't mean with power imbalance out there
in the open playing out, and another area I found
myself thinking of that particular dynamic in your research was
around this idea of you mentioned workers said that they
lacked leverage to negotiate, and I think that that's another

(05:59):
you know, what does leverage actually mean to a young
employee is very different?

Speaker 3 (06:05):
Yeah, absolutely, you know, And you think there's definitely circumstances
where employees in the workforce can have leverage over employers,
but a lot of the time that will only occur
when it's a very high skilled senior employee with a
lot of desirable and rare skills.

Speaker 1 (06:22):
Yeah.

Speaker 3 (06:23):
An issue that confronts a lot of the young workers
is that, you know, just by nature of being so young,
a lot of the jobs they can pick up are
in retail or in fast food things like that, and
in some respects the skills are replaceable in that the
employers at least consider that a lot of other people
can do them, and that really undermines any leverage that

(06:45):
or the minimal leverage that a teenager might have in
the workplace.

Speaker 1 (06:49):
Anyway, can you give me a sense of one level
of detail beneath this idea of young people, and if
there's any particular differences in gender, in cultural and linguistic diversity,
any socioeconomic drivers. Perhaps of the people who responded by
saying that they felt underpaid.

Speaker 3 (07:08):
Yeah, absolutely, And part of the survey results that we
were concerned with was identifying factors like that, and we
arrived at the conclusion that there are a number of
characteristics that do affect and that did bear out in
the survey. Some of those being non males, were more
likely to report exploitation, as were people with a disability.

(07:30):
The same was true of non permanent residents, so say
temporary visa holders, and also having a preferred language other
than English, and those in addition to the precarious working
arrangements as well. So there are all things which we
found to be consistent or indicative of greater likelihoods of
exploitation or mistreatment.

Speaker 1 (07:48):
I've got two more questions for you, Tom, and I
kind of want to bring this into kind of right
here today on Friday. If you could give one recommendation
to a policy maker, what would that be? But also
I'm keen to hear your thoughts on if you could
give one recommendation to a young person listening who might
feel as though they are in the kind of situation
that you're describing, what's one piece of advice for them

(08:12):
as well.

Speaker 3 (08:12):
So as for policymakers, we did provide six recommendations at
the conclusion of the report. I think one that I'm
particularly interested in, and that might sort of be more
of a legislative thing than an in practice thing, would
be consideration of the inclusion of something called a loaded rate. So,
in short, a loaded rate is pretty much an hourly

(08:34):
rate which tries to anticipate and encapsulate penalty rates. So
say if someone was paid one hundred dollars an hour
at a at nighttime and fifty during the day, the
loaded rate would be seventy five.

Speaker 1 (08:47):
Right.

Speaker 3 (08:47):
So I am partial to that recommendation because I think,
as the survey showed, there's so many young people that
aren't paid these penalty rates and that aren't paid the
appropriate amounts, and I think one potentially quite clean way
to do that would be to introduce a loaded rate
which accounts for them, such that employers in some respects

(09:10):
wouldn't have a choice about whether to pay or not
to pay the appropriate rate. As for the young workers themselves,
I would really recommend them to familiarize themselves to the
best extent they can with their workplace rights. I think
it's so easy to sort of just go to work
and not think too much about them and assume that,

(09:31):
especially a large employer, is going to do the right thing,
but unfortunately we found that's not the case. The Fair
Work Umbertsmen publishes a lot of resources online which are
meant for audiences of all ages and competencies, and I
think even getting across some basic ones like entitlements to
be paid more on public holidays, and when you may

(09:53):
or may not be entitled to overtime, how often you
should get breaks at work, even things like that. I
think the most important thing is these young workers recognizing
they have these rights and that's the first step to
enforcing them and making sure that they can be fulfilled
and they do bear out in practice.

Speaker 1 (10:12):
Tom, thanks for joining us on the Daily os this morning.

Speaker 3 (10:14):
Fain a pleasure.

Speaker 2 (10:15):
Thank you so much for having me such a fascinating chat,
and thank you so much for listening to today's podcast.
We'll be back this afternoon with the headlines, but until then,
have a great day.

Speaker 1 (10:30):
My name is Lily Maddon and I'm a proud Arunda
Bunjelung Kalkuttin woman from Gadighl Country.

Speaker 3 (10:36):
The Daily oz acknowledges that this podcast is recorded on
the lands of the Gadighl people and pays respect to
all Aboriginal and Torres Straight Island and nations. We pay
our respects to the first peoples of these countries, both
past and present.