When her employer went bust, international student Patricia couldn’t claim her unpaid wages

In the second of a series of reports on international students in Australia, there are fears the coronavirus pandemic and recession could lead to further exploitation and the creation of a new temporary underclass of workers.

Patricia Villa

Patricia Villa lost her job during the coronavirus pandemic. Source: Catalina Florez/SBS News

Like many others in Australia, Patricia Villa fell victim to COVID-19 - not physically, but financially. ​

The 30-year-old from Colombia lost her job when the Sydney giftware shop she worked for was forced into voluntary administration during the pandemic. ​

"It's been heartbreaking because there's nothing I can do," she told SBS News. ​

For almost four years, Patricia studied English and international business, leadership and management at English language school ILSC and training provider the Sydney Business and Travel Academy.​

As she is on a post-graduate visa, Patricia is allowed to work full-time. ​

For more than two years, she worked for a Mr & Mrs Jones store and was eventually promoted to store manager. ​But when the business was wound up in April, administrators estimated she was owed more than $15,000 in unpaid salary and entitlements not including superannuation. ​

Patricia lost her retail job due to COVID-19. Source: AAP

The unpaid salary relates to the two weeks she worked before the business went into voluntary administration.​

She was urged to make a claim with the government's Fair Entitlements Guarantee (FEG), but she is not eligible. ​

It is a safety net only available to Australian citizens and permanent residents, leaving Patricia with no other option other than to hope there is money left over after the voluntary administration process. ​

"I think it's unfair especially because it's money I worked for, it's time I've spent at this company. It was two-and-a-half years where I built a career," she said. ​

Liquidator Suelen McCallum told SBS News that Patricia may qualify as a priority creditor but she is unsure if there will be funds for creditors given the company's small amount of assets. 

Associate Professor Laurie Berg at the University of Technology Sydney has conducted surveys of international students around their treatment and conditions at work. She says the Fair Entitlements Guarantee needs urgent reform. ​

"The Fair Entitlements Guarantee should be open to anyone who has worked in this country. International students are workers under national labour laws and they should be entitled to the same benefits as Australian residents and citizens when their employers go bankrupt," she said.  ​

"We also need an effective and accessible wage recovery forum as well. The Fair Work Ombudsman is not a worker advocate and it is not set up to conduct large scale wage recovery in individual cases, and they only investigate a very small number of cases anyway."​

The Fair Entitlements Guarantee is not available to temporary visa holders including students. Source: AAP

Industrial Relations Minister Christian Porter said: "Whilst the government is still considering the recommendation concerning the FEG, significant action has been taken to address migrant worker exploitation in recent years". ​

Shadow Education Minister Tanya Plibersek said: "We are open to considering anything that prevents workers from being exploited at such a difficult time".​

With a recession taking hold in Australia, having no safety net for international students is bound to become a more urgent issue as businesses struggle to stay afloat, leaving many students even more vulnerable to not being paid what they're owed. ​

Dr Angela Lehmann is an education consultant with international education specialists the Lygon Group. She says it is a recipe for disaster.​

She says not only are some students struggling because they have lost their jobs due to the pandemic and aren't eligible for government support, their other source of support - their family back in their home country, may have also been impacted financially by COVID-19. ​

"We also have here in Australia, businesses in the hospitality and retail sector that are struggling themselves and are needing to cut costs in order to maintain their business. So we have a situation where we have the potential for exploitation of international students and the potential creation of a new temporary underclass of workers in Australia."

Government data showed there were more than 628,000 internationals students in Australia between January and April this year.​ They are allowed to work up to 40 hours per fortnight with exceptions made during the COVID-19 pandemic for those working in aged care and nursing. ​

Given many work in retail and hospitality - sectors hit hard by COVID-19 - the threat of bankruptcy and no government safety net is a reality for lots of students.​

Fortunately for Patricia, she has now found another full-time job in retail and is hoping the situation doesn't repeat itself. ​

"Retail is an area which has high staff turnover but it's also where lots of international students, a lot of people on temporary visas, find an industry where it's easy to find work," she said. 

"Definitely this could happen again in future and worse." 

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5 min read
Published 30 June 2020 at 5:41am
By Catalina Florez