International Seafarers Suffer $65 Million in Wage Theft Annually in Australian Waters

Seafarers working on foreign-registered freight ships in Australian waters face regular theft of wages and other entitlements due to legal loopholes and lax enforcement of labour standards, according to a new research report published today by the Australia Institute’s Centre for Future Work.

The report, titled Robbed At Sea, examines records of wage inspections conducted over the last decade by the International Transport Federation (ITF), a global federation of maritime and other transportation unions. The ITF sponsors a small team of 4 inspectors in Australia, to conduct spot checks of international vessels visiting our ports.

Key points:

  • Over the last decade, in close to 5000 inspections in Australian ports the ITF found 70% of ships failing to meet minimum international standards for wage payment and other core labour standards – with resulting recovery orders totaling $38 million over that time.
  • But the ITF team can only inspect a tiny fraction of all foreign vessels visiting Australian ports: about 450 per year, or just 2.5% of visits by foreign-registered ships in that time. On the basis of reasonable assumptions regarding the prevalence of wage theft in the other, uninspected ships, the report estimates total wage theft from international seafarers across the Australian shipping industry of some $65 million per year.
  • Seafarers on foreign-registered vessels (often flying ‘flags of convenience’ to evade labour and tax rules) usually come from low-wage developing countries, and have little power to resist exploitation by unethical ship owners, contractors, and sub-contractors.
  • Stronger rules in port countries (like Australia) are necessary to offer greater protection while they are in Australian waters. But the report identified several loopholes and enforcement failures that explain why these seafarers are routinely exploited, even when delivering cargo from one Australian port to another.

“Australia prides itself on being a country that respects the rule of law, and a fair go for workers. Yet we are allowing some of the most vulnerable workers in the entire global economy to be ruthlessly and knowingly exploited, right here in our own waters,” said Rod Pickette, co-author of the report.

“Repeated inspections have confirmed routine wage theft and other exploitation in our ports,” said Lily Raynes, co-author of the report.

“But those inspections are just the tip of the iceberg. Clearly this exploitation is a normal feature of international shipping, and Australia has both a moral and an economic responsibility to stop it within our jurisdiction,” Ms Raynes said.

The report makes ten specific recommendations for reducing the incidence of wage theft from international seafarers in Australian waters.

Report Recommendations Include:

  • Closing a current legal loophole which allows foreign-registered ships to conduct two trips between Australian ports without needing to respect the Fair Work Act or the Seagoing Industry Award
  • Strengthening inspection resources for the Australian Maritime Safety Authority and the Fair Work Ombudsman to ensure that existing rules are better respected

The report was prepared in cooperation with the International Transport Federation’s Australian Shipping Inspectorate.

It is being released to commemorate World Maritime Day (Thursday, 29 September) – an annual opportunity to raise awareness about the risks and exploitation faced in international seafarers.

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