A wave of underpayment cases is forcing employers to confront why migrant workers are exploited and what compliance requires
Another migrant worker underpayment case is before the courts – this time a $93,257 claim against the operators of an IGA supermarket in Narrandera, regional New South Wales, filed by the Fair Work Ombudsman (FWO) in July 2026.
The specifics will play out in the Federal Circuit and Family Court. But the case is really just the latest data point in a much bigger, persistent problem: why do migrant workers keep getting underpaid, and what should HR actually be doing differently?
Associate professor Anna Boucher, of the University of Sydney and senior counsel at Fragomen Global Law Firm, has researched labour market breaches across multiple countries and identifies three overlapping drivers. The first is visa dependency itself.
"They're susceptible to being underpaid because they're on visas," Boucher said. "A lot of migrants are on temporary visas, so sometimes those visas can be used to pressure migrants to engage in suboptimal employment by the employer."
The second driver is simple complexity. Boucher said neither employer nor employee is always aware a breach of immigration or employment law has occurred, particularly as legislative change accelerates.
"Because what we're seeing in legal practice is you've got a lot of changes happening to the Fair Work Act and the Migration Act, new forms of intersection, but changes in HR personnel, and they're not necessarily keeping track adequately of the particular migrant's visa journey," she said. "And that's where sometimes breaches can occur, not only of employment law but also of immigration law."
The third factor, Boucher said, sits alongside – and sometimes compounds – the other two: discrimination. "We still know that there are some instances of racialised treatment of migrants in the labour market," she said. "That still exists. We still see complaints before, for instance, the Human Rights Commission."
Her research found a high rate of intersection between underpayment and race discrimination, meaning a single case can involve visa pressure, genuine confusion over entitlements, and bias all at once – which makes the root cause difficult to isolate.
Laurence McLean, director of operations at Peninsula Australia, sees the same vulnerability from the enforcement side.
"I definitely think migrant workers are a target area for the Ombudsman, so we know the Fair Work Ombudsman specifically looks out for underpayments or issues around migrant workers because they do see them as more vulnerable," he said.
In his experience, most non-compliance is not deliberate. "The overwhelming majority of clients that Peninsula deals with definitely want to do the right thing," he said, pointing instead to difficulties with award interpretation and classification, and workers who delay raising concerns for years out of fear of jeopardising their job or visa.
The size of the temporary migrant workforce means these risks are not confined to a handful of employers. The Australian Bureau of Statistics (ABS) found migrants held 26.3 per cent of all jobs in Australia in 2019-20 – 5.3 million jobs performed by 3.6 million migrants – with 29.5 per cent of those migrant-held jobs filled by temporary visa holders, according to data cited alongside recent Federal Court penalty rulings against employers found to have exploited migrant staff.
Some workplaces, Boucher noted, have far higher concentrations still, which raises the stakes considerably for sectors such as agriculture, hospitality, retail and the fast-growing data centre industry.
How HR can close the gaps
Both interviewees pointed to the same underlying fix: continuous, structured review rather than a one-off check at the point of hire. "It's really an ongoing requirement. It's not just a set and forget," McLean said, adding that employers should regularly reconfirm award classification, pay rates and duties as roles change, rather than waiting for a complaint or a legislative deadline to prompt a review.
Boucher recommended dedicated immigration compliance software linked into core workforce systems. "That will give you alerts when a visa is coming up for renewal, or a new visa needs to be applied for, or maybe the person's come to the end of their visa status and there are no options," she said.
She also urged organisations to build visa status into standard workplace handbooks and HR procedures – something she said is still rare in practice – rather than leaving it with a single staff member whose departure can create a compliance blind spot.
McLean framed the additional diligence required for vulnerable cohorts as a straightforward extension of ordinary HR duty. "If you are hiring a vulnerable worker, you've actually got an additional obligation to double-check you're getting things right, because as I said earlier, they might not be as aware of their own rights," he said.
He also pointed to a governance dimension that often surprises business owners: new federal measures tackling worker exploitation now put businesses on notice that personal liability for directors and officers can follow underpayment findings, not just liability for the company itself.
With further back-pay orders against other supermarket operators emerging alongside the Narrandera matter, the message for HR and payroll teams is consistent: treat visa and award compliance as an ongoing governance function, not a box ticked at onboarding.
