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Rort fears as 457 visa loophole reopened

The Abbott government has quietly reopened a visa loophole that will allow employers to hire an unlimited number of foreign workers under a temporary working visa, in a move that unions say will bring back widespread rorting of the system.

In the Coalition’s bid to remove all ”red tape” from the 457 skilled migrant visa, employers will not be penalised or scrutinised if they hire more foreign staff than they applied for.

Before the loophole was closed in 2013 by the Labor government, companies in the mining, construction and IT industries were knowingly hiring hundreds more foreign workers than they had applied for.

In one example, an employer was granted approval for 100 visas over three years, but in 18 months he had brought in 800 workers under the 457 visa.

Unions say the move, which was introduced on February 14, undermines Australian job security while deliberately reopening a loophole that can easily lead to the exploitation of foreign workers. ”It is reopening a rort for employers,” said Dave Noonan, assistant secretary of the Construction, Forestry, Mining and Energy Union

”Even if the department checks, there is no administrative measure they can take.”

The Australian Workers Union argues it will exploit vulnerable workers. ”It’s deeply concerning that in a jobs crisis, the government is sneaking through changes that undermine local jobs and conditions,” said AWU assistant national secretary Scott McDine.

In March last year then prime minister Julia Gillard said the visa scheme was ”out of control”. During an election campaign visit to western Sydney, Ms Gillard said she wanted the 457 visa tightened ”to stop foreign workers being put at the front of the queue with Australian workers at the back”.

A discussion paper in 2012 also found there was no restriction to the number of 457 workers a company could nominate once a sponsorship is approved.

In the same year, mining magnate Gina Rinehart famously warned that Australians needed to work harder to compete with Africans who will work for less than $2 a day. Yet in June, the boss of Ms Rinehart’s Roy Hill iron ore project, Barry Fitzgerald, backed away from using foreign workers on 457 visas, saying he was confident he could find the staff locally.

Before the cap was introduced in 2013, the number of 457 visas was quickly rising. In the financial year 2009/10 there were 67,980 visas granted. By 2012/13 there were 126,350 visas granted, statistics from the Department of Immigration show.

Unions are also known to be hostile to the visa class because it has allowed non-union foreign labour to replace unionised local workers.

A spokesman for the Assistant Minister for Immigration and Border Protection, Michaelia Cash, said: ”While the Coalition is … committed to deregulation and the removal of unnecessary red tape, we are equally committed to ensuring the integrity of the 457 program.”

The changes come as the Coalition will review the overall function of the 457 visa, which unions argue is a ”stacked” panel.

”These secretive changes come on the back of the government’s announced review, which has been stacked to deliver a predetermined outcome that will hurt Australian workers,” Mr McDine said.

There are four members on the panel: John Azarias, from Deloitte Australia; Professor Peter McDonald, of the Australian National University; Katie Malyon, from Ernst & Young; and Jenny Lambert, from the Australian Chamber of Commerce and Industry.

Courtesy of The Australian

Administrator’s note:

This recent change is something of a surprise, although rising unemployment has never had any correlation to the skill shortage, because factory and process workers can’t be re-trained as engineers and nurses or other skilled AND experienced professional staff in a 6 week course! Skills in shortage generally have to be satisfied within a short time frame.

I don’t get the CFMEU’s statements that the government cannot do anything about errant employers. If anything loosening the 457 levels makes compliance an even greater incentive and gives the government greater leverage in terms of threat of sanction. The ultimate penalty for employers who breach the rules by attempting to underpay and restrict rights of foreign workers will be banning them from use of the program. The government however must come down heavily on those employers who try to rort the system and it must apply those penalties it has legislated.

The requirement is to pay the market salary for whatever industry, but no less than $53,900. That is not an insignificant salary and is one which is far below many awards in Australia, so if the government sticks to its guns, then that market salary threshold and the increased cost for visa applications, may make dodgy employers think twice about trying to import ‘cheap’ labour. The concept of ‘cheap’ labour is itself a union scare tactic, and the regulations -if rigorously applied and regulated – are more than sufficient to protect rights of the workers and Australians competing because a structured and consistent approach will make it far more complicated and expensive to use overseas staff.