The exploitation of overseas workers

5 December 2016

The HWU believes that the 457 and other Visa schemes (187,189) that involve the importation of labour (at least 180, 000 people per year and up to 240,000) have the potential to cause more harm than good to the Australian industrial relations framework, employment practices and the community in general.  Workers in unstable employment arrangements are more likely to be disinclined to raise any concerns over pay, conditions and workplace occupational health and safety hazards.  Although the Department of Immigration and Citizenship has the responsibility to monitor employers’ compliance with industrial laws, they do not have the capacity (enough workers or the budget) to fulfil this responsibility.

The remuneration of 457 visa holders presents a significant problem for employees and local Australians competing for work in a similar field and increases the likelihood that overseas employees will be exploited by their employer. Basically, there are two mechanisms that govern what a visa holder is paid. Both of these mechanisms need to be adhered to in order to be compliant with Immigration and Workplace law. 

In September 2009, the Department of Immigration and Border Protection introduced the Temporary Skilled Migration Income Threshold (TSMIT). This threshold ($53,900) sets the minimum guaranteed annual earnings for an employee nominated for a 457 visa. This amount is exclusive of superannuation.

In some instances, for certain classifications, the TSMIT threshold is greater than the minimum wage, Awards and Enterprise Agreements. This means, that Australian citizens doing exactly the same job are being paid less! However, some employers have come up with novel and illegal ways of undermining the system and their workforce. For example, many employers pay the TSMIT to their employee only to have their workers reimburse the employer a negotiated amount via cash payments (a common arrangement used to exploit workers).

Alternatively, some employers that pay the TSMIT to their workers exploit them in other ways to ensure that they can maximize their profits. Apparently, many employers force their workers to illegally work up to 60, 70 or more hours per week and or make them take on extra duties and functions not consistent with the positon description that accompanied their work contract.

Workers in precarious employment are more likely to be reluctant to raise any concerns over pay, conditions and health and safety. Although the Department of Immigration and Citizenship has the responsibility to monitor employers’ compliance with industrial laws, the HWU argues that they do not always have the capacity to fulfil this important responsibility.

The HWU believes that the exploitation of 457 and other visa holders can be prevented or minimized significantly if the government introduces compulsory trade union membership for these workers! The employer or employee would be responsible for paying the membership fee (to the relevant union) and the union can supplement the Department of Immigration and Citizenship monitoring of employers’ compliance with industrial laws.

This proposal will significantly reduce the incidence of exploitation of 457 visa holders and at the same time stimulate the Australian economy. We suggest that 457 and other visa holders be required to hold a compulsory union membership for the duration of the visa or until the visa holder becomes a permanent resident or Australian citizen.

Kamal Bekhazi

Research & Projects Officer

Health Workers Union