More temporary visa rorting revealed

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By Leith van Onselen

Earlier this year, the Senate Education and Employment References Committee has released a scathing report entitled A National Disgrace: The Exploitation of Temporary Work Visa Holders, which documents the abuses of Australia’s temporary visa system for foreign workers.

The most damning assessments from the Committee were regarding Australia’s Working Holiday Maker (WHM) and student visa holders, who were “consistently reported to suffer widespread exploitation in the Australian workforce”.

Specifically on the WHM (417 and 462) visa program, the Committee noted the following:

A substantial body of evidence to this inquiry demonstrated blatant and pervasive abuse of the WHM visa program by a network of labour hire companies supplying 417 visa workers to businesses in the horticulture sector and the meat processing industry.

It was clear from the evidence that these labour hire companies have a particular business model. There are a number of labour hire companies in Australia with close links to labour hire agencies in certain south-east Asian countries… The scale of the abuse is extraordinary, both in terms of the numbers of young temporary visa workers involved, and also in terms of the exploitative conditions that they endure…

On completion of their ‘training’, the 417 visa workers were given a job where they were required to work regular 12 to 18 hour shifts 6 days a week. They were frequently denied proper breaks and often had to keep working or return to work early after suffering workplace injuries. The pay rates were appalling. Most received around a flat $11 or $12 an hour irrespective of whether this was the night shift, the weekend, or overtime hours. These wage rates are illegal and clearly breach award minimums…

Poor or non-existent record-keeping was endemic across the labour hire companies mentioned in this inquiry. This has serious implications for ensuring compliance with legal minimum conditions of employment. The 417 visa workers never met the head labour hire contractor and only had a mobile number to receive texts about the start time for their next shift. The committee received many documents including fake timesheets and envelopes with a figure scrawled on it instead of a proper timesheet. The workers were paid in cash with no deductions for tax.

When the shift was over, these workers returned to squalid and overcrowded accommodation with no proper facilities, for which they were charged exorbitant levels of rent by the labour hire contractor. The rent payments were deducted straight from the workers’ pay packets, most of the time in clear contravention of the law…

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Today, Fairfax has revealed yet another example of mistreatment of temporary foreign workers, with dozens of Pacific Island fruit pickers underpaid and forced to work excessively long hours:

Workers recruited from Vanuatu last year by Melbourne-based labour hire operator Seasonal Labour Solutions were sent to work on a blueberry farm near Coffs Harbour in New South Wales for several months until January.

Investigations have found 26 workers were forced to work 36 days straight and received illegally low rates of pay.

The South Pacific employees, many of whom spoke little English, were short-changed penalty rates and were denied appropriate rest breaks…

Fair Work Ombudsman inspectors said staff were being underpaid almost $15,000, with the largest individual underpayment $770…

Serious claims of seasonal worker mistreatment have surfaced in recent months on farms elsewhere in New South Wales, and on farms in Victoria and Queensland…

The exploitation of overseas workers has been a recurring theme for the Fair Work Ombudsman in recent years…

80 per cent of foreign language job advertisements were offering wages below legal rates. Many of them were openly advertised as “black jobs”.

It sure feels like Groundhog Day, with abuse and rorting of Australia’s foreign worker visa system ongoing and seemingly widespread.

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About the author
Leith van Onselen is Chief Economist at the MB Fund and MB Super. He is also a co-founder of MacroBusiness. Leith has previously worked at the Australian Treasury, Victorian Treasury and Goldman Sachs.