Fairfax’s Michael Pascoe penned a timely article yesterday explaining why ‘skilled’ temporary work visas will continue to be rorted by employers irregardless of the Turnbull Government’s recent reforms to the 457 visa system:
…here’s how to rort the 457 temporary worker visa system and whatever the government renames it.
Let’s use an example of, say, refrigeration mechanics. This is a skilled area in demand…
There is an award for the job, but nobody with the skills works at the award wage – they’re better paid thanks to the demand for their services.
So Dodgy Brothers Refrigeration advertises for refrigeration mechanics at the award wage and, surprise, surprise, receives no local applications.
Under both the existing and proposed systems, this means Dodgy Brothers can charge ahead and hire foreign workers, perhaps in theory paying them the market rate, but more likely the award or the minimum guest worker salary ($53,900 a year – and it hasn’t changed since 2013). In any event, it’s a good deal less than the labour costs of the competitors genuinely competing in the local jobs market.
Dodgy Brothers gains an unfair advantage over its competitors. It also keeps a lid on refrigeration mechanic wages instead of escalating them to the extent of attracting more people to do the training to join the skilled trade.
And this example is why the government’s rebranded 457 visa scheme falls short.
No, you can’t trust employers to do their own labour market “testing”…
Pascoe has usefully identified the key shortcoming of the Turnbull Government’s reforms to the 457 visa system: they left the appallingly low pay floor of $53,900 (non-indexed) in place.
Ridiculously, this pay floor is some 35% below the average full-time salary of $82,789, which of course includes unskilled workers.
By maintaining such a low pay floor for temporary ‘skilled’ foreign workers, the Turnbull Government has ensured the system will continue to be overused and abused by employers, and will continue to undermine the pay and working conditions of local workers.
While there is also merit in tinkering with the Consolidated Skilled Occupations List and implementing independent labour market testing, raising the minimum pay floor so that it at least matches the average full-time salary should be the number one reform priority to ensure that the temporary skilled visa system is no longer rorted.
