Labor right to attack rorted working holiday visas

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By Leith van Onselen

Labor and the union movement has sparked a pre-election war with farmers over its plan to restrict access to working holiday maker visas. From The Daily Telegraph:

The Australian Council of Trade Unions is using its influence to pressure Bill Shorten to review the scheme with a view to ban backpackers working for a second year and put further restrictions on work in the first year…

In a submission to a Senate inquiry, the ACTU called for a review of the scheme pushing for the government to cap the number of visas handed out, ban job ads that advertise only for working holiday visa holders and abandon the second year of the program.

It also proposed work rights attached to the visa be remodelled so that it “operates as a genuine holiday visa with some work rights attached, rather than a visa which in practice allows visa holders to work for the entire duration of their stay in Australia”.

An ACTU spokesman said the union was concerned the visa had been “abused by big business to exploit visa holders and to deny locals access to opportunities”…

Opposition immigration spokesman Shayne Neumann refused to rule out backing the proposal and told The Daily Telegraph the number of temporary visa holders in Australia with work rights was “too high”.

The National Farmers’ Federation labelled the demands “ill-considered, ill-conceived and smack of ‘dog-whistle’ politics” and warned politicians against acting on it.

Late last year, a group of academics – Joanna Howe, Alex Reilly, Stephen Clibborn, Diane van den Broek & Chris F Wright – jointly penned an article in Fairfax claiming that the exploitation of temporary migrant workers increased in the wake of visa reforms in 2005 which allowed backpackers to extend their visa for a second year:

Australia already has more backpackers, and relies more strongly on them for horticultural work, than any country. Since 2005, working holiday visa holders can extend their visa for a second year if they work for 88 days in a specified regional industry…

The visa extension makes backpackers dependent on employers – a recipe for exploitation. And it fails to oblige employers to protect against exploitation…

Fair Work Ombudsman report found that the 88-day requirement created a “cultural mindset amongst many employers” where they consider hiring backpackers wanting a visa extension “a licence to determine the status, conditions and remuneration levels of workers … without reference to Australian workplace laws”.

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Unlike agricultural visas in New Zealand, Canada and the United States, and unlike Australia’s own Pacific seasonal worker program, there is no pre-approval of employers. Nor is there systematic ongoing regulation to ensure compliance with workplace laws…

Story after story after story have exposed exploitation on farms…

Several major studies have also found that backpackers are ripe for exploitation.

In 2016, the Fair Work Ombudsman undertook an inquiry into Australia’s backpacker visa scheme, which noted that “many backpackers are being subjected to underpayment or non-payment, unlawful deductions, sexual harassment, unsafe working conditions and other forms of exploitation”.

The Senate’s scathing report, entitled A National Disgrace: The Exploitation of Temporary Work Visa Holders, also documented the abuses of Australia’s Working Holiday Maker visas system, which was “consistently reported to suffer widespread exploitation in the Australian workforce”.

Whereas the 2017 National Temporary Migrant Work Survey found that one in every seven temporary migrant fruit and vegetable pickers were paid $5 an hour or less, and a third earned $10 an hour or less.

At present, there is no labour marking testing before farmers can hire a backpacker. Current backpacker visa arrangements also require no preference whatsoever for local workers.

Given the documented abuses, Labor and the unions are well justified in seeking to curb the abuse of the working holiday maker visa scheme.

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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.