Chapter 2Key issues
2.1This chapter outlines some key issues raised in evidence to the committee about the Migration Amendment (Strengthening Employer Compliance) Bill 2023 (thebill), including:
the new offence and civil penalty provisions;
the prohibited employers framework; and
the minister's visa cancellation powers.
2.2This chapter also articulates the committee's views and recommendations in relation to the bill.
Offence and civil penalty provisions
2.3Evidence received by the committee expressed broad support for the introduction of new offence and civil penalty provisions in the bill.
2.4Some of the evidence suggested that the bill could more precisely define the following terms and phrases:
‘arrangement in relation to work’:
‘undue coercion’;
‘undue influence’; and
‘undue pressure’.
Arrangement in relation to work
2.5Some of the evidence raised concerns that the phrase 'arrangement in relation to work' is not broad enough to cover all of the exploitative arrangements experienced by migrant workers.
2.6The Migrant Justice Institute (MJI) raised concerns that:
Traditional understandings of arrangement in relation to work may be physically limited to the workplace, or terms and conditions of employment. Therefore, there is a risk that without clarification, this provision will fail to capture a range of exploitative arrangements that the Bill clearly seeks to address.
2.7The Uniting Church in Australia, Synod of Victoria and Tasmania suggested that the phrase 'arrangement in relation to work' needs to be:
…broad enough to cover known exploitative conditions to which migrant and temporary workers have been subjected. For instance, it should cover where Working Holiday Makers are made to submit to sexual harassment or sexual acts, as well as sub-standard accommodation and withholding of passports, to receive their employer's sign-off for 'specified work' to gain an extension on their visa.
2.8The MJI recommended that a legislative note be inserted under proposed section 245AAC to define ‘arrangement in relation to work’ as:
…any arrangement entered into by the visa holder in response to an implicit or explicit request by the employer/principal. This includes, but is not limited to, an arrangement in relation to working conditions, accommodation, or physical conduct.
2.9Associate Professor Bassina Farbenblum suggested that paragraph (1)(c) should be deleted from proposed sections 245AAB and 245AAC to cover the wider range of coercive practices used by some employers. The paragraph:
…requires that the arrangement provides for the work to be done, so it actually makes it impossible to expand "arrangement" because it limits it only to the performance of work, not other things that may be used in order to coerce someone.
2.10The Department of Home Affairs (Home Affairs) explained that the new penalties are intended primarily to deter employers from using their:
…position either to coerce or unduly influence the worker to breach a condition of their visa or to threaten them with a consequence. Theygenerally relate to the employer-employee relationship under the Migration Act or the Fair Work Act rather than other types of acts that could imply that kind of coercion.
2.11A departmental representative explained that the phrase 'arrangement in relation to work' is broad enough to cover the exploitative conditions to which migrant workers are known to have been subjected.
2.12Home Affairs advised that the phrase has been intentionally drafted in this manner:
Appropriate coverage of exploitative behaviour is best achieved by not defining ‘an arrangement in relation to work’. If the Bill were to define the ‘arrangement in relation to work’, there is a risk that some kind of exploitative conduct may be inadvertently excluded.
Definition of fault elements
2.13The Law Council of Australia (Law Council) pointed out that the term 'undue' is not defined in relation to the new employer sanctions contained in the bill. The Explanatory Memorandum (EM) indicated that '[u]nder the general law, undue influence or pressure is a lower threshold than coercion'.
2.14The Law Council questioned whether it is necessary to include the term 'undue' in the context of the new employer sanctions:
…for conduct to amount to an offence, the employer must know or be reckless to the fact that the proposed work arrangement will result in either:
the visa holder breaching a work-related condition; or
believing that the employer will take an action which has an adverse effect on their immigration status by reporting them to the Department or withholding information they are obliged to provide to the Department.
2.15It argued that the term 'undue' is unnecessary because:
…if the prospective employer knows that the proposed work arrangement will have those results, any degree of influence or pressure exerted to accept or agree to that arrangement could fairly be characterised (as a matter of policy) as being undue, and meritorious of criminal sanction.
2.16The Law Council suggested that the penalty provisions:
…be simplified so that they are directed to capturing the intent to overbear on the migrant worker to accept a work arrangement against their interests which gives rise to the potential for exploitation.
2.17Dr David Neal SC suggested that the term 'undue' places an 'extra note of caution on the employer…Taking it away would help the policy of the legislation—that is, it would make it more strict'.
2.18Ms Carina Ford agreed that the word 'undue' is unnecessary, as it is:
…hard to imagine an example, if you are putting pressure on someone, for example, to work over their hours, where you would need the word "undue" if it's going to be a breach. So our position is that it adds an extra test to the process that's unnecessary for the purposes of this legislation.
2.19The Australian Chamber of Commerce and Industry (ACCI) argued that the bill does not adequately define ‘coercion’, ‘undue influence’, and ‘undue pressure’:
Without a clear legal definition, employers may inadvertently commit actions that could be interpreted as coercive, without the intention to exploit their workers. This leaves employers unsure as to what behaviours, actions or contexts might be considered coercive.
2.20The ACCI also argued that '[t]he relationship between employers and employees is inherently hierarchical, with the employer often having more power'. Itexpressed concern that, without precise definitions, 'the normal exercise of this power (for instance, reassigning an employee to a different task, enforcing company policies, or managing underperformance) might be misconstrued as coercive'.
2.21The ACCI was similarly concerned about what constitutes coercion in relation to the enforcement of visa conditions. It noted that '[w]ithout explicit guidelines as to what constitutes coercion in relation to enforcing these conditions, employers might unintentionally breach the legislation while trying to remain compliant with the visa rules'.
2.22ACCI’s Ms Jessica Tinsley recommended that the proposed legislation 'actually define what is meant by coercion, to put that without doubt'. She indicated, however, that the ACCI does not have a view on what that definition should be.
2.23Dr Neal argued that the term 'coercion' does not require further clarification in the legislation as:
…there comes a point where the plain meaning of the word "coercion" will be understood by a judge or a jury or a magistrate who is hearing the case. It is not really one of these words that is capable of further definition…Basically, the usual legislative drafting provisions are that if you have a word that is in common use in the English language then that is the meaning that will be attached to it by a jury and the judge won't interfere with that.
2.24Dr Neal further explained that a jury would:
…make a community-informed judgement about the legitimacy or non‑legitimacy of what is being done. In a circumstance where the evidence is that the employer knew that this was in breach of one of the conditions of the person's visa status of their work permit, the amount of pressure will be influenced by that, and we would expect in most circumstances that if you are trying to get someone to do something which you know is unlawful, you are going to be found guilty.
2.25Dr Neal also pointed out that the word 'coercion' needs to be read alongside the terms 'influence' and 'pressure':
The word 'coercion' has to be read along with the criminal intent, which is to get someone to breach one of the conditions of their work permit or visa status…you are going to have to make an evaluation of whether or not the pressure that was brought to bear was legitimate or illegitimate, justified or not justified. Quintessentially, those jury-type questions are for a judge or a magistrate hearing the case—they will make an evaluation and say, 'In all of these circumstances, what you did was illegitimate, unlawful and breached this provision.' Keep in mind that the word 'coercion' is going to be understood in the overall context of the three words: coercion, influence and pressure.
2.26The ACCI also raised concerns about the 'fault elements' that refer to 'knowledge' and 'recklessness'. It explained that those terms 'can potentially have a multitude of interpretations and [that failing to define them] will result in legal ambiguities that will cause confusion among employers'.
2.27The ACCI argued:
…it is crucial that precise definitions and comprehensive interpretive guidelines for these terms — 'knowledge' and 'recklessness' — are integrated into the legislation. By doing so, it will provide greater clarity and a stronger sense of legal certainty for employers.
2.28It suggested that 'a comprehensive guide or resource for employers that clearly illustrates the practical applications of these "fault elements" and provides guidance on how to avoid legal pitfalls' is required. Providing that resource 'would foster a more cohesive, comprehensible, and fair implementation of the proposed legislation for employers and employees'.
2.29Fragomen (Australia) Pty Ltd (Fragomen) did not agree that there is a need to define the terms in the bill. Itstated that the bill aligns 'the definitions of coercion, undue influence, and undue pressure with the interpretations under the general law'. It supported that alignment as it mirrors the 'principles [contained] in the Fair Work Act and general case law and avoids further confusion'.
2.30The Law Council’s Mr Matthew Wood pointed out that there are provisions in the Migration Act 1958 (the Migration Act) that are predicated on the knowledge or recklessness of an employer. By way of explanation, he cited section 245AC:
…which deals with allowing a person to work in breach of a work related condition. A person contravenes that provision if they allow, or continue to allow, a person to work in breach of a work related condition, and that doesn't apply if they've taken reasonable steps to check that they wouldn't be in breach of a work related condition for the purposes of doing the work. In that case, for the person who allows the other person to do the work in breach of the conditions, the fault element for the breach of the condition is, again, knowledge or recklessness.
2.31Home Affairs highlighted that the department had carefully considered the terminology used in the bill:
It captures a range of types of work relationships. Importantly, it captures individual persons and body corporates; labour hire intermediaries; phoenixing practices; undocumented work such as sexual services or domestic workers; paid or unpaid work; and other entities in the supply chain. The terminology around framing of offences and work is consistent with part of the Migration Act that are already established to issue employer sanctions. It was important in drafting this legislation to mirror existing definitions, which have been crafted to have the desired policy effect.
2.32A departmental representative stated that 'coercion may involve compelling a noncitizen to agree to a work arrangement by use of force or threat through conduct that may be unlawful, illegitimate or unconscionable'.
2.33He also gave evidence that the qualifier 'undue' is necessary in the bill as it:
…ensure[s] the new provisions send a clear signal that the intention of the conduct should be unwarranted, unjustified or excessive. These terms are consistent with the approach adopted across other Commonwealth legislation that includes offences and civil penalty provisions and remedies, including the Fair Work Act.
2.34In relation to the fault element of the new offences:
…knowledge or recklessness, is consistent with the existing work related offences under the Migration Act's employer sponsor framework. Forexample, the fault element to the existing offence of allowing an unlawful noncitizen to work is knowledge or recklessness. This ensures that it would not be acceptable for a person to rely on a claim that they simply did not inquire about the work related conditions of the worker or prospective worker, which is already a requirement under the law. It'salready a lawful requirement for the employer to check the visa status and working conditions of the employee, so this is consistent with that principle.
2.35In the view of Home Affairs, it is appropriate to rely on the common law definitions of 'coercion', 'undue influence' and 'undue pressure'.
2.36The Department of Employment and Workplace Relations (DEWR) added that these terms are also not expressly defined in the Fair Work Act 2009 (Fair Work Act).
The prohibited employers framework
2.37Many submitters voiced broad support for the introduction of the prohibited employers framework.
2.38The Federation of Ethnic Communities' Councils of Australia (FECCA), for instance, noted that the prohibited employers framework would provide employees with '[a]ccess to comprehensive and relevant information on prospective employers [which] will enhance transparency, accountability, and ultimately the protection of temporary migrant workers'.
2.39Conversely, the Housing Industry Association (HIA) suggested that 'the publication of the details of a prohibited employer, regardless of the circumstances that led to the offence is harsh'. It argued:
The publication of prohibited employers should only apply to those employers subject to criminal penalties, or those who have been proven to repeatedly engage in offending conduct. Additionally, employers should have the opportunity to request the removal of publication, especially in circumstances where they are able to establish or provide evidence that their contravening conduct has been rectified.
Implications of the prohibited employers framework for employers
2.40Several organisations representing businesses and employers suggested that the provisions of the bill should be introduced over a transition period to allow affected parties time to adjust to the new regulatory requirements.
2.41The ACCI suggested that employers must not be declared prohibited until after 'accessible and simple guidelines that outline the new obligations faced by their business' are issued.
2.42The FECCA similarly suggested that information should be provided to employers and employees about their rights and obligations. That information 'should be available in a variety of formats and in their preferred language and be disseminated from a trusted source'.
2.43ACCI representative Ms Tinsley explained that employers will generally use resources provided by government to understand their obligations. She noted that there is a need for 'more materials or more resources to be made available to understand what an employer's obligations are because what's out there is severely lacking'.
2.44The National Farmers’ Federation (NFF) Executive Officer, Mr Richard Shannon, suggested that the online resources provided by the Fair Work Ombudsman in relation to the horticulture award could provide a model for the development of educational material to assist employers in understanding their obligations.
2.45The NFF suggested that there should be a range of responses to businesses that transgress their obligations:
It is essential that the Minister and his delegates use their new regulatory powers in a considered manner, ensuring that the outcomes are always fair, just and proportionate…The powers must be used in a way which bears in mind the actual consequences of those powers, and the consequences must be balanced and in keeping with the nature of the contravention. While bad actors must be punished accordingly, those that are trying to do the right thing must be allowed to carry on in their business once their mistakes are corrected and made good.
2.46The HIA argued that '[e]mployers should not be excluded from employing migrant workers due to a mistake or lack of knowledge'.
2.47Mr Shannon suggested that '[t]here needs to be some graduation in terms of being given notice and an opportunity to correct the way in which businesses are operating'.
2.48Home Affairs advised that the bill would 'support a graduated approach to compliance and enforcement'.
2.49In addition, Home Affairs submitted that the prohibited employers framework is intended 'to protect temporary migrant workers from unscrupulous employers'. Migrant workers will not be penalised and '[t]he employment status of existing workers is not affected – they can choose to continue working for a prohibited employer, or not, subject to any work-related conditions in their visa'. Home Affairs explained that, under the framework, employers who have been found to have:
…engaged in serious, repeated or deliberate non-compliance of specified laws (including certain offences under, or breaches of, the Migration Act, the Fair Work Act and the Criminal Code) will be prohibited from allowing any additional temporary migrant workers to begin work for a specified period.
2.50The department further explained:
It is anticipated the Minister (or delegate) would prioritise and primarily be concerned with targeting those engaged in serious, deliberate or repeated forms of non-compliance to ensure that they are unable to continue with that behaviour. This decision will always follow, and be informed by a natural justice process.
2.51As noted by one representative:
Consideration is intended to be given, through regulations, to past and present conduct of the employer; impact on the business and community; impacts on the workers; and the severity of the breach. The minister's intent is that these penalties will apply for serious, deliberate or repeated noncompliance.
2.52Home Affairs highlighted that '[i]t is proposed the Minister's decision to declare a person to be a prohibited employer is subject to merits review', with prohibited businesses able to access administrative review and ‘judicial review is available for those breaches of the Fair Work Act or migration rules that form the triggers for the prohibition'.
2.53Home Affairs noted that an employer will have at least 28 days 'to make a written submission setting out reasons why the Minister should not make the declaration'. That written submission must be considered by the minister in addition to:
…any criteria prescribed in the Migration Regulations. Such criteria might include consideration of the impact of the conduct on the migrant worker(s), the person's previous history of compliance and the potential impact on the viability of the person's business if declared a prohibited employer.
2.54A departmental officer explained that the legislation would commence up to 12months after the passage of the bill. He indicated that this time would allow for communication and education in relation to the changes, with the educational component developed as part of the $50 million additional funding provided to the Australian Border Force:
That additional funding is being used for raising awareness amongst employers of their obligations under the Migration Act in partnership with the Fair Work Ombudsman. It's also being used for issuing of existing employer sanctions that exist. Where there are breaches of the current law, those will be brought forward as well to raise that awareness amongst industry of their obligations now ahead of new powers coming in. That activity is ramping up from now.
The minister's visa cancellation powers
2.55Three migrant workers gave evidence to the committee that outlined their lived experience of work-related exploitation. They all explained that migrant workers are often reluctant to report work-related exploitation due to fears that their current, or future, visa could be cancelled if they do so.
2.56Ms Jed Pica, a former international student who worked at a café in Melbourne, explained that she highly valued her visa and would not report work‑related exploitation unless there were a guarantee that it would not be cancelled:
The government should understand that, for international students, their visa is everything. It is worth more to them even than stolen wages or safe conditions at work. Even if they have not done anything wrong, if they are threatened with cancellation, students will just put up with it. Even in my case, when I found out that my employer was threatening me, I felt so ashamed. I thought that I had done something wrong, by working cash in hand. I really thought that, if he reported me to immigration, I would not know what to say. That is why I didn't take my case any further to the Fair Work Commission. I really think that there has to be a guarantee against visa cancellation for students and other visa holders if they have been underpaid or exploited. This is what we need to make sure that students feel safe and equal at work, even if employers threaten them. Students will never trust that the department will believe them. They will always feel that the department will listen to their employers word before theirs. It's only with a guarantee that they will actually be able to stand up for themselves at work. And I hope that this would make pay and conditions better for everyone, not just students.
2.57Mr Bishal Sapkota, an international student who worked as a cleaner in Canberra, explained to the committee that a visa 'is not just a legal piece of paper. It is hope for our parents, our dreams for the future and our path to make a better life'. He stated that '[m]y visa is the most important thing, even more important than lost money or time, and our managers know this'.
2.58Mr Sapkota informed the committee that after he and a co-worker sought to claim unpaid wages from his employer, his manager threatened to have them deported. He stated:
My co-worker and I are worried all the time about what the manager could do. What if he makes a false report to immigration with fake records? Even though we are not doing anything wrong, it is just our word against his. Ofcourse immigration will believe him before us. This threat makes me regret taking action against my boss. I didn't think it was right for the people to have their money stolen and then be forced to stay silent. I didn't expect that the law would be like this in Australia.
2.59Mr Massimo Calosi, a migrant who worked as a chef in Melbourne, echoed the views of the other migrant workers:
The common factor, though, that stopped me and my fellow migrant workers from speaking up was the fear of having our visas cancelled. As it stands, that is literally a weapon that is getting used recklessly against workers by bad bosses. We're talking about people who call this place home. Here we have families, we have friends, some of us have a footy team and all of us have dreams and hopes.
As migrants going through the visa process we are often asked to understand and embrace Australian values. A guarantee against visa cancellation for workers who speak up is not only a historic improvement for workers in Australia but also a clear and strong message that here in Australia we believe in embracing the values of safety, respect, equality and justice for our workers.
2.60Several submitters and witnesses suggested that the amendments to the minister's visa cancellation powers do not provide adequate assurance against visa cancellation for migrant workers to feel safe in reporting work-related exploitation.
2.61Mr Jarrod Tan from Democracy in Colour explained that migrant workers do not have clarity on how the existing Assurance Protocol would protect them if they were to raise allegations of work-related exploitation.
2.62Dr Mark Zirnsak reflected that, in his experience, 'Border Force has been very good at not cancelling visas for workers'. He stated that the Uniting Church in Australia, Synod of Victoria and Tasmania would 'still advocate very strongly for the notion of a guarantee, because the workers don't know that' the ABF often acts with that degree of leniency. He further indicated that '[j]ust because I haven't had a case where Border Force has cancelled a worker's visa, doesn't mean it doesn't happen. I don't want to pretend that's not the case'.
2.63The Grattan Institute explained that the Assurance Protocol provides migrant workers a means to report work-related exploitation without the fear of having their visa cancelled. A migrant worker who reports work-related exploitation will not have their visa cancelled:
…as long as: the migrant has sought advice or support from the Fair Work Ombudsman and is helping with inquiries; there is no other reason to cancel the visa (for example, for national security or character reasons); and the migrant has committed to following visa conditions in future.
2.64According to the Grattan Institute, 'the Assurance Protocol has rarely been used. Between 2017 [when it was established] and 2021, only 77 temporary visa‑holders used' it.
2.65Democracy in Colour argued:
…the Assurance protocol is not all‑encompassing and does not extend to government regulators outside of the Fair Work Ombudsman and the Department of Home Affairs. It is unclear if the proposed amendments would be applicable to migrant workers in all manner of exploitative situations. Additionally, the Assurance Protocol heavily relies on the migrant pursuing their employer. That is, the migrant worker must navigate a complex work right system, have demonstrated that their claim of exploitation is valid and be at the stage of an investigation taking place by the Fair Work Ombudsman to access the protections it provides. Needless to say, the exposure that this opens the migrant worker up to, let alone the complexities of progressing a complaint to this stage, act as layers of disincentive upon disincentive. Ultimately, this will prevent the worker from seeking a remedy for the situation they find themselves in.
2.66Mr Kunkel contended that the Assurance Protocol is 'very restrictive'. He explained that migrant workers often approach non-government organisations seeking to report work-related exploitation. Those organisations do not have access to the Assurance Protocol and 'can't provide them the assurance that their visa won't be cancelled'. Many migrant workers will decide not to report cases of exploitation as they have not been given that assurance that their visa will not be cancelled.
2.67Mr Kunkel further suggested that some migrants are not only concerned about losing their existing visa but are also concerned 'about adverse outcomes for their future visas'.
2.68Mr Thomas Costa advised that many migrants are reluctant to 'go to the Fair Work Ombudsman because, in order to access the assurance protocol, they have to first disclose their situation'. They believe that doing so could result in the cancellation of their visa or lead to the refusal of a future visa.
2.69For example, the United Workers Union noted that '[t]he amendments maintain a discretion to cancel, not a guarantee against cancellation of an exploited worker's visa'. The proposed amendment would still allow the minister or their delegate 'to consider any other matter that they considered to be relevant…[enabling them] at their discretion, to cancel an exploited worker's visa'.
2.70The Australian Council of Trade Unions (ACTU) submitted that the bill 'fails to provide temporary migrant workers with a protection against visa cancellation'. It noted:
Visa cancellation can have a dire effect on temporary migrant workers, and the threat of visa cancellation—even if there is no substantive basis for cancellation—has a chilling effect on workers' ability to report exploitation, leading to them accepting exploitative and unsafe conditions of work rather than their rights.
2.71FECCA submitted that 'unless the amendments provide an explicit guarantee against visa cancellation of a migrant worker who reports exploitation, reporting will continue to remain low and exploitative workplaces will go unaddressed'.
2.72Democracy in Colour suggested that the proposed amendments:
…have the potential to create conditions where the migrant worker could potentially be at higher risk due to the Minister's discretion and the manner in which determining the weight of factors and the factors themselves are considered. This could enable the Minister to assess grounds for cancellation in a discretionary manner under subsection 116, but without providing any certainty to the exploited worker. In this way, it is not clear how this would shift the cancellation mechanism in a manner that would provide assurances to migrant workers and contribute to the removal of visa cancellation as an initial cause for concern'.
2.73The Law Council noted that the bill seeks to authorise 'the making of regulations which are claimed to provide certainty against visa cancellation' for migrant workers reporting work-related exploitation. It explained that the 'amendments will not achieve the objective where there remains a discretion to cancel'.
2.74It further clarified that it would prefer that the regulations outline the circumstances in which the minister may not cancel a visa 'as opposed to discretion as to whether or not to cancel'.
2.75Democracy in Colour supported that suggestion:
…the Minister should have prescribed circumstances under subsection 116(2) where a visa must not be cancelled if there is any evidence of workplace exploitation. This change must allow for migrant workers to be protected at the earliest opportunity. Without these protections concerns related to an onerous and complicated process will prevent workers from seeking a remedy and render the rest of the proposed amendments meaningless.
Exploited Worker Visa Guarantee
2.76The ACTU indicated that there is widespread support for a stronger guarantee against visa cancellation for migrant workers who report work-related exploitation. It outlined that one proposed model, the Exploited Worker Visa Guarantee, would involve:
…the Minister issuing regulations for the purpose of s116(2) of the Act, which provides that a visa must not be cancelled under particular circumstances. That instrument should specify that the circumstances include where there is prescribed evidence…that the visa holder had been subject to a non-trivial breach of labour law.
2.77The Migrant Justice Institute proposed that the model would guarantee visa holders with protection against visa cancellation provided that the:
…visa holder produces expert independent evidence in the form of a certification that the visa holder is, first of all, pursuing a meritorious claim—so the certification would attest that there is evidence of a bona fide claim or a proper basis for the claim—and only in relation to a non-trivial breach of labour law, including basic employment law contraventions but also sexual harassment, workplace health and safety breaches and others. That requirement of a non-trivial breach should be defined in a legislative instrument—for instance, specifying that it must be underpayment over a certain threshold, like $2,000. A less serious breach, a breach that is more easily remedied, would not be enough to ground an application for these protections.
2.78Under that model, the migrant worker would obtain expert certification to demonstrate that they are 'taking action in relation to exploitation' and their visa could not be cancelled. The expert certification would be provided by a relevant government agency or a lawyer working for a union, non-profit legal practice, or an accredited employment law specialist. Limiting certification in this way would reduce the chance of false certification and limit the number of applications.
2.79The Migrant Justice Institute and Human Rights Law Centre understood that Home Affairs 'is reluctant to offer an indemnity against visa cancellation'. It is not proposing such an indemnity, instead it is seeking 'a protection against cancellation on one ground, and one ground only, under section 116'. MsSanmati Verma clarified that the power to cancel a visa under national security or adverse character grounds would still be available.
2.80Home Affairs advised that the amendment of section 116 would:
…permit the Migration Regulations to prescribe matters the Minister (ordelegate) may, must or most [sic] not take into account when exercising discretionary visa cancellation powers…as well as the weight to be given to those matters.
2.81It further advised that cancellation decisions made under section 116:
…are discretionary, and where there is clear evidence of exploitation, Home Affairs has had a long-standing policy of not pursuing visa cancellation for breach of a work-related visa condition. The Government has been working with key stakeholders to strengthen trust in these protections, and codifying these protections in the Migration Review will provide greater transparency about the underlying intent. This regulation-making power will enable the Government to give effect to this intent. Migration Regulations made under this provision will be subject to parliamentary scrutiny and will be disallowable.
A 'firewall' between the Fair Work Ombudsman and Home Affairs
2.82Scarlet Alliance argued that migrant workers will only feel safe in reporting workplace exploitation if they have access:
…to redress mechanisms such as Fair Work, WHS [workplace health and safety] authorities, and legal aid; and the creation of a "firewall" between these bodies and the Department of Home Affairs to protect migrant workers from visa-related repercussions when they speak out about industrial issues.
2.83Mr Costa explained that without a:
…firewall between the Fair Work Ombudsman and the Department of Home Affairs…there is always that risk [that] if [a] migrant goes to the Fair Work Ombudsman that their information can be accessed by another government department.
2.84Conversely, if the migrant were able to report work-related exploitation to a union or other non-government entity, they would be able to 'offer them client legal privilege and that information cannot be shared with anyone else'.
2.85Home Affairs confirmed that there are measures underway to implement an effective firewall between the department and the Fair Work Ombudsman:
…there is work ongoing alongside this particular bill…We are looking at the current working arrangement between Home Affairs and the Fair Work Ombudsman and the creation of a firewall, and we are looking at whether the actual visa that a person holds throughout a process of cooperating with the Fair Work Ombudsman is appropriate and what further protections in that visa we may need to recommend.
2.86The DEWR pointed out that it is not mandatory to disclose that you are 'a visa holder when you're coming forward to seek assistance from the Fair Work Ombudsman. You can do that entirely anonymously or otherwise without providing information about your visa status'.
2.87Home Affairs added that the proposed amendments to section 116 are:
…broader than the existing assurance protocol between [the] Fair Work Ombudsman and Home Affairs. The intent is to co-design the safeguards with stakeholders, and this could include evidence of credible claims from a community legal centre, specialist employment lawyer, union or regulator, for example. This could also include consideration of more than remuneration of fair work matters such as health and safety or discrimination matters.
Committee view
2.88The Migration Amendment (Strengthening Employer Compliance) Bill 2023 would implement two of the recommendations made by the Migrant Workers' Taskforce:
It would increase penalties against unscrupulous employers who exploit migrant workers and introduce measures that prohibit them from employing new temporary visa holders for a period of time; and
It would also make it easier for migrant workers to report instances of work‑related exploitation.
2.89The committee supports these two objectives, noting that stakeholders have raised some concerns about the draft legislation that would ensure these outcomes.
2.90In relation to the fault elements of the proposed offence provisions, the committee accepts that the proposals in the bill have been drafted consistent with related Commonwealth legislation and, as in those Act, appropriately rely on common law definitions of ‘coercion’, ‘undue influence’ and ‘undue pressure’.
2.91The committee considers that a clearer definition of the phrase 'arrangement in relation to work' would provide greater certainty in relation to the range of exploitative practices that migrant workers are known to experience.
2.92The committee acknowledges the concerns raised by industry bodies in relation to the new obligations that would be imposed on businesses and employers, and understands that the Department of Home Affairs is developing guidance materials that would assist businesses and employers in understanding and complying with their new responsibilities.
2.93The committee is sympathetic to the introduction of a non-discretionary protection against visa cancellation in circumstances where a migrant worker has been subject to workplace exploitation. It notes that Home Affairs is considering the development of a series of related measures that would progress elements of that proposed model.
2.94The committee received a number of submissions raising concerns about the potential for the employer prohibition scheme to be avoided by unscrupulous operators, in particular in the context of ‘triangular’ or labour-hire arrangements in the horticulture sector. This point was raised by industry groups (NFF and the Australian Fresh Produce Alliance (AFPA)), migrant worker representatives (Unions NSW and the Immigration Advice and Rights Centre) and academics (Migrant Justice Institute).
2.95The AFPA submitted:
In the instance where a labour hire provider becomes a prohibited employer, consideration must be given to the prevention of that labour hire company “phoenixing” and continuing to operate under a different name/ABN, but with the same persons/individuals managing the business.
2.96Similarly, the NFF observed:
Unlike farmers, who have significant financial and emotional investment into their business, labour hire companies are capable of operating with little if any capital investment or start-up costs. This means, where they are anticipating legal consequences, they may simply wind-up one business and then (re)establish, trading again with a new legal identity, name and ABN. That “structural agility” would make it relatively easy for an individual who is operating a labour hire company which has been declared a “prohibited employer” to dissolve that declared company, establish a new company, and then get back to exploiting migrant workers.
2.97Given that most employment arrangements in Australia involve a corporate employing entity, individual operators can generally only be found liable as accessories to misconduct under the Fair Work Act. The committee shares the view that the exclusion of accessorial liability means that an individual could simply ‘phoenix’ operations into a new corporate employing entity, to avoid a prohibition declaration applied to their previous employing entity. Theprovisions as drafted do not appear to place a sanction on this conduct or include an anti-avoidance measure to guard against it.
2.98This issue was raised during the hearing with departmental representatives, who confirmed that accessorial liability applied to breaches of employer prohibition declarations. However, this does not address the issue that a declaration itself could not be made against the individual responsible for the conduct. As such, if that individual ‘phoenixed’ operations to another corporate entity, no accessorial liability could apply because the new entity would not be prohibited under the scheme.
2.99In the discussion of these issues, both the AFPA and the NFF noted their continuing support for the implementation of national labour hire regulation as a key mechanism to promote fair standards and a level-playing field across the horticulture sector, as did the ACCI during the hearing. The government has committed to implementing this recommendation as part of the Migrant Workers’ Taskforce Report. The NFF noted the wide support for such a scheme across industry, unions and civil society groups. The committee shares the view of the NFF, AFPA and ACCI that this reform should be progressed as a priority.
2.100The committee recommends that the government:
removes the exclusion of accessorial liability for breaches of the Fair Work Act 2009 from the Bill and consider whether the anti-avoidance framework is sufficiently robust; and
continues to progress national labour hire regulation as a priority, in consultation with stakeholders.
2.101Both industry groups (the ACCI) and migrant worker representatives (Migrant Justice Institute and Migrant Workers Centre) highlighted the need for further engagement with stakeholders on the implementation of the employer prohibition scheme. Particular emphasis was placed on the need to provide time for small business to adjust to the new rules and on the importance of working with migrant communities to avoid unintended consequences. In a similar vein, business groups called for clear guidelines or educational material.
2.102The committee notes the intention of the government to make regulations supporting these reforms and develop educational materials, and recognises that the government has taken a collaborative and consultative approach in developing this legislation. The committee agrees the government should continue consultations with stakeholders, in particular industry, unions and migrant communities, in developing the supporting regulations and other materials to ensure broad support and avoid unintended outcomes.
2.103The committee recommends that the government continues to consult and engage with migrant communities, industry, unions and other stakeholders in developing supporting regulations and guidance material for the employer prohibition scheme, in advance of the Proclamation of the provisions.
2.104A number of submissions by unions and migrant worker groups raised concern about the role of trusted third parties in the decision-making process for issuing a prohibition declaration, on the basis that they may have greater access to relevant information about exploitative practices ‘on the ground’ than departmental officers. While supporting the decision-making framework set out in the Bill, the committee accepts there should be an avenue for trusted third parties, such as industry groups, unions or migrant community organisations, to provide information which may be relevant to the decision whether to consider imposing a prohibition or not.
2.105The committee recommends that the minister continues to consult and engage with migrant communities, unions, industry and other impacted stakeholders with regard to the regulations for the proposed new section 116(1A).
2.106The committee recommends that the government ensures trusted third parties, such as industry groups, unions and migrant community organisations, are able to provide relevant information to the Department in relation to a proposed employer prohibition, subject to natural justice considerations.
2.107Some submissions noted that the criteria which will govern the minister’s discretion to issue an employer prohibition declaration are to be prescribed, rather than set out in the legislation. There was a focus, particularly from industry groups, on ensuring that the scheme is applied in a way that is proportionate to the misconduct of the employer. Subject to one proposal below, the committee is satisfied that the framework set out in the Bill contains sufficient safeguards to ensure the discretion is exercised appropriately.
2.108The committee considers that it would be appropriate for the employer prohibition scheme to include an objects clause, which broadly outlines its intended operation. Currently, there is no explicit guidance in the law itself as to its purpose. Such a clause could confirm, for instance, that the purpose of the scheme is to prevent the exploitation of temporary migrant workers and could refer to the aim of sanctions proportionate to the misconduct engaged in.
2.109The committee also considers that the government should consider the LawCouncil’s proposal that the regulation-making powers be subject to the minister’s satisfaction that the regulations are consistent with the objects of the scheme.
2.110The committee recommends that a clarifying amendment be made to the Bill to insert an objects clause for the employer prohibition scheme.
2.111Subject to the preceding recommendations, the committee recommends that the Senate pass the Bill.
Senator Nita Green
Chair
Labor Senator for Queensland