4.1
Australian workers, irrespective of whether they are citizens, permanent residents or temporary visa holders are subject to the same workplace laws, entitlements and protections. However, while all workers can be subject to exploitation, temporary visa holders are particularly vulnerable to exploitation in the workplace.
4.2
A number of inquiries over a number of years have highlighted the systemic exploitation of international students, working holiday makers (WHMs) and other temporary visa holders in Australia, due to factors such as limited English language skills, lack of knowledge of Australian workplace laws and visa requirements.
4.3
This chapter examines the evidence received in regard to the different forms of exploitation; the particular vulnerabilities of temporary visa holders; and what mechanisms could be implemented to protect temporary visa holders from exploitation.
Temporary visa holder exploitation
4.4
The exploitation of temporary visa holders can take many forms and often involves employers contravening workplace laws. Offences commonly include: violations of workplace rights and protections; failure to meet legal minimum wage entitlements; unsafe work practices; and instances of threatening, unethical or abusive behaviour and coercion. Below is a list of examples of different forms of exploitation:
wage underpayment, or 'cash-back' arrangements;
pressure to work beyond the restrictions of a visa — e.g. student visa work limits (40 hours per fortnight while course of study is in session);
up-front payment or 'deposit' for a job;
failure to provide workplace entitlements such as paid leave, superannuation;
tax avoidance through the use of cash payments to workers
working conditions that are unsafe;
misclassification of workers as independent contractors instead of employees;
unfair deductions from wages for accommodation, training, food or transport;
threats to have a person's visa cancelled by authorities;
withholding of a visa holder's passport; and
requiring migrant workers to use and pay for sub-standard on-site accommodation.
4.5
In extreme cases, exploitation of temporary visa holders can take the form of human trafficking, slavery, and slavery-like practices such as forced labour and debt bondage.
Extent of exploitation
4.6
The underpayment and exploitation of temporary visa holders is a significant problem that has impacted the Australian labour market for years; it is not a new problem.
4.7
As outlined in the 2019 Report of the Migrant Workers' Taskforce (the Taskforce), there have been a number of formal inquiries and investigations undertaken by the Fair Work Ombudsman (FWO) that have revealed concerning indications of serious exploitation of temporary visa holders. Examples of investigations conducted by the FWO include the inquiry into:
labour procurement arrangements of the Baiada Group in New South Wales (2015);
7-Eleven Stores Pty Ltd (7-Eleven) (2016);
wages and conditions of people working under the 417 Working Holiday Visa Program (2016); and
trolley collection services procurement by Woolworths Ltd (2016).
4.8
In addition to investigations conducted by the FWO, multiple media investigations and reports have detailed numerous instances of serious workplace breaches against temporary visa holders in Australia. For example, the Australian Broadcasting Corporation's (ABC's) Four Corners programme in May 2015 detailed allegations of mistreatment of temporary visa holders in the meat processing and horticulture industries. Further in August 2015, a joint investigation by Four Corners and Fairfax Media showed systemic underpayment of the wages and entitlements of international student visa holders.
4.9
In 2017, a two part series by the ABC's Australian Story also raised issues of workplace safety and underpayment for working holiday makers working in remote locations as part of their requirements to undertake three months of 'specified work' to secure a second year visa.
4.10
While there have been multiple investigations and reports on the underpayment and exploitation of temporary visa holders, it is difficult to quantify precisely the prevalence and severity of the problem. The work of the Taskforce encouraged more independent work by academics and regulators, and noted a number of specific research findings that provide insight into the potential magnitude of migrant worker exploitation in Australia.
4.11
Associate Professor Bassina Farbenblum and Associate Professor Laurie Berg (Farbenblum and Berg) released the report Wage Theft in Australia: Findings of the National Temporary Migrant Work Survey in November 2017. The survey was the most comprehensive study of wage theft and working conditions among international students, backpackers and other temporary migrants in Australia. The survey received 4322 responses from temporary visa holders across 107 nationalities of every region in the world, working in a range of jobs in all states and territories. Key findings of the survey indicated that:
almost a third (30 per cent) of respondents said they earned $12 per hour or less and 46 per cent said they earned $15 per hour or less in their lowest paid job;
one quarter of international students and one third of working holiday makers (32 per cent) were paid around half the legal minimum wage;
underpayment was especially prevalent in food services, and in fruit and vegetable picking;
44 per cent of respondents were paid in cash and half rarely received a pay slip; and
91 participants (3 per cent) had their passport confiscated by their employer and 77 (2 per cent) by their accommodation provider. Four per cent reported that their employer asked them to pay money back in cash.
4.12
Associate Professor Bassina Farbenblum told the committee that the 2019 National Temporary Migrant Work Survey of 6,000 international students similarly found half were paid less than the basic statutory minimum wage and three-quarters were paid less than the casual hourly minimum wage.
Government response to temporary visa holder exploitation
4.13
All workers, including Australian citizens, permanent residents and temporary visa holders, are entitled to the same basic rights and protections under applicable workplace laws. These include minimum employment conditions, access to superannuation, and coverage under workers' compensation and workplace safety laws. These rights and protections are enforceable under industrial relations laws.
4.14
In 2016 following a number of high profile cases where vulnerable temporary visa holders were found to have been underpaid and exploited at work, the Australian Government announced the Protecting Vulnerable Workers policy to specifically address the exploitation of temporary visa holders in the workplace. This policy contained a number of elements, including:
establishing the Taskforce; and
the introduction of the Fair Work Amendment (Protecting Vulnerable Workers) Act 2017 (Protecting Vulnerable Workers Act).
4.15
In July 2021, the Australian Government released an exposure draft Migration Amendment (Protecting Migrants Workers) Bill 2021 (the exposure draft), aimed at strengthening existing protocols to address worker exploitation involving non-Australian workers in Australia.
Migrant Workers' Taskforce
4.16
The Taskforce was established in 2016 as a result of the underpayment and exploitation of temporary visa holders which was publicly exposed in media reports. The Taskforce was tasked with identifying proposals for improvements in law, law enforcement and investigation, and other practical measures to identify and rectify any cases of migrant worker exploitation.
4.17
The Taskforces final report, released in March 2019, made 22 recommendations aimed at further improving workplace protections for migrant workers. As outlined in Chapter 1, all 22 recommendations were accepted in-principle by the Australian Government. A summary of the status of recommendations is also outlined in Chapter 1.
Fair Work Amendment (Protecting Vulnerable Workers) Act 2017
4.18
On 15 September 2017, as part of the Protecting Vulnerable Workers policy, the Protecting Vulnerable Workers Act commenced. The Attorney-General's Department (AGD) outlined that the Protecting Vulnerable Workers Act introduced a higher scale of penalties for serious contravention of workplace laws. Under the Protecting Vulnerable Workers Act, AGD submitted that:
Deliberate and systematic contraventions of these workplace laws now attract a penalty of up to $630,000 per contravention for companies and $126,000 per contravention for individuals, a ten-fold increase on the previous maximum penalties.
4.19
Further, additional measures introduced under the Protecting Vulnerable Workers Act include:
doubling of penalties for record-keeping and pay slip breaches;
extending liability to franchisors and holding companies for breaches by their networks where they knew or could reasonably be expected to have known of contraventions, and failed to take reasonable steps to address them;
additional evidence gathering powers for the FWO, including the power to compel witnesses to provide evidence or attend an interview;
outlawing cashback arrangements—making it unlawful for an employer to require an employee to unreasonably spend their money or give it to their employer;
new provisions and penalties for hindering an investigation, or providing false or misleading information, documents or employment records; and
a reverse onus of proof, so employers that don't meet records or pay slip requirements have to disprove an allegation of underpayment in court.
The compliance and enforcement framework
4.20
AGD submitted that the compliance and enforcement framework supports Australia's national workplace relations system and is designed to ensure the highest level of compliance with workplace laws for all workers. Actions within the framework range from education and training, provision of advice, right through to prosecution in the case of serious breaches. The framework applies to all employees, including temporary migrants with work rights. The compliance and enforcement framework is discussed in detail in Chapter 2.
Migration Amendment (Protecting Migrant Workers) Bill 2021 – Exposure Draft
4.21
On 26 July 2021, the Australian Government released an exposure draft Migration Amendment (Protecting Migrants Workers) Bill 2021 (the exposure draft). The exposure draft responds to Taskforce recommendations 19 and 20 and proposes:
new criminal offences in relation to the coercion or the exertion of undue influence or pressure on a migrant workers in relation to a work arrangement in certain circumstances (recommendation 19);
provisions to prohibit employers declared as ‘prohibited employers’ from employing additional non-citizen workers (excluding permanent residents) (recommendation 20);
positive obligations on employers and other parties in the employment chain to use the relevant departmental systems (currently the Visa Entitlement Verification Online (VEVO) system) to verify a non-citizen’s immigration status and visa conditions prior to employing or referring a non-citizen for work;
aligning and increasing penalties for work-related breaches and related offences; and
new compliance tools for the Australian Border Force (ABF) to support behavioural change.
4.22
The Department of Home Affairs invited submissions in response to the exposure draft. Submissions closed on 16 August 2021.
Vulnerabilities of temporary visa holders
4.23
While the committee heard that the Australian Government has put in place a range of measures to protect temporary visa holders from exploitation, including through the establishment and recommendations of the Taskforce and the Protecting Vulnerable Workers Act, the committee received a large amount of evidence that demonstrates temporary visa holders continue to face exploitation.
4.24
The committee heard that temporary visa holders are particularly vulnerable to exploitation in the workplace. This is due to factors such as; a lack of knowledge of Australian workplace laws and visa requirements; limited English language skills; fear of visa cancellation; structural settings of visa conditions; and diminished powers protecting their work rights.
Knowledge of Australian workplace rights and obligations
4.25
The committee received evidence that temporary visa holders are particularly vulnerable to exploitation due to a lack of knowledge of Australian workplace rights and obligations.
4.26
As part of the work of the Taskforce, government agencies undertook a stocktake of existing communications strategies to inform visa holders with a work right about their rights and obligations in the workplace. The stocktake found that while government agencies were investing a great deal in disseminating information about workplace laws and conditions, there was a lack of cohesive messaging and delivery across the agencies.
4.27
The Taskforce looked at the needs of temporary visa holders which could inform whole-of-government communication strategies. Research conducted by the then Department of Jobs and Small Business, found that temporary visa holders' knowledge of their workplace rights was low. The research found that before their arrival in Australia, workers were relatively unreceptive to detailed information about workplace laws and conditions. Instead, workers were more concerned with the practicalities of arrival to Australia, such as finding accommodation and study arrangements.
4.28
The Department of Jobs and Small Business research found that the timing of communication about workplaces rights was important, with workers believing that the best time to receive information about workplace laws and conditions was when looking or applying for jobs.
4.29
Another key finding of the research conducted was that although respondents found the in-language information easy to understand and helpful, and to be of high quality, temporary visa holders suggested that more could be done to promote the products and resources and the fact that in-language tools, information and assistance are available.
4.30
Recommendation 2 of the Taskforce's final report recommended a whole of government approach to the information and education needs of temporary visa holders be developed. AGD advised that this recommendation is considered complete.
Information provided to temporary visa holders
4.31
The Department of Home Affairs (Home Affairs) advised the committee that the following information is provided to temporary visa holders:
all temporary visa holders are provided with a visa grant letter that includes information on their rights and obligations in Australia;
the department provides visa related information, including rights and obligations in Australia, on its website;
the department also provides information on the requirement to maintain lawful status in Australia as well as information on visa conditions and Australian laws through online forms, accessed through a visa holders ImmiAccount; and
the Australian Values Statement that must be signed and accepted when applying for an Australian visa, stating that the visa holder will conduct themselves in accordance with Australian values and will obey Australian laws during their stay in Australia.
4.32
Information on workers' rights and visa protections provided by Home Affairs includes that:
all people working in Australia have the same basic workplace rights and protections, regardless of citizenship or visa status;
the FWO protects and enforces the rights of visa holders;
an employer cannot cancel a visa, even if the via holder has breached a visa conditions. Only the department can grant, refuse or cancel visas; and
the Assurance Protocol which is an arrangement between the department and the FWO to support visa holders who approach them for help.
4.33
The FWO advised that all employers are required to provide employees, including migrant workers, with a Fair Work Information Statement (FWIS) before, or as soon as practicable, after the employee first commences employment. The FWIS sets out information about basic entitlements (including the National Employment Standards), modern awards, and the role of the FWO and the Fair Work Commission. The FWO makes the FWIS available in 38 languages and it can be given to employees in a number of ways, including in person, by mail, by email to the employee’s work email address or another email address nominated by the employee, or by fax.
4.34
In addition, the FWO undertakes a range of engagement activities to increase awareness amongst migrant workers of its functions and workplace rights. These activities include:
providing relevant intermediaries (community organisations, community leaders, university coordinators and international student leaders) with information about the FWO’s free resources and services, and encouraging them to further disseminate the information in their network;
publishing a community presentation package about working in Australia on our website that intermediaries can use to educate migrant workers about Australian workplace laws, and providing training on its use for those that require it;
delivering targeted engagement strategies that have provided tailored information and activities to specific migrant cohorts or multicultural communities;
providing funding to five not-for-profit organisations who assist vulnerable groups through the Community Engagement Grants Program;
hosting the Community Legal Centres (CLC) Forum bi-annually, which is regularly attended by close to 20 CLCs and organisations from across Australia that offer employment assistance to vulnerable workers; and
direct engagement with migrant workers and employers at community events to support them in understanding their workplace rights and obligations.
4.35
The FWO also develops and promotes in-language communications campaigns and provides translated media releases that contain information about FWO’s services to relevant culturally and linguistically diverse media outlets.
4.36
The Department of Education, Skills and Employment (DESE) submitted that a suite of information and resources for students, providers and agents across the international education sector have been developed and distributed to specifically address the exploitation of international students. Materials are included in different formats, including print, digital, flyers, animations, and are disseminated at key points of the study and enrolment cycle.
4.37
DESE also outlined information provided to workers under the Seasonal Worker Programme (SWP), as outlined in Chapter 3.
Knowledge of workplace rights and obligations remains a barrier
4.38
While the committee received evidence regarding the information currently provided by the Australian Government to temporary visa holders, the committee also heard that there remains a lack of knowledge of workplace rights and obligations for many temporary visa holders in Australia.
4.39
Unions NSW submitted that young people and temporary visa holders working in Australia for the first time face difficulties in identifying and accessing sources of information, and avenues for assistance. Unions NSW highlighted that '[i]t's impossible for workers to make a complaint about the violation of a workplace right if they don't know it exists'.
4.40
Australian Catholic Religious Against Trafficking in Humans (ACRATH) submitted that in its experience working with temporary visa holders in Bundaberg, workers raised concerns about 'changes from hourly rate work to piece rate work, accommodation and transport, and deductions from pay'. When ACRATH volunteers sought clarification on the terms of the workers' contracts, workers made statements such as, 'I have no idea what I signed'.
4.41
Mr Sam Roberts, National Secretary, National Union of Students, similarly stated that a lack of understanding of workplace rights and conditions is a key barrier for international students reporting exploitation.
4.42
The committee heard that the majority of information on workplace rights and the process for making a complaint are in English. For workers from culturally and linguistically diverse backgrounds this may act as a barrier to seeking further information or assistance.
4.43
The committee received evidence that in order to protect temporary visa holders from exploitation, more tailored information on workplace entitlements and conditions should be available. For example, ACRATH recommended that temporary visa holders:
… be provided with labour contracts and essential pre-deployment materials in English and their native language to ensure all parties are clear of their responsibilities and rights, and to assist with workers' transition to their work life in Australia.
4.44
Similarly, a joint submission from WEstjustice Community Legal Centre, Springvale Monash Legal Service and JobWatch, stated that there is a need for clarification and increased education of temporary visa holders regarding workplace rights, and recommended that:
A comprehensive worker rights education plan should be developed so that temporary visa holders are given the right level of information about their work rights, at the right time (i.e. when they apply for a visa, on entry to Australia, when they fill in a Tax File Number declaration, when they apply for an ABN etc.) and in a language and format that they can understand.
4.45
Submitters acknowledged that while resources are provided by government bodies, such as on the FWO website, there remains frustration that these resources are not accessible to temporary visa holders, for example, for those who do not have adequate internet access. AMES Australia highlighted to the committee the educational role that could be played by settlement agencies and community leaders in explaining workplace rights to temporary visa holders.
Jeopardising current or future visas
4.46
The committee received evidence that temporary visa holders are particularly vulnerable to exploitation due to the fear of losing their current visa or jeopardising their prospect of obtaining a future visa, including permanent residency.
4.47
In 2018, Farbenblum and Berg presented 'Wage Theft in Silence: Why Migrant Workers Do Not Recover Their Unpaid Wages in Australia' which found that the overwhelming majority of underpaid migrant workers (91 per cent) endured wage theft in silence.
4.48
Farbenblum and Berg submitted that results from surveys conducted in 2016 and 2019, consistently show that one of the most significant barriers to migrant workers making a complaint or seeking assistance to redress underpayment of wages, or health and safety issues, is concern that such action would jeopardise their current or future visa, or stay in Australia.
4.49
Further, Associate Professor Farbenblum highlighted that international students do not report wage theft as a result of a mistaken belief that accepting an underpayment of wages was an offence:
What our survey found, which was really troubling but also useful in our approach now, is that the majority of international students who had been underpaid believed they had broken the law by accepting underpayment. They have been given the message repeatedly that it's their fault that they're underpaid. That's a big part of why they don't come forward as well. If you think you've committed a crime or broken the law, you're not going to step forward.
4.50
Farbenblum and Berg explained that the fear of jeopardising their visa or future visa is a more powerful factor than 'lack of knowledge of work rights, poor English language ability or other factors in keeping migrant workers silent in exploitative work'.
4.51
Ms Jenny Lambert, Acting Chief Executive Officer, Australian Chamber of Commerce (ACCI) similarly highlighted that temporary visa holders do not report underpayment due to a belief that such a report will result in consequences affecting visa status. Ms Lambert stated:
Obviously there have been examples where international students have felt that they could not say to any authority that they felt they were being underpaid because of the concern that they may suffer visa consequences.
Structural settings contributing to vulnerability
4.52
The committee heard evidence that there are structural visa conditions that contribute to temporary visa holders being subject to exploitation, including the requirement to work 88 days in a regional area for a second year visa under the Working Holiday Maker (WHM) program; international student visa work limits; and employer sponsorship.
88 day requirement
4.53
The committee received evidence that the requirement under the WHM program for temporary visa holders to complete 88 days of specified work in regional Australia is a systemic factor that contributes to exploitation of WHM visa holders.
4.54
Under the WHM program, to be eligible for a second year WHM visa, a visa holder must have carried out at least three months of specified work in regional Australia. Specified work includes plant and animal cultivation, fishing and pearling, tree farming and felling, mining and construction. Bushfire recovery work and critical COVID-19 work in the healthcare and medical sectors have recently been added as specified work.
4.55
Dr Stephen Clibborn and Dr Chris Wright (Clibborn and Wright) submitted that the introduction of the 88 day work requirement in 2005 was intended to address apparent labour shortages in regional areas, particularly in horticulture.
Payslips
4.56
In December 2015, in an attempt to reduce exploitation and underpayment of temporary visa holders, a new requirement was introduced for WHMs seeking a second year visa, to provide pay slips to Home Affairs. This change was implemented to provide evidence that wages earned during the 88 days of regional work were consistent with award minimums.
4.57
Unions NSW submitted that, while the purpose of this regulation was to reduce exploitation, in practice it accentuated the dependence of WHMs on employers providing pay slips in order to remain in the country and has reduced the preparedness of workers to make formal complaints.
4.58
Clibborn and Wright submitted that, while WHM visa holders are not tied to any one employer, the requirement to provide employer documentation, such as payslips, has created dependent relationships that can limit some workers' mobility and likelihood of reporting employer breaches of employment laws, and therefore the practical availability of institutional protections.
4.59
Mr Daniel Walton, National Secretary, Australian Workers Union (AWU), also representing the Retail Supply Chain Alliance, highlighted the reluctance of WHMs in coming forward to report their experiences:
Essentially, what is happening now with those working in our farm sector is it is out of sight, out of mind. If those workers want to extend their visa by another year, they need to get through their 88 days to do so. The likelihood of them raising concerns and issues that jeopardise their 88 days is very unlikely, and so what we see time and time again is workers essentially swallowing that bitter experience until they finish. They get it completed, and then they come out and tell their stories.
4.60
Further, Unions NSW submitted that the 88 days of regional work has led to increased exposure to unsafe situations, longer working hours, hazardous work environments, discrimination and sexual harassment.
4.61
The committee received evidence from submitters that the 88 day requirement under the WHM program should be removed. Mr George Robertson, National Coordinator for farms, United Workers Union (UWU), told the committee that '[i]n terms of the 88 days, we think that there's an opportunity to phase out that requirement'.
4.62
Professor Stephen Howes, Director, Development Policy Centre, Australian National University (ANU), suggested that the SWP be prioritised over the WHM program. Professor Howes outlined 'that research has shown that backpackers are more likely to be exploited than Pacific seasonal workers'. Professor Howes stated that Australia should prioritise the SWP which 'would mean reversing the decision to provide second and third-year backpacker visas in return for agricultural work' under the WHM program.
4.63
This point was echoed by Mr Michael Rogers, Chief Executive Officer, Australian Fresh Produce Alliance (AFPA), who explained that from AFPA's perspective:
… we would like to get to the point where there's not a blunt instrument of an 88-day requirement for someone to secure a visa. We'd like, in time, to get to a place under the visa policy to have that obligation removed.
Student visas – condition 8105
4.64
Most student visas contain visa condition 8105 which prohibits students from working more than 40 hours per fortnight while their course of study is in session.
4.65
However, in response to the COVID-19 pandemic, the Australian Government announced that international students could work more than 40 hours a fortnight if they are:
employed by an aged care Approved Provider or Commonwealth-funded aged care service provider with a RACS ID or a NAPS ID, before 8 September 2020;
employed by a registered National Disability Insurance Scheme provider;
enrolled in a health care related course and supporting the health effort against the COVID-19 pandemic, as directed by health officials;
employed in New South Wales and Victorian supermarkets and associated distribution facilities for the duration of their respective lockdown periods;
in the agriculture sector; and
in the tourism and hospitality sector.
4.66
Home Affairs stated the students who work more than 40 hours per fortnight must maintain their course enrolment, ensure satisfactory course attendance, and ensure satisfactory course progress. Home Affairs stated that 'these are temporary measures during the COVID-19 pandemic, and will be reviewed by the Government' in the future.
4.67
Despite the temporary measure that has been introduced by the Government due to the COVID-19 pandemic, a number of submitters expressed concern about the 40 hour visa condition imposed on international students. Farbenblum and Berg submitted that 'this restriction profoundly contributes to exploitation of international students, and to their unwillingness to seek help for underpayment or report violations of workplace laws when they occur'.
4.68
Associate Professor Farbenblum told the committee that there is no evidence that the 40 hour limit has any impact on improving students' compliance with study. Instead, Associate Professor Farbenblum stated that the visa condition which requires students to comply with all of the requirements of the course they are studying (condition 8202), is a better compliance measure for students.
4.69
The UWU also highlighted that condition 8202, that requires students to maintain satisfactory course progress and attendance, ensures that students focus on their studies whilst in Australia. The UWU further stated that 'condition 8105 serves no ostensible purpose, other than to render international students liable to exploitation and underpayment'.
4.70
7-Eleven also submitted that restricting international students to 40 hours of work per fortnight is 'leading to workplace exploitation, subsistence living conditions and the formation of a societal sub-class'. 7-Eleven stated that there is a need to reform student visa rules:
… so that students have the necessary financial capacity to support their tuition fees and living expenses for the duration of their course. Without reform we are creating a sub class of employment and a further unsatisfactory stratification of our society.
4.71
Associate Professor Farbenblum stated that condition 8105 creates a 'vicious cycle' of exploitation as students are required to work twice as many hours to meet their basic living expenses:
As the 7-Eleven case study demonstrated, it is often egregious underpayment that drives students to work in excess of 40 hours per fortnight in order to meet their basic living expenses. The one in four international students who are paid $12 or less per hour must work twice as many hours to earn the equivalent of a worker paid the lawful minimum wage.
4.72
Associate Professor Farbenblum advised that, having breached their visa conditions by working more hours to meet necessary living expenses, international students 'are then far more vulnerable to continuing exploitation'. Associate Professor Farbenblum also explained that visa condition 8105 is the most significant factor in terms of stopping international students from coming forward to report underpayment due to a fear of immigration consequences:
… they're obviously incredibly vulnerable and they have invested so much in being here that they will not do anything that even remotely jeopardises their current student visa, but also any future visa.
4.73
Dr Stephen Clibborn stated that the vulnerability of international students is 'baked into the temporary migration system' whereby international students are aware they are being exploited but are not reporting it:
… given that they [international students] know they're not getting the minimum pay and given that they are not happy about it but still decide not to do anything about it, I don't think information alone is going to solve the problem. I think our two key points are to reduce the vulnerability that is in some ways baked into the temporary migration system through some of the visa rules and to increase enforcement
4.74
Regarding the recent changes to student visa conditions, Mr Angus McKay, Chief Executive Officer and Managing Director, 7-Eleven, explained to the committee that:
The government's recent changes to visa rules, where student visa holders can now work more than 20 hours in the hospitality and other sectors, has resulted in a shift from one employment sector to another. There's a clear dollar benefit to the student; there is also a clear simplification in the employment conditions.
Employer sponsorship
4.75
The committee also heard that temporary visa holders are vulnerable to exploitation when dependent on an employer's sponsorship for permanent residency. Professor Joo-Cheong Tham submitted that the formal dependence on the sponsorship of an employer can result in a willingness to work in breach of workplace laws. Professor Tham noted the findings in the Deegan Review which stated:
… where a visa holder has permanent residency as a goal that person may endure, without complaint, substandard living conditions, illegal or unfair deductions from wages, and other forms of exploitation in order not to jeopardise the goal of permanent residency can result in a willingness to work in breach of workplace laws.
4.76
The case study below highlights the conditions and circumstances which prevent temporary visa holders from reporting wage theft, or leaving employment, when dependent on an employer sponsorship for permanent residency.
Box 4.1: Case study 1. Skilled visa holders trapped in exploitation in exchange of permanent residence
'Tony (pseudonym) came to Australia with his family as a certified welder with years of experience in his home country. His plan was to get his hard work recognised, win his employer's nomination for permanent residence, and get his family settled in Australia for good.
There was one catch in his plan. However hard he worked, his employer wanted him to do more work. Tony was often sent to various worksites on a tight schedule, which left him little time for lunch or bathroom breaks. He worked over 60 hours per week and often had to sacrifice family time on weekends to go to work. Tony needed a test result of Competent English or higher for permanent residence application, but he had no time at all to study English after work or on weekends.
One day, Tony overheard his native-born co-workers talking about overtime penalty rate. They were wondering how the employer could afford to pay Tony and other temporary migrant workers the penalty rate for all the overtime work they did. It was only then that Tony realised that his employer had been discriminatorily underpaying temporary migrant workers. He was upset but could do nothing for fear his employer would not nominate him for permanent residence. Tony recently got a higher paying job offer from a partner business but had to turn it down to complete the required minimum three years with the current employer for permanent residence application'.
Misuse of Australian Business Numbers
4.77
The committee heard evidence regarding the misuse of Australian Business Numbers (ABNs) and how this contributes to the exploitation of temporary visa holders. The Australian Council of Trade Unions (ACTU), submitted that the ‘use of sham contracting is a widespread problem across the Australian economy’ and that the manipulation of ABNs facilitates and legitimises sham contracting, wage theft, and phoenixing by attempting to put the ABN holder outside of the reach of the pay as you go (PAYG) system and the ambit of industrial legislation.
4.78
The ACTU noted that the problem is particularly acute with temporary visa holders in the construction and cleaning sectors, contending that ‘whilst legitimate contracting arrangements occur across all industries, there is little doubt that many so- called independent contractors are in fact employees.’
4.79
To address this issue, the ACTU suggested that ABNs should not be available to temporary visa holders and there should be a screening process put in place by the Australian Tax Office to ensure that these categories of workers are not issued with ABNs and so are not subject to the exploitative practice of sham contracting.
Diminished powers of unions
4.80
The committee received evidence that temporary visa holders are also vulnerable to exploitation due to the diminished powers of unions in protecting their work rights.
4.81
Clibborn and Wright submitted that for most of the 20th Century, Australian unions held a central role in setting and enforcing minimum standards through the conciliation and arbitration system and deterred employers from breaching employment standards:
Under that system, unions enjoyed legal status as parties to awards, while high union density and relatively free right to enter workplaces provided them with knowledge of employer non-compliance and opportunity to address it. This also deterred employers from breaching employment standards given the risk of detection.
4.82
Clibborn and Wright submitted that unions now have little role as enforcers of Australia's employment standards, no longer having any formal function as joint regulators with the state, with legislation having been amended to remove them from some of that role.
4.83
Mr Abul Rizvi, Consultant, McKell Institute, told the committee 'the situation of temporary entrants in terms of the way they are being exploited is a function of a decline in the role of unions in our society more generally'.
4.84
Maurice Blackburn Lawyers submitted that 'it is no coincidence that the current rise in the number of wage theft cases, sham contracting and other poor employment processes comes at a time when trade union rights in the workplace have been diminished'.
Labour hire operators
4.85
The committee heard that temporary visa holders are vulnerable to unscrupulous labour hire practices. While many businesses in Australia rely on labour hire operators to provide a flexible workforce, the practice of outsourcing labour to meet labour demands can create an environment that supports the exploitation of temporary visa holders by unscrupulous employers.
4.86
The Taskforce's final report explained that a main driver of unscrupulous labour hire operators is to lower labour costs and associated charges to gain a competitive advantage. Further, the complex supply chain structure with multiple layers of contracting can make it difficult to determine which entity is responsible for the exploitation and be held accountable.
4.87
The committee also heard that while labour hire operators are subject to existing Australian laws, including workplace relations, taxation, superannuation, and migration law, temporary visa holders are vulnerable to exploitation as labour hire operators often create complex operating environments that make it harder to ensure compliance with the law.
4.88
The Taskforce identified that temporary visa holders are particularly vulnerable to exploitation by unscrupulous labour hire operators in the horticulture, cleaning, meat processing and security industries. The section below reflects evidence the committee received into exploitation in the horticulture industry.
The horticulture sector and supply chain
4.89
Unscrupulous labour hire operators seek to reduce labour and operating costs and increase profit margins. As the horticultural industry has a competitive supply chain, this can mean that pricing pressures are exerted throughout the supply chain.
4.90
The UWU submitted that the exploitation of temporary visa is most rife in industries where powerful actors at the top of a supply chain exert considerable price pressure on suppliers and labour hire companies further down the chain, creating a market for insecure and underpaid work.
Supermarkets supply chain
4.91
The committee received evidence from Coles Supermarkets Australia (Coles), Woolworths Group (Woolworths) and ALDI Australia (ALDI) regarding mechanisms currently in place to ensure temporary visa holders are protected from exploitation in their supply chains. Ms Vittoria Bon, Government and Industry Relations Manager, Coles, advised that in 2015, Coles launched its Ethical Sourcing Policy which aims to ensure its suppliers comply with the human and labour rights of workers. Ms Bon told the committee that Coles requires its suppliers to undergo a risk assessment:
… which is essentially a rigorous questionnaire. If that questionnaire returns a medium or high rating, they are then required to undergo an independent audit of their worksites. Our aim is to ensure that, if there is any underperformance, in the first instance we work with our suppliers to correct it. And that's what we've been doing. If a supplier is not able to rectify issues that have been identified, we reserve the right to no longer trade with that supplier.
4.92
In addition, Ms Bon stated that suppliers can choose to register with Fair Farms, a training and certification programme, or suppliers can opt in to use the Supplier Ethical Data Exchange (Sedex) auditing programme to meet compliance requirements set by Coles.
4.93
Ms Carmel Pelunsky, Director of Talent, Woolworths, explained that the development of Woolworths’ Responsible Souring Program in 2018 reflects Woolworths’ commitment to ensuring that workers are treated fairly. Ms Pelunsky stated that the programme includes Responsible Sourcing Standards which are benchmarked to leading international standards set by the International Labour Organisation (ILO) and the United Nations and which suppliers are audited against.
4.94
Ms Laura McManus, Human Rights Manager, Woolworths, outlined that in addition to the minimum standards set for suppliers in the supply chain, there was recognition of the unique risks around the management of labour providers in the Australian horticulture supply chain. Therefore, an addendum was added to the standards, titled ‘additional requirements for labour providers in the horticulture sector in Australia’.
4.95
Similarly, ALDI observed that as an international company with global supply chains, ALDI has Supplier Standards that establish minimum standards that must be met by ALDI’s suppliers, and are legally binding and form part of ALDI’s terms and conditions in all supplier contracts. Mr Daniel Baker, Director Corporate Responsibility, ALDI, noted that to reduce the risk of worker exploitation in the fresh produce sector where temporary visa holders are often employed, ALDI has an Australian Fresh Produce Social Monitoring Program that commenced in 2018 and has reviewed 218 third party social audit reports.
4.96
Coles, Woolworths and ALDI explained to the committee that their supplier requirements were applied equally to Australian suppliers and to suppliers located offshore.
Allegations of exploitation
4.97
The committee heard there are multiple avenues whereby supermarkets could become aware of allegations of exploitation against temporary visa holders in their supply chain, including through audits, investigations, onsite visits and working directly with workers. Ms McManus, Woolworths, explained that one of the main ways Woolworths becomes aware of individual grievances is through its independent third-party confidential hotline called ‘Supplier Speak Up’. Ms McManus advised that in the last financial year, 85 cases triggered an investigation, with 56 of these raised through the hotline.
4.98
Ms Bon, Coles, advised that where there has been an allegation of exploitation against a supplier in the Coles supply chain, the first step Coles takes is to speak to the worker or a third party of their behalf. If the allegation progresses, an on-site investigation would occur which would include an audit. Coles outlined that:
… if a supplier is found to have not done the right thing and we haven't been able to remedy that, in conjunction with our supplier, for the workers, we will discontinue supply, which we have done on a number of occasions.
Unauthorised subcontracting
4.99
Mr Baker, ALDI, advised that a key finding from ALDI’s compliance monitoring against its Supplier Standards has been the identification of unauthorised subcontracting. Mr Baker explained to the committee that:
… that's where…our suppliers are subcontracting the production of goods and services from their main production facility, potentially to another business or another site that ALDI's not aware of. We're quite strict in our requirements of our suppliers about informing ALDI of where our products are made. And, if we do find that that's happening or our suppliers are going to do that, we do want them to tell us so we can make sure our standards are maintained on those sites.
4.100
Woolworths explained that it has approximately 400 direct suppliers and that in most cases, direct suppliers can fulfil Woolworths supply needs, however:
… if they can't then they have their suppliers that they buy from. We call them tier 2. Then tier 2 would often buy from a larger pool, tier 3… it's tier 2 and tier 3 that would usually sell to the open market. But those direct suppliers are the ones that we do our most direct buying from.
4.101
In regards to tier 2 and tier 3 suppliers, Woolworths acknowledged that ‘it is the gap in our program at the moment’ as Woolworths does ‘not yet have visibility of the types of programs run on the multiple supplier tiers at a market level’. Ms McManus, Woolworths, explained to committee that Woolworths is working with suppliers in its supply chain to build capability. Ms McManus stated:
The better our suppliers also have the capability and the knowledge to manage the risks in their own supply chain—and now we're starting to talk multiple supply tiers— the stronger it makes the chain in its entirety.
4.102
Coles advised that the size and complex nature of their supply chain makes it impractical for Coles to directly monitor compliance of every supplier in their extended supply chain. However, Coles provided that it requires its suppliers ‘ensure that the standards outlined in Coles’ Ethical Sourcing Policy are integrated into contracts of suppliers within their own supply chain and monitored and reviewed’.
Working with other bodies
4.103
The committee heard that Coles and Woolworths have been working with union groups such as the Alliance, comprised of the Shop, Distributive and Allied Employees Association (SDA), the Transport Workers Union (TWU) and Australian Workers Union (AWU), in combating exploitation in the supply chain.
4.104
In November 2019, Coles signed the Ethical Retail Supply Chain Accord (the Accord) with the Alliance. The Accord 'aims to achieve a safe, sustainable, ethical and fair retail supply chain for all workers regardless of their employment status, citizenship or visa status'.
4.105
As part of the Accord, representatives from Coles and the Alliance discuss investigations or complaints, work on initiatives to embed ethical principles in the broader retail supply chain, and create more opportunities for work education initiatives, such as development and dissemination of worker guidelines.
4.106
Ms Bon outlined that in relation to the Accord, Coles and the three unions are undertaking a research study, looking at accommodation standards in the horticulture sector with the aim to develop minimum standards that need to be abided by in the industry.
4.107
Woolworths stated that they have a collaboration protocol in place with the UWU and are in conversation with the Alliance. Ms Pelunsky advised that in November 2020 and February 2021, Woolworths facilitated industry-wide briefings on workplace compliance for Woolworths’ suppliers, with representatives from the Victorian government, the Victorian Labour Hire Authority and representatives from unions and the FWO.
4.108
In addition, Mr Baker told the committee that ALDI commenced a partnership with Slave-Free Alliance in early 2021 to work to identify non-compliance and appropriate remediation measures in the ALDI supply chain. Mr Baker explained that:
If we found an instance of child labour in a supply chain, for example, we'd specifically work with the victims on the site through our partnership with Slave-Free Alliance to see that appropriate remediation measures were being put into place to correct those findings.
Modern slavery and human trafficking
4.109
Submitters raised concern regarding incidents of modern slavery and human trafficking in the horticultural industry supply chains where unscrupulous labour hire operators operate in an environment that makes it hard to ensure compliance with the law.
4.110
The Uniting Church in Australia, The Synod of Victoria and Tasmania and The Salvation Army Australia submitted that whilst Australia has taken some important steps to address modern slavery in supply chains, through the recent passage of the Modern Slavery Act 2018 (Cth) (Modern Slavery Act), there remain significant gaps in the criminal justice response to modern slavery.
4.111
This includes poor screening and engagement of suspected victims, limited or no collaboration with non-government organisations (NGOs) to assist victims to make an informed decision regarding cooperation with law enforcement (which is a requirement to access government support); and poor data collection to inform policy and budget decisions under the National Action Plan to Combat Modern Slavery (NAP 2020).
4.112
The Australian Council of Trade Unions (ACTU) recommended that the Modern Slavery Act be 'strengthened to include penalties for companies failing to disclose or providing false or incomplete reports, and penalties for failing to take action to eliminate modern slavery in their supply chains'.
Undocumented workers
4.113
The committee heard that there is large number of unlawful non-citizens in Australia, also referred to as ‘undocumented workers’, particularly in the horticulture industry, who have breached a visa condition or overstayed a visa, but currently participate in the workforce in Australia.
4.114
Unions NSW submitted that there are a number of ways workers on temporary visas can be considered to be working illegally:
Working holidaymakers are working illegally if they are employed by the same employer for more than six months. International students are restricted from working over 20 hours a week and 457 visa workers are restricted from working in any job/ industry not included in their visa. Additionally, temporary visitors may be working without a visa that allows work rights or may have overstayed their original visa.
4.115
The UWU submitted that reports estimate, prior to the COVID-19 pandemic, there were between 50,000 to 90,000 undocumented workers in the seasonal labour force in Australia.
4.116
The committee heard that undocumented workers are at a high risk of exploitation as there are serious penalties for those who contravene their visa requirements, including deportation. As such, undocumented workers are unlikely to report mistreatment or exploitation due to a fear of deportation.
4.117
The committee notes with concern that the Government is yet to respond to recommendation 25 of the National Agricultural Workforce Strategy which called for a ‘one-off regularization of undocumented AgriFood workers’.
Protecting temporary visa holders from exploitation
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The committee received a range of evidence on the need for increased protections for temporary visa holders, through mechanisms such as strengthening labour hire requirements, greater transparency for unions and serious penalties for unscrupulous employers. This evidence is explored in the following sections.
4.119
It should be noted that the committee also received evidence on the role of the Fair Work Ombudsman in addressing temporary visa holder exploitation. As such, discussion on the FWO is addressed separately in chapter 6.
National labour licencing scheme
4.120
Recommendation 14 of the Taskforce called for the Australian Government to establish a National Labour Hire Registration Scheme with the following elements:
focused on labour hire operators and hosts in four high risk industry sectors — horticulture, meat processing, cleaning and security — across Australia;
mandatory for labour hire operators in those sectors to register with the scheme;
a low regulatory burden on labour hire operators in those sectors to join the scheme, with the ability to have their registration cancelled if they contravene a relevant law; and
host employers in four industry sectors are required to use registered labour hire operators.
4.121
Further, the National Agricultural Workforce Strategy, released in March 2021, further recommended that all state and territory governments enact legislation to regulate labour hire providers.
4.122
The committee also received evidence supporting the establishment of a national labour hire scheme to prevent exploitation of temporary visa holders by unscrupulous labour hire companies. For example, ACRATH submitted that 'a national licensing scheme would go a long way to protecting the rights of migrant workers in Australia and prevent exploitation by unscrupulous labour hire companies'.
4.123
Mr Rogers, AFPA, similarly argued that a national approach was important. Mr Rogers explained that AFPA was supportive of an approach that would ensure national consistency. Mr Rogers highlighted that this was particularly important to remove the ability for unscrupulous employers to operate across state boundaries: He stated:
If you have someone who might be subject to a labour hire licensing requirement in Victoria but then they move to New South Wales, it's not a good outcome for anyone.
4.124
Mr Greg Manning, First Assistant Secretary, Employee Entitlement Safeguards and Policy Division, AGD, told the committee that consultation on the national labour hire registration recommendation commenced in October 2019 with the Attorney-General writing to the state and territory counterparts about the government's intention to take that recommendation forward.
4.125
Mr Manning advised the committee that there were also discussions with other relevant Commonwealth agencies, as well as state and territory agencies, and representatives of every state and territory, including those with a labour hire regime. In addition, an expert advisory group has been established comprising representatives from unions, employer peaks, and a couple from civil society.
4.126
Mr Manning advised that due to the pandemic, the work on the national labour hire scheme had been paused.
4.127
AGD informed the committee that the Australian Government has however 'continued consultations on the establishment of a national labour hire registration scheme'.
4.128
The FWO advised that it had received $15.004 million in 2019–20 to establish a National Labour Hire Registration Scheme. The FWO stated that the funding for the scheme has been re-profiled to commence in 2021-22 as the enabling legislation has not been passed. The FWO has also established an internal Taskforce to implement the scheme, subject to the passage of legislation.
Registration versus licensing
4.129
The committee heard from AGD that one of the issues explored in consultation was whether the national labour hire registration scheme should be a registration scheme or a licensing scheme.
4.130
Witnesses provided evidence on this question, with Mr Mathew Kunkel, Director, Migrant Workers Centre, stating that 'we're not calling for labour hire registration; we're calling for labour hire licensing'. Mr Kunkel explained to the committee the importance of having a labour hire licence scheme over a labour hire registration scheme:
We don't register to drive a vehicle on the roads or to drive a B-double up to Darwin and back; we need a licence to do that. I think that, if a company is in the business of buying and selling their workers' time to other employers, then they should get a licence for that, and they need to prove and demonstrate, and demonstrate on an ongoing way, that they can comply with the laws around the treatment of workers—and, indeed, migrant workers, who have additional burdens and barriers.
4.131
The Queensland Council of Unions similarly submitted that a registration system would not provide the safeguards needed for workers. They submitted that '[b]y licensing labour hire providers, those providers are required to demonstrate that they [are] operated by fit and proper persons and that they have the financial means to meet their financial obligations'.
4.132
Mr Rogers from AFPA also argued that the scheme should not simply be a registration but a licencing scheme, stating 'our view is that it should be a firm licensing arrangement with penalties, compliance and requirements'.
State and territory schemes
4.133
Submitters told the committee that a national scheme would need to encompass the best practices of the state schemes that are already in operation, and must not dilute any protections already offered by such state schemes.
4.134
Dr Carina Garland, Assistant Secretary, Victorian Trades Hall Council, told the committee that 'it's important that what is in place in Queensland and Victoria remain the benchmarks. We would not want to see any system that waters down the protections of workers federally'.
4.135
Similarly, Mr Daniel Walton from the AWU, explained that a national scheme should take the best aspects of the various models around the states. He explained that if a national scheme 'operate[s] on the lowest common denominator, then, frankly, let the states continue to manage labour hire in their respective areas'.
Queensland
4.136
The Queensland labour hire licensing scheme commenced on 16 April 2018 with the dual purposes of promoting the integrity of the labour hire industry and protecting vulnerable workers from exploitation. The committee heard that the scheme was implemented by the Queensland government following multiple inquiries where evidence demonstrated that unscrupulous labour hire providers exploited vulnerabilities of temporary visa holders in industries with high levels of labour hire arrangements, such as horticulture, food services, meat processing, security and cleaning.
4.137
Ms Natalie Wakefield, Director, Labour Hire Licensing Compliance Unit, Labour Hire Licensing Queensland, Office of Industrial Relations Queensland, explained that a key element of the scheme was that ‘labour hire providers must be licensed and users of labour hire services must only use licensed labour hire providers’. Ms Wakefield further explained that:
At application, labour hire providers must satisfy a fit and proper person test, including demonstrating compliance with a range of workplace, taxation and safety laws, and be financially viable. These requirements are ongoing where a licence is granted. Administrative actions available under the scheme include refusal of licence applications, imposition of conditions, and suspension and cancellation of licences.
4.138
As at 11 June 2021, there were 3,442 licensed labour hire providers in Queensland. Since the inception of the scheme, the Office of Industrial Relations Queensland advised that as at 5 July 2021:
57 licence applications had been refused;
212 licence applications had been withdrawn for failing to provide compliance information; and
68 licences had been granted with condition to enable the delegate to more closely monitor compliance.
4.139
In relation to licences (as at 5 July 2021):
87 licences had been cancelled; and
258 licences had been suspended.
4.140
Since the commencement of the scheme, there have been 15 prosecutions, with fines totalling $820,000 imposed by the magistrate’s courts.
Victoria
4.141
The Victorian labour hire scheme was established in response to the Victorian Inquiry into the Labour Hire Industry and Insecure Work which uncovered widespread abuse and exploitation of labour hire workers across Victoria. The objective of the scheme ‘is to protect workers from exploitation by labour hire providers and their hosts and to improve transparency and integrity of the industry’.
4.142
Mr Steven Dargavel, Commissioner, Victorian Labour Hire Authority, stated that the key elements of the scheme are that ‘labour hire providers must be licensed and those who use labour hire providers must only engage licensed providers’. Mr Dargavel noted that ‘significant penalties can apply to either unlicensed labour hire providers or to hosts who use them’.
4.143
As with the Queensland labour hire licensing scheme, in order to apply and maintain a labour hire licence in Victoria:
… providers must comply with their obligations pursuant to workplace law, taxation law, superannuation law, occupational health and safety law, workers compensation laws, labour hire laws, migration laws and applicable minimum accommodation and transport standards. The business officers must also be fit and proper persons.
4.144
Mr Dargavel stated that Victorian Labour Hire Authority undertakes education, enforcement and compliance activities, and commenced licensing in 2019 after the Queensland scheme and have made over 5,200 licensing decisions, including grants, grants with conditions, refusals, cancellations and suspension.
4.145
Appearing before a public hearing of the committee, Mr Dargavel outlined that the ‘awareness of very basic employment law obligations by most labour hire providers in the application process was demonstrably inadequate at the point of their application’. Mr Dargavel told the committee:
The authority spent more than a year ensuring providers understood their obligations and that they complied with them. In response to questions from the authority, a large number of providers withdrew their applications or determined to not file their applications.
4.146
Under the Victorian scheme, the committee heard that there have been ‘in excess of 1,000 applicants who commenced an application process, were confronted with difficult questions, withdrew and left the industry’. In addition, Mr Dargavel highlighted that:
… there were close to 200 formal withdrawals, 81 cancellations, a range of refusals and suspensions. There are hundreds of investigations currently underway in relation to both licence holders and outstanding applicants.
Powers under the Queensland and Victorian scheme
4.147
Under both the Queensland and Victorian schemes, there are a variety of tools that can be used to obtain information from labour hire providers. Under the Queensland scheme, during an audit or investigation the Queensland Labour Hire Licensing Compliance Unit (LHLCU) inspectors may:
interview persons (for example workers);
seize items of evidence; and
require certain documents to be provided (such as worker's terms and conditions of employment or wage books).
4.148
Similarly, the Victorian Labour Hire Authority has a team of inspectors who have a variety of powers to monitor compliance with the scheme including, where there are reasonable grounds, the power to:
enter and search premises;
examine and seize anything suspected of being connected with a possible contravention;
inspect, copy or take extracts from documents on the premises and make images or recordings;
seek the assistance of other persons; and
where necessary apply to the Magistrates' Court for a search warrant.
The horticultural industry
4.149
The Queensland Labour Hire Licensing Compliance Unit (LHLCU) noted that the horticulture industry was acknowledged as a high risk industry at the outset of the scheme. As a consequence, LHLCU focussed significant attention on compliance in the horticulture industry. In total, 816 compliance cases (audits, investigations, complaints) regarding labour hire providers in the horticulture industry had been finalised since the inception of the scheme. This resulted in 362 compliance actions (withdrawal, refusal, imposition of conditions, suspension, cancellation, prosecution).
4.150
In addition, the LHLCU advised there has been numerous educational and compliance campaigns conducted on farms either independently or with other agencies where the LHLCU has engaged with growers, labour hire providers and workers regarding obligations under the scheme, and gathered significant intelligence.
Interaction with state schemes
4.151
In relation to the interaction of a national labour hire scheme with the state schemes, Ms Wakefield informed the committee that the Queensland government is ‘on the record as supporting a national scheme so long as it does not reduce the protections of the Queensland scheme’.
4.152
Mr Dargavel further echoed this sentiment, stating that the Victorian government wants ‘to ensure that any potential proposal does not weaken the schemes that have been put in place and the scheme that has been put in place in Victoria’. Mr Dargavel further stated that while there has been improved compliance performance since the establishment of the scheme, there is ‘certainly more work to do’.
South Australia
4.153
In addition to the Queensland and Victorian labour hire licencing schemes, South Australia’s labour hire laws scheme commenced on 20 July 2020. The South Australian licensing scheme applies to labour hire providers operating within industries where workers are at a greater risk of exploitation due to the low-skilled, labour-intensive nature of the work that they are engaged to undertake. Industries that are required to be licenced are:
4.154
Similar to the Queensland and Victorian schemes, significant penalties apply to employers who provide labour hire services without being licensed or engage an unlicensed labour hire provider.
Criminalising wage theft
4.155
Recommendation 6 of the Taskforce's final report called for 'the most serious forms of exploitative conduct, such as where that conduct is clear, deliberate and systemic, criminal sanctions be introduced in the most appropriate legislative vehicle'.
4.156
In response to the recommendation of the Taskforce, the Australian Government drafted legislation to criminalise the underpayment of employees. As part of a consultation process, the Australian Government sought stakeholder views on criminalising underpayments, including the potential fault element of the offence, attributing criminal liability, interaction with the civil penalty regime and with other criminal laws, and enforcement considerations.
4.157
The committee heard that the introduction of criminal sanctions would provide a clear signal to unscrupulous employers that exploitation of workers is unacceptable with severe consequences.
4.158
Unions NSW submitted that penalties for employers found to have knowingly or intentionally underpaid their staff should be significantly increased, including the introduction of criminal penalties and restrictions on individual offenders from managing a corporation.
4.159
Further Unions NSW stated that where 'some businesses knowingly underpay their workers', the current fines are not acting as a sufficient deterrent. Unions NSW also argued that the consequences for wage theft need to be significantly increased, with the introduction of new offences under the Fair Work Act making it a criminal offence to knowingly and/or repeatedly underpaying workers.
4.160
Unions NSW submitted that while the legislation should maintain discretion for first time offences, if an employer systematically underpays workers, the offence should be treated as theft.
4.161
The committee notes that the criminalisation of wage theft was removed from the Australian Government's Fair Work Amendment (Supporting Australia's Jobs and Economic Recovery) Bill 2021 in March 2021. The committee further notes that on 13 November 2019, the Senate referred an inquiry to the Senate Economics Legislation Committee into the causes, extent and effects of unlawful non-payment or underpayment of employees’ remuneration by employers and measures that can be taken to address the issue. The committee is scheduled to report to the Senate by 2 December 2021.
Employer registration
4.162
The committee heard that in contrast to the SWP, work undertaken by WHMs, undocumented workers and international students 'is substantially under-regulated. There are no employer registration requirements for hiring these migrant workers'. The Law Council of Australia stated that less than 10 per cent of temporary migrants are subject to any oversight, 'leaving the vast majority of temporary visa holders subject to exploitation'.
4.163
Home Affairs told the committee that:
The Migration Act 1958 (Migration Act) does not provide a power to prevent employers of persons in non-sponsored programs, who are found to have engaged in workplace exploitation, from being able to hire people on those visa types again.
4.164
Outside of the SWP, employers do not need to be approved in order to employ temporary visa holders and the Australian Government does not keep track of who is employing those temporary visa holders. This enables repeat offenders to operate with impunity.
4.165
The Law Council of Australia submitted that a Temporary Visa Employer Register could be established to provide transparency and oversight arrangements for businesses employing temporary visa holders.
4.166
The Law Council of Australia argued that such a register could utilise the existing Standard Business Sponsorship or Temporary Activity Sponsor processes in place for Temporary Skilled Work Visa holders:
… whereby an Australian business is approved by the Department of Home Affairs under the Migration Act 1958 (Cth) (Migration Act) and Migration Regulations 1994 (Cth) (Migration Regulations) and thereby subjected to oversight of working arrangements and statutory compliance regimes.
4.167
Further, the Law Council of Australia explained that a two-stage registration process could be established where 'Australian employers are required to register as a Temporary Visa Holder Employer and the Temporary Visa holder is required to register their employment with that business'.
4.168
The committee also heard suggestions that if any employer was found to have breached a workplace relations law in a systematic way, or more than once, the employer should be prevented from employing temporary visa holders in the future.
Strengthening labour law enforcement and greater role of unions and other organisations
4.169
The committee received a range of evidence that called for the protection of vulnerable workers through strengthening labour law enforcement and increasing worker protections through registered organisations, such as unions, employer groups and community organisations.
4.170
For example, Mr Robertson, UWU, submitted that there is capacity to increase the role of unions to work alongside the FWO in complementary roles to increase scrutiny of industries in which exploitation is particularly rife.
4.171
Mr Walton, AWU, highlighted that to see an improvement in compliance and to ensure that workers are not being exploited, it must be recognised that the FWO 'cannot do that on their own'. Mr Walton concluded that the trade union movement would be the most appropriate organisation to assist the FWO in achieving these improvements.
4.172
To see practical change, Mr Walton told the committee that unions should have the ability to inspect workplaces. Mr Walton said:
The ability for unions to get in to inspect—what is commonly known as a time and wages inspection; that is, the ability to go in and investigate the books of employers to make sure that proper wages and conditions are being paid. The right for unions to do that—how they can do that and the amount of time and notification required to be able to do that—has changed dramatically, which essentially means employers can hide from providing that relevant information. With the amount of notification that is required, they've got ample time to try and remove and destroy documents or put in place other evasive tactics.
4.173
Mr Kunkel, Migrant Workers Centre, argued that the problem of wage theft and breaches of industrial law is so systemic in Australia that:
… you could throw as much money as you had at it and it's not going to fix the problem. The only thing that fixes breaches of industrial law is workers organising together in union. We've seen just how widespread these issues are; we need a widespread, collective approach to it.
Non-government regulator
4.174
The committee also heard unions can play an important role as a non-government regulator. Mr Rizvi explained that unlike the FWO, unions have a much wider spread in terms of being on the ground and available through their members and through their various representatives, 'which makes them much more accessible than a regulator—even a very, very well-funded regulator—can ever be'.
4.175
Secondly, Mr Rizvi explained that temporary migrants are much more likely to trust someone they know and have developed a relationship with than a government representative. Mr Rizvi said:
Temporary entrants are often in a situation where they are fearful of their circumstances. They are fearful of reporting being exploited and they are fearful that the employer, if they do make reports, will report them to the Department of Home Affairs or the Australian Border Force, and the consequence is that they are removed from Australia.
4.176
Dr Clibborn explained to the committee that temporary visa holders are reluctant to report a breach of their visa requirements because 'in their minds, the government is the government'. Dr Clibborn further highlighted 'there is value in having a trusted organisation, whether it is a union or a community group, that can act as a conduit between them and enforcement'.
Community legal centres and settlement services
4.177
The committee heard that in addition to unions, community legal centres and settlement services play a vital role in providing assistance to temporary visa holders. Farbenblum and Berg noted that further resources ought to be directed to community legal centres and trade unions to, amongst other activities, coordinate and deliver education programmes to vulnerable temporary visa holders.
4.178
Clibborn and Wright highlighted the importance of community legal centres in assisting temporary visa holders understanding their legal rights in Australia. Clibborn and Wright explained that 'community migrant representative groups offer temporary migrant workers valuable sources of information and representation. They can be effective conduits through which temporary migrant workers can exercise their legal rights'. Further, Clibborn and Wright noted that this is particularly significant given the prohibitive costs of engaging a private lawyer.
4.179
The Kingsford Legal Centre, Redfern Legal Centre International Student Service NSW and the Migrant Employment Legal Service, in a joint submission noted that temporary visa holders require legal assistance to take any action against misconduct, but are reluctant to approach government bodies such as the FWO. In its submission, Kingsford Legal Centre highlighted:
Without assistance, people who hold temporary visas cannot enforce their rights, and employers can exploit with impunity. Community legal centres are required to work alongside regulators and unions to provide additional support to people who hold temporary visas.
4.180
WEstjustice Community Legal Centre, Springvale Monash Legal Service and JobWatch outlined how they were already undertaking work in this area by providing community legal education to temporary visa holders in relation to their work rights and recommended that the Australian Government develop a comprehensive worker rights education plan, as such programmes are 'required to raise awareness of laws, and build trust and accessibility of services'.
4.181
The Migrant Workers Centre also recommended that the government fund community legal centres and trade unions to continue their work in this area:
The federal government should provide information about workplace rights in community languages, upon issuing temporary visas with work rights, to those who are issued the visas offshore. It should also facilitate follow-up education upon arrival by funding trade unions and community legal centres to offer workplace rights workshops in community languages.
4.182
In outlining the rationale behind this recommendation, the Migrant Workers Centre submitted that, as temporary visa holders often do not have clear information about their entitlements or Australian migration programmes and fear any potentially negative visa impacts of interacting with government authorities or having records of legal procedures, civil society organisations—such as trade unions, migrant community organisations and community legal centres—could potentially fulfil this educative role.
4.183
In addition, settlement services provide practical and community support for temporary visa holders, including assisting them to find employment. Settlement Services International described the role that their organisation plays:
We work with people who have experienced vulnerability, including refugees, people seeking asylum and culturally and linguistically diverse (CALD) communities, to build capacity and enable them to overcome inequality. In our work we also work to engage with communities and businesses at the local and regional level in order to build capacity and enable successful settlement and integration.
4.184
The Settlement Council of Australia noted that the role of such settlement services in Australia is to 'provide assistance to refugees and migrants in who find themselves in need, irrespective of visa status'. The Council noted that, throughout the COVID-19 pandemic, the settlement services sector has 'faced unprecedented demand for assistance from people on temporary visas'.
4.185
AMES Australia's services also include providing immigration advice and assistance to temporary visa holders, as well as helping temporary and permanent skilled visa holders to prepare for employment and find jobs commensurate with their skills, experience and aspirations. Since 2018, AMES Australia's Skilled and Professional Migrants Program has helped 1,394 individuals find work. AMES Australia further noted how, during the COVID-19 pandemic, its remit expanded to assisting temporary visa holders who were unable to access necessities and who had limited social support in Australia.
Religious organisations
4.186
Father Maurizio Pettena, Director, Australian Catholic Migrant and Refugee Office, Australian Catholic Bishops Conference, further highlighted the role of the Catholic Church in protecting temporary visa holders from exploitation. Father Pettena highlighted the unique position of the Catholic Church in protecting temporary visa holders.
Our network allows for linguistic and cultural affinity. In cases such as these, we contact the local police to investigate the matter. We also avail ourselves of a network of pro bono lawyers and, of course, Catholic agencies within the Catholic Church, such as, for example, CatholicCare or similar support agencies within the Catholic Church, irrespective of whether the person is a Catholic or not. We just look at the person without any discrimination…To the best of our possibilities and with full respect to the person's willingness, we connect them to professional agencies within our network, whether within the church or beyond.
4.187
ACRATH also attested to the approach of connecting temporary visa holders to local community members as there are high levels of trust that workers have in the church, and the faith community.
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Australian Catholic Religious Against Trafficking in Humans recommended that, as well as activities such as departure briefings, the Australian Government ought to provide 'supports and resources [for] community-based organisations to develop and deliver mandatory educational orientation sessions for all work-related visa holders and their family members'.
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Mr Mark Scully, Deputy Fair Work Ombudsman, Compliance and Enforcement, FWO, told the committee that the FWO works collaboratively with other parties to assist vulnerable temporary visa holders. Mr Scully highlighted that the FWO is ‘always looking for opportunities to engage with other parties who can assist us in reaching this vulnerable community cohort’.