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Education and Employment References Committee
10/07/2015
Australia's temporary work visa programs

ROBINSON, Mr Paul, Branch Secretary, Australian Rail, Tram and Bus Industry Union of Employees, West Australian Branch

WHITTLE, Mr Owen, Assistant Secretary, UnionsWA

[11:35]

CHAIR: I now welcome Mr Owen Whittle and Mr Paul Robinson from UnionsWA. Information on parliamentary privilege and the protection of witnesses and evidence has been provided to you. The committee has received your submission; thank you. I now invite you to make a short opening statement, and at the conclusion of your remarks I will invite members of the committee to put questions to you.

Mr Whittle : Thanks for the opportunity to be here. We are pleased that the committee has come over to Perth. Rather than repeating a range of the issues that we stated in our submission, I would just like to speak briefly about some additional research we have conducted recently into the implications of the China free trade agreement on the temporary work visa program. We have concerns following the recent signing of the China free trade agreement that labour market testing requirements will not apply to workers from China who work in Australia under the 457 visa program or any other temporary visa type. Our recent research shows that under these agreements the number of 457 visa applications that require employers to advertise jobs to Australian workers first could slump to about 25 per cent.

Already too few 457 visas are required to undergo labour market testing. In the nine months to May this year, 38,134 457 visas were granted to overseas workers, with only around one-third of those, or 12,000, subjected to labour market testing. If the provisions of the China free trade agreement and a possible future India free trade agreement were in effect in the same period, 2,400 fewer jobs would have been offered to Australian workers. This would mean that labour market testing would only cover one in four 457 visa nominations.

Under the new investment facilitation agreements in the China FTA, companies with projects worth more than $150 million will also be able to negotiate to bring in lower skilled workers, rather than just skilled workers, at wage rates that fall below the current floor for a standard 457 visa. We fear that the same will happen if the India free trade agreement is signed later this year, and currently Australia already has some similar exemptions from labour market testing with Thailand, Chile, South Korea and Japan.

In our view, these blanket 457 visa concessions should not be in free trade agreements at all, as we do not see how they have anything to do with international trade. In particular, the lack of labour market testing is of concern at a time when we have decreased training numbers and high youth unemployment in areas of Western Australia. In particular, areas in Perth's southern corridor, which has been a traditional corridor for manufacturing and other blue-collar work, have very high youth unemployment, particularly around Mandurah, where it is above 14 per cent; within the south-western corridor of Perth, where it is above 13 per cent; and in the south-east corridor of Perth, where it is above 11 per cent. Secondly, the most recent ABS statistics in regard to general unemployment data for the population of WA have unemployment increasing the rise. In particular, unemployment for males in Western Australia has almost doubled in the last three years.

Just before I wrap up, I would like to introduce Paul Robinson, the secretary of the Rail, Tram and Bus Union. He has some examples for the committee today of where they have issues with skill requirements of temporary workers and of how some organisations can be unwilling to invest in training of local workers when we set the bar for the importation of some labour so low.

CHAIR: Thank you, Mr Whittle.

Mr Robinson : I would like to tell you the story of how I became involved in the 457. It was a bit of a fiasco. In 2012, I was elected to the position of secretary. In November 2012, there was a serious safety incident regarding the overhead power lines for the suburban rail network: approximately 1,600 metres of wine was ripped down. I was immediately contacted by members of my union regarding the safety issue. As secretary, I have power to go and investigate under right of entry. When I investigated some of these incidents we found out that all the overhead linespersons—technicians and so on—had no qualifications at all. This was of major concern to me.

I then asked the Public Transport Authority why these people had not received any formal qualifications. When I delved into it a bit more, I found out that they had known since 2006 that they had no qualifications and that they should have implemented a training program and the overhead line workers should have received vocational education and training. One of the reasons they gave was that they had trouble attracting people with skills to come in and do the job. I further inquired and we found out that they were paying these guys about $26 an hour whereas in private enterprise they were probably getting $36 to $40 an hour. So people were not willing to come over. That prompted them to search for 457 visa people from the UK. So they advertised in the UK to get these people to come over, and they got around four or five of them.

A company called E-Oz developed the vocational education training package, which is to do with skills assessment, safety assessment and all that sort of stuff. They were the people that developed the industry standard. I delved a bit more into the requirements, and the industry standard requirements were that, no matter which country these staff came from, they had to have recognised prior learning in their country before receiving acknowledgement to come to Australia; and then when they got here they had to undergo 12 months of training. What I found was that there had been no recognised prior learning undertaken and there was no 12 months of training when they got here.

I inquired a bit more and they said the immigration department do not require it and they were getting their information from the Australian Bureau of Statistics. I wrote to both the immigration department and the Australian Bureau of Statistics. They have got a table which says that some countries are exempt from this particular category. I asked them how they came up with that table. They hid behind red tape and did not offer an explanation. I went back to E-Oz, the people who developed the standard, and they said that, because of the nature of the work, they require that anyone who comes into Australia from any country has to have recognised prior learning and they have to have training when they get here. I faced a dilemma. There was the red tape of the immigration department's list of companies that are exempt from any skill training assessment and no-one can tell me how they got this list or where it came from; and they do not even talk to the people who created the industry standard. It is quite bizarre.

At the time of this incident, I found out that they had employed five Australians as trainees for a fixed two-year contract and they had been bringing in people on 457 visas. It takes more than two years to learn all the skills to become a fully qualified linesperson. So I said to the Public Transport Authority: 'This is bizarre. How can you have trainees on two-year fixed-term contracts? They are never going to have enough time to complete the skill!' I then lodged a complaint, a section 44 application, in the state industrial relations commission in regard to why they were putting on trainees on two-year fixed-term contracts. The pressure of that resulted in the Public Transport Authority employing these five people permanently, which was a good result. However, it does show that, when getting people in on 457 visas, it is easy for employers to not really be able to prove that they have done enough to create trainee positions or train apprentices or whatever in sourcing trained people and skills.

CHAIR: Thank you. If an Australian resident or Australian citizen applied for one of those jobs would they have been required to have the E-Oz qualification?

Mr Robinson : Yes.

CHAIR: They would not have got the job without that qualification?

Mr Robinson : No.

CHAIR: Who was supervising the Australian workers on traineeships, the workers without certification?

Mr Robinson : That is quite an interesting story. To be blunt, when I exposed the fact that none of these people had received training or VET qualifications, the Public Transport Authority had to immediately implement some form of vocational training to get these people assessed. But the manager at the time, who had known about this since 2006, sort of disappeared; he got pushed away and they brought in additional people to fix up the mess that was facing them.

CHAIR: What training or formal qualifications did those overseas workers have?

Mr Robinson : The guys that came from the UK do have English qualifications and are very highly skilled. However, to bring them in they were required to have recognised prior learning to the industry standard and that was never done. In fact, the immigration department and the Public Transport Authority said that there was no requirement because they were on the exemption list. Well, as far as the industry standard goes, no such list exists. I have become quite friendly with these 457 visa worker guys. They have said to us that if they had been told that the cost of living here was so expensive they probably would not have come. They are here now but if they had the opportunity they would go to a private employer. In fact, they are currently in a position where some of them are coming towards the end of their visa time and they are probably looking at disappearing and going into better paid work in the same line of work. That is going to put the Public Transport Authority back into a position where they are going to lack skilled people in that area.

CHAIR: Did the Public Transport Authority train them in the certification required to be on the track?

Mr Robinson : Yes, they did.

CHAIR: So they did all of that, but they neglected to get them the E-Oz—

Mr Robinson : Yes. It was the pressure from the union saying that they required the vocational training. In fact, the guys who did have English qualifications were probably the first ones trained and recognised for prior learning, but it was only after the union put a lot of pressure on them. It made the news. It was quite a significant issue and it was quite an embarrassment to the Public Transport Authority—the fact that a whole bunch of people were running around without qualifications and working on such a highly skilled area, which resulted in a major incident that could have cost lives.

CHAIR: So the PTA then got all of the certificates, including the E-Oz certificate?

Mr Robinson : Yes, the vocational training. E-Oz is just the organisation that has developed the vocational training.

CHAIR: Do you think it is a breakdown in the bureaucracy—that one bureaucracy is not informing another of what the formal requirements are?

Mr Robinson : Definitely. Yes.

CHAIR: We have heard a bit about that this morning., Mr Robinson. Mr Whittle, we heard last week from the ACTU expressing concerns about the free trade agreements and the threshold of $100 million not being very high. Can you give us any sense in, say, the Perth CBD of the sorts of projects that would meet that criteria? If you cannot, you cannot, and that is fine. I am just asking.

Mr Whittle : Certainly. That is a low bar for an infrastructure project. When you look around the Perth CBD, there are some significant projects going on. There is a new stadium being built.

CHAIR: Would that qualify?

Mr Whittle : It is certainly well beyond it. It would not qualify for, I think, the Chinese ownership, but it will be an infrastructure project over $150 million. Also, a number of the buildings going up on the new waterfront development in Perth—the Elizabeth Quay development—would possibly qualify as well. Our concerns would probably lie more in the resources industry, where there is quite significant Chinese and Indian investment in our resources industry, particularly in the north-west. There are a number of projects with Chinese interests in the north-west which would exceed $150 million by a very long way. Also, there are the two coal mines in Collie. One is now owned by a Chinese company and one is owned by an Indian company. If there was significant investment in expanding those mines or other infrastructure projects like a rail line, which has been talked about for some time, that may also qualify.

CHAIR: So the unions are stating that, where we have Chinese ownership, they can bring in their own labour force without acknowledging the particular skill requirements, so none of the Australian laws would apply to that project?

Mr Whittle : My understanding is that it will expand to much lower skills than are currently available in the skilled migration program. A whole range of semiskilled positions would be covered that you currently could not access via a 457.

CHAIR: Like a trade assistant—that sort of level of worker?

Mr Whittle : Yes. Also, they would not have to do fit within the list that is published around skill shortages.

CHAIR: And no labour market testing.

Mr Whittle : No labour market testing and lower English skill requirements as well.

CHAIR: Obviously it is a big concern. In the Collie Power Station, what is that workforce? Do you know?

Mr Whittle : When it was being refurbished, the workforce would have numbered maybe 300 or 400, from memory. I did not visit it at the time. Currently, while it is just in production and it is not being refurbished, there may be 100 to 150, maximum, at any period of time.

CHAIR: Local workers could be displaced?

Mr Whittle : Yes, absolutely.

Senator JOHNSTON: Thank you, gentlemen, for coming along today and for giving us your valuable time. Mr Whittle, the current situation, as I understand it, is that we have to have some labour market testing to justify industrial support through these two particular visas. Is that the correct understanding? Forgive me, I am not as au fait as I should be on this. You are probably more the expert.

Mr Whittle : It is, but there are a number of loopholes where labour market testing does not have to apply.

Senator JOHNSTON: What exactly is labour market testing? Just take us through your understanding of what it does, how they do it, who pays for it and who has the statutory obligation to do it.

Mr Whittle : It is a requirement upon the organisation seeking to bring in the skilled visa holders to test the local labour market to ensure—

Senator JOHNSTON: Is it an organisation like the chamber of mines or is it BHP, for instance?

Mr Whittle : BHP. They would be required to, say, advertise in the local papers, maybe contact job placement companies and the like to seek local workers.

Senator JOHNSTON: Then they take that information on the inadequacy of people who have the skills, training and the capacity to do the work and go to the department of immigration and say, 'We need visas for 40 welders.'

Mr Whittle : Yes, for example. The range of numbers varies greatly. I think last week we got an application for over 360, working offshore in a very high paid, very high skilled environment—offshore construction and production—and we would contend that they could have easily filled those positions locally. How they go about the labour market testing is always a bit of a grey area for us. Quite often we see that they may set the requirement for skills much higher than they actually need as an easy way to dismiss local applicants before they approach the department of immigration. We really think that when those applications come across a desk at the department of immigration they do not drill down on the scope of the labour market testing. It is more of a 'tick the box' situation.

Senator JOHNSTON: Thank you for that. I am very interested in that. The KAFTA and the JAEPA are two examples of free trade agreements. You say that labour market testing in Korea and Japan is prohibited. So does that mean we are going to have a ready supply of Japanese and Korean tradespeople able to just come in on visas?

Mr Whittle : The bar has been lowered compared to what has traditionally been the case by the investment facilitation agreements, which allow for what they say is increased labour flexibility, along with a certain section in the agreement that says that neither party shall require labour market testing as a condition of temporary entry.

Senator JOHNSTON: So what will be the conditions for temporary entry? You need someone and you cannot get them? Is that the bottom line?

Mr Whittle : Yes, essentially. As I said, they might have to tick and flick some boxes in a form to Immigration, but they will not drill down and test that.

Senator JOHNSTON: So you would want the regulations in support of the act to be very specific as to certain criteria to be met before foreign workers who are not subject to labour market testing are able to come in. You are saying that legislation at the moment is inadequate or unenforced.

Mr Whittle : Yes. As I said, there are plenty of loopholes to get around it as well. We want to see genuine labour market testing. It needs to be proved to both the department of immigration and trade unions, when we wish to inquire, that it really has been genuine.

Senator JOHNSTON: Give me what you would see as the indices of genuine labour market testing. How do I tell genuine from fake?

Mr Whittle : That is a very good question. Potentially there might be a skills register operated by a government department where workers who may wish to work in a certain area can apply and be registered, so that before these visas are issued the company may have to contact people on that register to ensure that they have had the opportunity to get that work. Put that alongside genuine contact of job placement companies and maybe a longer lead time required for job advertising before they can apply for visas, so it is not just putting one job ad in one local paper for two weeks, one week or two days. It might be that they have to commit to three months of advertising.

Senator JOHNSTON: Broadly, they need to make a verifiable attempt over a period of time to get indigenous Australian workers into that industry, clearly supporting the fact that there is a shortage of those particular workers?

Mr Whittle : Yes.

Senator JOHNSTON: Mr Robinson, I come to your very interesting factual circumstance regarding the train line. This is the train line that we all see on the freeway and wherever—

Mr Robinson : Yes, it is.

Senator JOHNSTON: Did you say it was 16 kilometres of line?

Mr Robinson : No—1,600 metres of overhead line.

Senator JOHNSTON: So 1.6 kilometres of line. This has a voltage of what?

Mr Robinson : 25,000 kilovolts.

Senator JOHNSTON: That is pretty significant, isn't it?

Mr Robinson : Yes, absolutely.

Senator JOHNSTON: And you are saying that the technicians responsible for the maintenance of that line were not qualified people?

Ms Robertston : At the time.

Senator JOHNSTON: What were the qualifications necessary to be a linesperson on the public transport infrastructure at that time?

Mr Robinson : They had to have a Cert III in, I think, overhead—I have it here somewhere.

Senator JOHNSTON: That is all right—there was a specific nomination of qualifications to be a linesperson.

Mr Robinson : Yes, Cert III in overhead lines. I have forgotten the actual number but it is a Cert III.

Senator JOHNSTON: So the Public Transport Authority was clearly in breach of that requirement?

Mr Robinson : They were at the time, yes.

Senator JOHNSTON: Were they prosecuted?

Mr Robinson : No.

Senator JOHNSTON: Why not?

Mr Robinson : Good question. I did lodge a dispute with the Public Transport Authority. The prosecution probably did not go ahead because at the time that it happened there was really no requirement for them to have that certification. That is now different, because it has now changed because of the—

Senator JOHNSTON: So the law was a bit vague as to what the requirement was?

Mr Robinson : Yes, it was. So to even get a prosecution was probably going to be unlikely.

Senator JOHNSTON: On this particular 1.6 kilometres—not just that bit but the whole—how many people are moved every day on the infrastructure that the Public Transport Authority was responsible for wherein the persons maintaining those heavy-voltage lines were not qualified? How many people move in and out on a daily basis?

Mr Robinson : Tens of thousands.

Senator JOHNSTON: So in—was it 2005?

Mr Robinson : No, this happened in 2012.

Senator JOHNSTON: We had a situation where tens of thousands of people were moving on a daily basis on our electric rail system maintained by unqualified people.

Mr Robinson : At the time, yes.

Senator JOHNSTON: Who is responsible for surveilling that? Which authority is in charge of making sure that the public transport authority complies with the law?

Mr Robinson : The Office of Rail Safety.

Senator JOHNSTON: Was the Office of Rail Safety aware before your drawing it to their attention, or after?

Mr Robinson : After.

Senator JOHNSTON: And they did not prosecute anybody in the Public Transport Authority?

Mr Robinson : No.

Senator JOHNSTON: That is pretty novel, I would have thought. Excuse me for not being aware of the media at the time. Was there media at the time about this?

Mr Robinson : Yes, there was.

Senator JOHNSTON: Okay, I will go back and look at that.

Mr Robinson : I got heavily criticised, too, in the media when I exposed it. They said I was being misleading.

Senator JOHNSTON: Why? What was their defence?

Mr Robinson : They tried to discredit my statements in the media when I exposed the fact that these people did not actually have any qualifications.

Senator JOHNSTON: When you say no qualifications—

Mr Robinson : They had none—literally none.

Senator JOHNSTON: So they just walked in off the street—

Mr Robinson : No—they had been doing the job since whenever electrification was done. But there has been a transition over the years to recognise that type of skill. E-Oz has been developing this lines qualification for many years and has come up with the vocational training. But there was no requirement legislatively to have that qualification until 1 January 2014.

Senator JOHNSTON: Really?

Mr Robinson : Yes, that is right. Therefore trying to get a prosecution would have been—because there was actually no legislative requirement.

Senator JOHNSTON: Roughly how many people were charged with the responsibility of maintaining the line but were not qualified—10, 20, 30?

Mr Robinson : At the time around 25 guys.

Senator JOHNSTON: Whatever happened to them?

Mr Robinson : They all got trained.

Senator JOHNSTON: So as a result of your complaint, they were trained up and now have the qualification?

Mr Robinson : Yes.

Senator JOHNSTON: Who paid for the training?

Mr Robinson : The Public Transport Authority paid.

Senator JOHNSTON: So the situation has been fixed up?

Mr Robinson : It has been fixed as far as the training goes but I still have major concerns with the way in which 457s are brought in without actually sticking to a qualified standard. A part of the reason why this incident happened was that people were making decisions on engineering parts who did not have the qualifications to do so. It was one of these engineering parts which was designed and manufactured by an uncertified person that was holding up these lines. It was that which failed and brought down the lines. That was a major concern to us. But the immigration department and the industry standard do not talk to one another.

Senator JOHNSTON: I get your point. I want to go to the next part of my question. We have this clear inadequacy of skilled trained personnel maintaining the line and the Public Transport Authority sought to mitigate that by bringing some people in on these visas?

Mr Robinson : Yes.

Senator JOHNSTON: But you then said—if I am right and I want you to clarify this—that the particular people that were brought in were actually exempt from having the proper qualifications in any event.

Mr Robinson : According to the immigration department, yes.

Senator JOHNSTON: Why would we not just continue with who we have got on that basis? Do you follow what I am saying?

Mr Robinson : Yes. The Public Transport Authority made a decision to bring in five 457 visa guys who had qualifications in the United Kingdom. So these guys did have English qualifications, which were superior to anything Australia was offering at the time.

Senator JOHNSTON: That is good.

Mr Robinson : But it needed recognition by the industry standard here in Australia.

Senator JOHNSTON: And immigration did not demand their qualifications to be recognised by the industry standard setter here?

Mr Robinson : That is right. Basically what happened here was the immigration department basically said anyone from the UK that says they have these qualifications—

Senator JOHNSTON: And what were those qualifications? Was it a diploma in something?

Mr Robinson : Yes, they have a cert III or it might be a cert IV—I am not exactly sure what the English qualification is—but all they had to do was provide that and that was enough to get them into the country. The industry standard says that is not good enough. It says we need to know physically that what you are telling us you can do, you can do.

Senator JOHNSTON: Tell us about that industry standard. When did that come to the surface?

Mr Robinson : I am not an expert as far as the industry standard goes but I have had quite a few emails and phone conversations with the E-Oz who developed the vocational and training standard. They quite clearly have been doing this for a number of years in consultation with vocational education and training and with the Australian government.

Senator JOHNSTON: What do we call the industry standard? Does it have a name? You say cert III or cert IV is what the British guys have—

Mr Robinson : No, the vocational industries to have cert IIIs and cert IVs.

Senator JOHNSTON: But they are Australian qualifications?

Mr Robinson : Yes, they are recognised Australian qualifications.

Senator JOHNSTON: Have the five guys who have come in on the visas had to meet those criteria?

Mr Robinson : They have received recognition for prior learning on those.

Senator JOHNSTON: Was that just a tick and flick or did they actually have to sit a course?

Mr Robinson : They had to sit a course.

Senator JOHNSTON: And how long was the course?

Mr Robinson : I am not exactly sure but I think it was actually sort of fast tracked with the help of the industry standard with E-Oz to sort out this major issue that they had.

CHAIR: But they would have had to demonstrate competency against the cert III?

Mr Robinson : Yes.

Senator JOHNSTON: So they did that. Had they already started work on sustaining and maintaining these power lines before they got those qualifications, the Australian qualifications?

Mr Robinson : Yes, as they were working, they were doing the training. They still had to upkeep the maintenance the overhead line.

Senator JOHNSTON: So during the transition period, they were doing both at the same time?

Mr Robinson : Yes they were.

Senator JOHNSTON: How long were they in transition before they got their Australian qualifications?

Mr Robinson : I am pretty sure that the guys that came from the UK with their qualifications were the ones that were done first. That took about three months— I might be a little bit out with the timing there. They did it so that they could actually be the overseers to make sure that safety was adhered to and that the work was done properly before the others who had been there for a long time got qualified.

Senator JOHNSTON: What happened to the approximately five British guys who came out and after three months got their qualifications? Did they go home?

Mr Robinson : No, they are still here.

Senator JOHNSTON: Are they Australian citizens or permanent residents or what?

Mr Robinson : I think they have just about all got their Australian residency now but I do not know if they are Australian citizens yet or not.

Senator JOHNSTON: How long after their transition to get their qualifications that they needed—such that you were happy that your members were underneath power lines that were properly maintained—did we then have all the Australian cohort people qualified that previously had been unqualified?

Mr Robinson : They followed pretty quickly afterwards and could range from three months to the six-month period to get them all through.

Senator JOHNSTON: So when you took your action, which I think was very laudable, it was the Australian Rail, Tram and Bus Industry Union versus the Public Transport Authority?

Mr Robinson : Yes it was.

Senator JOHNSTON: And if I was to go to the state industrial commission website to look for that case, I would be able to read all of the material on all of the things?

Mr Robinson : It was C69 of 2012.

Senator JOHNSTON: That is very interesting. You say you got some criticism for this?

Mr Robinson : Yes, in the media by the Public Transport Authority. They were not happy with me going to the meeting. I was very upset with the whole issue of how the Public Transport Authority had known since 2006 that these people were required to have some formal training but had sat on their laurels. The other thing that was really disappointing was the fact that the PTA ended up going for people with 457 visas, had five Australian trainees, had known since 2006 but said they exhausted their options when they advertised and stuff like that. The problem we have got with it is that the same people in private industry are receiving probably 25 per cent more than what the Public Transport Authority was willing to offer. Another issue with 457 visas is you have got a government department that is only willing to offer $26 an hour yet the private sector is employing people and paying them $36 or $40 an hour.

Senator RICE: In terms of what is legitimate labour market testing, how can that be considered legitimate labour market testing?

Mr Robinson : That is my argument. My argument is: does that fit the criteria of labour market testing? You get a government entity such as the Public Transport Authority that says we are only willing to offer $26 an hour to get these people to come in. But they cannot attract them there because they are going to go to the private sector to with these qualifications. Therefore, they will not get anybody. No wonder they cannot get anybody because they do not want to pay them enough and so they go overseas. It will get these people to come over here and then they tell me they would not have come if they had known the cost of living was so high and they were going to pay them so poorly.

Senator JOHNSTON: You raised the issue of the private wages, terms and conditions being better and obviously higher than what the Public Transport Authority was prepared to pay. The liability issue for the private contractor or business would have been enormous and their insurer would have stipulated, 'You cannot go and do powerlines without qualified people.' But the Public Transport Authority went on regardless for six years.

Mr Robinson : As I said before, there was actually no legal requirement for them to meet any legislative requirement in regard to that study.

Senator JOHNSTON: If people had been killed on that 1.6 kilometre section or a derailment had occurred and massive injuries were occasioned, the liability issue was glaring: that the line was being maintained by unqualified people.

Mr Robinson : That is why I was criticised when I went to the media. I came out and said, 'You've got people that—sure they knew their job—have never been tested to any formal qualification. Who knew what their levels of experience were?

Senator JOHNSTON: A bit of a lawyers' feast.

Mr Robinson : Yes, and it was quite shocking, to be honest with you.

Senator JOHNSTON: But you raised this with the PTA and they fobbed you off, didn't they?

Mr Robinson : They tried to discredit me, but in the end—six months later, after the independent investigation was done by two English investigators they brought out—the Public Transport Authority had to own up to the fact that they were solely responsible for the incident.

Senator RICE: Thank you, Mr Whittle and Mr Robinson, for your really interesting testimony. I want to go back to the issue of labour-market testing and the free trade agreements. You said, Mr Whittle, that you felt that the Chinese free trade agreement would reduce the number of jobs that are subject to labour-market testing down to about 25 per cent from the current rate which you estimated as over 30 cent.

Mr Whittle : We looked back over what has happened over the past 12 months and at what would have happened if the China free trade agreement had been in place during that time. In the nine months to May there were 38,000 457 visas granted, but only about 12,000 of those were subjected to labour-market testing.

Senator RICE: Why only one third? What about the other two thirds?

Mr Whittle : Because of similar free trade agreements with other partners such as Chile, Japan and one or two others.

Senator RICE: So we are in a situation where we already have some two thirds of jobs that are not labour-market tested.

Mr Whittle : It is not just the free trade agreements; there is a range of other loopholes. I could go back and catalogue them, if you want, where companies do not have to comply with those labour-market testing provisions.

Senator RICE: That would be great. The evidence we have had so far is that the whole issue of labour-market testing seems to be a critical criterion to ensure that we are not importing foreign workers for jobs that could be filled here. But you are telling me that already two thirds of the jobs are not labour-market tested, and I find that very concerning.

Mr Whittle : It is. Going back to what Paul said about how genuine that testing is, and Senator Johnston touched on it, wages were offered below the industry standard and that was their way of testing the market. I believe that if they had offered industry-standard wages the labour-market testing would have come back with a different result.

Senator RICE: Is that lack of labour-market testing across all industries or are there particular areas that are exempt?

Mr Whittle : It is across all industries. My understanding is—and I can go back to pull out those particular parts of our research—that there are some industries where it happens more than others. From memory, it is the case in manufacturing and mining and a number of others. There is also a number of temporary work visas for which labour-market testing is not a requirement. I find it interesting that in the Department of Immigration and Border Protection submission to this inquiry they listed a whole range of visas that have work access, and a number of those actually do not require labour market testing. Some 457s do, but for 417s and others it is a mixed bag.

Senator RICE: What is your view about temporary work visas as a whole? Do you think there is a place for them under some much more stringent set of regulations?

Mr Whittle : Yes. We understand that the temporary work visa program plays a part in the Australian economy and that often there are very highly skilled positions that may not be able to be filled locally, but we do have concerns about how at times these visas can act as a disincentive to training and, in particular, to long apprenticeships. Four-year apprenticeships are declining in Western Australia, and we have a concern that part of the reason for that is the temporary work visa program. We really want to look at ways to incorporate greater mentoring and training into the visas that do come over and at ways to create funds or the like that assist employers to train. An example here is that there are a few state government run funds in the construction industry and other industries which employers are required to pay into and which then fund future training needs. They are looking at expansion of that in conjunction with the program, which is good. It would assist in meeting those future skill requirements.

Senator RICE: Yes. I was struck by your tables showing the actual decline in training while the increase in employment during the resources boom had been going on. It was very telling. As well as funds, are there other controls or other links that should be made between the availability of 457 visas and employers having the responsibility to provide training and apprenticeships? Do you have any thoughts about that?

Mr Whittle : Yes, absolutely. There has been talk in the past of set quotas: if you want to bring in x number of temporary work visas, you are required to put on y number of apprentices or trainees to learn the skills from those people. That may not be applicable in all industries. To use the mining industry as an example, I forget the name of the federal government report that looked into it a few years ago, but it certainly talked about an enthusiasm for foreign workers without an equivalent enthusiasm for meeting local training needs. Some of the resources companies have hit back at that, saying that it is not really feasible to fly apprentices in and out of remote mine sites, but then they do not seem to be willing to look at other alternatives for how they can place apprentices in other industries or pay into a fund that helps.

Senator RICE: Or actually having more people based near the mine rather than having the whole concept of fly-in fly-out workforces.

Mr Whittle : Absolutely. There is always a lot of associated work with resources companies. A lot of the manufacturing goes overseas, but, for the manufacturing that happens here that is related to resource projects, you could hope that they could try to increase apprenticeship numbers in those local manufacturing workshops which would be based in Perth or other large town centres.

Senator RICE: In your submission, you have the example of the Australian Manufacturing Workers' Union report about the WesTrac company, which had people being laid off. It was unclear from that whether those 75 apprentices got laid off as well. Do you have any information about that? Were there any consequences from what happened at WesTrac?

Mr Whittle : No, there were not. WesTrac is quite a large employer in the Guildford area in Perth. They would employ, as a rough estimate, maybe 400 people in that area. Actually, I might correct that: they probably employ about 400 people now, but at the time they were employing a fair bit more. At the time that they made those redundancies, they made 75 apprentices redundant as part of that process, as well as, I think, in total 330 workers.

My understanding is that none or very few of those redundant workers were the workers here on temporary work visas. They kept on those workers who were on temporary work visas while making the apprentices redundant. We would assert that if there was a genuine skill shortage the company would have been interested in assisting those apprentices to finish the final years. At the time, I did speak to one of the apprentices, who I think was maybe six months off finishing his apprenticeship as a fitter. I would have hoped that if there were genuine skill shortages the company would have seen the moral obligation to see those apprenticeships through. At the time that apprentice was struggling to find someone to pick him up to finish the last few months of his apprenticeship.

Senator RICE: There does seem to be a complete disconnect to all of that. There are two completely opposite things going on. There are 457 visas because there is meant to be a skill shortage, yet people are being made redundant. But you are saying that there were no consequences of doing that—that is was perfectly legal under the program.

Mr Whittle : It was. In preparing for today I spoke to a union member earlier in the week, whom I hoped would maybe be able to come with us, but unfortunately he was working offshore this week. He was recently made redundant by a different offshore labour hire contractor. That offshore labour hire contractor had a number of 457 workers and a number of local workers. When the worker was made redundant he queried the employer: 'Why am I being let go? Why are you keeping your temporary visa workers?' The employer just asserted that they had invested to bring those employees over and once they were here it would essentially have been a waste of money if they were made redundant first, before making the local workers redundant. The system allows them to do that. We would like to see the system structured in a way such that in those circumstances temporary workers are made redundant first, before local workers are made redundant. We do not want to victimise those workers, and we do see cases of victimisation of foreign workers. But ultimately they are here to fulfil a temporary requirement.

I would also say that it is often an incentive for the employer to keep on foreign workers because of the power imbalance in the employment relationship. They are less likely to know their employment rights. They are less likely to seek claims for unfair dismissal or underpayment of wages or other issues. Often employers might view it as a way to ensure that they do not get any industrial relations flow-back from their employees.

Senator RICE: What is the maximum length of time people can be employed for under 457 visas?

Mr Whittle : I think it is four years.

Senator RICE: If you have a change in the labour market during that time, then that does not come into play at all. For example, if you had decent labour market testing at the beginning then you could have a situation of labour market testing in the middle that could show that actually there was not a local skill shortage yet the foreign workers who had been engaged under the four-year contracts continued to take up the jobs that potentially could be taken up by a local employee.

Mr Whittle : Certainly.

Mr Robinson : It seems quite ironic, though, that in some industries—there are 457 visa workers in the hospitality industry, for example—I just do not think there is a genuine skill shortage. And that is becoming more and more frequent—that there is no genuine skill shortage at all; it is just an avenue for convenience by employers.

CHAIR: In relation to the free trade agreements, in Western Australia we recently had the FIFO inquiry that was done by the legislative council. It talked about increasing rosters and so on whereby we now have a situation where workers have a month on and then seven to nine days off. Do you think if we have Chinese workers or other foreign workers coming in under these free trade agreements we might see a worsening of those sorts of rosters, which are becoming commonplace? What is your fear around that?

Mr Whittle : My main fear with that is that you may see permanent accommodation on these remote mine sites. So, rather than having a workforce that is flying into and out of Perth or major regional centres, you may see the workforce based permanently at a remote site and never going to towns to either participate in the local economy or have down time.

CHAIR: Yes—fair comment.

Mr Whittle : The main concern for us would be that for those people who would work at a remote mine it would be very hard for unions or government regulators to really keep an eye on the conditions of their employment and whether or not they were being exploited. They could be in places we cannot get to as the trade union movement, and we would have serious concerns about potential deterioration of wages and conditions in the industry.

CHAIR: Certainly. Mr Robinson, going back to the 1.6 metres of overhead line: who ended up repairing that?

Mr Robinson : It was done by the crews.

CHAIR: Did they bring in any additional supervision?

Mr Robinson : They did. They brought in some experts in the field—electrical engineers—to oversee the repair work and make sure they were using properly designed equipment.

CHAIR: Would it be common practice to do that? Or do you think that was unique because of the circumstances?

Mr Robinson : They should have been using proper electrical engineers for that in the first place, in any event. But because of the seriousness of the issue and the incident at the time they made sure they brought in proper electrical engineers to make sure that the job got done, basically to avoid any criticism.

CHAIR: If there are no further questions, thank you very much for giving us your time today. We appreciate your submissions and your evidence this morning.

Committee adjourned at 12 : 31