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Education and Employment References Committee
17/07/2015
Australia's temporary work visa programs

FURNELL, Ms Peta, Acting Deputy Secretary, Department of Education and Training

INNES, Ms Helen, Acting Group Manager, Economic Strategy Group, Department of Employment

NOCKELS, Mr David, Commander, Immigration and Customs Enforcement Branch, Investigations Division, Border Operations Group, Australian Border Force

PARKER, Ms Sandra, Acting Secretary, Department of Employment

WILDEN, Mr David, Acting Deputy Secretary, Department of Immigration and Border Protection

[15:05]

CHAIR: I welcome witnesses from the Department of Immigration and Border Protection, the Department of Employment and the Department of Education and Training. We have not got Social Services, have we?

Ms Parker : There are people here. We will bring them up as we need to, if that is okay.

CHAIR: All right. Information on parliamentary privilege and the protection of witnesses and evidence has been provided to you. The committee has received your substantial submission. Do you wish to make an opening statement or statements?

Ms Parker : Just a very brief one.

CHAIR: At the conclusion of your remarks, I will invite members of the committee to put questions to you.

Ms Parker : The departments here today welcome the opportunity to participate in this public hearing of the committee's inquiry into the impact of Australia's temporary work visa programs on the Australian labour market and on the temporary work visa holders. The Department of Employment coordinated an all-of-government submission to this inquiry, with the exception of the Fair Work Ombudsman, which appeared at the Melbourne and Adelaide public hearings of this inquiry. The departments which contributed to this submission are present today. They are the Department of Immigration and Border Protection, the Department of Education and Training, the Department of Social Services and the Department of Industry and Science. The agencies work closely and cooperatively to provide, as far as possible, a seamless approach for workers, employers, unions and the community. Our government submission provides an overview of the subclass 457 sponsor and visa applicant criteria and analyses the contribution of visa holders at the industry and occupation level. Information was also provided on the monitoring activities of the Fair Work Ombudsman and the Department of Immigration and Border Protection. The departments here today are happy to answer questions on the submission or other questions that senators may have.

CHAIR: Thank you. So I can get my head around it, can you just give us a little snapshot of where your department, Education and Training, interfaces with the visa workers? We need a little flow chart.

Ms Furnell : I am Acting Deputy Secretary for Skills and Training in the Department of Education and Training.

CHAIR: Is it the skills aspect?

Ms Furnell : It is the skills aspect. The role that we play is in providing advice to the department of immigration regarding the skills occupation list, which is a separate list. It is around the independently sponsored migration. That is a role that came with us from the department of industry under the latest machinery-of-government change. That went to the department of industry when the Australian Workforce and Productivity Agency was absorbed into that department.

CHAIR: So the skills list is you?

Ms Furnell : That is skills, and that is a role that we are developing that is new for us in the education and training space. The Department of Employment also has employment—

CHAIR: What bit does Employment do then?

Ms Parker : There are a few components. In Employment, as you know, Senator, we look at job seekers, but we also look at people in jobs—so the workplace relations part of people in jobs and the work health and safety part of being in jobs.

CHAIR: Regardless of whether they are local workers or visa workers?

Ms Parker : That is right. I know you know all this from us appearing before you in other capacities, but we do labour market analysis and we also do skills shortages in regard to jobs, whereas Education, of course, is taking it from the perspective of what skills they need and what training and who is going to provide that and how we get them skilled for the work. But there are very close relationships between us, because we have all worked together in the past, either in one department or separately.

CHAIR: And Social Services—are they here?

Ms Parker : They are basically the social programs. They are the programs that are available to any visa holder—or some visa holders have different services available to them. That is where they fit in.

CHAIR: I think Immigration and Border Protection speak for themselves. On Immigration and Border Protection, I am just looking at a question that was put by Senator McKenzie to Senator Cash on 15 June, regarding Operation Cloudburst. Senator Cash said this was 'an unprecedented crackdown on illegal working and the exploitation of workers'. What is the mandate for Cloudburst? What powers does the operation have and what are the resources?

Mr Nockels : From the perspective of the Border Force, which is where that now sits—so, operationally, compliance and enforcement activities sit within the Australian Border Force—that is what we do, so, from a compliance perspective, our job is to go out there and ensure that there is compliance in terms of how those visas and visa holders are acting in accordance with the conditions of their visa. Cloudburst was designed on the basis of community concern that potentially there was abuse of those visas and visa holders. Cloudburst was the forerunner to Taskforce Cadena, which the minister has launched. We are responsible for all of that compliance activity within the Australian Border Force and the high-end enforcement activities which then lead into investigations from a criminal prosecution perspective. That is where I fit in in terms of the role that I play and the area that I look after within the Australian Border Force, which is investigations. When we think about that from the perspective of where we draw the power from, it is obviously the customs and migration acts, for the Border Force.

You asked a question about resources and so on. On the days of activity, we had 11 specific activities across all states, and that resulted in 38 individuals being detained. In that sense, I cannot give you an exact number of how many people were on the ground on the day, but there would have been multiple compliance teams across all the states, with specific and focused activities, of which there were 11.

CHAIR: Where did you gather that information from to do a simultaneous action?

Mr Nockels : That was based on previous activities, previous experience and intelligence in terms of what we have identified in the past. With the formation of Taskforce Cadena, there is a joint agency agreement between ourselves and the Fair Work Ombudsman's office. The primary focus of that is obviously on potential visa fraud but it also pulling together the intelligence holdings across both organisations to better target our approach so that we are not just going out and doing activities for the sake of it; we are actually looking at a targeted approach based on either allegations or specific intelligence that we have developed based on our experience in compliance operations that we have conducted.

CHAIR: You said 'Cadena' but I was actually talking about Cloudburst. Did one morph into the other?

Mr Nockels : Cloudburst was a very specific activity over a couple of days.

CHAIR: Is that where the 38 workers—

Mr Nockels : Correct.

CHAIR: Okay. That is what I was talking about before. I might still want to go to Cadena, but I was asking about Cloudburst. Some concerns have been raised. Those 38 workers did not have the relevant visas, as I understand it. Is that correct?

Mr Nockels : Yes—potentially unlawful citizens.

CHAIR: So they were deported?

Mr Nockels : I do not know exactly of the 38. I can check for you, but generally if they are unlawful citizens then ultimately that is the pathway.

CHAIR: What has been expressed to us—and I would be interested in what the department thinks—is that the 38 workers have probably been underpaid. Judging by what we have heard throughout the inquiry, they have probably been severely underpaid, yet they are deported from the country and then their underpayments just fall by the wayside. Certainly we have heard that, in terms of slavery, there is now a different approach being taken in some states. Where there is an issue of slavery, people can get a bridging visa, I think, that enables you to do your investigations and so on. But this group of workers, who do not have the required visas, are generally deported, and then their wages or the circumstances of their work fall by the wayside.

Mr Nockels : I will say a couple of things around that in terms of comment. Firstly, I cannot tell you whether those 38 individuals who we detained were in fact potentially being underpaid under the Fair Work Act. That would be something we would need to address to the Fair Work Ombudsman. That would be the first observation. Then, in terms of whether individuals have left of their own accord or have been detained and then removed, I know that the FWO—the Fair Work Ombudsman's office—has a number of cases where people have left the country but are owed back pay.

CHAIR: Are these workers without proper visas?

Mr Nockels : I cannot comment on whether they have proper visas or not. I just know that—

CHAIR: That has been, if you like, a grey area. What happens to workers who are found to not have the proper documentation? They are deported, so the issue of whether they were underpaid or not falls by the wayside. If we look at the most recent example, Benara Nurseries in Western Australia—I am a Western Australian senator—I think the initial raid on that property was done by Immigration, and some workers who did not have correct papers were deported, as we understand it. But there was a secondary group of workers there who had the right visas and who have been underpaid, so the Fair Work Ombudsman has been able to retrieve monies for that group. But, in terms of the first group, no-one is able to tell us whether they were underpaid or not. If you were an employer who wanted to be unscrupulous, you would certainly go for workers without formal documents. At the end of the day, if they get deported, no-one is ever going to follow up on a potential underpayment.

Mr Wilden : One of the points of difficulty here is that if the worker is participating in the workforce on a tourist visa they are actually in breach of their visa conditions. There is tension there with the concept of giving them their back pay if they have been in breach of visa conditions, given they had no authority to work. From an Immigration perspective, if you are here not abiding by the conditions of your visa, because you are on a tourist visa, you would by the essence of the action be treated differently than someone with a 457, who is legally here, legally working and being underpaid.

CHAIR: I guess that is the point I am making, but you can see that there could be an attraction for some employers to just pay that person $10 per hour, because they fall outside of our laws and they will probably be deported.

Mr Wilden : The department—through my colleague's section—would, in the instances where people are knowingly employing people who are here unlawfully or against the purposes of their visa, take a course against that employer. But that does not necessarily give recourse to the individual.

CHAIR: In relation to Benara Nurseries in Western Australia, have they been fined in relation to employing workers without the formal documentation?

Mr Nockels : I do not know that answer. I would have to check for that.

CHAIR: Could you take that on notice? The issue I was asking Fair Work about the other day—this is something I also pursued at Senate estimates—is that while I appreciate it is difficult to pursue a prosecution, in the case of Benara Nurseries we have kind of had two offences, if you like. I know there is a raft of other things, but for the sake of this I am really only interested in the visa workers. So we had workers without formal documentation being employed and who were then deported, as I understand it, but I am not sure what action was taken at that point. There has then been a second occurrence, which has involved workers with correct visas, where there has been an underpayment, and that was done via an enforceable undertaking. I appreciate that if they breach it there are sanctions, but it is as if this employer is getting away with it; there is no big prosecution being mounted against this employer potentially for the first offence and now this second offence. Both offences, in and of themselves, are very serious and we all want Australian laws upheld.

Mr Nockels : Again, I would have to go and check on the specifics of that case. But if we had enough evidence that would suggest that an employer, any employer, was contravening the Migration Act in the way that you have described, then we would be seeking to do something about that employer and that is where it would become a formal investigation sitting in my space where we would be pursuing potentially criminal charges and then, obviously, going through a brief of evidence and a court process. If it is specific to the Fair Work Act, then obviously it is something that the FWO would pursue from their perspective.

CHAIR: The second group was, but the first group dealt with workers who did not have the proper documentation and so that is clearly Immigration. Do you always prosecute employers, or is there a bit of, 'We’ll give you a first warning'? Is there a general rule of thumb that you would use, or is it always prosecution—what is it?

Mr Wilden : Everything is case by case. It would depend on the history of the person; it would depend on the size of the problem, if you like. We do find historically, through compliance activities, a lot of issues such as the underpayment of working holiday-makers and 457s are just administrative laxities as opposed to intent, so in those circumstances it is different to someone who is deliberately trying to hide information.

CHAIR: I appreciate that, but—

Mr Wilden : If you had a company that had come to our attention for the first time, we probably would not come down as strong as we could; we would want to find out the why, the where and the how. Often people with the best intent in the world do the wrong thing. We know some companies had thought they were allowing people to work—you are talking small businesses; they are not very sophisticated in their human resource practices. They employ someone who says, 'Yes, I have a visa'. They take them at face value. Should they show due diligence? Of course, but sometimes they do not. Again, that is a different scenario to someone who has wilfully said, 'Come on', or, you know, used relatives or contacts in another country to get people to them.

CHAIR: Although ignorance is not a defence.

Mr Wilden : Absolutely not, but that would guide us on the type of sanction we may apply.

CHAIR: So in the case of Benara Nurseries, the Fair Work Ombudsman—Ms Parker's opening address today was, 'We try and work together'—told us that they have developed good working relationships with Immigration and so on and so forth, but in the case of Benara Nurseries, the Fair Work Ombudsman was only vaguely aware that there had been this other raid on Benara Nurseries by Immigration. That does not strike me as a working relationship. The point that I made the other day was that we could have a situation where employers start to build into their business model: 'We might get sprung here. It'll cost us this much, but it's worth it and we'll keep going.' If there was not a fine for Benara Nurseries in the first instance, and I appreciate you have taken that on notice, and there has not been a fine from the Fair Work Ombudsman, then when do we stop Benara Nurseries doing what it has been doing?

Mr Wilden : If I may, I think one of the issues here really comes down to where both organisations have come from and where we are going. A couple of years ago, we had a good and productive but a fairly light-touch relationship with the Fair Work Ombudsman. In more recent times, we have codified through some memorandum of understanding a strengthening of that relationship. The creation of the Border Force has actually taken that up to a whole new level in the way we work together, the nature of the operations that will be undertaken, and then, subsequently, where operations find breaches, the actions that can be taken after that. When we look back I think you will see in the future that things will be treated differently. We are sort of in that phase of transition at the moment.

CHAIR: Given that this latest back pay by Fair Work was a week or so ago, would they now advise you that they have had issues at Benara Nurseries, given they told us earlier in the week that they were aware of the immigration rate? Would this now be a kind of pink flag?

Mr Nockels : Yes, in the sense that Taskforce Cadena has been set up and it is a specific joint agency task force where we will be sharing exactly that kind of information. If I could also just go back on my colleague's comments in terms of the working relationship with the Fair Work Ombudsman's office. Through that MOU and over the last couple of years, the level of focus of work between the two organisations has been quite intense, particularly around the 457 category of visas. We have made some changes in our legislation that allow Fair Work Ombudsman inspectors to be inspectors on behalf of the department, from a Migration Act perspective.

We also have provided them with direct visibility of our systems. They do not have a read-write, but they can look in from the 457 perspective, for example, and see who has it et cetera. They will be out there doing their compliance activities and if they see something that they think is untoward, they can come straight into our system and look to make sure that, yes, that person does, in fact, have a 457 visa or that person is, in fact, a sponsor of a 457 visa holder.

We also provide, again using the 457 subclass as an example, I guess what you could call 'referrals' or 'tip-offs' to each other. If they are going about an activity or vice versa and we see something that we think is in their patch, we would speak to them about it. So we get a number of referrals from them which we then, from our perspective, wash through our process in terms of our matrix to understand exactly what we see there. Then we would take particular compliance activity, if that was the need, against that organisation.

CHAIR: The Four Corners program showed some workers who did not have correct documentation being employed, I think, directly by Baiada or one of their myriad labour hire firms. More recently, the Fair Work Ombudsman's body of work reported on the way that Baiada and its labour hire companies structure one another. Given your recent MOU and Taskforce Cadena, is that now something that you are directly involved in?

Mr Nockels : When you say 'directly involved in'—

CHAIR: With Baiada?

Mr Nockels : And what the FWO has done there?

CHAIR: Yes.

Mr Nockels : As I understand it, the FWO's report has gone over the last 18 months or so.

CHAIR: Yes, but they have just recently published that report.

Mr Nockels : Correct. We have not been intimately involved in that, but certainly we are aware of some of the labour hire organisations who have been providing labour to Baiada.

CHAIR: Does that mean that, from an immigration point of view, you are looking at those operations?

Mr Nockels : In the broad, yes. That is what Taskforce Cadena is about: focusing our efforts from an intelligence, compliance and investigation perspective on the labour hire companies who we feel deserve that. Obviously, not all labour hire companies are in that space but some are, so that is where our focus is. Invariably the model, as you know, is that the companies themselves do not necessarily take on the workforce; they will use an intermediary.

CHAIR: I think it is a misnomer to use the word 'company' because it implies there is some sort of office and personnel.

Mr Nockels : There are, but the majority of people are not directly employed by the company.

CHAIR: No, but the Baiada ones are particularly, which is the focus of the report. You said you gather intelligence. Do you talk to the National Union of Workers, which has been the union uncovering a lot of this, or do they talk to you about concerns they have?

Mr Nockels : Not me personally—

CHAIR: Well, your department?

Mr Nockels : I think the commissioner spoke to union representatives just recently.

Mr Wilden : And, on a day-to-day basis, we obviously, through policy changes et cetera, have lots of consultations with a wide range of stakeholders, and I personally have had representations from several unions over the last few years where they feel there are activities; we then get that into the system and make sure it goes, nowadays, to David and his colleagues so that they can do the appropriate investigations. So, where we become aware of it, it is treated like any other piece of intelligence we might gain about possible behaviours or breaches.

CHAIR: I will hand over to you, Senator Rice, because I know you have to leave earlier.

Senator RICE: Thank you, Chair. As to the 457s, I refer to the statistic in your submission that, of the 457 sponsors that were being targeted for compliance, almost a third had some breach of their obligations. What is the nature of the targeting, first of all? How did you choose that subset of 4,000? That, to me, was a very concerningly large number; I just want your reflections on that.

Mr Wilden : I will speak in the broad, if that is all right, at the moment. Where we start in terms of that is: we have 35,000 or 38,000 registered active sponsors, as we call them. We run risk profiles in terms of how we manage most of our business. In relation to sponsors, for example, if it were a new business, as part of our due diligence on checking them as new sponsors, we look at elements like who is on their board, their committee, and who the owners are. Is there any relationship to other things they have done in the past? If they are an existing sponsor, it is their behaviour: have they been in breach before, et cetera? You sort of wash out people who we know are of potential concern because they have breached in the past, and we want to make sure they do not breach in the future because, if the nature of the breach is small, you do not automatically lose your sponsorship but we do pay a lot more attention to you. If it is very serious then, yes, you lose your sponsorship. But as to the ability to create new companies—that is where we look at issues like the owner of the company. If, for example, someone pops up who has been associated with other companies that have been sponsors that have been in breach then clearly we put a fairly big spotlight on that. So, through this sort of general process of understanding who is in the sponsor group, what their behaviours are and if they are new or longstanding, that drops us down from that sort of 30-plus thousand into this group that we want to look. Then, when we actually look at them, you go down again to the breaches, and, as I mentioned before, a lot of breaches are not intentional. A lot of breaches that come in are simple things like having not sent a letter in at the right point in time to notify us that a worker had stopped. It has to be done within a statutory period and they just do not do it because, with small businesses, it gets away from them. And then it goes right up to the very serious breaches where we find, if you like, patent fraud in their behaviours.

Senator RICE: Given that targeting, were you concerned with the level—that almost a third of those sponsors that were targeted had a breach of some sort?

Mr Wilden : Yes and no. You are always concerned. You would love a system where people have full compliance. The reality is, as I have said, that some of these companies are new to the whole game of getting an employee from overseas. They can read the books. It is like tax time. We would like to believe that everyone does the right thing by tax, but, through no ill intent, you can just make mistakes. Once you clear out, of the just over 1,000-odd, how many were not of a serious nature, and you get down to those of a serious nature, you are talking quite a small number in relation to a cohort of 35,000. So it is down under the one per cent. The issue then becomes: what is the nature of that? Is it patent? Is it organised?

Mr Nockels : To follow up on that: in terms of those statistics—and I think you quoted the two-thirds—that is in fact two-thirds of sponsors monitored. So it is going back to—

Senator RICE: Yes, that is what I was—

Mr Nockels : We use a risk-based approach obviously. So that is the 2,323. When we looked at them under the targeted risk-based approach, we considered them to have satisfactorily met their obligations. So just under a third of those—that is 1,184— were found to be in breach of their obligations. But then we go to David's point, which is: intentionally, or not intentionally, is it an education issue, et cetera? Of those unsatisfactory factory cases, a total of 609 were sanctioned—that is cancelling the visa or barring the sponsor from using the 457 program. So that is 609 out of the 35,000, or thereabouts. Five hundred and seventy five of those 1,184 received a formal warning, and 40 were issued with infringement notices. When you look at the statistical analysis of that, it is, in fact, quite a small number of people who we need to actually sanction.

Mr Wilden : In terms of numbers, as at 31 May there were 36,491 active sponsors accessing the 457 program.

Senator RICE: What surveys do you do of the ones that you are not targeting—just to get a bit of a feel across the board, those 35,000 sponsors, of a proportion of breaches?

Mr Wilden : When you say 'monitor', I guess the way we look at it is: most people enter the system with an intent on doing the right thing. It is where we look for behaviours that suggest they may not be that really triggers us. Our starting point is: with people coming on and off all the time, we have very big users of the program for big projects that might be going for a couple of years and that employ several hundred people, and then we have a lot of very small restaurants wanting to bring in one chef, for example. Based on the modelling that we do, we know the sort of industries that we need to pay more attention and the sort of occupations which are more likely to see breaches occur. Through breaking those down you can tend to target. For example, if you were to look at a new firm bringing in a number of engineers to work on a large mining project, the risks are fairly low. Their salaries are going to be up in the high 100s or 200s. That is a very different scenario than a small suburban business which has never been involved before and is bringing in a chef to work in their small restaurant. We then start to say, 'Is there anything else we need to look at here?' We make that assessment at the beginning. Then you need a behaviour or something to happen, either in the broad profile or with that particular company or visa holder, that would trigger a deeper look at them.

Senator RICE: Are there particular work types that you monitor as a matter of course?

Mr Wilden : As a matter of course, there are certain occupations which regularly appear in our non-compliant type area. We could probably get together something for you that highlights what they are. Again, a lot of it comes down to geography, occupation, salary level—those are the sort of indicators. If I can, I will take that on notice—

Senator RICE: Yes, take it on notice.

Mr Wilden : and come back to you with a short paper that sets out the characteristics or the issues that we look at.

Senator RICE: Thank you. That would be good. Moving on to the other temporary work visas, the working holiday-makers and the student visas, certainly the evidence presented to us suggests that we seem to have a bigger problem with those in terms of workers being exploited than the 457s. Could you just expand on your view on how those temporary visas are working? From the department's perspective, do you think that we do have a problem there?

Mr Wilden : It is not correct to characterise them as work visas. They are not work visas in the same way that the 457s are. The 457s are controlled; they have sponsorship; they have obligations around them. Whereas, a 417 or a 462 holder is, in essence, a holiday-maker with work rights, in the same way that a student visa may have work rights attached to it.

Senator RICE: Certainly the evidence we have had presented suggests that those visas are effectively being used as work visas.

Mr Wilden : Some may be. I do not want to downplay the issue, but, again, if you go to the fact that at any point in time there is 150,000 working holiday-makers in Australia and about 60 per cent of them choose to work in some capacity—and that could range from a couple of weeks through to, if you like, most of the two years they are here—if we scale it down, the program itself was set up many years ago as a cultural visa. As part of that, to enable people to come here they still have to show evidence of funds to enter the country and be granted their visa. They then come into country; after that, from a department of immigration's perspective, with it not being a work visa we do not have a monitoring regime for people who are on a working holiday-maker visa who choose to work.

Senator RICE: The ACTU has recommended to us that the department should collect data on the work done by working holiday and student visa holders. What is your response to that suggestion?

Mr Wilden : If that was to occur we would need a fundamental reconsideration of the program itself, the whole program settings and the nature the program, remembering that it is a reciprocal visa with other countries. The program is actually created by the Department of Foreign Affairs and Trade under an MoU. Whatever we did to change the nature of that program actually comes back to—I cannot remember how many countries we are up to now. You would be in a position where potentially you would have to renegotiate those agreements.

Senator RICE: Just to collect the data?

Mr Wilden : Sorry, if you were changing the settings, you would have to change the settings to collect the data, because we do not have any control points to enable us to collect that data, unless it were done voluntarily by the visa holder. We do not have a sponsorship role here. There is no sponsor obligation; there is no tie point. Students come in, they study and they are allowed to work during this period. We do not have any control over those who choose to work, over where they work, over the nature of the work they do. They are just participating in the workforce, as are working holiday-makers, and they are if you like bound by the same rules as an Australian being employed and monitored by the Fair Work Ombudsman.

Senator RICE: Do you think that is a problem? From the evidence presented to us, it seems to me that there does need to be some more data collected to see the extent of the problem that we have. We have received evidence that there is a problem. Whether it is systemic or not is difficult to tell.

Mr Wilden : Exactly. I suppose the counterpoint would be that the 457 program is heavily scrutinised and monitored. Even after the last couple of years, having had several large reviews, we still cannot say with any great accuracy what the level of fraud is in that program, down to those that are caught and those that are managed. In the same way, to set up a system we would have to know where these people are and how they are participating in our workforce. From a department of immigration perspective, we do not have any mechanisms to do that at the moment, unless you change the nature of the visa condition to one that had, for example, sponsorship obligations which shifted back onto the employer.

Senator RICE: One of the conditions with the student visas is that they have a 40-hour per fortnight limit. How do you monitor that and how do you uncover breaches of that requirement?

Mr Wilden : In similar ways that we do with other programs. You have the right to work 40 hours. The presumption is that you will abide by the conditions. To be blunt, there are places around universities that like employing university workers. We know where a lot of these areas are. We get dob-ins from the public or through the unions which highlight that students are being underpaid because they are being allowed to work longer hours. When that comes to our attention, it goes to my colleagues in Border Force, who would then undertake a compliance activity.

Senator RICE: How well do you think you are doing in uncovering that? The students might not be being underpaid but they may be working considerably more than their 20 hours a week. They reckon it is pretty good—they have got a full-time job and that is what they want.

Mr Wilden : The challenge will always be that one of the control points there is that if you are here you have to abide by the conditions of the visa, not only for us but by the conditions of your study as an international student. That means attending classes and doing all those sorts of activities, which immediately puts a limiter, if you like. Changes to the student program in recent years have shifted the onus onto universities to make sure that their students are appropriately enrolled and attending et cetera. We have been focusing at that end as well. Reporting of abuse in that system is not as high. I would argue that is probably because to come here as an international student is a very expensive business, so you are probably finding that to pay the fees—

Senator RICE: You might want to work more than 20 hours a week then.

Mr Wilden : Or, conversely, if you can afford to pay the fees and show us—because you have to show evidence of funds to the department before you enter the country. I cannot remember the figure off the top of my head, but I will get it for you. That is set at a limit that shows you can support yourself without the need to work. There is a break on that automatically. Yes, you can work if you wish, but if you choose not to the terms of your visa being granted go to your ability—you have to pay the fees and show you have enough money to support yourself in Australia for the duration of your study. That is not a requirement of the working holiday visa, other than the first few thousand dollars; you have to show that you have some money to come here.

Senator RICE: What resources does the department put into monitoring the 417 and the 462 visas?

Mr Wilden : I will have to come back with a number for you, because we have undertaken quite a lot of change with the Border Force creation. We used to have a student compliance team who used to do all of that—the investigation, desktop monitoring, investigating dob-ins et cetera. I do not know where they have ended up in the new structure.

Senator RICE: It would be good if you could take that on notice. Thank you.

Mr Wilden : Yes, that is fine.

Senator RICE: I will leave it at that for the moment.

Senator McKENZIE: The committee has heard evidence from the horticultural sector, in particular, and again this morning from people in the pork industry that their entire business sustainability relies on access to temporary visa holders, particularly the working holiday visa holders, because we cannot get a reliable source of labour in the time frame out in regional Australia. Is that a fair assessment? Does that match with the data and your understanding of the situation?

Ms Parker : I am going to answer it from an employment perspective. The department, and I think it would be fair to say our minister, would say, 'Look to the local labour market first and go to Australian job seekers first.' An example of that is the $5.1 billion employment services program designed to get people jobs, and there are a lot of people who were looking for jobs—825,000 job seekers. Ideally, we want them to be working, but our assessment and analysis is that there is always going to be some jobs that need to be done by temporary visa holders, including highly specialist and emerging areas where you cannot meet—or employers tell us and the evidence would show they cannot meet—short-term demand through employment and training. Some of the areas that I think the ombudsman pointed out were some of the agricultural areas where they have got seasonal stuff they want done quickly and they need to get a workforce together. Or there are a lot of those where mining projects and others come through and it might be easy for us to say, 'Plan five years in advance.' But until they get their licences and they get their agreements from state governments and local governments and it all lines up, they cannot get all that investment in place. So it is difficult.

The Australian government does not direct the recruitment practice of Australian companies, but there is a strong workplace relations legislative framework in place. Wherever there is a need for workers that cannot be met through our employment services, which is obviously what we would want—we want it to be met through our employment services or local workers—the department's view would be that there has to be strong protection and that should cover all workers and there should not be any discrimination in that regard. So the workplace law applies. We would also say that, given that the requirements to pay people above the safety net are in place, that says to employers, 'You not only have to bring them out and pay for them, you have to pay all the other entitlements they are owed, you have to pay them above the award—above, often, local enterprise agreements that are negotiated—and you had better think pretty seriously if you are going to do this.' So there are a lot of disincentives built in as well. There are strong protections they have to comply with.

Obviously, some of these examples that you have been given are totally not acceptable, but we would also say that the regulation that is there is strong and that the ombudsman does take strong, decisive action when it needs to. We welcome Taskforce Cadena because it will enable fraud and exploitation to be better tackled in a more seamless way. It is a longwinded answer, but I would say that there is no doubt any survey you see that has been done in this area would say that there are some companies that struggle to get local employees for a whole range of very good reasons. The balance is difficult, and the committee would know that the balance is always going to be difficult here.

Mr Wilden : If I may add to that in regard to one of the challenges, and I use this example often, because it struck me through a consultation we have been doing in recent times around reform to the skilled program, and I will come back to that in a moment. It was the Western Australian Farmers Federation who, through that consultative process, highlighted the challenges of needing people for periods of six to eight weeks when you are 600 kilometres from the nearest town. Most Australians are looking for full-time work, so that is very hard to do. And they have—certainly over the years—for those peak periods learned how to use the Working Holiday-maker program—people come out, they can stay on-site, they get paid, they leave. But that was over the years, as I said: at the beginning they train people for two weeks on the use of certain machineries, or whatever they use, than they get six weeks' worth of work, and then the next year they would love them to come back. Part of the policy work we are doing at the moment goes to reform of the skilled program, from the short-term, temporary businessman who comes out here to sell his wares for two weeks right through to asking, is there an opportunity for these sorts of markets to be better met through this concept of a short-term work visa versus the default, being a working holiday visa? Because it brings back in some of the controls we talked about before. Now, this is not going to be a '457 lite'. It is a very different approach. It is asking: are there opportunities for a visa to serve a very short, focused period of work—but the department can have better controls over knowing who these people are that are employing the workers, where the workers are going to be, et cetera. That policy work has been out for 12 months now, and we have had a large number of consultations with business, industry groups, unions. We are just refining the endpoint, which will come out in a couple of months' time.

Ms Parker : Just one other thing that is interesting: under the previous government—and there was a variation then under this government—there was a project we had in Employment called a job seeker relocation program. And at one stage, there were offers of nearly $10,000 to get job seekers to move from one side of the country to the other. You know, there were lots of jobs going in WA in the mining sector and there were lots of places available. It was incredibly difficult to get people to go and take up those jobs. There is probably a whole range of reasons for that. It was difficult for us to understand what those reasons were—cultural, community, we know the accommodation was expensive; you can give all the reasons—but the fact was that the incentives were put in by the government and people were not taking them up. So it is frustrating for employers.

Senator McKENZIE: I know we are not unique in the world, but our labour force—and our student population—does not seem to be particularly mobile or responsive. Is that correct?

Ms Parker : The Europeans we have met with, European bureaucrats and others, have said that European communities are much more mobile and that there is much more of a culture of moving. In some areas of the US there is not, because of a whole range of reasons including that the employer might pay for their accommodation and pay for their health and then, once you are locked into those, it is very difficult for people to move. We have some of that, too. The difficulty with WA was always going to be that the cost of the accommodation was astronomical, and people would have known that. It is very difficult to move someone from Tasmania to Perth when they have never lived outside of that community and it is quite strong—so I think it depends. That would certainly be our experience in trying to encourage job seekers to move. So yes; I think there is something in that.

Senator McKENZIE: We have been looking at the simplistic—I think—equation of the number of working temporary visas and its relationship to the number of unemployed Australians. There has been quite a public debate about the idea that there is some simple way in which they are incredibly related. My understanding is that it is a lot more complex than that. I am just wondering, Ms Parker: do you have anything that you would like to add around the public debate about the number of workers on temporary visas and its relationship to unemployment rates in Australia?

Ms Parker : It is always going to be a balance. One of the things that we do know is that having people on temporary visas does not have to just mean that someone else loses a job or does not get a job. They can create jobs. For example, it is estimated that the free trade agreements—they are obviously getting a lot of coverage in the media at the moment—will create 9,000 jobs per year. That is because employers get confident to take people on and they create more opportunities. That is why we are trying to encourage more women, for example, to participate in the labour force. Bringing more people in who may not be thinking of working or applying to work creates more job opportunities. It is good for everybody.

There is a perception that it is a very black and white thing—one visa holder gets a job and someone else loses it. But it is not that simple; it is much more complicated than that. If we want employers to survive and thrive, they need to be able to get workers. Hopefully, the aim of any government would be to have a balance in that, to have flexibility. You obviously employ Australians first. You skill up people. You take apprentices. You have the full range of workers when you are a certain size. But you also need the flexibility to be able to have casuals, part-timers and visa holders as needed. As we have said, governments cannot monitor every single visa holder. What you have got to do is take a targeted approach, which immigration and the Fair Work Ombudsman have been talking about. It is the same as the tax office or anyone would do. You have to do a cost-benefit analysis and a risk analysis, and do it in a measured way. You do not want to lock things down so much that people have to check in every week about where they are or what they are doing. There has to be a balance. We also want our young people to have the experience of working overseas and being able to take up a visa. Immigration spoke about the reciprocal part of this. There are big international issues here about diplomacy and so on. It is a complicated issue; it is certainly not black and white.

Mr Wilden : If you look at the 457 cohort, two-thirds are professionals. They are not the semi-skilled, they are the higher end. So they are not displacing workers. The 457 program, being a temporary visa, is designed to be responsive to the labour market. I think you will find that that plays out. A very good example is nurses. We had shortages of nurses for a very long time. But as we are now starting to bring more nurses out of the Australian system, the number of 457 nurses has dropped significantly in the last couple of years. However, you are not going to get like for like; you will hear that nurses cannot get jobs when they graduate but, unfortunately, we still have to bring in 457s to be critical care nurses in Broken Hill because a new graduate cannot do that. So there is always going to be that little overlap. People may not get jobs as a nurse, but a nurse is not a single construct; there are many different types of nurses. So you might get a bulge. Until the 457s numbers in general nursing drop, you will not have full employment there or it will take time to get employment. But that does not mean you will not have a need for specialist individuals in particular places.

Senator McKENZIE: The nursing issue may be a bit like the doctor shortage: it is a maldistribution rather than a skills shortage.

Mr Wilden : Absolutely.

CHAIR: In terms of the 9,000 jobs created as a result of the free trade agreements, which free trade agreements are you talking about?

Ms Parker : China, Japan and Korea—a combination of the three.

CHAIR: We heard evidence in Sydney from a local tradesperson who worked in an engineering plant. He gave evidence of where the company had brought in 457 visa workers and he was required to train them up. He was then made redundant and the 457 workers stayed on. One reading of that scenario would be that those workers were brought in to take his job. How do we guard against that kind of occurrence? I am not sure who is responsible for policing that.

Ms Parker : Is it a Fair Work Ombudsman issue?

Mr Wilden : It probably crosses both portfolios. From our side, when you become a sponsor and nominate a position that you wish to fill, you need to show what you are going to pay and a whole pile of characteristics about your company—the size of your company and all of that.

CHAIR: Yes, we understand all of that.

Mr Wilden : That is the first thing. Let's assume that we say that all looks fine and they can employ the worker. After that, unless we become aware of a breach or it comes up through some other means, we do not do close monitoring. If a circumstance like that was brought to our attention it would immediately go into the monitoring unit and they would say, 'Is there anything behind this?' We get lots of claims—and it goes from 'there is something in it' to 'the person was sacked for a whole pile of reasons they did not tell you and here are those reasons'. It is always very difficult to make a general response on how we would respond to that particular circumstance.

CHAIR: Then how do you sift the wheat from the chaff? After the event, it is very easy for the employer to create a story that would satisfy you if you went in there to—

Mr Wilden : I would like to think it is not that easy to fool us. We have got some pretty skilled investigators.

CHAIR: Baiada Poultry are getting away with murder. Everyone seems incapable of dealing with them to stop the practices that are going on.

Mr Wilden : I am talking about 457s.

CHAIR: I know. But they are very capable at creating a whole environment that no-one seems to be able to actually stop.

Mr Wilden : Sure. In the 457 space, in circumstances like that, as I said, it ranges from individuals saying, 'I have,' through to allegations that they sacked the whole workforce. Basically, we investigate. If there is anything to it, action is taken. If there is not, as you said, we can only act on evidence. If evidence is provided that a person is let go not for the reasons they are purporting, unless we can have counter-evidence, it is supposition. That is where the skills of our investigators come into it. They say, 'Where is the threshold of evidence that says something has occurred that is not right, that is in breach of your obligations as a sponsor?'

 

CHAIR: In that case, you could quite easily construct a 'he said/she said' scenario. You are coming in after the event—the worker has been made redundant. The worker's story is that he had to train up the workers—which is in the evidence from Sydney—and subsequently he was made redundant. But the employer could put a different story. You are not working in real-time, you are working after the event. So at the end of the day you have to believe one story over the other.

Mr Wilden : We would make a judgement based on what the evidence showed us. For example, if there were several workers, with follow-up applications for 457s, that would raise much more significant questions than a one-off event would.

Ms Parker : Chair, what you are talking about depends on the circumstances. It could be an unfair dismissal claim.

CHAIR: No, this worker was paid out—a redundancy.

Ms Parker : But if the worker does not want to be dismissed and says they do no want to take the payout, they can go to the Fair Work Commission and say they are being unfairly dismissed—and then there is a case made there.

CHAIR: I understand that.

Ms Parker : So I guess there are two sets of protection.

CHAIR: Let me give you another example—from the meatworkers union in Queensland. They seem to be on top of the industry and understand it well, and they have done a lot of work in trying to get jobs for local people. They say that across the meat sheds in Queensland, the meat processing plants, there used to be a significant use of 457 visas workers—and I understand there is a labour agreement across that industry—but that is now being circumvented by the use of 417 visa workers. On top of that, the meatworkers told us, there is an enterprise agreement in place across most of the meatworks and for a boner—which is where the 457 workers used to be, but now they are using 417 visa workers—there is a 30 per cent difference between the enterprise agreement and the award. In relation to the rest of the workforce—I think they call them labourers—there is a 20 per cent difference between the enterprise agreement and the award. So what is now occurring in some of those meat processing plants is that the labour hire companies are bringing in a cheaper workforce on the award. They are not obligated to pay the enterprise agreement because it is between the meat factory and its employees—and the union if they choose to be a signatory. So what is happening is that there is downward pressure on wages and we have got an infiltration of 417 visa workers. None of that is illegal, but it is not appropriate and it is a deliberate driving down of wages by the employer in the use of these 417 visa workers. You have a labour agreement in place and an enterprise agreement in place, but, in the boning rooms in particular, there is this emergence of 417 visa workers.

Mr Wilden : I cannot comment about the—

CHAIR: None of that breaks the law, but it is clearly inappropriate.

Mr Wilden : From the department's perspective, as you said, we do have a labour agreement for that industry. It is only for those specified occupations.

CHAIR: Boning is one of them, isn't it?

Mr Wilden : Yes, there are three occupations, I think, off the top of my head. They are mid skill level; they are not the unskilled workers.

CHAIR: Yes, I appreciate that.

Mr Wilden : That is an industry—meat boner, slicer, slaughterer. Regarding the agreements, there are 27 in meat boner and slicer, eight in the slaughterer category and 393 as skilled meat workers. So there are a total of 428 workers across Australia under the labour agreements in the meat industry, and there are 28 companies that have them. That, if you like, is the slice of workers on 457s. But, going back to earlier statements, we do not monitor 417s.

CHAIR: If you saw that occurring, would you say to the company, 'Look, you're not doing the right thing here'? What is your response to a situation like that?

Mr Wilden : We would not have a response. That is a FWO issue, because it comes to how the industrial system is working.

CHAIR: It is not, because nothing in that scenario is illegal; it is inappropriate, but it is not illegal. There is the case of blatant rip-off, which is the Baiada case, but in the meat industry it tends to be, 'We've got labour agreements in place, but actually we can get this whole other workforce, because even though it is classed as a skilled occupation it is not certified.'

Mr Wilden : Yes, it is semiskilled.

CHAIR: 'So we can train them up and use them and pay them at the award rate.'

Mr Wilden : From our portfolio's side, all we are involved in is that request that, when becoming a sponsor, accessing labour agreements and requesting 457 workers, you have to meet the conditions of the 457 workers. We do not have visibility in this.

CHAIR: Sure, but it goes back to the point that Senator Rice used: the 417 visa, which gives work rights but is not regulated in the same way the 457 worker visa is, can be sourced at a cheaper rate and is being used.

Mr Wilden : They are what they are. The 457 is a structured, sponsored program; it is one option an employer could choose to fill their vacancies. Regarding 417s, we know a number of the meatworks, for example, have done a great job resettling refugees who come in and are unable to have work rights. I cannot talk to the issue of pay rates. That is not in my area of expertise.

CHAIR: But it is in the evidence. I am not asking you to do that, but we have this situation which is occurring. That is the point that I have been making. We understand that the National Farmers' Federation has a research project underway looking at this lower skilled work visa. Whilst we can all recognise that there are seasonal needs in that sector, you could put in place that low-skilled visa with all the protections in the world, and it could still be undercut by 417 visa workers. The difference is that 417 visa workers can work anywhere across our labour market with no restrictions. That might be fine, but then we have these restrictions on other classes of visa. The obvious thing is that you bring in the cheaper worker. So it seems to me that we need to look at that 417 class of visa to at least give it a market rate that is similar to whichever other visa class it is in competition with, because clearly there is now this competition in visa workers, which puts downward pressure on wages.

Ms Parker : They are here for six months only, and with one employer.

CHAIR: Yes, but then they can do the regional bit and get the extra year.

Ms Parker : That is right.

Mr Wilden : They can only stay with one employer for six months. As you have probably had evidence about, people can go from one to the other to the other to the other. So if you have a company with, you know, 'buddies', you can certainly work your way around.

Senator RICE: And are working for—

CHAIR: We had two pork producers here today who are producing a premium product. They are not interested in workers for six months, but a contract cleaning company, a boning plant—any of those areas—would be quite happy to turn that workforce through. It seems that there is not this issue in the wine industry. It has similar problems to the pork industry. It is trying to attract long-term employees. But, in other parts of our labour market, there is a significant problem. Is this something the department is looking at, Ms Parker? You said you undertake workforce analysis of the labour market. Clearly, you know the areas of exploitation—contract cleaning, hospitality.

Ms Parker : Yes.

CHAIR: I note in WA there is a whole raft of prosecutions again.

Ms Parker : Yes, that is right. The Ombudsman has good data on some of that. I hate to do this in an inquiry. I think it is more a visa issue. You are right. What you have said is how the EBA works and the award. I mentioned unfair dismissal, but you can only take unfair dismissal when you have actually been dismissed or feel you have the power to take an unfair dismissal claim, and there are adverse action claims you can bring as well. Of course, workers have the right to bargain, but, again, there is a grey area with all of this. What sort of research were you thinking about?

CHAIR: We heard today—I cannot remember which group it was; it was one of the migration groups—that you were undertaking surveys.

Ms Parker : Employer surveys—yes.

Senator McKENZIE: The Migration Council this morning.

CHAIR: Yes. I am wondering whether this issue of the 417 visa is something you were looking at, in terms of the impact it is having in reducing pay rates across an industry.

Ms Parker : That is an interesting question. I will find out for you.

CHAIR: All right. The other thing is that the pork producers were very dissatisfied with Immigration. They said they used to have business liaison officers that they could deal with. We had two providers: Windridge Farms, which is a very big provider, and the other company, Murray Free Range, is a boutique provider. I do not think they knew each other before today, but they both had exactly the same issues of saying: 'We make one mistake and we have to go back and do our forms again, and that takes months. We call the department and we get a different person each time.' I think Mrs Murray said she called the department for a week—

Senator McKENZIE: No, that was Mrs Wallace.

CHAIR: Sorry, Mrs Wallace had called the department for a week and the phone rang out. When they had the business liaison officers, they could say, 'You've made a mistake. You've put the wrong code in. Just fix that.' They both told us independently of the complex, long and involved process—

Senator McKENZIE: And frustrating.

CHAIR: Yes—frustrating process. I appreciate that we should have checks and balances in the system—do not get me wrong; I am not saying it should be open slather—but this seemed to be a lack of resources.

Mr Wilden : I would argue that we do not have a lack of resources. The question is: how do we provide service at any point in the process? The name has just gone out of my head. We used to have industry reps—

CHAIR: Yes, they called them business—

Senator McKENZIE: Business liaison officers—

Mr Wilden : That is not that name, but I know who you are talking about. They ceased a couple of years ago. Ultimately, they became—

CHAIR: Were they part of an efficiency dividend?

Mr Wilden : They were part of a general look at how we do our business. They were not specifically an efficiency dividend. When we look at how we do business, that was an area where it was decided that we would not continue those roles. Ultimately, if they moved from being a liaison type position to what we do in our contact centres, it would be exactly what you were saying: 'Could you tell me how to fill in a form?' The question comes down to: why would industry X, Y or Z or company X, Y or Z get a boutique service to find out how to fill in a form when the rest of the Australian public and people overseas come through our normal mechanisms, through the contact centres?

Senator McKENZIE: One of the issues we heard—and we heard it from ACCI as well—was that, rather than additional regulation or legislation in this area, education and monitoring compliance would probably solve a lot of the issues we have been hearing about. One of the roles of this particular officer was to head out of Canberra and out of the department to communicate directly with employers about their responsibilities. That was an educative role rather than just being a point of contact. I wanted to ask both the Department of Employment and the Department of Immigration and Border Protection about the extent of your role in educating both employers and incoming temporary workers of their rights and responsibilities.

Mr Wilden : Regional outreach officers were their names. Yes, we still do have an education-type role. We have been increasing through the use of our correspondence. As I said before, in the last couple of years I cannot tell you how many forums I have sat at where we talk about policy change and where we seek feedback et cetera. At the end of the day, in the e-world we have, pretty much anything you need to know about our organisation, how it works and the forms that apply is available on our website—

CHAIR: People complained about that. They said it was complicated—

Senator McKENZIE: And that it changes all the time.

Mr Wilden : It changes all the time because policy changes, and we have to reflect those policy changes. On the issue of complexity, it is a complex business that we are in. We have nearly 100 visa types; they range from family relationships to short-term, long-term, permanent migration—

CHAIR: These are growers who knew what they wanted. They were applying for 457 visa workers. Both appeared to be good employers, but they both talked about getting different advice, having a week when phone calls went unanswered and getting a reference wrong. They said there were four or five references they had to put and so it was easy to get a reference wrong, and that caused them to start the whole process again. Their business is pork and not filling out forms.

Mr Wilden : I accept that. The issue we have is: we have the regulation we have until government decides to change it.

CHAIR: I do not want to see less regulation, but this is more than that. This is frustration because they get a number wrong or the call is not answered—that is the crux of it. I think regulation is good; we should have more of it.

Senator McKENZIE: That is not quite a unity ticket.

CHAIR: They understood the need for there to be regulation, but this is frustration from getting incorrect information and calls going unanswered. If they make a little mistake, they have to go right back and start again. How do we get over that? That is not policy change.

Mr Wilden : We also have to accept that, but if you happen to make a little error with your ABN it is a pretty significant error. We need to make sure that we are calibrating the nature of the mistake.

CHAIR: Why should it cause you to go back to square one and start again?

Mr Wilden : You do not necessarily have to but, if it is a big error, you may need to. I cannot speak to what they presented to you. In terms of how we would run a normal process—

CHAIR: Presumably you want to expedite the process and so why can't someone pick up the phone and say: 'Excuse me, Ms Lines, is that really your ABN?' There has to be give and take. It is not a bureaucracy where you have to fight—

Mr Wilden : We do not have a cookie-cutter approach to all phases of what we do. There are circumstances where I know we do exactly that. Going back to my very early statements, a sponsor is not necessarily a sponsor. There is a big difference between a small business person who has never used our system and struggles with it and very large firms who use it every week and who go through it seamlessly.

CHAIR: These people have used it before. You cannot fob them off because of their inexperience. They are good employers who over a period of 10 years—

Senator McKENZIE: Twenty-five years, wasn't it?

CHAIR: used 457 visa workers. They appreciate that things change. Their frustration was not with change; their frustration was with your website, which is difficult to use, with unanswered calls and with making little mistakes and having to start the process again. Mrs Murray said that she had paid the $350 and was told that she would have to pay it again. They fought that and they got the fee back, because they had made an error. You can show leniency with employers when they make mistakes on wages, as you said earlier, but here we have two employers trying to get 457 worker visas and if they make a mistake they have to go back to square one. You are treating people a bit differently here.

Mr Wilden : I cannot speak in detail to that. I do not know what the allegations are. I do not know the circumstances. I do not know where they are in the process. Are there cases where we would do that? Yes, absolutely. If somebody has made a very significant error in their process, we will send it back. Are we perfect? No. We will occasionally not answer phone calls, because volumes go up because, if a policy change comes in, a lot of people want to talk to us. Depending on the seasonality of the particular program, our call volumes go up. So there is always that load balancing, if you like, between high-quality availability and client service and the cost of that service. They are judgements that we make all the time. In terms of those two particular instances, I cannot speak to if they played out exactly as you have said. I have no reason to doubt that, but I do not know what those triggers are.

We try to deliver to good quality client service to employers and to visa holders. We try to present the best information we can on the website. We will always hear when people find it difficult, but we also hear it when people say: 'I love the new update. I found things a lot easier.' So I think that we are always going to suffer that tension, but our intent is to provide good service, to have accurate information available and to provide efficient processing of visa applications, sponsorship applications and nomination forms.

CHAIR: In relation to the 457 visas, we have heard story after story—and again from the pork producers—of 457 workers converting to permanent employment. Is that a key element of the 457 visa?

Mr Wilden : It is not a key element, but it is a pathway.

CHAIR: So it is a recognised pathway, is it?

Mr Wilden : If you are here as a 457 worker, you are allowed to apply for other visas. If you have a sponsor who you are working for and who wishes to sponsor you permanently as opposed to temporarily, you just enter that process. All that it is is the permission to do so. There is no automatic right to move off a temporary visa on to a permanent visa. A permanent employer sponsored visa, for example—which is the primary one that they come through on—is a visa that you apply for the same whether you are in country or out of country.

CHAIR: Do you keep stats on what percentage of 457 workers convert to—

Mr Wilden : We do. I do not think that I have them with me, but we can certainly provide them.

CHAIR: Can you give those to us on a yearly breakdown?

Mr Wilden : Over the last five years?

CHAIR: Yes.

Mr Wilden : Okay.

CHAIR: What is the process? Is it very bureaucratic? Does it happen quickly?

Mr Wilden : It is probably slightly more expedited than if you are applying offshore, because we know a lot of stuff anyway; we already know all of those details, but you still have to go through the same process. The direct route is slightly shorter because we do not need as much information, because we already have it. That is basically the difference. The actual decision is no different: you still have to meet exactly the same thresholds for transitioning a 457 worker on to a permanent visa as you would for employing a permanent employer sponsored person from overseas or someone who is onshore on a different visa.

CHAIR: Presumably, as you said, once you have been here—two years, is it?

Mr Wilden : Two years minimum, yes.

CHAIR: Presumably your English has increased. So what tests do you need to meet?

Mr Wilden : Rather than run through that now off the top of my head, I will provide for you the criteria for 457 visas and the criteria for employer sponsored visas. They are the two main ones that people come in on. People coming here as tourists apply for permanent employment. It is only what you are allowed to do onshore or offshore.

CHAIR: I am not a visa expert, and I do not pretend to be one, but it does kind of raise some questions for me. In Melbourne, we were given the scenario of perhaps a young person coming out, doing their primary school in Australia, then secondary school, then university, and then eventually getting permanent citizenship. Along that route, that person has spent their formative years in Australia and is probably as Australian as I am, yet for the whole of that period of their life, say if they came here when they were 10—I think that there is an age restriction, but it is much lower than that, isn't it? There is an age threshold?

Mr Wilden : There is an age threshold. It depends on the visa the parents are here on. There is a whole pile of variables.

CHAIR: Someone could sit until they were 15 years on that kind of precarious route to permanent citizenship and different rules apply across that spectrum. The point was made that Immigration does not keep any stats on that. That person could have had two or three different visas during that time, couldn't they?

Mr Wilden : Probably not. If they were here for that length of time as a child—

CHAIR: Yes.   

Mr Wilden : So they were here with their parents. Whatever their parents—

CHAIR: Or they were sent here to board.

Mr Wilden : Quite possibly. If they were here as a student, yes. They can be sent here for a long time as long as their parents pay their fees et cetera.

CHAIR: So is that the same student visa from primary school through to—

Mr Wilden : No, there are different visas depending on whether you are in the tertiary sector, vocational sector or—

CHAIR: Yes, that is the point I am making. So there are at least two visas there.

Mr Wilden : Yes.

CHAIR: For that whole period of time their entitlements might change as well.

Mr Wilden : As a student probably not. The conditions of being here are pretty similar across them. It is just a boarding school is different than an independent adult at—

CHAIR: Yes, that is right.

Mr Wilden : There would be criteria that would be different.

CHAIR: But do you keep stats on that conversion? If someone is here as a boarder on that visa then becomes a vet or a university student, presumably there is a change in the visa, is there?

Mr Wilden : You have to change visas, yes.

CHAIR: So are you keeping stats on that progression?

Mr Wilden : We keep an enormous amount of data. We would not keep that as a matter of course, but we could find it. If required, we can run reports.

CHAIR: How then are you keeping a handle on the increase in permanent residents? If that is not capped, if I can convert from a 457 to a permanent resident, or I could go this very long route, and then we have also got immigration programs and refugees, who is keeping the big count here?

Mr Wilden : We do. For example, if a 457 comes on ENS they are counted in the migration program.

CHAIR: So that would be a number off the migration—

Mr Wilden : Anyone coming permanently is counted—

CHAIR: Regardless of how they come?

Mr Wilden : Regardless of how they come, if they are on a permanent visa they are in either the migration program or the refugee humanitarian program.

CHAIR: Do you then factor in, 'Look, we're going to get 20 per cent of our immigration intake from 457s'? Is that factored in?

Mr Wilden : It is part of our planning process, yes. Historically, the main pathway, the permanent stream has been family and you basically put your application in and get in with everyone else and through data we process you. In the skilled stream there are several categories in there. There is business investment, direct employer sponsorship and what we call the general human capital stream, which is independent skilled people coming in. We use the skilled occupation list which sets a series of parameters for a number of those programs. We work with states and territories on how many places they think they need. We track the pathway for the 457s, for example, if it is, say, 25,000 a year. So we can plan how many we think will come in and then over the course of the year, if needed, you can move places in the program. The program has been 190,000 for the last three or four years, made up of, roughly, two-thirds skilled and one-third family and other.

CHAIR: Senator McKenzie just reminded me of a question we were talking about before. Of the recommendations in the report that was done, the Robust new foundations: a streamlined, transparent and responsive system for the 457 programme, you have not supported the legislative requirement for labour market testing. As you would no doubt appreciate, in the Robust new foundations report there are two schools of thought on labour market testing. One is less and one is more. I am just wondering why there is the noted piece there. Is that entirely because there are two schools of thought?

Mr Wilden : I cannot speak on behalf of the government. The paper was done by an independent group. They came to a series of findings and the government decided that they would note that finding and have chosen not to make changes to the current system.

CHAIR: Did the department give advice to the government on these recommendations?

Mr Wilden : The sort of advice we would give on those recommendations, say, for labour market testing would be, 'If you wished to change labour market testing here is how you would do it—through legislative change, regulatory change et cetera.' As I said, the view there was that at the moment the system does not need to be changed and noted that that was what the committee thought but there is no proposal to change the current system.

CHAIR: But did you give this advice to government?

Mr Wilden : No, that is the recommendation. The recommendations were done by the independent—

CHAIR: Yes, I know. Then the government 'supported in principle', 'supported' or 'noted'—as in the case of labour market testing. So was that on advice from your department?

Mr Wilden : No, we would not advise the government to accept or not accept findings. We would advise the government on what each of those findings meant in terms of policy change, impact or whatever, and the government would make a choice about whether or not they wished to accept it. Sometimes governments accept things and do not even ask for our advice.

CHAIR: True. Did you have input into that, Ms Parker?

Ms Parker : The?

CHAIR: The Robust new foundations recommendations.

Ms Innes : We participated in some of the early discussions that the independent committee had and we were involved in working closely with Immigration.

CHAIR: But did you give advice to government on any of the recommendations?

Ms Innes : Only as they relate to our portfolio responsibilities.

CHAIR: So you would have said, 'This should be supported'?

Ms Innes : On labour market testing? That sits with Immigration.

CHAIR: No, I am just speaking generally.

Ms Innes : We would just give information about the labour market and the workplace relations aspects of the various recommendations. As Mr Wilden said, it would be providing advice to government on what their recommendations mean.

CHAIR: So when we get to the government response and recommendation 1.1, which says 'supported in principle', has someone in the minister's office put 'supported in principle'?

Mr Wilden : No. The government publishes the outcomes based on a whole pile of input. The first input is the report itself. Then, as we said, departments and any other interested portfolio provide advice on what it means and what would be required to do this and then the government make a judgement on what they wish do and publish the government's formal response.

CHAIR: Would you say, for example, 'We recommend no change'?

Mr Wilden : We might say that, yes. It depends on what the actual is and what the question asked of us is.

CHAIR: Have you done work on other ways of testing the labour market? I am not sure whether it is Ms Parker or you, Mr Wilden.

Mr Wilden : I would like to give it to Ms Parker but I think it is mine.

CHAIR: You think it is yours?

Mr Wilden : I think it might be.

CHAIR: I have been quite attracted to the UK model, where there is an expert panel that makes a recommendation about the skills list but ultimately the government makes the decision and it does not rely necessarily on employers; employer unions and other stakeholders have an input to the expert panel and they make the recommendation rather than the initial analysis coming from the employers. Have you done work around those sorts of model?

Mr Wilden : In terms of where we are compared to, say, the UK model, which I am quite familiar with, there is a body that has just had its first meeting recently, having had a period of recess while the—

CHAIR: Yes.

Mr Wilden : They are still working through how far their reach will be, but their key role is to advise government across the broad range of issues around skilled migration. It will go to some of these very issues around state use of labour market lists, for example, and how the training benchmarks work. They will have a very broad remit in terms of advising government on what the current policies are doing and whether they should be changed et cetera.

CHAIR: How was that committee membership arrived at?

Mr Wilden : Basically, the government or the minister offers people to come on board. There are certain parameters in the legislation around the make-up. Off the top of my head, it is industry, state and territory governments, unions and I think the rest are discretionary. So we may have an academic or we may not have an academic et cetera.

CHAIR: Did the department put up any names or make suggestions?

Mr Wilden : The department was asked for advice, so we put up names of people who come from different sectors that they may wish to consider.

CHAIR: Did you put up names, too, Ms Parker?

Ms Parker : I do not think we did. It is the usual approach to setting up these kinds of committees.

CHAIR: Did you, Ms Furnell, given that you do the skills list?

Ms Furnell : Not that I know of.

 

Mr Wilden : We may have had informal discussions. As a matter of course, we know who is in the sector and then there is a range of options for how they can be put together. We come up with a list by talking to colleagues et cetera. I do not think there was a formal approach to our colleagues for names, for example. If you are going to look at, for example, union membership, we know who the big unions are.

CHAIR: The ACTU is on there.

Mr Wilden : They are, yes. We would say, 'Here are the main unions that participate in these particular schemes, so you may wish to pick one or all.' It is the same with the business community and state and territory governments. You can have all or you can have one. They have gone for one.

CHAIR: We had an academic in Adelaide the other day say that she thought that there was a missed opportunity with the committee because all bar one of the members of the committee supported increasing our visa worker intake.

Ms Parker : I am not sure how she would know that.

Mr Wilden : Was that Joanna Howe?

CHAIR: Yes.

Mr Wilden : I am aware of her work.

CHAIR: And you must be aware of her view as well?

Mr Wilden : Yes.

CHAIR: She said it on the record.

Mr Wilden : I have not read that particular piece of evidence. That is a view.

CHAIR: What did you want to tell me? I have just about finished my questions.

Mr Wilden : If you have others, I will have a look at this and maybe have a quick chat.

CHAIR: I do not have any others.

Mr Wilden : If you wanted it now we can provide independent evidence of funds requirements for students. Going back to our earlier conversation about whether they would be exploited, I have a bit of information available here if you would like it on—

CHAIR: I think Senator Rice asked that question.

Mr Wilden : Yes, I think so. We can provide that on notice.

CHAIR: Yes. Senator McKenzie, do you have any further questions?

Senator McKENZIE: I am submitting a question on notice around temporary working visas and unions. It is all easy data.

CHAIR: Thank you very much for coming along today. We look forward to a fruitful relationship with Immigration and FWO. If you can stamp out Baiada's bad practices that would be good.

Committee adjourned at 16:37