Market Rates For Temporary Skilled Overseas Workers

Market Rates For Temporary Skilled Overseas Workers

The Minister for Immigration and Citizenship, Senator Chris Evans, today announced details of the requirement for temporary skilled overseas workers to be paid market salary rates.

The payment of market rates will ensure subclass 457 visa holders are on the same wages and conditions of employment as those provided to an Australian worker undertaking equivalent work in the same workplace.

Where there is an equivalent Australian worker in the workplace, the market rate will be determined by the industrial arrangements that apply to this worker for example, a collective agreement, award, award conditions with above award salary rates or a common law contract.

Where there is no equivalent worker onsite, the employer may reference collective agreements or awards for that position to substantiate the market rate. If there is no applicable agreement or award, other evidence such as remuneration surveys or earnings data must be provided.

"The Rudd Government has made it clear that temporary skilled overseas workers should not be employed ahead of local workers because they are a cheaper option," Senator Evans said.

"The Subclass 457 visa scheme is a demand driven program designed to supplement not replace the local workforce when there are serious skills shortages."

Under current arrangements, employers are obliged to pay workers on subclass 457 visas the Minimum Salary Level of $45 220 or the award rate. This means overseas workers can be paid less than an Australian employee in the same workplace who may be paid at above award rates which is the market rate.

"For example, tradespeople working on mine sites or other industries where skills are in high demand are often paid well above award rates," Senator Evans said.

"The payment of market salary rates will ensure that overseas workers are not used as a cheap form of labour or used to undercut Australian wages and conditions."

Market salary rates will apply to all new subclass 457 visa holders from 14 September 2009 except where annual earnings of $180 000 or more are proposed.

Visas will not be granted to new subclass 457 visa applicants if the market salary rate for the position is below a Temporary Skilled Migration Income Threshold of $45 220. The threshold will be indexed in line with ABS earnings data.

Under transitional arrangements, employers currently paying less than the market salary rate to existing Subclass 457 visa holders employed in Australia will have until 1 January 2010 to commence paying market rates.

"The implementation of market salary rates is part of a package of reforms to improve the integrity of the subclass 457 visa program," Senator Evans said.

"These reforms will ensure local training and employment opportunities are not undermined and prevent the exploitation of foreign workers while enabling industry to access skilled overseas workers where there are skills shortages."

Reforms to the subclass 457 visa program announced in April include:

*Increasing the English language requirements for subclass 457 visas in trade occupations and for chefs;

*Introducing formal skills assessments for all trade occupations from countries that are not considered low-risk countries;

*A requirement that employers of subclass 457 visa holders attest to a strong record of, and commitment to, employing local labour and non-discriminatory employment practices;

*Developing formal training benchmarks for sponsors, and

*Requiring labour agreements for employers of 457 visa holders in ASCO 5 7 occupations.

From 14 September 2009, new worker protection laws will strengthen the integrity of the temporary skilled working visa program, assist in improving workplace safety and ensure overseas workers are not exploited.

The new laws will enable specially trained officers with investigative powers to monitor workplaces and conduct site visits to determine whether employers are complying with the redefined sponsorship obligations.

Employers found in breach of the obligations in the Migration Regulations could be fined up to $33 000 and the department will retain the ability to cancel an employer's approval as a sponsor or bar them from making further applications for overseas workers.

The new laws will also enable the Commissioner of Taxation to disclose tax information to the Department of Immigration and Citizenship in order to ensure correct salary levels are being paid to visa holders.

Media Contact:
Simon Dowding
(02) 6277 7860
0411 138 541

SOURCE: Minister for Immigration and Citizenship, Senator Chris Evans