02/07/2008 - 22:00

457 visa reforms to lift costs

02/07/2008 - 22:00

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New laws to reform the 457 visa program are expected to increase costs for employers and make the system more difficult to use, according to some industry groups and migration consultants.

New laws to reform the 457 visa program are expected to increase costs for employers and make the system more difficult to use, according to some industry groups and migration consultants.

The federal government this week released a discussion paper outlining a number of reforms that could be adopted in legislation later this year, as part of an attempt to clarify sponsor obligations and penalise employers that exploit the system.

Of chief concern to businesses are a number of non salary-related costs that may be introduced for sponsors.

These include paying workers' travel costs, recruitment fees, migration agents' service fees, licensing and professional registration costs, medical costs or health insurance and education costs for children.

The Chamber of Commerce and Industry WA said it was concerned the proposed reforms would significantly add to the financial and regulatory burden of employing workers from overseas.

However, the Australian Mines and Metals Association said that even if the changes are introduced, they may not affect mining companies as much as businesses in other sectors.

The organisation's principal employee relations consultant, Geoff Bull, said most of its members did not encourage workers to migrate with their spouses and children because they would be working in remote locations.

Mr Bull said the AMMA had not decided whether it would be lodging a submission on the paper.

According to Interstaff Recruitment's Dan Engles, the legislation will effectively reintroduce the reforms that were already tabled by the previous government in draft legislation last year.

Mr Engles said one proposed change, which would require employers to provide income protection insurance to 457 visa workers, had already prompted concern from some clients.

"The rationale seems to be that if there's a gap in work for the individual, the employer is required to compensate, rather than sending them offshore again," he said.

"I think employers would be very concerned with the escalating costs. It's definitely making it more expensive for employers and there don't seem to be any concessions."

Mr Engles said the clause was directed at labour hire companies that may have exploited the system, but it was made redundant by reforms already introduced in October last year.

The new legislation, scheduled for introduction in September, will focus on four main areas - refining sponsorship obligations, improving the way breaches are dealt with, expanding governmental powers to monitor and investigate employer non-compliance, and improving information sharing between government agencies.

The discussion paper suggests that officers be appointed to investigate workplaces, with similar powers to the former workplace inspectors.

It also proposes a maximum penalty for employers providing false or misleading information of a $110,000 fine and/or 10 years' imprisonment.

Employers found in breach of their obligations that reoffend or fail to remedy the situation may have their names published by the department.

Information sharing between agencies such as DIAC and the Australian Taxation Office would be strengthened to ensure workers were paid correctly.

If introduced, the new laws would add to reforms that are due to kick in shortly. From August 1, the standard minimum salary level for workers on 457 visas will increase by 3.8 per cent, to $43,440.

In regional areas, the minimum level will increase to $39,100, and for ICT professionals it will rise to $53,530.

The government has appointed Industrial Relations Commissioner Barbara Deegan to review the 457 program, due for completion later this year.

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