Skilled Migrant Workers’ Pay Will Not Undercut Australian Wages, Michaelia Cash Confirms

Employers will be barred from paying skilled migrant workers anything less than equivalent Australian staff under new migration agreements that have sparked attacks among unions.

The Australian, by David Crowe, 29 August 2014

Assistant Immigration Minister Michaelia Cash declared the overseas workers would have to be paid at least the same as Australian staff when the new arrangements are offered to local areas suffering from skills shortages.

As Labor, unions and the Greens attacked the new scheme, Senator Cash rejected claims that foreign workers brought in to areas like Darwin could be paid less than Australians under the Designated Area Migration Agreements.

​The Australian revealed today that the new agreements will offer a potential concession on the minimum rate paid to those on 457 skilled worker visa, but the government rejected claims that this meant the scheme would undercut Australian wages.

​“In all cases, employers must pay overseas workers at least the same wage as Australian workers,” Senator Cash told The Australian.

“Australian wages cannot be undercut under the DAMA program.”

The minimum salary threshold for the 457 visa — currently $53,900 and known as the Temporary Skilled Migration Income Threshold or TSMIT — will also apply to the new local area migration agreements.

“This means that overseas workers must be paid either the market salary rate, or the TSMT, whichever is higher,” Senator Cash said.

“No one employed under the DAMA guidelines will be paid less than the relevant award paid to an Australian worker.

“No foreign worker can be hired on rates less than Australians receive.”

The existing 457 program requires employers to pay their skilled foreign workers at least the market rate and to provide terms and conditions at least at the same level provided to Australian employees. This continues to apply to 457 visas issued under the DAMA schemes.

If an employer pays an Australian worker $70,000 a year the same rate must be paid to an equivalent skilled foreign worker brought in to fill any proven labour shortage.

If an Australian worker is paid less than the TSMIT — which may happen with some occupations — the employer might be able to apply for the 10 per cent concession to pay less than the usual $53,900 per year, if this was agreed by authorities.

The government believes this would only occur when an employer could not find an Australian on rates already below the 457 visa benchmark.

The government said the concession worth up to 10 per cent only applied to the special 457 visa program threshold and it was not a concession to market rates.

This only applies to circumstances where Australian workers are being paid either this salary ­or less, and there are strong supporting reasons — for example, where the cost of living is relatively lower or where other measures are in place to manage risk.

When the visa application fees and compliance costs are taken into account, the relative cost of sponsoring a 457 visa holder under the DAMA compared to employing an Australian worker remains high.

Labor has panned the new rules, saying there’s no place in Australia for exploiting overseas guest workers.

Opposition Leader Bill Shorten says jobless Australians must be the priority, given unemployment is now at its highest level in a decade.

“We see in many parts of regional Australia, high levels of youth unemployment, high levels of unemployment of mature-aged Australians, who’ve been dislocated by changes in the Australian economy,” Mr Shorten told reporters in Melbourne on Friday.

“The government needs to explain why it would exploit underpaid labour, exploit underpaid labour from overseas, in preference to finding jobs for unemployed Australians.”

The Australian revealed today that the new rules were signed off this week and are set to be applied in Darwin first and then offered to other regions suffering an exodus of skilled workers who are rushing to join mining and gas companies.

Job categories covered include childcare workers, disability carers, mechanics, bricklayers, office managers, carpenters, chefs, nurses and many others.

Each migration agreement will be limited to a specific area, such as Darwin or the Pilbara in Western Australia. Each agreement must be approved by a local authority, which in the case of Darwin is expected to be the Northern Territory government.

The unemployment rate in Darwin is about 2 per cent and federal government sources have dismissed the possibility of DAMAs being allowed in regions with high jobless rates.

The Darwin agreement, backed by the Northern Territory government and talked about for more than two years, is expected to be capped at 500 places with the priority going to those employers that can prove the greatest need for staff.

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