Impact of temporary visas on training and skills development
An underlying principle of the 457 visa program is that employers who
sponsor a 457 visa worker will train and upskill local workers so that reliance
on temporary visa workers can be reduced over time.
A key point made by several submitters and witnesses to both this and
previous inquiries has been the negative impact that temporary visa programs have
had on the opportunities for training across a range of industry sectors. Concerns
were also expressed that recent Australian higher education graduates were
missing out on employment opportunities due to a decline in the provision of
graduate employment programs and an employer preference for recruiting visa
workers. These submitters argued that the decline in workforce training and
graduate employment had serious implications for Australia's future workforce capacity.
Conversely, other submitters and witnesses pointed out that the
introduction of training benchmarks under the 457 visa program addressed these
concerns, first, by imposing additional training costs on sponsoring employers
to remove any perverse incentive to employ overseas workers, and second, by
creating funds that would contribute positively to the national training
This chapter therefore considers the impact of Australia's temporary
work visa programs on training and skills development in Australia, the utility
of the current training obligations, and proposals for improving their
effectiveness so as to ensure the development of Australia's skills base and
future workforce capacity.
Impact of 457 visas on training and skills development, graduate employment
programs, and future workforce capacity
Several unions stated that the incentive for employers to train Australian
workers has been undermined by the easy availability of temporary visa workers.
These unions identified cost as a relevant factor in the decision by certain
employers to recruit overseas workers rather than train or up-skill Australian
The Australian Federation of Air Pilots (AFAP) submitted that 'in
certain instances the 457 visa program has operated to reduce training and
skills development of Australian commercial pilots'. The AFAP provided an
example where an airline introduced a new aircraft to Australia and then
advertised for pilots under the 457 visa program. Although 'there were numerous
experienced and qualified pilots on similar turbo-prop aircraft within
Australia', it appeared the airline was trying to avoid the cost of providing 'specific
training to the Australian pilots (instead preferring pilots already qualified
on the type)'. AFAP made the point that recruiting 457 visa workers in these
circumstances effectively reduced skills development within Australia.
Likewise, the Australian Institute of Marine and Power Engineers (AIMPE)
expressed concern about the dearth of relevant training for Australians trying
to enter the marine industry and that employers were finding it cheaper to
employ 457 visa workers than to train Australian workers. The AIMPE noted:
Gradually shipping companies have begun reducing the intake
of cadets and trainee engineers into the marine industry. It is much easier for
them to access the current temporary work visa programs and it is cheaper than
to train. Meeting the current benchmark training requirements is easy to get
around. This trend has serious and long term implications for marine engineers'
employment in this country. Such benchmarks are ineffective and have not helped
at all in the marine industry sector.
Similarly, unions expressed concerns about the impact of temporary work
visa holders on, firstly, the professional formation and career progression of
Australian tertiary education graduates, and secondly, on the future workforce.
The Australian Council of Trade Unions (ACTU) pointed to an alarming
drop in graduate employment in 2014:
...the latest figures show that only 68.1% of new bachelor
degree graduates seeking full-time work were in full-time jobs in 2014, down
from 76.1% in 2012. This is the lowest in the history of the series, which
began in the early 1970s. In Western Australia, the results of a recent survey
found just 53.1% of graduates were in full-time employment compared with 68.5 %
Specific concerns about increasing unemployment rates amongst
engineering graduates and an inability to secure professional consolidation on
the job were expressed by Engineers Australia:
When temporary migrant engineers are used in adverse demand
circumstances, there are likely to be impacts on employment opportunities for
new Australian engineering graduates. Statistics show that unemployment among
new engineering graduates has increased which is a problem in its own right.
However, professional formation for new graduates is undertaken on the job and
when positions are occupied by temporary migrants, opportunities for professional
formation for new graduates are restricted.
Along with the impact on individuals of an inability to secure graduate
employment, however, unions also pointed to systemic consequences in terms of
effective workforce planning and the provision of a future workforce.
The Australian Nursing and Midwifery Federation (ANMF) noted that while
graduates possess substantial theoretical knowledge, they 'require further consolidation
of their clinical skills to become a skilled practitioner'. Furthermore,
graduate nurses need to obtain sufficient employment in order to retain their
registration and be able to work as a nurse.
Ms Annie Butler, Assistant National Secretary of the ANMF noted that their
union had 'predicted for some time that in 10 to 15 years we are going to see
perhaps half the nursing and midwifery workforce retire'. To prepare for this
eventuality, university places were increased such that Australia now produces
sufficient nursing graduates.
Mr Nicholas Blake, Senior Industrial Officer with the ANMF noted that, historically,
most healthcare facilities had a graduate program that employed nursing
graduates. Indeed, twelve month graduate programs developed and implemented by an
employer have been 'identified nationally as an effective way to deliver
support for newly qualified nurses and midwives moving from the academic
environment into the workforce'.
However, the ANMF argued that temporary visa programs are not being used
as intended because 'increasingly employers are reducing graduate nurse
programs in favour of a greater reliance and utilisation of temporary overseas
Ms Butler warned that the current inability of nursing graduates to
transition into the professional workforce is a serious structural problem with
potentially long-term negative consequences for the future workforce.This
is not only a lost investment in the education of professional health workers,
but if not remedied, 'will represent a lost generation of Australian graduates
to the Australian health and aged care sectors'.
By contrast, Fragomen submitted that the root cause of the deficit in
the training and skills development of Australian workers was a lack of government
investment in training and skills development over the previous 20 years,
particularly in the STEM subjects of science, technology, engineering and
mathematics. Fragomen contended that there was a limit on the extent to which
the shortfall in training and skills development could be met by the private
Fragomen argued that the issue of training and skills development and
its relationship to the use of the 457 visa program was being examined from the
wrong angle. In their view, the lack of adequate training and skills
development opportunities for Australians was causing business to use temporary
visa programs as an alternative source of skilled labour, rather than the use
of temporary visa programs leading to a reduction in training and skills
development opportunities for Australians.
Impact of 417 visas on training in the meat processing sector
The committee heard evidence from the Queensland Branch of the Australasian
Meat Industry Employees' Union (AMIEU) regarding training in the meat
processing sector, and the impact that the heavy reliance on temporary work
visas is having on the provision of training to Australian workers.
Mr Matthew Journeaux, Assistant Branch Secretary of the AMIEU (Queensland),
noted the meat industry, and in particular red meat processing, 'is a very
traditional industry'. It is 'very labour intensive and very competitive' and 'does
not have huge amounts of technological improvements'.
Mr Journeaux gave a breakdown of the skill sets in the industry:
The workforce typically consists of 30 per cent highly
skilled—slaughterers, boners and slicers—and approximately 70 per cent
labourers with varying degrees of skill required to perform their roles.
There are no formal apprenticeships for meatworkers working in the meat
processing industry. Instead, the training for skilled work occurs on the job
with suitable candidates selected from the pool of existing employees
performing unskilled roles at the establishment:
Typically the skilled positions have been filled from the
labouring pool where labourers show promise and are trained to become
slaughterers, boners and slicers. ...The candidates for training in those more
skilled positions would typically perform their training on the job, where they
would be assigned a mentor and their training would take place on the chain.
As noted in chapter 4, both Mr Journeaux and Mr Grant Courtney, Branch
Secretary of the AMIEU (Newcastle and Northern NSW Branch), had noted that the
AMIEU was an active and supportive player in the meat industry labour agreement
under which, an employer is required to reduce its reliance on 457 visa workers.
In order to meet those obligations, an employer must therefore have processes
in place to prioritise the upskilling of the local labour force.
It was within this context that the AMIEU drew attention to what they
saw as a 'disturbing' new trend that had emerged since 2010, namely the
extensive hiring of large numbers of 417 visa holders (also known as the
Working Holiday Maker or 'backpacker' visa) such that 417 visa workers now made
up 'a significant proportion of the unskilled workforce of most meat processing
The AMIEU made two key points about this new practice. First, the hiring
of 417 visa workers reduced the opportunities for local workers to obtain
unskilled employment in meat processing plants. And second, because of the way
training occurs in the meat processing sector, hiring 417 visa workers reduced 'the
pool of local workers in the workforce who could be trained for skilled
positions' and therefore deprived local workers of opportunities for training
The effectiveness of the current training obligations
The Australian Government Department submission noted the 457 visa
program 'is not intended to address long-term workforce needs', but rather
'support and complement existing domestic education, training and skills
In 2009, training benchmark requirements were introduced for the 457
visa program 'to ensure that employers are working to reduce their future
reliance on the program through the provision of training and skills
development to Australian citizens and permanent residents'.
The two training benchmarks in the 457 program require subclass 457 sponsors
operating in Australia for 12 months or more to demonstrate:
recent expenditure, by the business, to the equivalent of at
least two per cent of the payroll of the business, in payments allocated to an
industry training fund that operates in the same industry as the business (benchmark
recent expenditure, by the business, to the equivalent of at
least one per cent of the payroll of the business, in the provision of training
to Australian citizens or permanent residents employed by the business (benchmark
This means that if a business cannot prove it uses one per cent of its
payroll to train its workers, it must pay two per cent of its payroll into a
registered training organisation or training fund. In cases where a business
has traded in Australia for less than a year, 'it must have an auditable plan
to meet the training benchmarks'.
The committee received evidence that businesses in certain industries
regularly exceeded the training benchmarks. The Australian Mines and Metals Association
(AMMA) pointed out training the local workforce was their 'first priority' and
that the mining industry spent over $1.15 billion on training in 2011–12.
Indeed, AMMA noted that, compared to the existing training benchmarks
for the 457 visa program where employer sponsors are required to spend either 1
or 2 per cent of total payroll on training Australians, 'companies in the resource
industry exceed those requirements, in fact contributing up to 5 per cent of
payroll to training as an industry'.
Likewise, Fragomen also noted the majority of their clients had comprehensive
training programs in place because they recognised the inherent value in skills
The committee also received evidence of collaboration between unions and
employers in the training sphere in an effort to fill skill capacity and
training gaps and compensate for the lack of suitable vocational training.
For example, in 2010, the Maritime Union of Australia (MUA) and industry
employers jointly established the not for profit company Maritime Employees
Training Limited (METL) as a response to a skill shortage of seafarers. The MUA
noted that establishing training organisations 'is neither cheap nor easy' and
required extensive research, planning and networking with industry. However, by
the end of the 2012–13 financial year, METL had facilitated the training of
over 100 seafarers and 36 had completed their traineeship, either with METL or
with another employer.
The above examples notwithstanding, the committee heard various
criticisms about the operation of the current training requirements under the
457 visa program.
Mr Henry Sherrell, Policy Analyst at the Migration Council of Australia (Migration
Council) was critical of the lack of an adequate 'paper trail' to determine if
a particular company was in fact meeting its obligations under training
benchmark A or training benchmark B. He noted there was no publicly available
data about the size of the funds under training benchmark A and who is
receiving those funds.
Mr Sherrell also pointed to the difficulties encountered by employers in
actually proving that they meet the training benchmarks:
Anecdotally, many employers complain that, when you become a
sponsor, the hardest part is demonstrating that you spend one per cent on
training. Many pass that threshold, but going through the process to document
and prove it is hard.
The ANMF and the ACTU argued that the current requirements are
ineffective because employers are not obliged to provide training in the same positions
that they employ temporary visa workers. The ANMF suggested that the nursing
profession benefited little from the current arrangements because the training
resources are 'typically consumed by medical staff, specialists and senior
The ACTU also pointed to inequities within the current scheme such that
an employer using just one 457 visa worker is required to meet the same
training benchmark as an employer using multiple 457 visa workers.
It was recognised that the availability of temporary overseas labour is not
the only factor contributing to a deteriorating record on skills formation. The
ACTU argued that the 'historical infrastructure for skills formation in
Australia has been steadily dismantled over the last two decades':
On the one hand we have seen a proliferation of private
training colleges as a contestable training market has been set up, and public
training providers have lost funding and resources. On the other hand, many of
the large public utilities or enterprises which once provided the core of the
skilled blue-collar workforce have been privatised and have radically decreased
their training commitment.
However, employers also made the point that deficiencies in the national
training effort relate not only to specific vocational skills and the
resourcing of training institutions, but also to a broader failure to ensure
that young people have basic employability skills.
For example, in response to committee questions about steps that could
be taken to address high youth employment in terms of encouraging local workers
to consider working in agriculture, Ms Sarah McKinnon, Manager of Workplace
Relations and Legal Affairs at the National Farmers' Federation stated:
Schools do not regularly offer or encourage agricultural courses,
because of the difficulty they have in getting their students out into the farm
and back each day and the costs that that involves, so there is not great
take-up in the TAFE jurisdiction—in the VET area. We do need to do more about
getting these young people job ready for the kind of work that they are asked
to do, because in agriculture a lot of the training is done on the job. So we
do not always need structured, formal training before we get people out onto
the farm, but what we do need is for them to have those basic job-ready skills:
motivation, what to wear, the importance of turning up every day at the same
time for the same period and those kinds of basic skills. I think we need to do
a lot more work, particularly in the areas where there is high youth
Proposals to replace the current training arrangements
Given the trenchant criticism of the inadequate operation of the current
training benchmarks, and the lack of any hard data with which to measure their effectiveness,
several submitters and witnesses proposed alternative arrangements.
In general, many of the proposals aimed to:
ensure that employers who have a genuine need to sponsor overseas
workers to fill skill shortages are also training the future workforce, and
thereby reducing their need to rely on temporary overseas workers in future;
increase employment and training through trade apprenticeships,
traineeships and graduate degrees in the specific occupations allegedly in
short supply; and
increase the cost of accessing 457 visa workers relative to the
cost of training Australian workers, especially young people in entry-level
Requirements to engage Australian
graduates, trainees, and apprentices
The key proposal put forward by several unions was a requirement to
employ Australian graduates, trainees, and apprentices in the same occupations
where the employer is seeking to use 457 visa workers. These submitters argued
that the measures would develop the future skills base and reduce employer reliance
on overseas workers.
In this regard, the committee notes that similar recommendations have a
long history and that the 2008 Deegan review suggested comparable requirements around
the training commitments of Australian employers and the employment of Australian
Employers seeking to benefit by bringing overseas workers to
Australia should be required to make some tangible commitment to the training
of Australians in the skills sought. The commitment could be commensurate with
the level of overseas labour employed but should also have a real connection to
training in the appropriate area of skill. Large employers could be required to
hire a percentage of apprentices or new graduates. This, at least, might ensure
that Australian graduates were not passed over for employment opportunities
because they lacked relevant work experience and because it is more cost
effective to employ experienced employees from outside Australia. Small
employers could participate in industry-wide training schemes or contribute to
scholarship or training funds in appropriate areas.
In terms of trade and technical occupations, the ACTU proposed that
employer sponsors of 457 visa tradespersons 'must demonstrate that Australian
apprentices represent at least 25 per cent of the sponsor's total trade
workforce'. The threshold for this requirement would be the employment of four
or more tradespersons.
With regard to trainees and cadets, the AIMPE recommended that all
employers using 457 visa workers 'be required to employ a new entrant trainee
or cadet engineer to be trained for the position that is filled by the
In relation to graduate employment, the ANMF recognised that running a
graduate employment program came at a cost to an employer 'because new graduates
need support in the early period of their employment' whereas overseas workers
may already have the requisite skills. However, the ANMF noted there were also
'cultural, professional and healthcare systems issues' that overseas workers faced
on arrival in Australia and that it may therefore take some time for overseas
workers to adjust. Consequently, while there may be instances where it could be
cheaper to employ overseas labour, in other instances, the cost of bringing
both graduates and overseas workers up to speed would be roughly equivalent.
The ANMF emphasised the importance of graduate employment programs in building
workforce training capacity and therefore recommended:
every nurse or midwife graduate be afforded and guaranteed access
to a graduate program to ensure the next generation of nurses and midwives are
retained in the sector;
each employer of a nurse on a temporary work visa be required to
employ one graduate nurse on a full time basis for each nurse at the enterprise
employed under a temporary work visa; and
a 457 sponsor of nurse labour be entitled to a direct payment
from the Commonwealth in recognition of the start-up costs and administration
of graduate programs.
More generally, the ACTU proposed that:
...where employers are sponsoring 457 visa workers in
professional and managerial occupations, recent Australian higher education
graduates with less than 12 months' paid work experience should represent at
least 15% of the sponsor's managerial and professional workforce.
The committee notes that the Azarias review proposed replacing the
current training benchmarks with a training levy that would be paid into
existing government programs run out of the industry and employment departments
that specifically support apprenticeships and training.
The proposed levy would be $800 per visa holder for a large business,
and $400 per visa holder for a small business. In practice, the more 457 visa
workers employed, the greater the levy that would be paid.
While several submitters supported replacing the current benchmarks with
a training levy, there was sharp disagreement over the size of the levy to be
The Migration Council supported the levy amounts proposed by the Azarias
However, the ACTU argued that 'the proposed contribution rate falls far
short of what is required and is actually a step backwards from the current 1
per cent payroll requirement'. Instead, the ACTU proposed a $4000 levy for each
457 visa worker employed. This levy would 'be paid to an approved industry
training fund, group training company or the Commonwealth (where no relevant
fund or training company exists)'.
The ACTU further noted that the 'amount of $4000 is the same as the
standard incentive payment the employer would have received if they had
actually trained an Australian apprentice'. According to the ACTU, this measure
would provide the appropriate incentive to an employer to take on an
This means that if 457 visa sponsors actually employ a new
apprentice, they will be entitled to a payment from the Commonwealth for this
same amount. This provides an incentive to take on Australian apprentices as
the net cost to the sponsor will be zero if they do so.
As noted earlier, the ANMF and the ACTU were critical of the current
requirements under the 457 visa program because employers are not obliged to conduct
training in the same occupations that they employ temporary visa workers. The
ANMF and the ACTU therefore recommended that training funds be directly linked
to the occupation in which the employer was sponsoring temporary visa workers.
By contrast, Ernst and Young was concerned that an annual training fund
contribution would 'result in an unreasonable financial burden on many sponsors':
The proposed fund will impose an additional financial burden
on employers, and large employers in particular, who invest in training their
Australian employees regardless of any immigration requirements and who already
make investments in upskilling and engaging target groups such as youth and Indigenous
To address this, Ernst and Young proposed that simplification and
deregulation could be achieved by:
retaining current training benchmark B: expenditure of at least 1
per cent of payroll on training Australian citizen and permanent resident
replacing training benchmark A (contribution to an industry
training fund of 2 per cent of payroll) with the proposed annual training
The committee received evidence about the paucity of accurate publicly
available information across a range of areas related to the employment of
temporary visa workers and training.
The ANMF stated it was very difficult to obtain information on both the number
of people that come to Australia and work under different visa arrangements,
and the domestic training effort by 457 visa sponsors in the occupations where
457 visa workers are being sought.
Ms Butler noted that the nursing regulatory authority would have figures
on the number of migrants gaining registration as enrolled and registered
nurses. However, she did note the overall numbers may be difficult to ascertain
if some temporary migrant workers in aged care did not have a requirement for
Nonetheless, the ANMF recommended that the Australian Health Practitioner
Regulation Agency (AHPRA) publish annually all new registrations of nurses and
midwives on temporary work visas.
As noted earlier, the Migration Council drew attention to the absence of
data on the training benchmarks and submitted that the lack of data hampered
any attempt to examine the effectiveness or otherwise of the training
The ACTU was highly critical of the absence of data about the trends in
It remains a glaring hole in the governance and transparency
of the program that there continues to be no information available on, say, how
many apprentices are being trained by sponsors who are employing 457 visa
workers or whether the number of apprentices being trained by these sponsors is
increasing or decreasing over time.
As outlined above, if the standard of 25% was applied to the
current 457 tradespersons workforce of 27 790, the expected number of
apprentices and trainees across those workplaces would be almost 7000 – but
this information is not available.
Without this information, it is simply not possible to verify
if there is in fact any training dividend at all from the 457 visa program.
In order that the public could be reassured that employers of 457 visa
workers were in fact offering meaningful training, and developing Australia's
future skills base, the ACTU recommended that the following data should be
collected and made publicly available:
the number of employers currently sponsoring skilled tradespersons
(ANZSCO level 3) on 457 visas;
the number of apprentices and trainees employed directly by these
457 sponsors, in total and by sponsor industry and state/territory;
the trades in which those apprentices are being trained, including
the number of apprentices in the same trade classifications in which the 457
visa workers are employed;
whether the apprentice and trainee numbers in each category have
increased, decreased, or have not changed since approval of the employer as a
the details of any other substantive action taken by the sponsor
to increase apprentice and trainee training in each category (other than
directly employing apprentices) e.g. participation in group training schemes as
the host employer, cadetships and the results of such action.
4.16 One of the key prerequisites for community
acceptance of the 457 visa program is that skilled migration should complement
domestic training. It should not be used as a substitute for training
Australian workers, graduates, and apprentices. The committee is particularly
mindful that the community needs to be reassured that temporary work visa
programs are not having a negative impact on training opportunities for
Australians, particularly young Australians.
Evidence to the inquiry has demonstrated the links between the demand
for temporary visa workers and training and skills development in Australia,
the skills base of the permanent Australian workforce, and future workforce
It is of the utmost concern, therefore, when evidence indicates that the
457 visa program has undermined the incentive for employers to train Australian
workers, graduates and apprentices. It is a clear indication that the 457 visa
program is not being used as intended when employers have taken what may appear
to be the cheaper route of recruiting 457 visa workers rather than training
This is a particularly short-sighted approach, with obvious costs to those
Australian workers, graduates and apprenticeship applicants that will miss out
on opportunities for training and upskilling. In addition, there are
implications for workforce capacity. Employing 457 visa workers rather than
training Australians will perpetuate skills gaps in areas of identified need.
Perhaps more seriously though, Australia risks creating skills gaps for the
future by denying Australian workers and graduates of tertiary institutions the
opportunities to develop requisite skills in areas of future workforce need.
The evidence to the inquiry makes it clear that the current training
requirements are ineffective and in need of complete overhaul. They are simply
not meeting the needs of either our current or future workforces. This is not
to say that that promoting training is or should be a core aim of the 457 visa
program. Rather, as noted in previous inquiries, it is to note that the 457
visa program should make a positive contribution to the national training
effort. The committee believes this contribution is best achieved by removing
ineffective obligations and replacing them with the correct incentives and more
effectively targeted requirements.
Clearly, these matters are intimately related to the primary goal of
ensuring that the 457 visa program is only used to enable employers to address
short to medium term workforce needs by sponsoring skilled overseas workers on
a temporary basis to fill positions where the employer is unable to find
suitably skilled Australian workers.
In this regard, the committee notes that establishing a genuinely
tripartite, independent, and transparent body with responsibility for providing
objective evidence-based advice to government on matters pertaining to skills
shortages, training needs, workforce capacity and planning, and labour
migration (see Recommendation 6 (chapter 3)) would, if implemented, go a long
way towards ensuring the 457 visa program is used as intended. Such a body
could also provide advice on fostering greater coordination at a national level
around training as well as greater integration between the supply and demand
for skills and training. An independent expert body could also address one of
the key questions raised by many submitters and witnesses: if approximately
three quarters of a million temporary visa holders in Australia have work
rights (this figure does not include the approximately 650 000 New Zealand
(subclass 444) visa holders with work rights), what efforts are being made to
identify skills gaps and train Australians to fill positions in those
Over and above Recommendation 6, however, specific measures should be
taken to produce positive training outcomes for Australian workers and reduce
the need to rely so heavily on temporary visa workers. In this regard, the
committee endorses the views of the Deegan review on these matters.
With the Deegan proposals in mind, it is clear to the committee that a
successful transition to graduate employment is a key element of securing
Australia's future workforce capacity. To this end, the revival of graduate
employment programs across a range of industry sectors is a high priority. Further,
the committee is of the view that where an employer has hired a temporary visa
worker, the employer should be required to employ a graduate in the same
enterprise/location on a one-for-one basis.
Mindful of the additional costs that employers may face in terms of
training Australian tertiary graduates (as compared to employing temporary visa
workers), the committee considers a short review is appropriate to assess the
extent of any potential additional costs involved in running a graduate
training program, and the desirability and feasibility of directing funds
collected from the training levy (see below) towards such a program, in order
to ensure that graduates gain ready access to graduate employment positions.
In terms of trade and technical training, the committee is persuaded of
the need to expand apprenticeships in areas where employers are recruiting 457
visa workers. Given that the Commonwealth provides a standard $4000 incentive
payment to an employer that engages an apprentice, it seems reasonable to
expect employers that sponsor a 457 trade worker to also make a quantifiable
commitment to training Australian apprentices in the same occupations where
temporary visa holders are being employed.
Noting the training benchmarks imposed on 457 visa sponsors are not a
proportional payment and do not reflect the number of 457 visa workers employed
in a business, the committee agrees with the Azarias review that the benchmarks
should be abolished and replaced with a training levy that would be paid per
457 visa holder employed in the business. However, the committee regards the
levies proposed by the Azarias review as insufficient to ensure the correct
incentives are in place to ensure that employers make a genuine commitment to
training Australian workers, graduates, and apprentices.
Finally the paucity of accurate data across a range of areas relating to
the employment of temporary visa workers needs to be addressed as a matter of
urgency in order to underpin meaningful action on training to address
identified skills shortages.
The committee recommends that employer sponsors of a 457 visa worker (professional)
be required to also employ an Australian tertiary graduate in the same
enterprise on a one-for-one basis.
The committee recommends that employer sponsors of a 457 visa worker
(trade) be required to demonstrate that apprentices represent 25 per cent of
the sponsor's total trade workforce (with the threshold for this requirement
being the employment of four or more tradespersons).
The committee recommends that the current training benchmarks be
replaced with a training levy paid per 457 visa holder employed in the
business. The committee recommends that the levy be set at up to $4000 per 457
visa worker and that the levy be paid into existing government programs that
specifically support sectors experiencing labour
shortages as well as apprenticeships and training programs. The committee notes
that this levy would need to be closely monitored to ensure it is paid by the
sponsor and not passed on to the visa holder.
The committee recommends a short review be conducted into the costs to
employers of running graduate employment programs, and the desirability and
feasibility of directing funds collected from the training levy to assist
employers implement and administer graduate programs, such that Australian
tertiary graduates are afforded ready access to graduate employment positions.
The committee recommends that the following data be collected and made
publicly available on an annual basis (either by the relevant statutory agency,
or the relevant government department):
all new registrations of nurses and midwives on temporary work
the number of employers currently sponsoring skilled
tradespersons (ANZSCO level 3) on 457 visas;
the number of apprentices and trainees employed directly by
these 457 sponsors, in total and by sponsor industry and state/territory;
the trades in which those apprentices are being trained,
including the number of apprentices in the same trade classifications in which the
457 visa workers are employed; and
whether the apprentice and trainee numbers in each category
have increased, decreased, or have not changed since approval of the employer
as a sponsor.
Although this chapter has focussed primarily on the 457 visa program,
the committee also has serious concerns about the effect of the 417 visa
program on the opportunities for training and upskilling local workers.
The widespread use of 417 visa workers in the meat processing industry
is not only impacting employment opportunities for local workers, particularly
in regional areas, but is drastically reducing the opportunities for the
training and upskilling of a local labour force, and as a consequence,
exacerbating and prolonging skills shortages.
Reducing the pool of local workers that may be considered suitable for
training and upskilling as slaughterers, boners and slicers in the meat
processing industry will, in practice, entrench dependence on 457 visa workers
to fill those skilled roles. This is short-sighted, counter-productive, and
Furthermore, using 417 visa workers in this manner undermines an
underlying principle of the 457 visa program, namely that employers who sponsor
a 457 visa worker will train and upskill local workers to address skills gaps so
that reliance on 457 visa workers can be reduced over time. It also undermines
the meat industry labour agreement, because to the extent that one of the
requirements under the labour agreement is for an employer to reduce its
reliance on 457 visa workers, an employer must prioritise the upskilling of its
The committee will have more to say on the 417 visa program in chapter
5. In light of the above, however, the committee therefore emphasises the
critical importance of examining the impacts of the full array of temporary work
visas in combination, rather than just assessing their operation in isolation.
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