Around one in five working arrangements involving foreign workers in Australia are problematic, data contained in a submission to a Senate Inquiry into the effect of foreign worker visa programs suggests.

The information pertains to workers throughout the construction and other sectors under a key foreign worker employment program.

Data from the Fair Work Ombudsman indicates that while compliance practices on the part of the vast majority of employers who hired foreign workers through the 457 visa program was generally good, problems did occur in a substantial minority of cases.


That data was unveiled in a joint submission prepared by six government bodies for the Senate Inquiry on the impact of Australia’s temporary work visa programs on the Australian labour market and on the temporary work visa holder.

According to the data, out of 1,174 visa holders monitored over the six months to December last year, the Ombudsman identified concerns with 230 cases, or nearly 20 per cent of the total.

Of these, 146 concerns related to the amount of salary being paid and 58 related to concerns about the position and nature of the role itself. A further 26 cases resulted in concerns about both the salary and the conditions.

Apart from this, there were a further 95 cases (8.1 per cent of the total) in which the Ombudsman was unable to locate the employer sponsor and 48 cases (4.1 per cent of the total) in which the sponsor failed to provide information, meaning that the level of compliance in these cases cannot be assessed.

Around 141 cases were finalised during the period, resulting in the recovery of $225,155, while legal proceedings were initiated in a further three cases.

Building and building related services accounted for a significant number of problem cases, with construction and ‘professional, scientific and technical services’ (largely engineering) being the second and third most frequent areas in which concerns occur (10.39 per cent and 9.74 per cent of the total concerns respectively) behind food and accommodation services (22.73 per cent).

The submission comes as debate about the merits of the foreign worker visa program continues, with employer groups arguing that the program is a necessary in order to fill critical areas of skills shortage but unions fearing it is being exploited as a form of cheap labour.

In its submission to the inquiry, for example, the Australian Industry Group argues that media attention with regard to foreign workers has focused unfairly on the ‘relatively few employers who do not meet their obligations’ and that ‘no evidence has been presented which points to widespread or systematic abuse.’

More broadly, Ai Group says Australia does not have the capacity to meet all of its labour needs over the long term, and that in the construction sector specifically, current skills shortages will be further exasperated by an upturn in residential and commercial building along with low numbers of apprentices coming through.

“We simply do not have the right people, with the right skills in the right places to do the jobs that our industry needs and we will need to rely on the immigration program and various working visa categories to help underpin our economic performance for the foreseeable future,” Ai Group says in its submission.

Citing as an example a recent Four Corners program which uncovered widespread and routine abuse and harassment of migrant workers from Europe and Asia (in this case on 417 visas which allow people to travel and work for up to six months in one location), however, the Construction, Forestry, Mining and Energy Union said in its submission that there was extensive evidence of the foreign worker system being abused along with the existence of an extensive underground criminal element through use of unregulated labour hire firms.

In one recent case, the union says 13 Chinese and 16 Filipino workers were paid as little as $4 per hour to work on a construction site in New South Wales.

The six government bodies involved in the submission referred to above are the Department of Employment, the Department of Immigration and Border Protection (DIBP); the Department of Education and Training (DET), the Department of Industry and Science, the Department of Social Services (DSS), the Fair Work Ombudsman (FWO) and Safe Work Australia.

In total, 50 submissions were received. Public hearings in Brisbane, Melbourne and Sydney are expected throughout June.