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VISA CONDITIONS FOR CONTRACTORS AND EMPLOYERS
Recently the Four Corners program showed a number of "contractors" who allegedly are breaching Australian Industrial Relations and Migration Laws. It should be noted that when foreign workers are employed in Australia, the visa conditions require the contractors as employers to be compliant with Australian Laws including the Industrial Relations Law.
The recent Four Corners program showed a risk that some employers, particularly in the Pastoral and Horticultural Industry are allegedly taking by not doing their due diligence checks to establish that the contractors who they engaged are bona fide contractors, with bona fide ABNs and, are compliant with not only Industrial Relations Laws but also superannuation guarantee contributions, payroll tax, workplace health and safety and, workers compensation legislation. The reality is that a number of these "bodgie" contractors have allegedly placed employers including growers, farmers, agriculturalists and horticulturalists at risk of their crops and other work ceasing when contractors’ employees are found to be in breach of their Visas.
In an effort to assist employers we suggest that the following check list be adopted in assuring the employer that all legislation is complied with and the details below may assist:-
- Migration Act 1958
Visa Entitlement Verification Online (“VEVO”)
Since the 19th August 2007, it has been an offence under this Act for EMPLOYERS to knowingly or recklessly allow a worker to work, or to refer a worker for work, when that worker is someone from overseas who is either illegally in Australia or, who is working in breach of their visa conditions. People from overseas who work whilst in breach of their conditions of entry or, who work whilst illegally in Australia, are rendered to be "illegal workers". Similar offences exist for referral for employment (by say a labour hire company or contractor) of an illegal worker (to say a grower).
Employers convicted of these offences face substantial fines and possible imprisonment whilst companies face much larger fines per EACH illegal worker.
These offences apply to employers, labour hire companies, employment agencies and, anyone who allows illegal workers to work or, who refer illegal workers for work.
If a worker is sourced through a labour hire company that company is the legal employer (NOT the GROWER) of that worker, the business using the services of the worker will not be liable, (unless it also has a legal relationship with that worker). In this situation, the labour hire company will commit an offence.
Higher penalties will apply when an illegal worker has been exploited through slavery, forced labour or sexual servitude. The maximum penalties include imprisonment and fines of up to $33,000 for individuals and $165,000 per illegal worker or for companies.
More detailed information is available at the Department of Immigrationand Border Protection website at the following links and phone numbers;
If you are a grower and seek to employ you should register once only at
- general enquiries - 131 881
- For citizenship enquiries - 131 880
- For General Skilled Migration enquiries - 1300 364 613
- Note: Whenever possible please choose to apply online by visiting
If you choose to make a paper application please do not use plastic pockets when submitting documentation. Please help the Department of Immigration and Border Protection in its environmental initiatives by submitting all documents in a single envelope.
Employers without access to the internet can use a toll free visa entitlement verification fax back service that provides written confirmation from the Department of a visa holders' entitlement to work in Australia. To use this service, you will need to complete the authority to obtain details of visa status form and fax it to 1800 505 550. If you have internet access, you can do that through the Department's website or otherwise by calling 1800 040 070.
It is important to note that the labour hire company is the employer. The farmer or horticulturalist who engages the labour hire employee is a client of the labour hire company and is not the employer.
Whilst growers who engage labour-hire employees are not liable for Visa breaches, they need to be aware that there have been instances of raids by the Department which have resulted in the illegal workers leaving the properties during peak periods resulting in a shortage of labour for the grower. It is therefore important whilst the penalties may not apply to the grower but that the implication of illegal workers or workers being exploited on properties will have an indirect result of depriving the employer of available labour.
An employer's due diligence could include asking the following questions of a labour hire company prior to engaging employees and ensure similar records if the grower is the employer of foreign workers;
What is the labour-hire company/contractor’sABN? (Refer toDoes the labour-hire company/contractor hold copies of the Visa for all workers’ referred to the grower?
Which award or Enterprise Agreement does the labour-hire company/contractor use to pay its employees?
If the answer to the previous question is an Enterprise Agreement, what is its name and registration number?
What is the labour-hire company/contractor’s WorkCover registration number?
Seek a written undertaking from the labour-hire company/contractor to advise prior to the expiration of the foreign workers' visa and ensure that they will not provide foreign workers who do not have a right to work in Australia?
Have all employees including labour hire employees signed your induction check list?
Ensure that you induct labour hire employees, contractors and employees with your Workplace Health & Safety Procedures including chemical handling, use machinery and equipment and, do they have experience and hold the appropriate licences and permits any machinery or equipment that they will use on your property?
- Question and Answer
QAlan Nguyen is a Horticulturalist who obtains workers from a reputable labour hire company. One of his new staff turns out to be an illegal worker. Is Alan liable?
ANo. Provided the labour hire company remains a legal employer of the illegal work, Alan will not be committing an offence. In this situation the labour hire company, not Alan may be liable.
Once Alan discovers that the employee's is an illegal worker, he should end his working relationship with the person immediately.
QBill Jones engages a person at the farm gate to pick fruit. Bill discovers that the person is an illegal worker later that evening, after using visa entitlement verification on-line to run a check on worker entitlements. Is Bill liable?
ANo. Employers who initiate work entitlement checks of new employees within 48 hours of an employee commencing work would not usually be referred for prosecution. However, once Bill discovers the worker is an illegal worker, he must end his working relationship with the worker immediately. Bill will also need to prove when the employee started work to get the benefit of the flexible 48 hour checking period.
QCasey Smith is a farmer who engages a group of workers referred by a local Backpacker Hostel. The hostel claims to have check the entitlements of the workers, but no-one turns out later to be an illegal worker. Could Casey be liable?
ANo. The department would not usually consider prosecuting Casey if she could show an invoice or some other document from the Backpacker Hostel which says that the Hostel had checked that the workers had valid visas to work in Australia. In this situation the Backpacker Hostel may be liable for the offence of referring an illegal worker for work.
QAt harvest time Albert Wu has a field of grapes that needs to be immediately harvested to prevent spoiling. He engages casual workers but is unaware of any restrictions on their visa entitlements to work. Would Albert have committed an offence if he discovers after the harvest that one of the workers is a non citizen who is not entitled to work?
ANo. Provided Albert had not previously received an illegal worker warning notice and he had not received some specific information he suggests the worker might not have a valid visa to work in Australia, then the new offences would not apply.
QIt is the next harvest and Albert Wu had another field of grapes that needed to be immediately harvested. He engaged casual workers, but this time he is aware that some of them are visitors to Australia and do not hold a valid visa to work in Australia. Albert put them on anyway. Has Albert committed an offence?
AYes.
These questions and answers have been provided from the Department of Immigration and Citizens booklet entitled "People without Valid Working Visas; New Penalties for Employers".
- Migration Act breaches
In April 2015 a Darwin based company was fined $175,000 for breaching sponsorship obligations under the sub 457 Visa Program. This was the first civil penalty application that the Department undertook in the Federal Court, and is the largest civil penalty any Court has imposed for breach of sponsor obligations.
The Court found in that instance that Choong Enterprises had paid 457 Visa Holders as little as $12 an hour, failed to abide by its record keeping obligations, and knowingly produced false pay records and, had illegally recovered the costs of migration agent fees from four visa holders, amongst other contraventions. It also found that the Director of Choong Enterprises Ronald Choong, had aided and abetted these breaches. As a result the Minister stated,
"the stiff penalty this company has received should send a warning to other sponsors; if you fail to meet your requirements, my Department may impose administrative sanctions, issue an infringement notice, execute an enforceable undertaking, or apply to the Federal Court for a civil penalty order."
The Minister went on to further state,
"The Department is constantly monitoring 457 sponsors to ensure that they are operating appropriately. The overwhelming majority of business act in good faith and, therefore have nothing to fear, but we want to send a strong message that if you breach your obligations, you can expect to face the consequences."
The Minister went on to say that:
"Australians can be confident that the Department of Immigration & Border Protection is adequately resourced to ensure that those sponsors and visa holders found to be breaching their obligations are targeted and appropriate action is taken against them."
The consequences of the Choong Enterprises Pty Ltd outcome, that company no longer has any 457 Visa Holders in its employment and admitted its wrong doing to the Court.
There have been a number of illegal workers detained a number of Eastern Suburbs locations. I can only assume it is a matter of time for similar situations arise in the other States.
*The Department of Immigration and Border Protection advises that it takes no responsibility for the information included in the websites of other government departments.
- Exploitation
The issue of exploitation arises where employers, contractors and labour hire companies do not comply with Australian.
An example of this might be that the Award rate for a casual worker is say $18:00 per hour. These contractors or labour hire companies may be charging the employer (say) in the region of $20 to $23 per hour. It is clear on that information that the labour “add ons” including 9.5% superannuation plusthe Workers Compensation levy would not be sufficient to cover either the labour costs or have a profit margin. Clearly, in those circumstances, a grower should be aware to the fact that they are engaging workers through a third party which is not abiding with Australian Industrial Relations Laws. Whilst the grower may not be the employer, there is a risk of damage to the grower's reputation and, more importantly, may result in the Fair Work Ombudsman entering the property resulting in an exodus of those workers during a peak season.
Our website provide the current award rates which are expected to increase on 1st July each year.
- Payroll Tax( )
If workers are engaged through a labour hire company, there should be no impact on the grower's payroll tax. However, if the grower engages employees who are paid below the Award rate, are not paid superannuation (currently 9.5%) they may be understating their wages which may leave them liable to prosecution for underpayment of such things as payroll tax, superannuation and workers compensation levy.