Data Protection

The Department of Immigration and Citizenship has small business in its sights when it comes to transgressions of 457 visas, and is armed with a $85.3 million package to help it better police the visa system for working migrants.

457 visas were introduced in 2003 in response to Australia’s skills’ shortage. Under these visas, Australian employers are allowed to sponsor overseas workers they are prepared to employ to come and live and work in Australia.

These visas have been used in a huge variety of industries to help combat chronic staff shortages. Many people on these visas have been employed in the IT, accounting and mining sectors, to name just a few areas in which 457 visa holders have been employed.

Visas are issued for a period of between three months and four years, and they allow the primary applicant to bring secondary applications such as spouses and children to Australia on the same visa. 457 visa workers are employed in four major occupation groups – managers and administrators, professionals, associate professionals, tradespersons and related workers.

Sponsors have specific obligations they must meet to in order to be able to sponsor overseas workers under the 457 visa program. For example, the employee cannot leave the sponsored position and still maintain the sponsorship. The employee must also work in the position the visa stipulates they work in (that is, they cannot change jobs within the company and still remain compliant with the visa program).

The visa holder is also not allowed to work for anyone else or themselves while they are being sponsored. If an employee wishes to change jobs, then a new visa agreement must be entered into. It is also up to the employer to ensure the applicant has good English skills.

What’s changed?

In early 2008, the new Federal Government announced it was reviewing the 457 visa system, to crack down on sponsors who were not meeting their sponsorship obligations and to ensure those working on 457 visas were working in appropriate conditions.

This is because there has been some evidence to suggest some businesses have been paying 457 visa holders a salary below the minimum wage. In some cases, workers have also had to work in substandard conditions.

The focus of the government’s review has been the small business sector, and it’s likely there will be much tougher policing of visa sponsors in small business when the review has been finalised.

In the meantime, the Department of Immigration and Citizenship has been conducting an extensive education campaign to get the message out that every business that employs 457 visa holders, small or otherwise, needs to ensure they remain compliant with their obligations.

Michael McCrudden is a lawyer with Craddock Murray Neumann who specialises in assisting clients to manage 457 visa applications. He says a “major change as a result of the review will be expanded monitoring, especially in relation to smaller companies”.

One of the reasons smaller companies are the focus of the review is because larger companies generally have formal and prescribed systems in place for managing visa applications. But smaller firms don’t necessarily always have these disciplines in place, which is why the Federal government is keen to shine a light on visa sponsors in the small business sector.

What you can do to ensure you comply

The best advice to small businesses in terms of ensuring compliance with visa requirements is to employ a specialist such as a solicitor to help manage the paper work or processes.

Businesses that want to manage the process themselves will have to do a lot of work to ensure all the paperwork associated with the visa applications is perfect.

Aside from hiring a specialist, it’s also an idea to document systems and procedures related to 457 visas, as well as clearly communicate the workings of the system to anyone employed on a 457 visa.

The consequences for businesses found to be in breach of their obligations under the 457 visa system are serious.

The Federal government is introducing new civil penalties under the Migration Act 1958 for organisations that breach sponsorship obligations. Employers that don’t meet their obligations face significant penalties, including large fines for the most serious offences.

McCrudden says the consequences of being found to be non-compliant are worse than merely being fined. “If an employer is found to be in breach of its sponsorship obligations, the breach could result in employers being denied the opportunity to sponsor additional employees. It may also result in the cancellation of existing 457 visas that were granted to its employees,” he says.

The ramification for employers in this situation is dire and would potentially result in the business ceasing operations. “So there could be a terrible impact on employers above and beyond civil penalties,” McCrudden says.

McCrudden’s advice to employers that inadvertently find they have breached their sponsorship obligations is to “be proactive. Once the breach has been identified seek legal advice. It will normally follow that the Department will need to be notified of the breach. It is better that the process is managed in this way rather than the Department uncovering the breach as part of its monitoring activities.” He suggests it is worthwhile seeking legal advice if an employer thinks their visa program could be in breach of regulations.

McCrudden’s final piece of advice to employers using workers on 457 visas is to keep on top of paperwork. “It’s also wise to ensure you fully understand your obligations,” he says.

Small businesses that don’t maintain compliance with their obligations under 457 visa rules and that are audited without warning leave themselves in a compromised position. Those that do follow the rules stand themselves in good stead if there is an unexpected knock on the door.