Many employers want a ‘cheapie’


1. Slaving Away

A revealing look at where your food is coming from. Caro Meldrum-Hanna investigates the dark secrets behind Australia’s fresh food supply chain.

Broadcast 8:30pm Monday 4 May 2015. Published 2 weeks ago, available until 9:30pm on 1 June 2015.


2. Employers want a ‘cheapie, just arrived off the boat’, Aussie IT workers told

Extract: Sylvia Pennington, The Sydney Morning Herald, March 15, 2013,

Vendors began using cut-price foreign talent to up their profits and elbow Aussies out of jobs early last decade, as soon as they twigged they could, according to those who claim to have been stung by the practice.

While debate over the visa system rages, IT consultancy Mahindra Satyam has announced plans to use staff from India, Malaysia and the Philippines to up its Australian head count from 1600 to 5000 over the next two years.

Forty per cent of the staff would be located in Australia and 60 per cent offshore to Mahindra Satyam, head of ANZ operations Bobby Gupta told India’s The Economic Times on Tuesday. The region currently accounts for 8 per cent of the firm’s $US1.31 billion annual revenue.

One worker told Fairfax Media he was made redundant from his nine-year IT management gig with a national liquor retailer in 2003 after the company hired Satyam (now Mahindra Satyam) to take over the IT jobs of eight local staff.

“We were given a few months’ notice of our redundancy and in that time we had to train the Indian staff on how to support our internal systems. It was never said but we were made to feel that if you wanted your redundancy payment, you had to train them.

While training the Indian staff, we found out that they were all in Australia on 457 visas. “There were six of them with some rotating to give others exposure to the systems.” IT professionals say this practice is in common with other major systems integrators and consultancies that use short-term 456 and longer-term 457 visas to boost their bottom line by importing lower-paid overseas workers.

3. Remove the fetters from management?

The design of the 457 scheme is often loosely linked to globalization, but it is clear that policy decisions play a major role. One crucial influence has been neo-liberal philosophies that seek to remove the fetters from management prerogative.

Source: M. Ruhs, ‘The potential of temporary migration programmes in future international migration policy’ (2006) 145 International Labour Review, pp. 14-15.

Ruhs classifies the 457 scheme can as laissez faire because of the absence of any caps or quotas, but even within this classification it appears as extreme, due to the absence of any labour market testing..

He says, there is always a need for host countries to manage the demand for migrant labour. This is because the level of labour immigration that is in the interest of individual employers is unlikely to coincide with that in the best interest of the economy as whole.

He goes on to argue that this entails ensuring that there are no opportunities for lowering labour costs by lowering labour standards, that demand for migrant labour is residual after recruitment of local workers fails, and that other methods of responding to shortages are not unfairly foreclosed. The 457 scheme fails to meet this fundamental challenge of managing the demand for labour.

Because the 457 scheme comes with extensive opportunities for renewal and with opportunities for the worker to apply for permanent residency, it may be wrong to call it a temporary migrant labour scheme. Instead it may be better characterised as a permanent migration program, though one that differs from the traditional program in that the workers are highly dependent on individual employers. This does not of course detract from but instead reinforces our argument concerning the need to meet the challenges of regulation.

4. However little workers earn….

However little workers earn, there is always somebody who wishes they earned even less. And for those somebodies, the solution is: Import more cheap labor. But not just any cheap labor — cheap labor that cannot quit, that cannot accept a better offer, that cannot complain.

Bonded labor is the oldest idea in American labor markets. In the 17th and 18th centuries, about half the British migrants to the United States arrived as indentured servants, people who agreed to work for a term of years in exchange for food, lodging, and the cost of their passage. Perhaps you assumed that such arrangements had expired centuries ago? Think again.

5. ACTU submission: review of skilled migration and 400 series visa programs, 30 January 2015


Immigration is an integral part of the Australian story. Migrants have made and continue to make an invaluable contribution to Australia’s social, cultural and economic life. Unions are particularly proud of the fact that thousands of our members across the country are migrants or come from migrant backgrounds, and indeed union officials too have similarly diverse backgrounds. Unions recognise that skilled migration will continue to be a part of the response to our future national skill needs.

Our clear preference is that this occurs primarily through permanent migration where workers enter Australia independently, with a greater stake in Australia’s long-term future and without the ‘bonded labour’ type problems of exploitation that can emerge with temporary and/or employer-sponsored migration. We recognise that there may be a role for some level of employer-sponsored and temporary migration to meet critical short-term skill needs.

However, there needs to be a proper, rigorous process for managing this and ensuring there are genuine skill shortages and Australian workers and young people are not missing out on jobs and training opportunities. We are deeply concerned at the growing number of free trade agreements the Australian Government has entered into which prohibit such a process from applying to employers seeking to bring in nationals of parties to those agreements.

At present, there is no structured mechanism for determining if the overall level of temporary migration, by occupation or industry sector, is responding to a genuine skilled labour supply deficiency, either across a region or across the nation as a whole. In this regard, we submit that the national, industry and regional labour demand analyses that were being undertaken by the Australian Workforce and Productivity Agency (AWPA) before it was abolished in 2014 should be reintroduced.

The AWPA Resource Sector Skills Needs Report of October 2013 and the Manufacturing Workforce Study of April 2014 are two good examples that provided robust and credible research on skilled labour demand. The Industry Skills Councils’ (ISCs) annual Environmental Scans could also be better utilised as a credible source of industry intelligence on sector specific skilled labour needs that require national training resource allocation to address the supply side of the equation.

Where the analysis indicates there is not a supply deficiency, the occupations should be taken off temporary migration skill supply. To be clear, the development of more sophisticated forecasting and skills analysis capacities should be used to complement labour market testing; they are not a substitute for labour market testing. Even if it can be shown that an occupation is in skill shortage at a national or sectoral level, the onus should still always be on each individual employer to provide evidence of what they have done to fill a position with an Australian citizen or permanent resident.


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