The wage cut-off threshold for temporary migrants is slipping, while the Government stalls on long-demanded reform. But the costs associated with bringing in temporary foreign workers still make recruiting and training local workers an attractive option, according to migration experts.
The Temporary Skilled Migration Income Threshold (TSMIT) is a salary - set at $53,900 — above which temporary skilled migrants must be paid.
Occupation lists, labour-market testing, and equivalent salaries for migrants in local jobs all help support the integrity of visas, but the TSMIT is the core mechanism preventing the importation of migrant workers on low wages.
The TSMIT has been held at the same level since 2013, meaning it has slipped compared to the rising cost of living.
Labor had campaigned on an election platform of increasing the TSMIT to $65,000, but that policy is now under review.
A Government-commissioned report in 2016 called for the TSMIT to increase in line with wages, and Government senators called for a review of the threshold in a Senate committee report in April.
Immigration Minister David Coleman is on leave and was not available to provide comment for this story prior to publication.
Balancing business needs and the community
The 457 visa was replaced by subclass 482 last year, and both have provided an option for Australian businesses to bring in migrant workers when vacancies are proving difficult to fill.
They have long drawn controversy, partly because it means employers can exert control over vulnerable workers and that Australian workers might be missing out on employment opportunities.
Top occupations on the temporary skilled visa
Occupation Workers
Cook 4,521
Chef 3,580
Cafe or Restaurant Manager 3,125
Developer Programmer 2,960
ICT Business Analyst 2,580
Software Engineer 2,465
Marketing Specialist 2,010
University Lecturer 1,992
Accountant 1,900
General Practitioner 1,859
Resident Medical Officer 1,805
Motor Mechanic 1,713
Management Consultant 1,561
Key points:
The income threshold for temporary work migrants has been stuck at $53,900 since 2013
Recent reports have recommended it be reviewed and increased, but the Government is silent on the issue
New regional migration agreements offer discounts below this threshold
And new regional visas are set to provide even greater discounts for employers, prompting concerns from Labor.
Labor announced in April it had wanted TSMIT to increase to $65,000. While the office of Labor's immigration spokesperson Senator Kristina Kenneally confirmed that policy was now under review, a spokesperson said: "Labor remains deeply concerned about the Liberals' policies that continue to undermine the pay and conditions of all workers."
Wayne Parcell, a immigration partner for EY, believes TSMIT should reflect changes in wages, but noted in any case the cost to the employer associated with the visa process meant employing Australians still made economic sense.
"It is simply better economics to pay the market rate salary to an Australian instead of to an overseas worker who will be a cost to the employer of as much as $10,000 in government training levies and visa application charges," he said.
ACTU president Michele O'Neil said raising the TSMIT was a "small but important part" of eliminating exploitation.
"People who come to our country on temporary visas with work rights should not have to fear exploitation and abuse at the hands of unscrupulous employers, and businesses who want to hire locally and pay fairly should not have to compete with dodgy operators who bend and break the rules," she said.
Jenny Lambert, director of employment at the Australian Chamber of Commerce and Industry, said the TSMIT was already at a level to ensure visa holders were able to support themselves.
"If the TSMIT is set too high then it makes many occupations, particularly in regional Australia, ineligible regardless of whether the employer is willing to pay the TSMIT," she said.
"For example, if the market rate for a mechanic in Bourke is under the TSMIT then the application is ineligible regardless of how desperately the community may need a mechanic."
Concern over regional TSMIT discount
The Government is introducing two new regional visas in November, with 23,000 places each year, as it seeks to fill job vacancies in regions at the same time as relieving congestion in cities.
The visas promise a pathway to permanent residency for those prepared to live in regional Australia for three years.
But it is also introducing more regional migration agreements: deals with local governments that allow temporary migrant workers to be imported in circumstances less restrictive than the ordinary rules.
Mr Parcell said there were currently 42,000 job vacancies in regional Australia, and the 'designated area migration agreements' (DAMAs) were designed to help fill these.
"Through to 2023 another 85,000 [regional] workers are expected in the healthcare and social assistance industry and 28,019 in education," he said.
"The newly approved DAMAs provide employers in the respective regions access to a 10 per cent reduced TSMIT, allowing the reduced earnings of $48,510 to include food and board or other non-monetary benefits up to a cap."
Visas available under each DAMA
Region Visas per year
Warrnambool 100
Far North Qld 200
Adelaide 300
Kalgoorlie 500
Northern Territory 500
Orana 500
Regional SA 750
In the past year, DAMAs have been announced for the Northern Territory, south-western Victoria around Warrnambool, Adelaide, regional South Australia, the Orana region around Dubbo in New South Wales, the Goldfields area around Kalgoorlie and Far North Queensland.
The 10 per cent reduction in the wage threshold — below the level of its six-year freeze — is a concern for Labor.
"The Liberals' further reduction of wages for temporary migrant workers under the Designated Area Migration Agreements is putting even more pressure on pay and conditions for all Australians," Senator Kenneally's spokesperson said.
Overall, the new DAMAs offer approximately 3,000 visas in the first year.
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