Worst of old 457 visa system will carry over into the new

The new temporary visa program will carry over the worst aspect of the old 457 visa program.

The core problem with the 457 visa system is its failure to prevent overseas workers from being hired on cheap wages for jobs that Australians have the skills to fill.

Global companies have been criticised for paying overseas workers below Australian market rates in industries, including IT, that they would be hard-pressed to demonstrate had a genuine skills shortage.

But the need for independent labour testing was the one key issue Prime Minister Malcolm Turnbull washed over when he announced the rebirth of the 457 visa system under a different name.

When Turnbull said he was responding to the Coalition government's own 2014 expert inquiry into the 457 visa program, he failed to acknowledge its core recommendation.

The inquiry led by John Azarius recommended the abolition of the current approach to labour market testing and its replacement with a new independent model.

This finding confirmed the need for labour market testing to be done at arm's length of employers, particularly those with vested interests who would otherwise exploit the system.

In making this recommendation, Azarius was echoing international best practice and evidence from the OECD. The UK has an independent advisory migration body staffed by economists and legal experts who provide evidence and advice to the government on which occupations have skills shortages.

Joanna Howe, Associate Professor in Law at Adelaide University is an expert on the 457 visa program and says an independent labour market agency is needed to ensure Australia's skilled occupations list is regularly updated to reflect the economy.

She noticed that Turnbull had mentioned the name of Azarius twice during his press conference on Tuesday but had failed to note his key finding.

While the new temporary skill shortage visa was presented as a response to the Azarius review, it failed to implement its core recommendation to abolish employer-conducted labour market testing and replace it with an independent labour market testing model.

As Howe points out, the Department of Immigration does not have the capacity to scrutinise the validity of labour market testing conducted by employers.

Even if the government tightens employer labour market testing, it will still fall short of the independent model.

According to Howe, employer-conducted labour market testing is not working effectively anywhere in the world.

For it to work, the Department of Immigration would need massive resources to verify the testing conducted by companies that claim to have advertised for jobs that they could not fill with Australian labour.

While the announcement to abolish the 457 visa program is a step in the right direction, Howe laments that it provided more rhetoric than substance when it comes to putting Australian jobs first.

This story Worst of old 457 visa system will carry over into the new first appeared on The Sydney Morning Herald.