Australia targets new law at employers of illegal workers

23 August 2012

The Australian government has announced a consultation on draft legislation intended to protect the Australian labour market from firms which knowingly employ illegal labour. Chris Bowen MP, the Australian Immigration Minister, announced the consultation on the Migration Amendment (Reform of Employer Sanctions) Bill 2012.

The bill would replace an existing law, the Migration Amendment (Employer Sanctions) Act 2007. The main innovation would be to introduce a 'deemed employment' provision which would make it easier to prosecute companies that 'take part in a chain of events that result in a foreign national being allowed or referred to work without the required permission.' This provision is intended to address the problem of 'sham contracting'. A statutory defence will be introduced so that those who can prove they made proper checks will not be guilty of an offence.

Mr Bowen said that the bill 'is an essential part of the government's effort to stamp out illegal work practices used by employers and labour suppliers to gain a competitive advantage. Illegal workers undermine the integrity of Australia's migration program, reduce work opportunities for Australians and expose vulnerable workers to exploitation.'

Mr Bowen continued, 'The Bill extends liability to certain third parties in order to address sham contracting arrangements often established to circumvent the law, and includes statutory defences to protect those who seek to do the right thing by verifying work entitlements of non-citizens whom they allow or refer to work.'

There will be no change to the maximum terms of imprisonment for criminal offences under the act which will remain at two years for the 'baseline offence' and at five years for an aggravated offence under the act. The aggravated offence is committed where the employee in question has been 'exploited'. For a breach of a civil penalty provision under the act, individuals could face fines of up to AUS$9,900 and firms could face fines of AUS$49,500 for each breach.

Speaking on 3rd August 2012, Mr Bowen said that legislation introduced by the Australian government in 2007 had proved ineffective. He said that the government will introduce legislation to introduce a graduated system of sanctions to deal with companies that employ illegal labour. Infringement notices will be issued first, then non-fault civil penalties and eventually criminal sanctions.

The new bill will, if passed into law, replace the Migration Amendment (Employer Sanctions) Act 2007 and will implement the recommendations of the 2011 Howells Review.

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