New penalties for employing illegal workers

From 1 June 2013, employers engaging or contracting illegal workers face civil penalties of up to $76,500.

Changes to the rules governing the employment of illegal workers and tighter controls surrounding the use of 457 visas mean that employers need to be more vigilant in how they engage and manage foreign workers.

Unless employers can prove they have taken reasonable steps at reasonable times to verify that their employee or contractor had permission to work in the role offered, employers could be subject to fines if they:

• have allowed a person to work who does not have a visa.
• have allowed a person to work who does not have the proper work condition on their visa.
• have referred a person to work who falls under the above categories.
• have participated in an arrangement where an illegal worker is allowed to work.

Under the new civil penalty rules, the Department of Immigration and Citizenship no longer needs to prove that the employer knew or was reckless regarding the visa status of the employee or contractor when the person was engaged (although this will still constitute a criminal offence punishable by imprisonment). Now, employers are assumed to be guilty unless they have followed the correct work verification processes. These include:

• contracting a third party to verify the work rights of an individual; or
• sighting and retaining documents that establish that the person is an Australian or New Zealand citizen; or
• using DIAC’s VEVO service.

Penalty provisions have also been introduced which expose executive officers of a company as well as other staff.

The Australian Government is also introducing changes to the subclass 457 visa system that may impact employers of foreign workers. These changes are likely to include stronger integrity measures such as:

• empowering case officers to more closely question the need for certain foreign workers in certain cases, particularly in generic occupations;
• placing limits on the number of subclass 457 visas that can be sponsored in any year;
• fewer English language exemptions;
• imposing more rigorous training benchmarks; andempowering Fair Work Ombudsman Inspectors to investigate compliance with sponsorship obligations concerning the payment of market rates and working in the correct nominated role.

Whilst these changes are not expected to prevent the sponsorship of genuinely needed foreign workers, they are likely to create additional red tape and could result in longer processing times.

If your company uses the subclass 457 visa program, it is vital to ensure that your work verification processes comply with the new requirements and that they are regularly audited and reviewed. Equally, it is just as important to ensure that your company’s expectations about immigration compliance are fully communicated across the business.