Unions are concerned that low wages and poor workplace conditions are prevalent in the industries that Working Holiday Makers (WHM) operate. The government has missed the crucial problem that affects these sectors of the labour market. Better paid jobs, with decent working conditions should be the priority. Where is the government’s plan to raise wages and conditions in these sectors? We know that 90% of WHMs work in the agriculture sector where low wages are commonplace. It is also clear that the rules and regulations that govern the workplace need to be better monitored and enforced, including the right of entry and inspection powers for unions and better resources for the Fair Work Ombudsman to carry out monitoring activities.

The Working Holiday Maker visa has unfortunately become synonymous with unscrupulous labour hire companies that abuse their workers. Exploitation of working holiday makers in the farm sector include cases of underpayment, provision of substandard accommodation, debt bondage, and employers demanding payment by employees in return for visa extensions.

There is a growing body of institutions and reports that recognise there is a problem of unregulated labour hire companies exploiting workers. This includes the March 2016 Senate Standing Committee on Education and Employment “A National Disgrace: The Exploitation of Temporary Work Visa Holders”. Without the significant problem of unscrupulous labour hire companies being addressed we fear that there will be a continued exploitation of these workers.

On the Backpacker tax the ACTU is concerned that in real terms, a 32.5% tax rate will net a WHM $11.94 per hour from commencement of employment. Overseas workers, like all Australians, should be required to pay tax on their earnings. While it is important overseas workers contribute to tax, their tax liability should be determined on the basis of their earnings in a manner that is consistent with the principles that underpin our progressive tax system. They should not be taxed at a rate so high they are earning an after-tax rate that Australian society would consider unacceptable. The ACTU is concerned that when one considers that the average annual earnings for WHMs are approximately $13,300, the unfair nature of the government’s proposal is striking. The government has unfortunately missed the real problem – that wages and conditions are too low in the sectors that WHMs operate.

At a time when unemployment remains at just under 6% and youth unemployment is in double digits, the Australian community needs to have confidence that such a large and growing temporary work visa program is not having adverse impacts on employment and training opportunities for Australians, particularly young people. While we recognise that labour markets are not perfect and there will be cases where genuine skills shortages exist, unions do recommend an annual cap on the number of Working Holiday Maker Visa Holders and the second year extension of the visa should be abandoned altogether.

Equally, the community needs to be assured that employers and others are not exploiting vulnerable temporary overseas workers who are unaware of their rights or not in a position where they feel able to exercise those rights. Unfortunately, the evidence available from our affiliated unions and other sources is that both Australian and overseas workers are being disadvantaged and exploited on a regular basis under the current policy and program settings that govern temporary work visas including WHM visas.

 This has been happening far too often and for far too long for it to be dismissed as a few isolated cases in an otherwise well-functioning program.