Black Economy Taskforce Recommends Ending Migrant Work Restrictions

A consultation paper has been released by the Australian government as part of its Black Economy Taskforce operation which features several controversial recommendations, including allowing international students and refugees to work for more than 40 hours a fortnight.

The taskforce—which is led by the chairman for the Board of Tax, Michael Andrew—also called on business leaders, professional bodies and ethnic groups to suggest methods that the government can use to combat the growing mentality that has seen illegal cash payments become “almost a national sport”.

The paper recommended granting asylum seekers the right to work while awaiting a decision on their refugee status, arguing that preventing them from legally working increases the likelihood of participation in the illegal cash economy. The report also suggested that students be given the right to work for more than 40 hours a fortnight, citing similar concerns that the restriction increases the propensity of students to engage in off the books economic activity.

The study found that combating the illegal cash payment economy—which constitutes up to $15 billion in lost federal tax revenue—will be as much of a cultural challenge as it is an economic one.

“Particular ethnic, demographic and occupational groups may be reluctant to depart from established practices”, the paper read.

“[There are] a variety of beliefs, assumptions and suppositions which people draw on to excuse, defend or justify operating in the shadows.”

However, the papers main argument still rests on the premise that limiting individual’s ability to legally work increases the possibility of illegal economy activity.

“They point out that foreign students who cannot afford to comply with this work restriction have no choice but to go underground,” the paper reads.

“As a result, a sizeable and rapidly growing pool of vulnerable employees is created. It is no surprise, in these circumstances, that cases of exploitation, bordering on slavery, have come to light.”

Attention was also drawn to the role that peer pressure can play in encouraging certain ethnic groups to participate in illegal black economy.

“There is broad agreement that cultural change is required, but recognition that this is not something that governments, acting alone, can decree,” the paper said.

“We are conscious that some ethnic groups are predisposed to deal in cash and welcome suggestions on how best to influence this behaviour.”

“Ethnic community leaders will probably have a strong role to play in this regard. Contact with potential whistle‑blowers, for example, could be made through social media channels,” it said.

The CEO of Absolute Immigration, Jamie Lingham, also expressed his support for the taskforce’s recommendations, saying the move will drastically improve the quality of life for migrants who are waiting for a decision to be made on their visa application. However, he advocated for a more cautious approach when addressing the employment restrictions of international students, arguing that foreign nationals undertaking study in Australia should be required to meet a minimum academic performance level before they are given the right to work.

“Our view is that it is nonsensical that the 30,000+ people in Australia who are applying for refugee status do not already have the right to work. This group are already in Australia, and the current policy unfairly restricts them from making a positive contribution to society during the period that their claims are being considered,” Lingham said.

“Applications can remain in processing for years, and regardless of the outcome we believe that these people have a right to earn their own money and help make a positive contribution towards their life in Australia. In regards to the 470,000 student visa holders, we believe that in the event that work rights are extended beyond the current limit of 40-hours per fortnight, there should be greater scrutiny given to the academic performance of students, taking all work rights away from poor performers.”

“The reality is that student visa holders need to show that they possess an independent level of financial support, without the need to work during their time studying in Australia. In all cases, work experience should increase their chances of finding employment on returning to their home country, not to act as a money-making exercise for the duration of their studies. We believe that with both options being considered, there needs to be significant protections in place to avoid worker exploitation and the underpayment of wages.”

“Our view is that there is a real danger of employers using these groups as a source of cheap labour, and capitalising on the fact that some of these people may not understand their rights whilst living and working in Australia. At best, this is a poor replacement for the recently abolished 457 visa program, and due care needs to be taken to ensure that these moves do not create an underclass of second class citizens. This will only serve to reduce the illegal cash economy while increasing the overall exploitation of vulnerable migrant workers,” he said.

If you have any questions or would like us to assist with your global immigration queries, please contact one of our Registered Migration Agents on 1300 ABSOLUTE (1300 227 658).

Jamie Lingham

Chief Executive Officer

MARN 0108123