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The 457-Visa System: Benefits and Risks Report

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Updated: Sep 29th, 2020


The 457-visa system is an immigration programme, which allows employers to source skilled labour from outside Australia. 457-visa allows skilled employees to work in Australia for a period of between one day to four years (Department of Immigration and Border Protection, 2004). The Appendix section shows the figures of people who migrated to Australia from 1996 to 2014. The skilled occupations that are allowed to outsource employees are documented in the Migration Regulations. However, over time, Domestic Workers’ Unions have expressed their displeasure with this arrangement. They view 457-visa as taking away jobs that belong to Australian citizens (ABC NEWS, 2016; McHugh, 2014). This paper will explore the benefits and risks associated with hiring skilled overseas workers. Additionally, the paper will suggest various methods of addressing the risks.


To the Organisation

According to McGrath-Champ, Rosewarne, and Rittau (2011), the positive reception of the assorted geographical state of a business can produce innovative insights into the job market. At times, especially during the economic boom, it becomes difficult for businesses to find skilled domestic workers. During these periods, the government is not able to train enough skilled workers domestically to match the high demand for labour. For this reason, the Australian government has allowed employers to cater to the deficit by sourcing workers from outside the country.

The employers are responsible for nominating the migrant workers. The recruitment plan empowers them (employers) to be in a position to hire only qualified persons (Campbell & Tham, 2013). Additionally, the government does not impose a quota on the number of visas that may be issued. Therefore, the employer is at liberty to nominate as many migrant workers as required. Migrant workers provide businesses with affordable labour. While the Australian legal framework outlaws the down cutting of wages through sourcing overseas employers, it remains evident that such overseas workers are more favourable to employers because of their affordability.

To the Economy

Another major benefit of migrant workers is that they boost the growth of the domestic economy. Migration is of significant benefit to the overall economy as long as the migrants’ skills match the labour needs of the host country (Bahn, Barratt-Pugh, & Yap, 2012). Migrant workers who come to Australia are usually highly trained and motivated individuals, an aspect that is likely to fuel the growth of the Australian economy. Carvalho (2015) argues that migrant workers serve to lift the population in terms of involvement and yield. Without migrants, the country’s population may dwindle to unsustainable levels, a situation that may have a negative impact on the county’s economy.

Latimer (2014) view migrant employees as people who “support short-to-medium term skills shortages when Australians are unable to fill such roles” (para. 11). On the other hand, with migrants in place, the population is expected to grow to the extent of resulting in a more robust domestic economy. The existing labour economic literature suggests that migration improves the wellbeing of the host country since temporary migrant employees contribute to the capacity and mobility of the state’s labour market (Crock, Howe, & McCallum, 2014). The presence of migrant workers in a country is a sign that the host country upholds collective worker representation as Helfen, Schüßler, and Stevis (2016) suggest.

To Migrants and their Dependants

The 457-visa model provides skilled migrants with an opportunity to work for better wages and under better working conditions. Most of the migrant workers are from less developed countries whose wages are relatively lower (Bahn et al., 2012). Therefore, securing these jobs, which may not be readily available in the home country, is as an opportunity for them to better their lives. Additionally, migrant workers are allowed to bring their dependants with them to Australia (Crock et al., 2014). These dependants may benefit from working in other industries that do not require special skills. On the other hand, children of the migrant workers benefit from improved education facilities in the host country. Bahn et al. (2012) reported that the number of migrants’ children in Western Australia schools had increased by 30% in the four months between November 2008 and February 2009. Such workers also benefit from specialised training aimed at equipping them with safety and health skills that are suitable for the work environment.


High Causalities

According to Safe Work Australia (2011), over 250 Australian workers succumb to work-related injuries each year while another 2000 die from illnesses that are attributed to the workplace environment. Many non-fatal cases also exist, a situation that further drives up the number of work-related injury cases. These cases intensify the cost of compensation for the affected employees. It is estimated that nearly 6% of Australia’s Gross Domestic Product goes to compensation and worker rehabilitation (Safe Work Australia, 2011). Among the impediments to Australia’s ambition to minimise workplace deaths and injuries are risk blindness (Bahn, 2013).

According to Bahn (2013), risk blindness arises from a cultural bias since individuals can either not see it, or they deem it inherently acceptable. Risk blindness has been found to lead to poorer health and safety performance (Bahn et al., 2012). The situation is highly associated with migrant workers. Most temporary workers come from countries whose health and safety records are worse compared to the state of affairs in Australia. Additionally, the workers bring with them their home country perceptions about the said risks. Hence, they are more prone to injuries when compared to domestic workers.

Additional Overhead Costs

Another implication associated with employing migrant workers is the increased overhead costs, which are incurred in areas such as training and assisting the migrants to obtain housing. Migrant workers are a full responsibility of their employers while working in Australia. They have increased financial burden for their employers who have to go out of their way to ensure that the temporary workers are suitable to work in their new environment. This situation calls for vocational training in areas such as worker safety and health, as well as language tuition for non-English speakers. Migrant workers have been found to be at a higher risk of workplace injury compared to domestic workers (Bahn, 2013).

This knowledge places a strict responsibility on employers to ensure that such employees attain the necessary workplace safety training, including eliminating language and cultural barriers that may exist between employees and their managers or co-workers. Employers also have to spend extra time assisting workers to find housing, obtain bank accounts, as well as making them aware of Australian customs (Bahn, 2013). These activities consume company time. Hence, they may be counterproductive on the company’s part. Human resource managers may also find difficulties dealing with migrant workers because they are not specially equipped with the necessary multicultural skills to accommodate such employees. This case may lead to panic, which is counterproductive to the workplace.

Managing High Causalities and Overhead Costs

Townsend, Wilkinson, and Burgess (2014) address the need for better employee management mechanisms in countries that wish to gain from the input of their diverse human resource base. Hence, in the context of this paper, following the high risk of injury or death that faces migrant workers, mitigation is highly important to keep these cases low. Injuries to employees while at work cost the organisation money in terms of compensation to the victims or their dependants. One of the main ways to manage the high risk of injury involves employing Occupational Safety and Health (OSH) measures in the workplace. The International Labour Organisation (ILO) breaks down the aspects of OSH to include communication, training, and instructions approach (Bahn, 2013; Langille & Mundlak, 2015).

Some migrant workers have difficulties communicating in English, which is the medium language in virtually all Australian industries (Toner & Wooley, 2008). Employers may alleviate the effects of the language barrier by offering short English courses for 457-visas under their custody. This training can also be expanded to include workplace safety and health measures. One of the primary ways to mitigate the extra costs by employers is to require migrant workers to have vocational English proficiency before nominating them for the 457-visa. This strategy will ensure that the company incurs no extra costs to the extent of offering proficient training to the workers. Toner and Wooley (2008) have emphasised the need for migrant workers to become vast in English.


Hiring temporary workers under the 457-visa programme has its benefits and risks. One of the major benefits is that it enables employers to obtain skilled labour from overseas. This benefit is important in preventing the risk of labour drain. The economy also benefits from the relationship of employer-skilled migrant workers since their presence in Australia spurs economic growth by lifting the population. The result is a more robust economy with a higher labour capacity and functional fluidity. On the other hand, certain risks are associated with hiring temporary workers. For instance, migrant workers are at a higher risk of sustaining workplace injury due to aspects such as language barrier and failure to participate in risk assessment.


Temporary migrants.
Source: Bahn et al. (2012).

Reference List

ABC NEWS. (2016). Union questions job cuts at Hunter Valley coal mine. Web.

Bahn, S. (2013). Risk blindness among temporary migrant workers in Australia. Web.

Bahn, S., Barratt-Pugh, L., & Yap, G. (2012). The employment of skilled migrants on temporary 457 visas in Australia: Emerging issues. Labour & Industry: a journal of the social and economic relations of work, 22(4), 379-398.

Campbell, I., & Tham, J. (2013). Labour market deregulation and temporary migrant labour schemes: An analysis of the 457-visa programme. Australian Journal of Labour Law, 25(3), 239-272.

Carvalho, P. (2015). Web.

Crock, M., Howe, S., & McCallum, R. (2014). Conflicted Priorities? Enforcing Fairness for Temporary Migrant Workers in Australia. Oxford: Oxford University Press.

Department of Immigration and Border Protection. (2004).Temporary work (skilled) (subclass 457) visa. Web.

Helfen, M., Schüßler, E., & Stevis, D. (2016). Translating European Labour Relations Practices to the United States through Global Framework Agreements? German and Swedish Multinationals Compared. Industrial & Labour Relations Review, 69(3), 631-655.

Langille, B., & Mundlak, G. (2015). Book Review Symposium: The future of the International Labour Organisation in the global economy, by Francis Maupain: Introduction. International Labour Review, 154(1), 68-72.

Latimer, C. (2014). Web.

McGrath-Champ, S., Rosewarne, S., & Rittau, Y. (2011). From one skill shortage to the next: The Australian construction industry and geographies of a global labour market. Journal of Industrial Relations, 53(4), 467–485.

McHugh, B. (2014). Web.

Safe Work Australia. (2011). National Work Health and Safety Strategy 2012-2022. Web.

Toner, P., & Woolley, R. (2008). Temporary migration and skills formation in the trades: A provisional assessment. People and Place, 16(3), 47-57.

​ Townsend, K., Wilkinson, A., & Burgess, J. (2014). Routes to partial success: collaborative employment relations and employee engagement. International Journal of Human Resource Management, 25(6), 915-930.

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