MIGRATION AMENDMENT (EMPLOYER SANCTIONS) BILL 2006 Explanatory Memorandum

Commonwealth of Australia Explanatory Memoranda

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MIGRATION AMENDMENT (EMPLOYER SANCTIONS) BILL 2006

2006 THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA SENATE MIGRATION AMENDMENT (EMPLOYER SANCTIONS) BILL 2006 EXPLANATORY MEMORANDUM (Circulated by authority of the Minister for Immigration and Multicultural Affairs, Senator the Hon Amanda Vanstone)

MIGRATION AMENDMENT (EMPLOYER SANCTIONS) BILL 2006 OUTLINE 1. The Migration Amendment (Employer Sanctions) Bill 2006 ("the Bill") amends the Migration Act 1958 ("the Act") to introduce new offences for employers, labour suppliers and other persons who allow illegal workers to work. 2. The incidence of illegal work in Australia is a significant problem that denies Australians the opportunity to gain employment and can result in the exploitation of non-citizens. It is also a concern to the Government because of its close association with cash economy industries, which are characterised by abuses of Australia's tax, employment and welfare laws. 3. The absence of effective penalties for employers of illegal workers also encourages people smuggling and trafficking activities for the purpose of illegal work. Victims of trafficking may be forced to work illegally in conditions of forced labour, sexual servitude or slavery. 4. Currently, it is an offence under section 235 of the Act for: · an unlawful non-citizen to do any work in Australia, whether for reward or otherwise; and · a non-citizen, who holds a visa that is subject to a work condition, to work in Australia in contravention of that condition. 1. In addition, there are administrative measures available under the Act, such as visa cancellation and removal powers, that can be taken against persons who work illegally in Australia. 2. In contrast, there are no mechanisms in the Act to penalise persons who allow non- citizens to work in Australia illegally. 3. The proposed new offences will: · deter employers and labour suppliers from employing illegal workers or referring them for work; and · encourage employers and labour suppliers to verify the work entitlements of potential employees when there is a substantial risk that they may be illegal workers. 1. The offences will supplement existing measures in relation to illegal workers and provide a holistic approach to combating illegal work in Australia.

FINANCIAL IMPACT STATEMENT The amendments contained in the Bill will have minimal additional financial impact. All additional costs will be absorbed within existing funding arrangements.

REGULATION IMPACT STATEMENT 1. BACKGROUND 7.1Unrestricted access to the labour market is a privilege limited to citizens and permanent residents of a country. In Australia, permanent residents, Australian citizens, and New Zealand citizens who enter Australia on a valid New Zealand passport, have an unrestricted right to work. Other people wishing to enter the country face the precondition that they have either no access or restricted access to the labour market. 7.2Illegal workers comprise those persons in Australia legally but who work in breach of visa conditions, and those people who do not hold a valid visa. As at 31 December 2005, there were estimated to be just under 46,400 overstayers in the Australian community. Of that number, around 56%, or 26,200 people had been in Australia unlawfully for more than 5 years. 7.3A significant proportion of unlawful non-citizens work illegally in order to fund their continued presence in Australia. Some visa holders are also working in breach of their visa conditions. 7.4Despite the growing success of immigration compliance activities, it is unlikely that the problem of illegal work will be reduced without further statutory reforms to supplement traditional compliance measures. 1. THE PROBLEM / ISSUES 7.1The problem is how to combat attempts to work illegally in Australia, consistent with Australia's objective to attract genuine visitors and to minimise the burdens placed on the Australian community by any new measures. Impact of the problem 7.2The presence of a significant group of non-citizens working illegally is at odds with an orderly migration program. Planning the level for each stream of the migration program is tightly controlled. The levels are based on Australia's capacity to assist the settlement of newcomers, Australia's economic requirements and performance, employment conditions of Australian citizens, Australia's obligations to humanitarian entrants and to assist family reunion. 7.3Allowing illegal unskilled workers to remain in Australia provides a pull factor for avoiding immigration controls. A failure to act would undermine confidence in the integrity of these controls. 7.4The availability of work for people without authority to enter the labour market is not only an immigration matter but also one that has significant economic and social implications. 7.5Employers may recruit a person without work rights for a range of reasons, including: · ignorance of the lack of work rights;

· availability to commence work; · willingness to undertake the work offered; and · ability to pay lower rates of pay and lower overheads. 7.6By employing a person without work rights, employers close the position to an Australian citizen or permanent resident. Further, employers who employ legal workers may be disadvantaged in not being able to compete with the lower overheads of those who employ and under-pay illegal workers. 7.7There are indications that people in low-skilled positions are: · often paid below official rates; · some may not pay tax, either at the correct rate or at all; and · some are claiming social security benefits that they are not entitled to. Why is government action needed to correct the problem? Level of risk 7.8As at 31 December 2005, there were estimated to be just under 46,400 overstayers in Australia. Of that number, 26,200 had been in Australia unlawfully for more than 5 years. A significant proportion of this group is probably working to support their continued stay. 7.9According to DIMA's Driver Based Costing returns for the 2004-05 financial year, the cost of locating illegal workers and issuing warning notices to their employers was approximately $1691 per illegal worker. The average cost of cancelling a visa was approximately $9932. The average cost of detaining an unlawful non-citizen located in the community was approximately $221 per day and the average cost of their removal from Australia was $1800. This translates to a minimum cost of approximately $3,712 for each unlawful non-citizen who is located, detained and removed from Australia and $13,644 for each illegal worker whose visa is cancelled for breach of a work condition and who is subsequently detained and removed from Australia. 7.10It should be noted that Driver Based Costing allocates costs to a range of Departmental outputs. The compliance costs for overstayers form part of the total compliance costs and have been extrapolated from the consolidated output costs for 2004-05. For this reason, the figures should only be regarded as estimates of the cost of this compliance activity. Nonetheless, they indicate that the costs of locating, detaining and removing illegal workers are significant. 7.11Despite the success of departmental compliance action, there is little prospect that the problem of illegal workers will diminish without a significant change in the strategies used. 7.12A correlation exists between the number of people who overstay their visas and/or work in breach of visa conditions and the growing number of non-citizens who enter Australia

temporarily. Therefore, unless new processes and procedures are implemented to control this trend, the increasing number of non-citizens entering Australia will result in an increase in the number of overstayers and illegal workers. 7.13The increasing population of illegal workers would ultimately require not only additional compliance staff to deal with the expected work-load but greater capital expenditure on detention facilities and associated costs of accommodating, detaining and ultimately removing people from Australia. 7.14In addition, while there are penalties for those who work illegally, there are no effective parallel strategies for employers who employ illegal workers. Systemic compliance problem 7.15The Government's compliance strategies are designed on the basis of there being substantial voluntary compliance. As such, the measures used to promote compliance thus far have been useful tools for those employers and visitors who wish to comply with Australia's immigration laws, but do not do enough to discourage those who wish to breach immigration law. 7.16The Employer Awareness Campaign, for example, has proved to be a useful information tool for law-abiding employers, but it has not been able to encourage those employers who are not interested in cooperating with the Government to maintain the integrity of the immigration program. 7.17It is possible for employers to be prosecuted under section 11.2 of the Criminal Code Act 1995 for aiding and abetting an illegal worker to commit an offence. The offences that the employer would be aiding and abetting are those in section 235 of the Migration Act 1958, which variously deal with non-citizens working in breach of visa conditions or whilst unlawfully in Australia. 7.18However, prosecutions rarely occur under this provision, because of: · difficulty in obtaining supporting witnesses; · insufficient evidence to prove that an employer intended his or her conduct to aid and abet the illegal worker to commit an offence; and · the chain of evidence required to meet prosecution standards.

Consequences of no action 7.19If no action is taken, current compliance efforts indicate that increased numbers of people will try to enter Australia to work illegally. Market forces will favour the employment of illegal workers, who may be paid lower wages and work in sub-standard conditions, disadvantaging legal workers. Employers who employ legal workers at rates of pay and conditions consistent with Australian workplace relations legislation will have a competitive disadvantage. 7.20While illegal workers would continue to be located and removed from Australia, there would be no action taken against those who employ them. 7.21Failure to take further action against illegal work would: · encourage a rise in the levels of illegal work, undermining the integrity of a managed immigration program; · encourage people smuggling and other unlawful immigration by providing job prospects for unlawful non-citizens, thereby undermining border integrity; · increase the likelihood of tax and social security fraud; · present a health problem to the Australian community, due to people bypassing the health checks normally undertaken by lawful longer-term residents; · present safety risks to the Australian community, due to people bypassing the rigorous character checks normally undertaken in relation to lawful long-term residents; and · increase the chances of illegal workers being exploited through low wages and poor working conditions, particularly in the sex industry where women may be trafficked to work illegally in conditions of sexual servitude. 1. GOVERNMENT'S OBJECTIVES 7.1The Government's overall policy is to regulate the entry and presence of non-citizens in Australia. In the context of this Regulation Impact Statement, the Government's objective is to reduce the numbers of illegal workers in Australia and ensure that people who knowingly or recklessly employ illegal workers are subject to sanctions. Is there a regulation/policy currently in place? Who administers it? 7.2The current regulatory scheme seeks to prevent illegal work by imposing criminal and administrative sanctions on non-citizens who work illegally. 7.3The main administrative sanctions for illegal workers are visa cancellation and removal from Australia. Non-citizens whose visas are cancelled may also be barred from being granted further visas for a period of three years.

7.4Non-citizens who work illegally may also be prosecuted for the offences set out in section 235 of the Migration Act 1958. However, prosecutions rarely occur because of the competing obligation to remove unlawful non-citizens from Australia as soon as reasonably practicable. 7.5The only existing measures that could be directed at employers of illegal workers are the aiding and abetting provisions of the Criminal Code Act 1995. These provisions have not been effective to restrict the employment of illegal workers. This is because it is difficult to prove an intention on the part of an employer to aid and abet an illegal worker to commit an offence. To prove such an intention it must be demonstrated that an employer knew the employee was committing an offence. 7.6There are several policy measures in place, all administered by the Department of Immigration and Multicultural Affairs (DIMA), which are designed to reduce the numbers of illegal workers in Australia. These are: · the Employer Awareness Campaign (EAC), which is an information campaign aimed at educating employers about not recruiting people without work rights and indicating how to check whether people do have work rights; · the internet based work rights checking facility called Entitlement Verification Online ("EVO") which provides employers with a quick and easy way to check a non-citizen's work entitlements; · the operation of the Fax-Back Facility which is a free call service that provides employers and labour suppliers with information about the work right status of their non- citizen employees; and · the issuing of administrative Illegal Worker Warning Notices to employers and labour suppliers who engage or refer illegal workers. 7.7These measures have been useful for employers who want to do the right thing but have done little to discourage those who wish to assist breaches in Australia's immigration laws. OPTIONS 7.8There are several options available which can be used to achieve the Government's objectives, and which can be implemented either separately, or in combination with other measures. These options, are: · Option 1: Continuation of traditional compliance activities; · Option 2: Continuation of EVO to ensure work rights checking remains as easy as possible; · Option 3: Continue the EAC, so that employers receive further information about the risk of illegal workers and the processes of checking work rights; · Option 4: Introduce more effective offences for employers and labour suppliers who allow or refer illegal workers to perform work;

· Option 5: Pursue joint fieldwork activities with other Departments such as Centrelink and the Australian Taxation Office; and · Option 6: Extend the work rights for visitors to Australia. 7.9The options, discussed in this Regulation Impact Statement, complement one another and, taken together, provide a more effective strategy which combines effective legal sanctions with assistance to employers to comply with work rights checking requirements. A number of the options (such as improving the supply of information to employers) would work in tandem with the more substantive options. In other words, it is important to regulate the supply of information in relation to new measures, not only to inform the affected parties, but also to attempt to slow down the growth in numbers of illegal workers without resorting to increasing the level of compliance activities. 1. OPTIONS 7.1 Option 1: Continuation of traditional compliance activities 7.1.1 Traditional compliance activities conducted by the DIMA will continue to play an important role in the prevention of illegal work in Australia irrespective of the other options that may be pursued. 7.1.2 However, for the reasons discussed above, traditional compliance activities by themselves have not been sufficient to eliminate the problem of illegal work in Australia and a more pro-active approach is required. 7.2 Option 2: Continuation of EVO 7.2.1 The provision of services that make it easier to check the work entitlements of non- citizens helps to address the problem of illegal work by increasing voluntary compliance on the part of visa holders and employers. Any measures that make it easier for employers and visa holders to ascertain their work entitlements increase the numbers of people who voluntarily do the checks to determine whether they are entitled to work. 7.2.2 On 1 July 2004, DIMA introduced a pilot entitlements verifications service called EVO for use by a limited set of employers. Following the success of the pilot, EVO was made available to all employers and labour providers, as well as to visa holders. Employers and visa holders can use EVO to check work entitlements. The system is accessed via the Internet and provides users with an instant response in plain English about a non-citizen's work entitlements. It is a free service. To check a non-citizen's work entitlement, an employer needs to provide identifying information such as the non-citizen's passport number, name, date of birth and country of origin to protect the privacy of the non-citizen. Businesses without Internet access can perform a work rights check through one of the methods discussed below. 7.2.3 EVO overcomes the difficulty of providing employers and visa holders with meaningful information about work entitlements on a visa label with very limited space.

7.2.4 The Immigration Records Information System (IRIS), which is the processing system used at visa-issuing posts overseas, currently limits the amount of information that can be printed on the visa label. It allows up to six conditions to be displayed. The first four conditions can display the four-digit code plus up to forty characters. The remaining two conditions can display the four digit code only. 7.2.5 Even if the IRIS system were reprogrammed to allow additional information to be printed on the visa label, there would be insufficient space to display the more complex work related visa conditions set out in the Migration Regulations 1994. For example, the text of condition 8107, which effectively ties the visa holder to a specified employer, contains over 672 characters. Approximately 16 times more space would need to be made available to print this condition on a visa label. 7.2.6 EVO allows the full text of each work related visa condition to be displayed on an employer's computer screen in plain English. This represents a significant improvement on the information currently displayed on visa labels. At present, the expression "Work Limitation" is all that is printed on a visa label where a visa holder is only entitled to perform limited work. No explanation about the nature of the work limitation is provided. In addition, EVO provides a link to the full regulation wording, should an employer wish to view it. 7.2.7 A web-based system such as EVO also allows the work entitlements to be ascertained of non-citizens who hold label-free visas such as Working Holiday Maker visas, Student visas and others. A person granted a label-free visa has no evidence in their passport of the conditions attached to their Australian visa. These records are instead stored on DIMA's computer systems, against which airlines and travel agents can confirm that the holder may enter Australia, and employers and labour suppliers can check work entitlements. IMPACT ANALYSIS Impact Groups 7.2.8 The groups that may be affected by this option include the community (illegal workers and legal workers), business (employers and labour suppliers) and the Government (the Department of Immigration and Multicultural Affairs, the Australian Taxation Office and Centrelink). Community costs and benefits 7.2.9 There are no costs to the community arising out of this option, aside from financial costs incurred by the Government in enhancing and maintaining the on-line system, which would be transferred to the taxpayer. 7.2.10 The benefits would include: · better information for visitors to Australia, and a decreased likelihood that they work under the misconception that they have work rights; · increased visitor traffic as higher visitor compliance rates lead to lower refusal rates for visa applications; and

· lower cost of compliance activities, as well as an increased level of employment of legal workers, if the numbers of illegal workers are reduced. Business costs and benefits 7.2.11 There are no costs envisaged for businesses from the continuation of EVO. Businesses that choose to use the service would incur the cost of a local call if they have a dial up Internet connection and no costs if they have a broadband connection. There would also be a time cost of several minutes per employee if a work rights check is incorporated into the recruitment process. This cost would need to be balanced against the potential loss in productivity that could be experienced if a valuable but illegal employee is removed from the workplace because of breaches of immigration laws. 7.2.12 An on-line work rights checking system brings about a number of significant benefits for employers who wish to check whether their employees have work rights: · It provides employers with an instant response about the work entitlements of prospective employees compared with the one-to-two day response period for the existing Fax-Back Facility. · Employers do not have to undertake the difficult task of interpreting visa labels which lessens the administrative burden of conducting work rights checks. The advice provided by EVO clearly sets out the extent of a visa holder's work entitlements in plain English. · It provides employers with a means of ensuring that they do not accidentally employ people without work rights, thereby lessening the risk that they will lose valuable employees as a result of Departmental compliance activities. · There is improved competition as some businesses no longer have to unfairly compete with others using cheap illegal labour. 7.2.13 The extent to which this option would increase the levels of voluntary compliance on the part of employers and visa holders would depend on whether these groups are able to easily access the Internet. 7.2.14 The Department of Communication, Information Technology and the Arts (DCITA) estimates 74% of all businesses used the internet, and 88% of all Small and Medium Enterprises were connected to the Internet. The National Office for the Information Economy also estimates that there is only a very small difference in the levels of technology adoption between metropolitan and non-metropolitan businesses. The National Farmers Federation has also provided informal advice that farmers have an extremely high level of Internet usage. 7.2.15 These figures suggest that the continuation of EVO would be extremely useful for businesses that want to check the work entitlements of their employees. Businesses without Internet access could conduct an on-line work rights check by visiting an Internet cafe, library or local business that has an Internet connection. Alternatively, they could use one of the existing work rights checking mechanisms such as the Fax Back Facility.

7.2.16 It must also be remembered that this option only impacts on those employers who voluntarily comply with the arrangements to check work rights entitlements. It does not impact on employers who do not avail themselves of this facility. To have an effective compliance strategy there needs to be provision made to impose sanctions on employers and labour suppliers who continue to engage or refer non-citizens without the right to work. Impact on small business 7.2.17 A user friendly on-line work rights checking facility is particularly useful for small businesses that have previously not had the time to learn how to interpret visa labels. Small businesses without Internet access would be able to use an alternative checking service such as the Fax Back Facility. Government costs and benefits 7.2.18 The continuation of EVO would entail financial costs for the Government. These costs would include: · the costs of enhancing and maintaining the system. This includes costs of upgrading EVO given the expected widespread adoption of the system by Australian employers and labour suppliers, · staffing costs associated with maintaining the system and registering new employers and labour suppliers; and · the costs of advertising the new on-line checking facility. These costs would be minimal as a one-page information brochure would continue to be inserted in the employer awareness kits discussed at paragraph 4.3.3 below. 7.2.19 Over time these costs would be offset by more effective use of compliance resources associated with the location of illegal workers. More employers and visa holders taking advantage of the easier process for checking work entitlements represents an increase in voluntary compliance, freeing up resources that can be allocated to areas of non-compliance. 7.3 Option 3 - Continuation of the Employer Awareness Campaign 7.3.1 This option is to continue DIMA's Employer Awareness Campaign (EAC) which provides information about who is entitled to work in Australia and the ways of checking work rights. The objective of the EAC is to increase the level of voluntary compliance on the part of visa holders and employers. 7.3.2 The EAC commenced in 1992. Its purpose has been to ensure that employers recruit only those people with work rights and to provide information on what documents should be seen to check on the right of a person to take a job. DIMIA compliance officers distribute information kits to employers during employer awareness sessions and community meetings and information briefings. This information is also available on DIMA's website. 7.3.3 In 2000, DIMA introduced an Employer Work Rights Information Checking Line as part of the EAC. The freecall telephone line provides employers with general information about work right issues and assistance with reading visa labels. In the same year, the Fax

Back Facility was established which provides employers and labour suppliers with information about the work right status of their non-citizen employees. 7.3.4 DIMA is currently revising the information kit to promote the use of EVO in preference to reading visa labels. IMPACT ANALYSIS Impact Groups 7.3.5 The groups that may be affected by this option include the community (illegal workers and legal workers), business (employers and labour suppliers) and the Government (the Department of Immigration and Multicultural Affairs, the Australian Taxation Office and Centrelink). Community costs and benefits 7.3.6 It is likely that the only parts of the community to be adversely affected by the continuation of the EAC are illegal workers and their families. As employers become more familiar with the restrictions against employing illegal workers and the sanctions involved, it is likely that the employment opportunities for illegal workers would decrease. 7.3.7 However, this group is being targeted by the Government, in an attempt to decrease the costs of illegal workers to the community. It is expected that the overall benefits to the community will outweigh the costs to this group of people. Business costs and benefits 7.3.8 There are no costs for business under this option other than the time taken to read the information kits. Both the telephone line and the Fax Back Facility are freecall services. 7.3.9 The benefits to business would include: · increased awareness about the people who are entitled to work in Australia. This would allow employers to avoid the costs associated with DIMA removing illegal workers from the workplace; and · information on how to comply with the law to avoid being prosecuted for employing illegal workers. Impact on small business 7.3.10 Some small businesses may not have the time to read the information kits that are distributed as part of the EAC. However, the time taken to read the kits would need to be weighed against the potential loss in productivity that could be experienced if an illegal worker is removed from the workplace. Government costs and benefits 7.3.11 This option will result in financial costs for the Government, including:

· printing and distribution of the Employer Awareness Kit. This cost is approximately $74,000 each year; · infrastructure and staffing costs associated with the telephone information line. This cost is approximately $75,000 each year; and · infrastructure and staffing costs associated with the maintenance of the Fax Back Facility which is approximately $191,000 each year. 7.3.12 These costs would be offset by more effective use of compliance resources associated with the location of illegal workers as fewer people seek to work illegally in Australia. 7.4 Option 4 New offences for employers and labour suppliers who recruit people who do not have the authority to work 7.4.1 It is an offence under section 11.2 of the Criminal Code 1995 to aid or abet the commission of an offence against a law of the Commonwealth. Since it is an offence under section 235 of the Migration Act 1958 for a non-citizen to work without work rights, it is also an offence to aid or abet (by employing or referring) non-citizens to work illegally in Australia. 7.4.2 The maximum penalty that may be imposed on a non-citizen who is convicted of an offence under section 235 of the Migration Act 1958 is $10,000 (subsection 235(5)). The same penalty applies to employers who are convicted of an offence under section 11.2 of the Criminal Code Act 1995. 7.4.3 Prosecutions of employers for aiding and abetting an offence under section 235 rarely occur for the reasons noted in paragraph 2.18 above. 7.4.4 The ability to successfully prosecute employers is also made difficult by the fact that illegal workers are almost never willing to cooperate with the Department by providing statements against their employers. In many cases this is because of the fear of retribution by the employer or other stakeholders who trade in illegal workers against themselves or members of their families. There have been few briefs to the Director of Public Prosecutions in respect of employers who knowingly employ illegal workers. 7.4.5 The Department has been conducting the EAC since 1992. The EAC encourages employers to check the work rights of prospective employees and explains how to do so. However, under current law, there is no obligation on employers to check the work rights of employees, even where there is a substantial risk that they are not entitled to work. It is also difficult to establish, for the prosecution of aiding and abetting, that employers may knowingly have recruited people without work rights. 7.4.6 To have an effective compliance strategy there needs to be provision made to impose sanctions on employers and labour suppliers who continue to engage or refer non-citizens without the right to work. Proposed sanctions

7.4.7 It is proposed to introduce fault-based criminal offences for employers and labour suppliers who allow or refer illegal workers to perform work. The offences would only apply where the employer or labour supplier knew the person was an illegal worker, or was reckless to that fact. 7.4.8 As recommended by the Review of Illegal Workers in Australia (RIWA), the maximum penalties for the proposed offences would be $13,200 or 2 years prison for an individual, and $66,000 for a body corporate. An employer or labour supplier found to have engaged or referred an illegal worker could be prosecuted for each illegal worker. 7.4.9 The proposed offences need to capture the range of non-traditional work relationships found in the construction, taxi and sex industries where many illegal workers are found. For example, owners of taxicabs often lease or bail their vehicles to drivers. If the proposed offences only applied to persons who "employ" illegal workers, taxi owners who knowingly allow an illegal worker to drive their cabs would not be captured. Similar problems exist in the sex industry where some brothel owners claim to be renting rooms to their sex workers instead of providing employment. 7.4.10 It is expected that most first-time offenders would be given a written warning instead of being referred for prosecution. As the imposition of sanctions would be aimed at encouraging a change in behaviour, warnings for first-time offenders would be important in motivating voluntary compliance. 7.4.11 A prosecution policy could also be developed to give employers who engage large volumes of workers over a short period of time a 48 hour grace period to perform any checks. This would ensure that in the small number of cases a check is required the normal work of the business (for example harvesting of crops or serving customers) would not be disrupted by any requirement to immediately conduct the checks. 7.4.12 If the proposed offences are pursued, there would need to be an effective campaign aimed at employers and other related parties to raise awareness of the new offences and to provide information about the circumstances where it would be prudent to check work entitlements. That campaign could build on the existing Employer Awareness Campaign. 7.4.13 If the proposed offences are introduced, it would also be important to provide employers with an easy mechanism to check work rights. This could be achieved through the continuation of the on-line work rights checking system discussed at Option 2 above. IMPACT ANALYSIS Impact Groups 7.4.14 The groups that may be affected by this option include the community (illegal workers and legal workers), business (employers and labour suppliers) and the Government (the Department of Immigration and Multicultural Affairs, the Australian Taxation Office, Centrelink and the Commonwealth Director of Public Prosecutions. How will this affect existing regulations and regulatory authorities

7.4.15 The Migration Act 1958 would need to be amended to impose new offences on employers and labour suppliers who engage or refer illegal workers. The amendments, if passed, would not affect other regulatory authorities. Likely benefits and costs and who will experience them 7.4.16 While a range of costs and benefits are expected to flow from the introduction of criminal sanctions, it is envisaged that the benefits, particularly to the community and Government, will outweigh the costs to labour suppliers, employers, some new employees and Government. Community costs and benefits The benefits to the community: 7.4.17 The benefits to the community would include · improved access to employment opportunities for those with a right to work; · fewer people living in the community that have bypassed the more rigorous health and character checks undertaken by lawful long-term residents; and · less exploitation within the community. Anecdotal evidence suggests that some illegal workers may not be paid minimum wages under industrial legislation. The costs to the community: 7.4.18 The costs to the community will be that people seeking employment may need to have the required documentation available to show labour suppliers and potential employers who seek proof of entitlement to work in Australia. Those who gained their Australian citizenship at birth may need to pay for a copy of their birth certificate. This would only be necessary where their parents have not retained the initial copy supplied at the time the birth was registered. The average cost of an Australian birth certificate is between $17.50 and $40. Almost all Australians, by the time they reach the age of employment, will have already obtained their birth certificate in order to open a bank account, get a Tax File Number, driver's licence or passport. Many Australians will also already hold an Australian passport, which is valid for 10 years, at a cost of $172. 7.4.19 These costs would primarily be experienced by people seeking work in industries where there is a relatively high proportion of illegal workers (such as the building, taxi and sex industries) who may be asked to provide proof of their entitlement to work in Australia. Business costs and benefits The benefits to business: 7.4.20 The increased work rights checking associated with the proposed offences would reduce the risk of employers losing valuable, but illegal labour, due to immigration field activities.

7.4.21 There would be improved competition, as some businesses would no longer have to unfairly compete with others using cheap illegal labour. The costs to business: 7.4.22 Businesses engaging new employees would need to consider doing a work rights check where there is a substantial risk that a prospective employee is an illegal worker. Failure to do so could lead the business to commit the proposed offence of reckless engagement of an illegal worker. 7.4.23 The factors that will determine whether there is a "substantial risk" of engaging an illegal worker include: · the proportion of illegal workers in the industry; · the information provided by the prospective employee; and · whether the employer has previously been given a warning for employing illegal workers. 7.4.24 The costs of doing a work rights check will be the time taken to conduct each check (several minutes) and the cost of a local call if the proposed on-line checking facility is used. There will be no direct financial costs associated with other checking mechanisms such as the Fax Back Facility or visa label (for non-citizen employees) or birth certificate/passport (for employees who are Australian citizens). Many businesses will not incur any additional costs because they already do the checks that have been recommended by the Department since 1992. 7.4.25 The costs of conducting work rights checks would be largely confined to businesses that operate in industries where there are a high proportion of illegal workers such as the construction, taxi, cleaning, horticultural and sex industries. This is because the risk of employing illegal workers in these industries will be higher. Many businesses operating in these industries may decide to address this risk by checking the work rights of all new employees. 7.4.26 The costs to business may also include the increased difficulties faced by some employers in attracting legal labour, particularly employers in the fruit and vegetable growing sector. This difficulty is likely to be offset by programs to improve the supply of labour in regional Australia such as the Harvest Trail initiative. Working Holiday Makers from overseas who have worked as a seasonal worker in regional Australia for a minimum of three months are able to apply for a second Working Holiday Visa which also assists in improving the supply of labour in regional Australia. Impact on small business 7.4.27 The proposed offences may have an increased impact on small businesses in the construction, taxi and hospitality industries where there are higher proportions of illegal workers. However, the proposed offences would not require routine work rights checking. A check would only be needed where there is a substantial risk that a prospective employee is an illegal worker.

7.4.28 The compliance burden associated with these checks would be minimised by the availability of easy mechanisms to check work entitlements such as the proposed on-line checking facility. Small businesses that do not have Internet access would be able to use an alternative checking service such as the Fax Back Facility. 7.4.29 The proposed policy of giving most first time offenders a written warning and 48 hours in which to conduct the checks would also help to minimise the impact of the proposed offences on small business. For example providing a warning would provide small businesses with an opportunity to receive information on the risks of illegal workers and on the processes for checking work entitlements. Government costs and benefits The benefits to Government 7.4.30 The benefits to Government would include: · more effective use of compliance resources associated with the location of illegal workers. due to the reduced numbers of illegal workers and reduction in the number of attempts to enter Australia unlawfully; · lowered costs of unemployment benefits for supporting those unable to get work because of illegal workers taking jobs; · increased revenue by legal workers paying taxes, and spending their earnings in Australia; and · maintenance of the integrity of the visa system controlling the entry of non-citizens.

The costs to Government 7.4.31 The costs to Government associated with the introduction of the new offences would include: · the costs of enforcing the new offences in the courts; · the costs of advertising the new offences as part of the employer awareness campaign; and · the costs of enhancing and maintaining the EVO system. This includes costs of upgrading EVO given the expected widespread adoption of the system by Australian employers and labour suppliers. 7.4.32 While the Commonwealth DPP may experience a small and sustained rise in the number of cases put forward for prosecution, such a rise is unlikely to be significant because: · those employers not already aware of their obligations and the possible consequences will soon become aware; · the proposed policy of giving written warnings to first-time offenders, should ensure that there is no sudden increase in the number of prosecutions; and · only the most serious offenders are likely to be prosecuted. These would include employers who repeatedly engage illegal workers or those involved in employment scams. 7.4.33 These costs should be outweighed by the benefits outlined above. Moreover, it is expected that the revenue collected from the fines would offset some of these costs. Expected outcomes for this option 7.4.34 The imposition of fault based offences would be an important step in motivating employers and labour suppliers to abide by laws restricting access to employment for non- citizens and a new element to the Department's campaign to combat illegal workers. Other countries such as the United Kingdom, United States, Canada and New Zealand have already imposed employer sanctions to aid their campaigns against illegal workers. 7.4.35 This option would need to be complemented by an information campaign to ensure that employers and labour suppliers, as well as those peak bodies that either represent them or need to work with them, know and understand their obligations and the possible consequences of not meeting those obligations. This could be done as part of the Employer Awareness Campaign discussed at Option 3 above. 7.4.36 Up to the present time the Government has adopted the strategy of raising employer awareness about who can legally work. It has relied upon the voluntary cooperation of employers to hire only those with a right to work. The only effective penalties to date have in practice been the loss of labour. Where illegal workers are located, they are generally detained and later removed from Australia.

7.5 Option 5: Joint field work with other agencies 7.5.1 One of the key issues surrounding enforcement of immigration law is the correlation between industries that attract illegal workers and those that attract workers who might be in breach of other laws. These are largely but not exclusively industries regarded as part of the cash economy and involve workers who may be illegally in Australia, unlawfully claiming benefits or avoiding income tax. 7.5.2 This option is to develop closer working relationships between Commonwealth agencies, particularly DIMA, the ATO and Centrelink. In particular, it is proposed that joint field operations be carried out with ATO and Centrelink officers. 7.5.3 Initiating a joint information campaign between the three agencies to reinforce the "no illegal work" message would be an important measure. RIWA endorsed this "whole of Government" approach to resolving the problem of illegal workers in Australia and noted that working across a range of Government agencies, with due respect paid to privacy principles, would improve effectiveness and efficiency. 7.5.4 To reinforce this measure, there should be a much closer working relationship developed by DIMA, Centrelink and ATO field teams. Employers would be much more wary about employing illegal workers if they thought the ATO might investigate them as a consequence of their having come to the attention of immigration officials. 7.5.5 Centrelink already cooperates closely with the ATO and has out-posted officers working on compliance issues. Centrelink's compliance strategy is aimed at preventing social security fraud, and apart from field activity there is scope to work with DIMA to prevent payments being made to illegal immigrants. Centrelink could also assist DIMA in information/outreach programs aimed at employers. Centrelink already operates a national contact centre which advises employers about their obligations and reporting requirements and acts a referral point for other government agencies. Similar close working relationships could be developed with DIMA. IMPACT ANALYSIS Impact Groups 7.5.6 The groups that may be affected by this option include the community (illegal workers and legal workers), business (employers and labour suppliers) and the Government (the Department of Immigration and Multicultural Affairs, the Australian Taxation Office, and Centrelink). Community - costs and benefits 7.5.7 As mentioned previously in this document, those who have the right to work in Australia would have increased access to employment opportunities if employers were aware of how to check work rights. This would be enhanced if employers knew that a number of Commonwealth Government agencies might be checking that they only employ people who are abiding by the law. There should be significant benefits for the community.

Business costs and benefits 7.5.8 Businesses are already asked to check the work rights of those they are considering employing and already receive information on how to make those checks. The fact that more officers may be facilitating the flow of such information and making checks should not create additional costs for business. Government costs and benefits 7.5.9 The proposal focuses on how information and field activities may be carried out. It is not expected that there would be a significant change in the number of staff and costs involved in such activities. The benefits are expected to be increased efficiency in the use of Commonwealth resources and an increase in the opportunity for an important message to employers to be repeated and reinforced, ie don't employ those without the right to work. 7.6 Option 6: Expanding work rights on visas 7.6.1 This option involves the expansion, in some form, of work rights available for temporary visa holders. 7.6.2 One way of achieving this outcome would be to extend work rights to every visitor who enters Australia. However, the migration and temporary entry programs are already carefully calculated to take into account the needs of the labour market. It would be inappropriate to change this by allowing all visitors to Australia to work because it would: · challenge the operation of the existing labour market; · complicate economic policy making; · threaten existing worker entitlements; · undermine the integrity of the existing immigration program; and · contribute to the difficulties of Australians who may already have trouble finding work. 7.6.3 An alternative approach would be to relax the work restrictions for some temporary entrants, in order to meet labour demand in particular areas, such as regional Australia and industries with short-term staff requirements and/or high staff turnover. The Government has already made significant moves in this direction, with recent changes to the Working Holiday Maker visa scheme allowing extended stays in Australia with work rights for working holiday makers who have worked for at least three months in the harvest industry. 7.6.4 The approach of allowing all visitors to Australia to work would have a significant impact on the Australian community, businesses and government. IMPACT ANALYSIS Impact Groups

7.6.5 The groups that may be affected by this option include the community (illegal workers and legal workers), business (employers and labour suppliers) and the Government (the Department of Immigration and Multicultural Affairs, the Australian Taxation Office, Centrelink and the Commonwealth Director of Public Prosecutions). Community costs and benefits 7.6.6 The Australian community would experience a great number of costs as a result of this option. · There would be increased competition for jobs, particularly for unskilled and semi- skilled jobs. As the majority of the Australian unemployed are unskilled, this would reduce their chances of finding work. · An increase in the rate of Australian unemployment would place increased strains on the social security system, thereby imposing a cost on all taxpayers. · More competition between Australian workers and foreign workers may lead to pressures for downward changes to pay rates and conditions. · The easing of work restrictions for visitors to Australia could encourage illegal immigration and exacerbate overstayer rates because it may be seen, internationally, as a sign that Australian authorities are lenient towards those who breach their immigration laws. · If more complicated checking requirements were introduced (because of an uneven distribution of work rights amongst holders of visitor visas) it could make the task of checking work rights more difficult for employers. 7.6.7 It is difficult to see that the broader Australian community would benefit from this option. Business costs and benefits 7.6.8 The businesses that want to cooperate with the Government would continue checking whether potential employees have work rights. However, if more visitors had work rights, and if they could be granted work rights following their arrival in Australia, it could become difficult for employers to distinguish which visitors had work rights and which did not. Government costs and benefits 7.6.9 As it is not presumed that all work restrictions would be lifted under this option, compliance activities, and associated costs, would still continue. The Government would also face the following additional costs: · there would be a lack of integrity in the immigration program; · there would be inconsistency with other immigration measures, such as those targeting overstayers and people-smuggling;

· the social security system would be placed under more strain, as a result of the increased competition for jobs; · there would be a danger of increased non-compliance with taxation requirements; and · other initiatives to address problems of long-term unemployment and shortage of labour in regional areas, such as the National Harvest Trail, would be undermined. 7.6.10 There are not expected to be any benefits for the Government as a result of this option. 7.6.11 This option is not preferred. The current unemployment rate of around 5% suggests that there is sufficient labour in Australia to supply the needs of those employers who currently employ illegal workers. In addition the recent increases in Australia's annual migration program, the significant expansion of temporary business entry to Australia and the changes to the Working Holiday Maker scheme are all making significant contributions to meeting labour market shortages. 7.6.12 Although there may be a mismatch of the location of the labour shortage and areas of high unemployment, it would be preferable for that mismatch to be addressed through the already implemented changes to the Working Holiday Maker scheme and projects such as the Harvest Trail Initiative rather than to increase the numbers of visitor workers. The latter would exacerbate and not reduce current unemployment levels. It would also be less likely to provoke industrial action by unions that are currently conducting a concerted media campaign against the main skilled temporary business visa used by employers to fill skilled vacancies. 1. CONSULTATIONS 7.1 What are the views of the affected parties? 7.1.1 The majority of employers and industry bodies that forwarded submissions to RIWA in 1999 did not support the original proposal for sanctions which included strict liability offences and "on the spot" fines. A key concern of fruit and vegetable growers was that it is not always possible to attract sufficient legal workers during the harvesting period and that more should be done to develop and the implement the concept of the National Harvest Trail. On the other hand, some employers, including primary producers, did provide qualified support for new criminal offences providing the process of checking work rights was made easier. 7.1.2 Many of these concerns have been addressed by the Government's decision to defer the strict liability offences recommended by RIWA, the establishment of easier work rights checking services such as Entitlement Verification Online (EVO) and the introduction of a range of measures to help improve the supply of labour in regional Australia. These include the National Harvest Trail initiative and changes to the Working Holiday Makers scheme to encourage work in regional Australia. Significantly, a number of industry groups including the National Farmer's Federation have now indicated that they are not opposed to the introduction of fault based criminal offences.

7.1.3 There was support for the provision of more employer education as well as for measures that would make legal labour easier to access. There was also support for new offences where the employer had knowingly employed someone without work rights. 7.1.4 Many of these concerns have been addressed with the establishment of easier work rights checking facilities such as the Fax Back Facility, the National Harvest Trail initiative, and the Government's decision to defer the strict liability offences recommended by RIWA. Several industry groups have indicated that they are not opposed to the introduction of fault based offences. 7.2 To what extent were affected parties consulted? Consultation with peak industry/employer bodies 7.1.1 On 14 May 1999, the Minister for Immigration and Multicultural Affairs wrote to the following bodies to seek their views on the review of illegal work in Australia and the issues raised in the Discussion Paper: · Australian Chamber of Commerce and Industry; · Australian Industry Group; · National Farmers' Federation; · Business Council of Australia; · Housing Industry Association; · The Tourism Taskforce; · Tourism Council of Australia; · Inbound Tourism Organisation of Australia; and · Migration Institute of Australia; · Restaurant and Catering Australia; · Australian Council of Trade Unions · Australian Fresh Stone Fruit Growers; · Australian Mines and Metals Association Inc; · Australian Apple and Pear Growers Association Inc; · Australian United Fresh Fruit and Vegetable Association Ltd; · Australian Wine and Brandy Producers Association; · Federation of Ethnic Communities' Association; and · Australian Chamber of Fruit and Vegetable Industries Ltd. 7.1.2 In addition to the above, the Review Secretariat also contacted the following organisations: · QANTAS; · Ansett Australia; · Hotel, Motel & Accommodation Association; · Meetings Industry Association; and · The Committee for Economic Development of Australia. 7.1.3 Further consultations with industry groups occurred in 2000. These consultations focussed on the scheme of sanctions recommended by RIWA and included the circulation of

a further discussion paper, face-to-face meetings with key industry groups and a series of public meetings in capital cities and rural areas. 7.1.4 Peak industry and employer bodies were also consulted about the proposal to defer implementation of the strict liability offences. Other Commonwealth agencies 7.1.5 On 14 May 1999, the Minister for Immigration and Multicultural Affairs wrote to the Prime Minister and the following Ministers to seek the views of their portfolio on the review and the issues raised in the Discussion Paper: · the Prime Minister; · the Treasurer; · the Attorney-General; · the Minister for Employment, Workplace Relations and Small Business; · the Minister for Finance and Administration; · the Minister for Foreign Affairs; · the Deputy Prime Minister and Minister for Trade; · the Minister for Industry, Science and Resources; · the Minister for Sport and Tourism and Minister assisting the Prime Minister for the Sydney 2000 Games; · the Minister for Agriculture, Fisheries and Forestry; and · the Minister for Social Security. 7.1.6 As the review examined a number of issues of interest to certain portfolios, more detailed and ongoing consultations took place with: · the Australian Taxation Office (ATO); · the Department of Employment, Workplace Relations and Small Business (DEWRSB); and · Centrelink. 7.1.7 The consultations focused on: · the preparation of the Discussion Paper "The Hidden Workforce: Illegal workers in Australia and those that would join them"; · the preparation of "Issues Paper 4 Industry Demand for Labour and linked government activities"; and · the preparation of the review's final report. 7.1.8 All were provided with copies of all agenda items considered by the external Reference Group. 7.1.9 During the drafting process for the proposed offences, DIMA also consulted with: · the Attorney General's Department; · the Commonwealth Director of Public Prosecutions; · the Department of Employment and Workplace Relations;

· the Department of Transport and Regional Services; and · the Department of Industry, Tourism and Resources. 1. CONCLUSION AND RECOMMENDED OPTIONS 7.1An assessment of each of the options appears earlier in this document and while each option stands on its own, they are also complementary and hence a combination of the options is preferred. 7.2 List of recommended options 7.2.1 Option 1 Continuation of traditional compliance activities 7.2.2 Option 2 - Continuation of EVO. 7.2.3 Option 3 - Continuation of the Employer Awareness Campaign, so that employers continue to receive information about the risk of illegal workers and the processes for checking work rights. 7.2.4 Option 4 Introduction of fault based offences for employers and labour suppliers who allow or refer illegal workers to perform work 7.2.5 Option 5 - Joint fieldwork with other agencies. 7.3 Why are some options preferred and others rejected? 7.3.1 Only Option 6 (extending the work rights available for visitors) has been rejected. This is because that option would not achieve Government objectives. Rather, it would have the effect of exacerbating the problems associated with illegal work. The range of options that have been recommended have been developed on the basis of: · the extensive experience of the Department with the problem and the effect of strategies used to date; · the guidance provided to the review by the external Reference Group appointed by the Minister; and · the views of the community and business, including those forwarded to the review in the form of submissions. 1. IMPLEMENTATION AND REVIEW STRATEGY 7.4 How will the preferred options be implemented? 7.4.1 Option 1 Continuation of traditional compliance activities. 7.4.2 Option 2 - Continuation of EVO.

· DIMA would continue to provide and market the EVO service to employers and labour suppliers and would need to upgrade EVO given the expected widespread adoption of the system by Australian employers and labour suppliers, · . 7.4.3 Option 3 - Continuation of the Employer Awareness Campaign. · The EAC would be revised to inform and guide employers and labour suppliers about their new obligations if the proposed offences are introduced. A component of the EAC would be specifically designed to raise awareness of the new offences in regional Australia. 7.4.4 Option 4 - New offences for employers and labour suppliers who recruit people who do not have the authority to work. · It would be necessary to amend the Migration Act 1958 and for a significant information campaign to be undertaken. 7.4.5 Option 5 - Joint field work with other agencies (ATO and Centrelink) · DIMA has already established joint fieldwork arrangements under a Memorandum of Understanding signed between the three agencies, and · DIMA and the ATO have put in place arrangements for the regular exchange of information about visa overstayers. These arrangements are working well. 7.5 Are the preferred options clear, consistent, comprehensible and accessible to users? 7.5.1 Yes - while the recommended options are generally independent of each other, they are clear, complementary as well as consistent in their aim to reduce to extent of illegal work in Australia. All of the options aim to increase the level of understanding by the range of affected parties. It is proposed that the EAC be significantly revised to support the proposed offences. 7.6 Are they sufficiently flexible to adapt to various situations and circumstances? 7.6.1 Yes - the options include a range of measures which, if implemented, should ensure that there is increased awareness of work rights and the procedures for conducting the checks. 7.6.2 The policy of giving written warnings to first time offenders and the discretion to decide when to refer cases to the DPP, would ensure that the proposed offences are sufficiently flexible to accommodate the varying degrees of wrongdoing associated with the employment of illegal workers. 7.7 What will be the impact on business, including small business, and how will the compliance and paper burden costs be minimised? 7.7.1 The Government's decision to defer the strict liability offences recommended by RIWA will significantly reduce the possible compliance burden on business. The proposed fault-based scheme would only require an employer or labour supplier to conduct a work

rights check where there is a substantial risk that a prospective employee is an illegal worker. In contrast, the strict liability scheme would require routine checks to be made. 7.7.2 Any compliance burden associated with the proposed fault offences would be largely confined to businesses that operate in industries where there are a relatively high proportion of illegal workers such as the construction, taxi and sex industries. This is because the risk of employing illegal workers is higher in these industries. 7.7.3 The continuation of EVO would minimise the compliance/paper burden for employers who decide to conduct a work rights check. It would spare employers the complicated task of interpreting visa labels and there would be no need to keep paper records of the checks. 7.7.4 The benefits to business would include: · reduced risks of losing valuable, but illegal labour, due to immigration field activities; and · improved competition. 7.7.5 It is acknowledged that there will be some costs to business, which may be more keenly felt by small business, and these may include: · an added administrative burden in those cases where an employer decides to conduct a work rights check; and · increased difficulties in attracting legal labour, especially in the fruit and vegetable growing sector. 7.8 How will the effectiveness of the preferred options be assessed? 7.8.1 If successful, the range of options recommended should result in a reduction in: · the number of illegal workers in Australia; and · the number of persons who attempt to enter Australia for this purpose. 7.8.2 It may however be difficult to measure accurately the extent of the success of the measures, as the number of those currently working illegally is an estimate based on experience, not an exact number. One reasonably accurate indicator however is expected to be a decline in the number of long-term overstayers. With reduced access to employment, it should become harder for overstayers to remain in Australia. 7.9 If a preferred option takes the form of regulation, will there be a built-in provision to review or revoke the regulation after it has been in place for certain length of time? 7.9.1 Only Option 4, which proposes new fault based offences for employers and labour suppliers, would require legislative regulation to implement. Specifically it would require an amendment to the Migration Act 1958.

7.9.2 It is not proposed that there be a provision in the new legislation to review or revoke the legislation. However, the operation of the fault-based offences would be reviewed no later than 2 years after commencement to assess their effectiveness as a deterrent or educational tool. The external Reference Group, which guided RIWA, agreed that it would be important for the impact of any coercive powers on employers to be reviewed and evaluated 2-3 years after commencement.

MIGRATION AMENDMENT (EMPLOYER SANCTIONS) BILL 2006 NOTES ON INDIVIDUAL CLAUSES Clause 1 Short title 1. The short title by which this Act may be cited is the Migration Amendment (Employer Sanctions) Act 2006. Clause 2 Commencement 2. Subclause 2(1) contains a table setting out the commencement information for this Act. The subclause also provides that each provision of this Act specified in column 1 of the table commences, or is taken to have commenced, in accordance with column 2 of the table. Any other statement in column 2 has effect according to its terms. 3. The effect of item 1 of the table is that sections 1, 2 and 3 of this Act commence on the day on which this Act receives the Royal Assent. 4. The effect of item 2 of the table is that Schedules 1 and 2 to this Act commence on a single day to be fixed by Proclamation. However, if any of the provisions are not proclaimed within 6 months of this Act receiving the Royal Assent, they will automatically commence on the first day after the end of that period. 5. The note in subclause 2(1) makes it clear that the table only relates to the provisions of the Act as originally passed by the Parliament and assented to. The table will not be expanded to deal with provisions inserted into this Act after it receives the Royal Assent. 6. Subclause 2(2) provides that column 3 of the table in subclause 2(1) is for additional information that may be included in any published version of this Act but which is not part of this Act. There is no additional information in column 3. Clause 3 Schedule(s) 7. This clause provides that each Act specified in a Schedule to this Act is amended or repealed as set out in the applicable items in the Schedule concerned. In addition, any other item in a Schedule to this Act has effect according to its terms.

SCHEDULE 1 Employer sanctions Migration Act 1958 Item 1 At the end of Division 12 of Part 2 8. This item inserts a new Subdivision C at the end of Division 12 of Part 2 of the Act. Subdivision C Offences in relation to persons who allow non-citizens to work, or refer them for work, in certain circumstances 9. New Subdivision C of Division 12 of Part 2 of the Act introduces new offences to deal with allowing unlawful non-citizens to, or referring unlawful non-citizens for work, and allowing lawful non-citizens to work or referring lawful non-citizens for work in breach of their visa conditions. 10. Section 13 of the Act provides that a lawful non-citizen is a non-citizen in the migration zone who holds a visa that is in effect. 11. Section 14 of the Act, when read in conjunction with section 13, effectively provides that an unlawful non-citizen is a non-citizen in the migration zone who does not hold a visa that is in effect. For example, this may include non-citizens who overstay their visas or non-citizens who enter Australia without visas. Section 245AA Overview 12. New section 245AA provides an explanatory overview of new Subdivision C. 13. Paragraph 245AA(1)(a) announces the creation of new offences relating to allowing or referring unlawful non-citizens for work. 14. Paragraph 245AA(1)(b) announces the creation of new offences relating to allowing or referring lawful non-citizens for work in breach of their visa conditions. 13. New subsection 245AA(2) explains that these new offences make use of a number of terms which are defined in the various sections of this new Subdivision and elsewhere in the Migration Act 1958. 14. The specific terms used in these sections are outlined at subsection 245AA(2) as follows: (a) section 14 (defines unlawful non-citizen); (b) section 245AG (defines work and allows to work); (c) section 245AH (defines exploited ); (d) section 245AI (defines other terms);; 15. New subsection 245AA(3) directs the reader to new section 245AF which sets out some circumstances in which this Subdivision does not apply.

16. New subsection 245AA(4) advises that Section 235 also contains offences relating to work by an unlawful non-citizen and a non-citizen in breach of a visa condition. Section 245AB Allowing an unlawful non-citizen to work 17. An unlawful non-citizen commits an offence under subsection 235(3) of the Act if he or she performs work in Australia. 18. To complement this offence, new subsection 245AB(1) makes it an offence for a person to allow, or continue to allow, an unlawful non-citizen to work. 19. New subsection 245AB(1) sets out the physical and fault elements of the offence. It provides that a person commits an offence if he or she: · allows, or continues to allow, a person who is an unlawful non-citizen (the worker) to work; and · knows, or is reckless as to whether, the worker is an unlawful non-citizen. 20. New paragraph 245AB(3)(b) provides that the maximum penalty for this offence is 2 years imprisonment. This penalty must be read with sections 4AA and 4B of the Crimes Act 1914, the effect of which is that a court could impose, instead of, or in addition to, this penalty of imprisonment, a pecuniary penalty, not exceeding $13,200 for a natural person and not exceeding $66,000 for a body corporate. 21. Subsection 5.4(1) of the Criminal Code provides that a person is reckless with respect to a circumstance if: · he or she is aware of the substantial risk that the circumstance exists or will exist; and · having regard to the circumstances known to him or her, it is unjustifiable to take the risk. 22. To prove that an employer recklessly allowed an unlawful non-citizen to work, it would be necessary for the prosecution to establish that: · there was a substantial risk that the worker was an unlawful non-citizen; · the employer was aware of this substantial risk; and · having regard to the circumstances known to the employer, it was unjustifiable for the employer to have taken the risk. 23. Current case law indicates that the fault element of recklessness is a variable standard that provides "flexibility having regard to the vast range of offences covered by the Code". What constitutes a substantial risk "may vary depending on the context and gravity of the criminal activity" (Hann v Commonwealth DPP [2004] SASC 86 (26 March 2004), at paragraph 23). 24. The Attorney-General's Department publication, Commonwealth Criminal Code A Guide for Practitioners (March 2002), also notes that what constitutes a "substantial risk" varies from "likely or probably" to the lesser requirement that it be "merely possible" (at page 75).

25. It is intended that a person would be reckless as to the circumstance in paragraph 245AB(1)(b), where he or she is aware of the possibility that a worker could be an unlawful non-citizen. 26. The possibility of a worker being an unlawful non-citizen exists in all industries but is more likely in those industries where the Department of Immigration and Multicultural Affairs ("DIMA") locates a relatively high proportion of illegal workers such as in the construction, taxi, hospitality, cleaning, horticultural and sex industries. 27. An employer might become aware of that risk through DIMA's employer awareness campaigns or by being given an Illegal Worker Warning Notice for employing an illegal worker. Example of where an offence would be committed under new subsection 245AB(1) 28. A person would commit an offence under new subsection 245AB(1) if, after its commencement, he or she knowingly or recklessly allowed an unlawful non-citizen to work for him or her under a contract of service entered into after the commencement of this amendment. Examples of where an offence would not be committed under new subsection 245AB(1) Example 1 29. At harvest time a farmer has a field of grapes that needs to be immediately harvested to prevent spoiling. He engages casual workers but is unaware of any restrictions on their entitlement to work. After the harvest the farmer discovers that one of the workers is a non- citizen who is not entitled to work. In circumstances such as these, where an employer is unaware of work restrictions new subsection 245AB(1) will not apply. Example 2 30. An employer would not normally commit an offence under subsection 245AB(1) where the worker was obtained from a labour referral service. Unless the employer had received information indicating that the worker was an unlawful non-citizen, the employer is entitled to rely upon the fact that the person operating the referral service would be committing an offence by referring illegal workers for work. Example 3 31. A head contractor at a building site would not commit an offence under subsection 245AB(1) if its subcontractor allowed an unlawful non-citizen to work at the site. This is because the relationship between the head contractor and the unlawful non-citizen would not satisfy the definition of "allows to work" in section 245AF. In this situation the subcontractor would commit an offence under subsection 245AB(1). 32. New subsection 245AB(2) provides that an offence against new subsection 245AB(1) is an aggravated offence if the person knows, or is reckless as to whether, the worker is being exploited. The exploitation need not have been committed by the person who allows the worker to work.

33. The meaning of "exploited" is set out in new section 245AH. 34. Subsection 245AB(2) has been drafted broadly so that the exploitation need not necessarily be committed by the person who is allowing the non-citizen to work. This is to ensure the aggravated offence would apply in situations where an employer knows or is reckless to the fact that their non-citizen worker is being exploited by another person who has hired or loaned the non-citizen to the employer to perform work, as sometimes occurs in the sex industry. Unless an employer is connected to the person who is exploiting the worker, it is extremely unlikely that the employer would be in a position to commit the aggravated offence. This is because the very nature of forced labour, sexual servitude and slavery strongly suggests that the victim of the exploitation would not be free to find work with an employer who is not connected with the exploitation. 35. New paragraph 245AB(3)(a) provides that the maximum penalty for an aggravated offence is 5 years imprisonment. This penalty must be read with sections 4AA and 4B of the Crimes Act 1914, the effect of which is that a court could impose, instead of, or in addition to, this penalty of imprisonment, a pecuniary penalty, not exceeding $33,000 for a natural person and not exceeding $165,000 for a body corporate. Section 245AC Allowing a non-citizen to work in breach of a visa condition 36. Under section 41 of the Act, the regulations may provide that visas, or visas of a specified class, are subject to specified conditions. These conditions are set out in Schedule 8 to the Migration Regulations 1994 ("the Regulations"). 37. Paragraph 41(2)(b) of the Act makes it clear that a condition may impose restrictions on the work a visa holder may do in Australia. These restrictions may, amongst other things, be restrictions on doing: · any work; or · work other than specified work; or · work of a specified kind. 38. A non-citizen who holds a temporary visa subject to a condition restricting the work that he or she may do in Australia, commits an offence under subsection 235(1) of the Act if he or she works in contravention of that condition. 39. To complement this offence, new subsection 245AC(1) makes it an offence for a person to allow a non-citizen to work in breach of a visa condition. It provides that a person commits an offence if he or she: · allows, or continues to allow, a non-citizen (the worker) to work; and · knows that, or is reckless as to whether, the worker is a non-citizen; and · knows that, or is reckless as to whether, the worker holds a visa that is subject to a condition restricting the work that the worker may do in Australia; and · knows that, or is reckless as to whether, the worker is in breach of the condition. 40. The meanings of "work" and "allows" to work are set out in new section 245AF.

41. New paragraph 245AC(3)(b) provides that the maximum penalty for this offence is 2 years imprisonment. This penalty must be read with sections 4AA and 4B of the Crimes Act 1914, the effect of which is that a court could impose, instead of, or in addition to, this penalty of imprisonment, a pecuniary penalty, not exceeding $13,200 for a natural person and not exceeding $66,000 for a body corporate. 42. Subsection 5.4(1) of the Criminal Code provides that a person is reckless with respect to a circumstance if: · he or she is aware of the substantial risk that the circumstance exists or will exist; and · having regard to the circumstances known to him or her, it is unjustifiable to take the risk. 43. The fault element of "recklessness" and the concept of a "substantial risk" are discussed above at paragraphs 21 to 25. 44. It is intended that a person would be reckless as to the circumstances in paragraph 245AC(1)(b), where he or she is aware of the possibility that the worker is a non-citizen. 45. It is intended that a person would be reckless as to the circumstances in paragraph 245AC(1)(c) where he or she is aware of the possibility that the worker holds a visa subject to a condition restricting the work that the worker may do in Australia. 46. It is intended that a person would be reckless as to the circumstances in paragraph 245AC(1)(d) where he or she is aware of the possibility that the worker is in breach of a condition on their visa. 47. The risk of non-citizens working in breach of their visa conditions exists in all industries but is more likely in those industries where DIMA locates a relatively high proportion of illegal workers such as in the construction, taxi, hospitality, cleaning and sex industries. 48. An employer might become aware of those risks through DIMA's employer awareness campaigns or by being given an Illegal Worker Warning Notice for employing an illegal worker. Example of where an offence would be committed under new subsection 245AC(1) 49. A person would commit an offence under new subsection 245AC(1) if, after its commencement, he or she knowingly or recklessly engaged a lawful non-citizen under a contract of service in breach of his or her work condition. Example of where an offence would not be committed under new subsection 245AC(1) 50. A person would not commit an offence under new subsection 245AC(1) if he or she allowed a non-citizen to work where: · the non-citizen held a visa subject to a visa condition that prohibits the non- citizen from working more than 20 hours per week; and · the person allowed the non-citizen to work for 10 hours; and · the person did not know and could not determine that the non-citizen was working for another person for more than 10 hours a week.

This is because the person would not have been reckless as to the circumstance that the non- citizen was working in breach of his or her work condition. 51. New subsection 245AC(2) provides that an offence against new subsection 245AC(1) is an aggravated offence if the person knows, or is reckless as to whether, the worker is being exploited. The exploitation need not have been committed by the person who allows the worker to work, but the person will have committed an aggravated offence if they know or are reckless as to the worker's exploitation. 52. Subsection 245AB(2) has been drafted broadly so that the exploitation need not necessarily be committed by the person who is allowing the non-citizen to work. This is to ensure the aggravated offence would apply in situations where an employer knows or is reckless to the fact that their non-citizen worker is being exploited by another person who has hired or loaned the non-citizen to the employer to perform work, as sometimes occurs in the sex industry. Unless an employer is connected to the person who is exploiting the worker, it is extremely unlikely that the employer would be in a position to commit the aggravated offence. This is because the very nature of forced labour, sexual servitude and slavery strongly suggests that the victim of the exploitation would not be free to find work with an employer who is not connected with the exploitation. 53. The meaning of "exploited" is set out in new section 245AH. 54. New paragraph 245AC(3)(a) provides that the maximum penalty for an aggravated offence is 5 years imprisonment. This penalty must be read with sections 4AA and 4B of the Crimes Act 1914, the effect of which is that a court could impose, instead of, or in addition to, this penalty of imprisonment, a pecuniary penalty, not exceeding $33,000 for a natural person and not exceeding $165,000 for a body corporate. Section 245AD Referring an unlawful non-citizen for work 55. New subsection 245AD(1) makes it an offence for a person to refer an unlawful non- citizen to another person for work. It provides that a person commits an offence if: · he or she operates a service, whether for reward or otherwise, referring one person to another for work; and · he or she refers a person (the prospective worker) to another person for work; and · at the time of referral, the prospective worker is an unlawful non-citizen and he or she knows that, or is reckless as to that circumstance. 56. New paragraph 245AD(3)(b) provides that the maximum penalty for this offence is 2 years imprisonment. This penalty must be read with sections 4AA and 4B of the Crimes Act 1914, the effect of which is that a court could impose, instead of, or in addition to, this penalty of imprisonment, a pecuniary penalty, not exceeding $13,200 for a natural person and not exceeding $66,000 for a body corporate. 57. Subsection 5.4(1) of the Criminal Code provides that a person is reckless with respect to a circumstance if: · he or she is aware of the substantial risk that the circumstance exists or will exist; and

· having regard to the circumstances known to him or her, it is unjustifiable to take the risk. 58. The fault element of "recklessness" and the concept of a "substantial risk" are discussed above at paragraphs 21 to 25. 59. It is intended that a person would be reckless as to the circumstance in paragraph 245AD(1)(c), where at the time of referral he or she is aware of the possibility that the prospective worker could be an unlawful non-citizen. 60. The risk of a prospective worker being an unlawful non-citizen exists in all industries but would be more likely in those industries where DIMA locates a relatively high proportion of illegal workers such as in the construction, taxi, hospitality, cleaning and sex industries. 61. A person operating a referral service might become aware of that risk through DIMA's awareness campaigns or by being given an Illegal Worker Warning Notice for referring an illegal worker. A service, whether for reward or otherwise, referring a person for work 62. A service that, whether for reward or otherwise, refers one person to another for work may include an employment agency or business that supplies, hires, recruits or refers persons to employers for work. 63. For example, a referral service would include: · employment agencies contracted to the Department of Employment and Workplace Relations as part of the Job Network; and · companies that arrange large volumes of staff (for example, backpackers) for seasonal fruit picking. 64. The referral service need not be the exclusive or primary function of a business. For example, if a migration agent whose primary function is to provide immigration advice occasionally refers clients to other persons for work, that migration agent would operate a service within the meaning of paragraph 245AD(1)(a). 65. New subsection 245AD(2) provides that an offence against new subsection 245AD(1) is an aggravated offence if: · the prospective worker will be exploited if in doing the work in relation to which they are referred or in doing any other work for the person to whom they were referred; and · the person operating the referral service knows of or is reckless as to that circumstance. 66. The meaning of "exploited" is set out in new section 245AH. 67. New paragraph 245AD(3)(a) provides that the maximum penalty for an aggravated offence is 5 years imprisonment. This penalty must be read with sections 4AA and 4B of the Crimes Act 1914, the effect of which is that a court could impose, instead of, or in addition to, this penalty of imprisonment, a pecuniary penalty, not exceeding $33,000 for a natural person and not exceeding $165,000 for a body corporate.

Section 245AE Referring a non-citizen for work in breach of a visa condition 68. New subsection 245AE(1) makes it an offence for a person to refer a non-citizen for work where the non-citizen, in doing the work, will breach a visa condition which restricts the work he or she may do in Australia. It provides that a person commits an offence if: · he or she operates a service, whether for reward or otherwise, referring one person to another for work; and · he or she refers a non-citizen (the prospective worker) to another person for work; and · at the time of referral, he or she knows that, or is reckless as to whether, the prospective worker is a non-citizen; and · at the time of referral, the prospective worker holds a visa subject to a condition restricting the work the prospective worker may do in Australia and he or she knows that, or is reckless as to whether, the prospective worker holds such a visa; and · at the time of the referral, he or she knows that, or is reckless as to whether, the prospective worker will, in doing the work to which he or she was referred, be in breach of the condition and the worker will actually be in breach of the condition. 69. New paragraph 245AE(3)(b) provides that the maximum penalty for this offence is 2 years imprisonment. This penalty must be read with sections 4AA and 4B of the Crimes Act 1914, the effect of which is that a court could impose, instead of, or in addition to, this penalty of imprisonment, a pecuniary penalty, not exceeding $13,200 for a natural person and not exceeding $66,000 for a body corporate. 70. Subsection 5.4(1) of the Criminal Code provides that a person is reckless with respect to a circumstance if: · he or she is aware of the substantial risk that the circumstance exists or will exist; and · having regard to the circumstances known to him or her, it is unjustifiable to take the risk. 71. The fault element of "recklessness" and the concept of a "substantial risk" are discussed above at paragraphs 21 to 25. 72. It is intended that a person would be reckless as to the circumstances in paragraph 245AE(1)(c) where at the time of referral, he or she was aware of the possibility that: · the prospective worker is a non-citizen; and · the prospective worker holds a visa subject to a condition restricting the work that the prospective worker may do in Australia; and · the prospective worker will, if in doing the work to which they were referred, be in breach of the condition. 73. The risk of non-citizens working in breach of their visa conditions exists in all industries but is more likely in those industries where DIMA locates a relatively high proportion of illegal workers such as in the construction, taxi, hospitality, cleaning and sex industries. 74. A person operating a referral service might become aware of that risk through DIMA's awareness campaigns or by being given an Illegal Worker Warning Notice for referring an illegal worker.

A service, whether for reward or otherwise, referring a person for work 75. A service that, whether for reward or otherwise, refers one person to another for work may include an employment agency or business that supplies, hires, recruits or refers persons to employers for work. 76. For example, a referral service would include: · employment agencies contracted to the Department of Employment and Workplace Relations as part of the Job Network; and · companies that arrange large volumes of staff (for example, backpackers) for seasonal fruit picking. The referral service need not be the exclusive or primary function of a business. For example, if a migration agent whose primary function is to provide immigration advice occasionally refers clients to other persons for work, that migration agent would operate a service within the meaning of paragraph 245AE(1)(a). 77. New subsection 245AE(2) provides that an offence against new subsection 245AE(1) is an aggravated offence if · . the prospective worker will be exploited in doing the work in relation to which they are referred or in doing any other work for the person to whom they were referred; and · the person operating the referral service knows of or is reckless as to that circumstance. 78. The meaning of "exploited", is set out in new section 245AH. 79. New paragraph 245AE(3)(a) provides that the maximum penalty for an aggravated offence is 5 years imprisonment. This penalty must be read with sections 4AA and 4B of the Crimes Act 1914, the effect of which is that a court could impose, instead of, or in addition to, this penalty of imprisonment, a pecuniary penalty, not exceeding $33,000 for a natural person and not exceeding $165,000 for a body corporate.

Section 245AF Circumstances in which this Subdivision does not apply 80. New section 245AF puts it beyond doubt that no offence is committed under the new Subdivision in certain circumstances. 81. New paragraph 245AF(a) provides that no offence is committed under the new Subdivision if a detainee in immigration detention voluntarily engages in an activity of a kind approved in writing by the Secretary. 82. Currently, detainees in immigration detention facilities are given the opportunity to engage voluntarily in activities for which merit points are awarded. The availability of these activities is an important aspect of the management of immigration detainees and ensures that they are able to participate in meaningful activities such as food preparation. 83. The purpose of new paragraph 245AF(a) is to put beyond doubt that the DIMA's Detention Service Provider would not commit an offence under the new Subdivision where a detainee voluntarily engages in these activities. 84. Section 245AF is worded as a beyond doubt provision because the absence of the intention to create legal relations means that none of the contracts in subsection 245AG(2) are intended to exist between the Detention Services Provider and an immigration detainee. The provision is simply being inserted for abundant caution. 85. Subsection 5(1) of the Act contains definitions of "detainee" and "immigration detention". "Detainee" means a person who has been taken into, or kept in, immigration detention, using such action and force as are reasonably necessary to do so. 86. "Immigration detention" means: · being in the company of, and restrained by, an officer or another person directed by the Secretary of DIMA to accompany and restrain the detainee; or · being held by, or on behalf of, an officer: - in a detention centre established under the Act; or - in a prison or remand centre of the Commonwealth, a State or a Territory; or - in a police station or watch house; or - in relation to a non-citizen who is prevented, under section 249, from leaving a vessel on that vessel; or - in another place approved by the Minister in writing. 87. New paragraph 245AF(b) provides that no offence is committed if a prisoner in a prison or remand centre of the Commonwealth, a State or a Territory engages in an activity as a prisoner. A non-citizen who is unlawful or who holds a visa subject to a work condition may be a prisoner in a prison or remand centre. 88. The purpose of new paragraph 245AF(b) is to put beyond doubt that prison operators do not commit an offence under the new Subdivision where a prisoner engages in activities as a prisoner. 89. New subparagraph 245AF(c)(i) provides that no offence is committed if a person engages in an activity in compliance with a sentence passed or an order made under

subsection 20AB(1) of the Crimes Act 1914. That subsection provides federal courts with a power to make a community service order or other work order. 90. The purpose of new subparagraph 245AF(c)(i) is to put beyond doubt that a person who allows a prisoner to engage in an activity in compliance with a sentence passed or an order made under subsection 20AB(1) of the Crimes Act 1914 does not commit an offence under the new Subdivision. 91. New subparagraph 245AF(c)(ii) provides that no offence is committed if a person engages in an activity in compliance with a community service order, a work order, a sentence of periodic detention, an attendance centre order, a sentence of weekend detention, an attendance order or a similar sentence or order made under a law of a State or Territory. 92. The purpose of new subparagraph 245AF(c)(ii) is to put beyond doubt that a person who allows a person to engage in an activity in compliance with a sentence passed or a Court order made under a law of a State or Territory does not commit an offence under the new Subdivision. Section 245AG Meaning of work and allows to work 93. New section 245AG defines "work" and sets out the circumstances in which a person "allows" another person to work. 94. New subsection 245AG(1) defines "work", for the purposes of the new Subdivision to mean any work, whether for reward or otherwise. This is intended to be a broad definition and may include, for example, paid work, voluntary work or work done in return for accommodation, food or any other benefit. A broad definition is needed to capture situations where persons may work in conditions of sexual servitude without receiving any remuneration. Work is also defined in this way to ensure consistency with the definition of "work" in subsection 235(3) of the Act. 95. New subsection 245AG(2) exhaustively defines the circumstances in which a person "allows" another person to work for the purposes of the new Subdivision. The circumstances are broad enough to cover not only the traditional employer-employee relationships, but also alternative working arrangements that are common in industries where illegal work occurs, such as in the construction, taxi, hospitality, cleaning and sex industries. 96. New paragraph 245AG(2)(a) provides that a person "allows" another person to work if he or she employs the second person under a contract of service. A person employs another person under a contract of service if they are in a normal employer-employee relationship. 97. New paragraph 245AG(2)(b) provides that a person "allows" a person to work if he or she engages the second person under a contract for services (other than in a domestic context). A person engages another person under a contract for services if the other person is an independent contractor. 98. This paragraph intentionally excludes contracts in a domestic context. The amendments are not intended to require householders to make inquiries before engaging the services of contractors at their homes, such as plumbers, electricians or cleaners.

99. This paragraph is not intended to exclude general domestic activities in a commercial context. This Subdivision is intended to apply to people who engage cleaners as independent contractors as part of a cleaning business. The amendments are not intended to capture householders who may use the services of that business. 100. Persons who engage independent contractors in a domestic context are excluded because of the short term basis of the relationship (unlike employment) and the limited capacity of householders to check the work entitlements of non-citizens. 101. New paragraph 245AG(2)(c) provides that a person "allows" another person to work if he or she bails or licenses a chattel to the second person, or another person, with the intention that the second person will use the chattel to perform a transportation service. 102. This paragraph is intentionally limited to transportation services. The amendments are intended to only affect taxi companies and other chauffeured car hire services. It is not intended to apply to car rental agencies. 103. An example of a situation of allowing a person to work is where an owner of a taxi bails or licenses their taxi to a driver for agreed periods, on agreed terms and conditions. The owner and the driver are not in an employment relationship, but the owner clearly intends the driver to work and payment for the use of the taxi may be calculated as a proportion of the driver's fares. 104. This paragraph also allows for the situation in which the owner of a taxi bails or licenses a taxi to a person who is not the driver. In these circumstances, if the owner intends that the driver will drive the taxi, the owner will "allow" the driver to work, despite the fact that the contractual relationship is between the owner and another person. 105. New paragraph 245AG(2)(d) provides that a person "allows" another person to work if he or she leases or licences premises, or a space within premises, to the second person, or another person, with the intention that he or she will use the premises or space to perform sexual services. 106. "Sexual Services" is defined in new Section 245AI. 107. This paragraph is only intended to capture persons who lease or license premises with the intention that the other party provides sexual services from those premises. Paragraph 245AG(2)(d) is designed to capture brothel owners who claim to be merely renting rooms to their sex workers instead of providing employment. 108. New subsection 245AG(3) provides that, for the purposes of new paragraph 245AG(2)(d), "premises" means an area of land or other place, whether or not it is enclosed or built on, a building or other structure, or a vehicle or vessel. This definition is intended to ensure that a person allows another to work as defined in new paragraph 245AG(2)(d) even where the premises are other than a building. For example, a person that leases a caravan with the intention that the lessee will use the caravan to provide sexual services would be captured by paragraph 245AG(2)(d).

Section 245AH Meaning of exploited 109. New section 245AH sets out the circumstances in which a person is being "exploited" for the purposes of the new Subdivision. 110. New section 245AH provides that a person is being "exploited" if the person is in a condition of forced labour, sexual servitude or slavery in Australia. 111. "Forced labour", "sexual servitude" and "slavery" are defined for the purposes of this Subdivision in new section 245AI. 112. The purpose of new section 245AH is to create additional liability for employers and referrers who know that, or are reckless as to whether, the worker or prospective worker has been exploited by being subjected to forced labour, sexual servitude or slavery while in Australia. 113. This meaning reflects the first limb of the definition of "exploitation" in the Criminal Code. The second limb of that definition, which relates to the forced removal of a person's organs, was not included in the meaning of "exploited" for the purposes of the new Subdivision due to the unlikelihood of such activity occurring in the employment context. Section 245AI Meaning of other terms 114. New section 245AI defines a number of other terms for the purposes of the new Subdivision. These definitions reflect the definitions of the equivalent terms either already in the Criminal Code. 115. "Forced labour" has the same meaning as in section 73.2 of the Criminal Code. Subsection 73.2(3) of the Criminal Code provides that "forced labour" means the condition of a person who provides labour or services (other than sexual services) and who, because of the use of force or threats, is not free to either cease providing the labour or services or leave the place where the labour or services are provided. 116. "Sexual service" has the same meaning as in the Dictionary in the Criminal Code, which provides that "sexual service" means the commercial use or display of the body of the person providing the service for the sexual gratification of others. 117. "Sexual servitude" has the same meaning as in Section 270.4 of the Criminal Code. Subsection 270.4(1) provides that "sexual servitude" is the condition of a person who provides sexual services and who, because of the use of force or threats is not free to either cease providing those services or leave the place where the services are provided. 118. "Slavery" has the same meaning as in Section 270.1 of the Criminal Code. Section 270.1 provides that "slavery" is the condition of a person over whom any or all of the powers attaching to the right of ownership are exercised, including where such a condition results from a debt or contract made by the person. Section 245AJ Geographical jurisdiction

119. New section 245AJ clarifies the geographical reach of the offence provisions in the new Subdivision. 120. New section 245AJ provides that section 15.2 of the Criminal Code applies to an offence against new section 245AB, 245AC, 245AD and 245AE. 121. The application of the geographical jurisdiction set out in section 15.2 of the Criminal Code will ensure that, for example, a person would commit an offence under new section 245AB if he or she employs another person under a contract of service outside Australia and that other person entered Australia and performed work in Australia under that contract. 122. The scope of the offences in new sections 245AB, 245AC, 245AD and 245AE is limited to where the worker is working in Australia by the very nature of the offences. This is because the offences only relate to unlawful non-citizens, which by definition means a non- citizen in the migration zone, or in relation to work in breach of a visa condition as the provisions cover non-citizens who are allowed to work or who are referred for work in Australia. Section 245AK On a trial for an aggravated offence 123. New section 245AK sets out what is necessary in a trial for an aggravated offence under the new Subdivision. 124. New subsection 245AK(1) provides that if the prosecution intends to prove an aggravated offence against new sections 245AB or 245AC the charge must allege that the worker has been exploited. 125. The circumstances in which a worker or prospective worker will have been "exploited", are set out in new section 245AH. 126. New subsection 245AK(2) provides that if the prosecution intends to prove an aggravated offence against new sections 245AD or 245AE, the charge must allege either that the prospective worker has been or will be exploited: · in doing the work in relation to which he or she was referred; or · in doing other work for the person to whom he or she was referred. 127. The circumstances in which a worker or prospective worker will have been "exploited", are set out in new section 245AH. 128. New subsection 245AK(3) provides guidance to the trier of fact in the event that it is not satisfied that the defendant is guilty of an aggravated offence, but is otherwise satisfied that the defendant is guilty of an offence against new section 245AB, 245AC, 245AD or 245AE. It provides that, in such circumstances, the trier of fact may find the defendant not guilty of an aggravated offence but guilty of an offence against that new section 245AB, 245AC, 245AD or 245AE. Item 2 Application

129. This item inserts an application provision for the amendments contained in Schedule 1 to the Bill. 130. Paragraph (a) of this item provides that where a person is referred for work in circumstances where an offence would be created, new Subdivision C of Division 12 of Part 2 of the Act applies where the referral is made on or after the commencement of the Schedule. 131. Paragraph (b) of this item provides that in any other case, new Subdivision C of Division 12 of Part 2 of the Act applies where a person begins, on or after the commencement of this Schedule, to be allowed to do the work in circumstances where an offence would be created by the amendment. 132. This means that people who currently allow unlawful non-citizens or non-citizens in breach of visa conditions to work will not commit an offence under the new Subdivision. An offence will only be committed when a non-citizen is allowed to work unlawfully and begins that work after the commencement of the Schedule.

SCHEDULE 2 Related amendments Crimes Act 1914 Item 1 After paragraph 15Y(ca) 133. This item inserts a new paragraph into section 15Y of the Crimes Act1914. 134. New paragraph 15Y(cb) provides that the protections for children involved in certain proceedings in Part IAD of the Crimes Act apply to proceedings for the new aggravated employer sanctions offences in new Subdivision C of Division 12 of Part 2 of the Migration Act. 135. Section 15Y of the Crimes Act provides that Part IAD of the Crimes Act applies applies to certain proceedings. 136. Part IAD provides certain protections for children involved in proceedings for sexual offences. These protections include: · certain limitations on the admissibility of a child's sexual reputation or experience; · certain limitations on the cross-examination of a child witness; and · the use of special facilities or arrangements for child witnesses to give evidence. Migration Act 1958 Item 2 At the end of subsection 235(1) 137. This item inserts a note at the end of subsection 235(1) referring to the offence provisions contained in the new Subdivision C of Division 12 of Part 2 of the Act. Item 3 At the end of subsection 235(3) 138. This item inserts a note at the end of subsection 235(3) referring to the offence provisions contained in the new Subdivision C of Division 12 of Part 2 of the Act. Item 4 At the end of section 235 139. This item inserts new subsection 235(7) at the end of section 235 to ensure that section 235 is consistent with the new Subdivision C of Division 12 of Part 2 of the Act. 140. Broadly, section 235 makes it an offence for unlawful non-citizens to perform any work in Australia and for lawful non-citizens, who hold visas subject to work conditions, to work in Australia in contravention of their work conditions. 141. New subsection 235(7) puts it beyond doubt that what amounts to "work" for the purposes of section 235 does not include: · an activity in which a detainee in immigration detention voluntarily engages where the activity is of a kind approved in writing by the Secretary; · an activity in which a prisoner in a prison or remand centre of the Commonwealth, a State or a Territory engages as a prisoner;

· an activity in which a person engages in compliance with a sentence or court order made under subsection 20AB(1) of the Crimes Act 1914; and · a community service order, a work order, a sentence of periodic detention, an attendance order, a sentence of weekend detention, an attendance order or a similar sentence or order, passed or made under the law of State or Territory. 142. Subsection 20AB(1) of the Crimes Act 1914 provides federal courts with a power to make a community service order or other work order. New subsection 235(7) makes it clear that any activity done under such an order is not "work" for the purposes of section 235. Item 5 Application 143. This item inserts an application provision for the amendments contained in item 4 of Schedule 2 to the Bill. 144. This item provides that the amendments in item 4 only apply to activities engaged in after the commencement of Schedule 2.

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