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Can foreign workers be paid less than Australian workers under the free trade agreement?

Australian trade unions have raised the concern that the China-Australia FTA (CHAFTA) would result in foreign workers being employed in Australia at a lower rate and conditions than Australian workers. Are they right?

The CFMEU has started rallying against the CHAFTA on the claim that there is no statement in the CHAFTA that says foreign workers working side by side with an Australian worker shall receive the same conditions and pay.

“That’s nowhere in the agreement… go through the pages of the agreement and look at the Memorandum of Understanding and it doesn’t say it in black and white; nowhere in the agreement,”  Michael O'Connor, CFMEU National Secretary, told with Fran Kelly on RN Breakfast last week.

The CHAFTA is at risk as more than 2,000 workers rallied recently in Brisbane's CBD to protest against the agreement. Bill Shorten has endorsed the union-led assault against the free-trade pact, revealing Labor will take up the fight in ­parliament to rewrite labour ­standards, conditions and skills testing in the historic multi-­billion-­dollar agreement.

One of the documents detailing the nature of the cooperation, namely the IFA at Clause 2(e) indicates that foreign workers will have to be given the same conditions: “…the project company agrees to comply with all Australian laws and regulations, including applicable Australian workplace law, work safety law and relevant Australian licensing, regulation and certification standards.”

The entire process of approval however is complex with several layers of approvals, and authentication involving the project proponents, the China International Contractors Association, the Department of Foreign Affairs and Trade (DFAT) and the DIBP. But, no union consultation is involved.

The process also allows scope to negotiate different employment standards. Commenting on the issue, the online academic journal, The Conversation stated:  “While the very general conditions stipulated in clause 2(e) could be argued to specify some minimum, albeit vague, employment conditions, Clause 5 of the MOU provides the scope for the circumvention of standards and rates of remuneration set through enterprise agreements,” notes the report.

It says that in effect, the project company can request concessions in connection with employment standards.

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    Glen Wednesday, 29 July 2015

    No further stay on all applicants coming in using this pathway. Limit work only to the sponsored employer (none of that contracting rubbish). More strict compliance requirement for sponsors and equivalent Australian worker versus foreign worker ratio. Create a special category visa and charge a higher VAC. Only specialised workers will be able to afford this pathway because of strict requirements. This will eliminate the potential of bringing in unskilled low income earners (which is what they have done in other parts of the world). Make the process more difficult. Labour should look at solutions, not just enticing voters. I agree that the Libs might have been a little hasty in the free trade agreement, but there are more productive ways to tackle the situation. Needing a degree and at least 6.0 IELTS will eliminate a lot of undesired skilled workers.

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