Prime Minister Malcolm Turnbull says employers who don't try to hire Australians first will be named and shamed in an overhaul of the 457 foreign worker visas.
The federal government’s hard-line approach to foreign workers will see Australian employers who hire foreigners pay more under a new visa scheme.
Prime Minister Malcolm Turnbull announced on Tuesday the Coalition is immediately abolishing the 457 visa scheme and replacing it with a new system.
“Australian workers must have priority for jobs in our country, foreign workers add value to the nation but they must supplement and not replace hard-working Australians,” Mr Turnbull said in Canberra on Wednesday.
Employers who choose to hire foreign workers over locals will be made to contribute to a new training fund to upskill Australian workers. Further details will be announced in May’s budget.
“Employers who nominate workers for the temporary visas will contribute to the fund, which will support skills development and take up of apprenticeships and traineeships,” Mr Turnbull said.
Immigration Minister Peter Dutton said the government will work with businesses who struggle to find an Australian worker and added employers already pay to train staff.
“The current arrangement is that it’s 1 per cent of their payroll or 2 per cent of their payroll if they decide to put the money into an industry training fund,” Mr Dutton said.
Mr Dutton said upskilling local staff would put them in a better position for a promotion.
“They can be the next applicant for the job, so that we don’t have to bring a foreign worker in to fill that job,” he said.
Watch: Turnbull on the 457 visa changes
The 457 visa program is being replaced with new two-year and four-year visas, which will cost $1,150 and $2,400 respectively.
Mr Turnbull warned the labour market testing requirements for the new visas - including advertising jobs over six months - would be rigorously policed.
Employers who fail to meet requirements will be named and shamed.
The skilled occupation list, which specifies which jobs are eligible for a temporary visa, will be cut from 650 to 400 occupations, and applicants must have previous work experience.
Under the second four-year visa applicants will be required to possess a high standard of English language and undergo a criminal background check.
Mr Turnbull said the new two-year visa won't be a pathway to permanent residency, but anyone currently in Australia on a 457 visa won't be affected by the new arrangements.
"They'll ensure that each new migrant has the skills and outlook to contribute to Australia and our economy in the way we need them to," he said.
"This ability to hit the ground running will benefit both our migrants and our nation by helping them integrate into our culture and our workforce."
The prime minister could not say how many more jobs would be available to Australians once the new scheme started.
"In terms of the absolute number of people, it will depend obviously on the demands of the economy and on skills shortages," Mr Turnbull said.
"What we want to make sure is where there are long and enduring skills shortages in Australia, that Australians are being trained to do that work."
There are 95,000 workers on 457 visas at the moment - less than 1 per cent of the workforce.
It is understood the Turnbull government will on Thursday reveal another major step in its immigration crackdown, with tighter citizenship testing in its sights.
"Changes to citizenship will also enable our migration program to contribute still further to our social cohesion while enhancing our security," Mr Turnbull said.
Watch: Dutton explains 457 visa replacement
Mr Turnbull rejected comparisons between his announcement and a move by US President Donald Trump who has tightened foreign worker visas in a "buy American and hire American" executive order.
The prime minister said his government's changes to the visa program had been in the works "going back well over a year".
Australian Industry Group chief Innes Willox said the existing 457 visa system was opaque and open to abuse and he expected the new scheme to be more transparent.
But he expected some businesses would pay more under the changes.
The co-founder of successful technology company Atlassian, Mike Cannon-Brookes, says 457 visas are essential, telling The Australian anything that makes bridging the talent gap more difficult is bad for the country.
The majority of 457 visa holders are from India (26.6 per cent), followed by the United Kingdom (16.9 percent) and China (6.1 per cent).
India's external affairs ministry said it was "examining the consequences" of the policy change, the Times of India reported.
"This is also a matter we will be looking at in the context of Comprehensive Economic Cooperation Agreement (CECA) negotiations," ministry spokesperson Gopal Baglay said.