Researchers warn it’s embedding modern slavery risks, draining critical health skills from Pacific neighbours and delivering a lopsided economic return to Australia
Australia’s Pacific Australia Labour Mobility (PALM) scheme is rapidly becoming a backbone of the regional workforce and a growing source of labour for aged care. But a new submission to the federal inquiry into the value of skilled migration argues the program is delivering a lopsided economic return to Australia, embedding modern slavery risks and draining critical skills from neighbouring health systems.
For HR leaders in agriculture, meat processing, hospitality and care, the analysis by Dr Morgan Harrington and Dr Matt Withers is a warning that PALM is no longer just a sourcing channel – it is a material workforce, ESG and reputational risk.
A “guestworker” scheme with some of the harshest conditions
The PALM scheme allows workers from nine Pacific Island countries and Timor Leste to take up low‑, semi‑ and unskilled jobs across rural and regional Australia on Subclass 403 visas. These visas are issued either for a short‑term nine‑month placement or for up to four years under the long‑term stream. More than 31,000 PALM workers are currently in Australia, a number that has grown quickly in recent years.
What distinguishes PALM from most other visa categories is not its scale but its conditions. Workers cannot freely change employers, they are barred from bringing family members, and they have no pathway to permanent residency. The researchers argue that these features create a structural dependency that leaves workers highly vulnerable to exploitation.
Those vulnerabilities are not theoretical. It is estimated that around 7,000 PALM participants have left their sponsoring employers and “disengaged” from the scheme altogether, walking away from the formal program rather than stay in placements they see as untenable. The NSW Anti‑Slavery Commissioner and the UN Special Rapporteur on contemporary forms of slavery have both formally identified PALM as a modern slavery risk.
For HR leaders, that places the scheme squarely in the frame of modern slavery reporting obligations and ethical sourcing expectations, not just labour supply.
Who really benefits? A “triple win” that flows four to one to Australia
Successive governments have sold PALM as a “triple win” – good for Australian employers, for Pacific workers and their families, and for the development of partner economies. The available data, however, suggest that most of the economic value stays in Australia.
Drawing on a Department of Foreign Affairs and Trade presentation, World Bank surveys and official worker guidance, Harrington and Withers estimate that between 2018 and 2022 PALM workers generated roughly $990 million in industry value added. Of that, about $184 million was saved or remitted to Pacific countries (including superannuation), while $806 million remained in Australia.
The Australian share includes employer profits, tax revenue, personal spending in local communities, rent paid by workers and donations to Australian organisations. World Bank data and official payroll information support a similar picture: roughly two‑thirds to three‑quarters of PALM workers’ post‑tax income is spent in Australia, leaving about one‑third available to save or send home.
Since that DFAT analysis was presented, the number of PALM workers has tripled. If the ratios have held, the imbalance in economic benefit between Australia and its Pacific neighbours will have widened significantly. That raises tough questions for employers that rely heavily on the scheme while also talking up their commitment to fair work, shared value and sustainable regional development.
Not so “unskilled”: how PALM is reshaping the care workforce
Although PALM is formally a low‑ and semi‑skilled migration program, much of the work now being done under the scheme would be recognised in practice as skilled labour.
More than half of PALM workers remain in agriculture and over a third in meat processing. But the long‑term stream has expanded quickly – more than doubling from just over 7,000 workers in 2022 to nearly 16,000 in 2025 – and there has been a sharp increase in placements in accommodation and in health care and social assistance. The number of workers in health and social assistance alone has grown more than fivefold since 2022, reaching around 1,200.
In aged care, a Certificate III in Individual Support (Ageing) is not mandated by statute but is widely treated as a baseline qualification. PALM workers in aged care are required to hold Certificate III, gained either through a pilot program delivered by the Australia Pacific Training Coalition in Suva or in Australia through the Aged Care Expansion (ACE) program.
The submission highlights further research showing that, through ACE, PALM is actively recruiting skilled health workers from Pacific countries, including registered nurses, who then frequently work in lower‑skilled care roles once in Australia. In other words, the program is drawing in trained health professionals from systems that can least afford to lose them, to fill Australia’s growing aged care gaps on a temporary, tightly controlled basis.
For HR and workforce leaders in aged care and health, that poses a double challenge: you may be relying on a workforce stream that both undermines regional health capacity and falls into a high‑risk category for labour exploitation.
A growing dependence – and a fragile foundation
The submission is clear that PALM has become “increasingly vital” to rural Australia and is now deeply embedded in sectors with chronic labour shortages. The risk, the authors argue, is that the model’s long‑term sustainability is being undermined by:
- The deprivation of basic labour and human rights, particularly freedom of movement between employers
- Highly uneven economic returns in Australia’s favour
- An escalating brain drain from Pacific health and care systems
If these dynamics are left unaddressed, the consequences may not be limited to individual cases of exploitation or workforce churn. The authors warn that diplomatic and economic relationships that underpin regional labour mobility could be damaged, with obvious downside risk for employers who have structured workforce planning around PALM.
Former Immigration Minister and current NSW Anti‑Slavery Commissioner Chris Evans – who oversaw early iterations of seasonal worker programs – has already noted that PALM has become “much more complex” as it has expanded beyond its original narrow agricultural remit and into the care industries. That complexity translates into policy uncertainty, compliance burden and reputational exposure for employers.
What kind of workforce partner does Australia want to be?
Harrington and Withers do not argue for abandoning PALM. Instead, they set out a reform agenda aimed at making the scheme genuinely mutual and sustainable.
They propose rebalancing the economic benefits by reviewing employer deductions so workers can remit more of their earnings, exploring ATO‑managed deduction models similar to HECS to spread repayment over time, and publishing regular data on the value added to the Australian economy.
They call for reforms to remove modern slavery risks before the scheme spreads further into new industries, including guaranteeing workers the ability to change employers and extending core protections such as Medicare access.
And they argue that any further expansion into aged care must be matched by direct investment in the care infrastructure of Pacific countries and Timor Leste, creating pathways for workers to gain qualifications and experience in Australia and then return to meaningful roles at home rather than being permanently lost to their domestic health systems.
For HR leaders, the submission is a prompt to look beyond headcount and hourly rates when considering PALM. It invites a harder conversation with boards and executive teams about whether current use of the scheme aligns with organisational values, ESG commitments and long‑term workforce resilience – and what role employers should play in pushing for a more ethical, balanced and stable model of labour mobility in the region.
