Fair Work Ombudsman inspectors will be given new powers to ensure 457 visa holders are being paid market rates and are working in their approved roles, under new arrangements announced by the Gillard Government.

In a joint statement issued yesterday, Workplace Relations Minister Bill Shorten and Immigration Minister Brendan O'Connor said some employers were abusing the 457 program by bringing in temporary labour when local workers were available, bringing in relatives for non-existent jobs, or exploiting vulnerable workers.

FWO inspectors will be able to check whether the workers are receiving the rates, and doing the jobs, specified in their visas. Suspicious activity going beyond those basic issues would be referred to DIAC.

"Employers who do the right thing have nothing to fear from this change and there will be no additional compliance burden or red tape for them," the Ministers said.

According to the statement, FWO currently employs more than 300 inspectors. In 2011-12, the FWO investigated 157 complaints about 457 visas, recouping $207,871 for employees working under them.

AiG chief executive Innes Willox said the initiative seemed "reasonable", and that employers who abused the system should face the appropriate sanctions.

"However, we need to tread warily given the politicisation of this issue in recent weeks," Willox said.

He said the proposal was not considered by the Ministerial Advisory Council on Skilled Migration.

Minister O'Connor said any additional costs would be looked at in the budget process, and the government was looking to legislate the changes as soon as possible.

Minister Shorten said the government would be looking to introduce its second tranche of Fair Work Act changes – including extending the right to request flexible working arrangements, and new powers to tackle workplace bullying – "this week".