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Credit: Reuters/Jeff Haynes By James Grubel CANBERRA | Tue May 29, 2012 3:30am EDT CANBERRA (Reuters) - Australian Prime Minister Julia Gillard moved on Tuesday to quell deep anger within her Labor Party over new rules for foreign workers at major resource projects, giving government lawmakers more oversight to ensure local jobs are protected. The government on Friday approved the first Enterprise Migration Agreement to let mining companies hire thousands of offshore workers to help overcome chronic worker shortages and ensure major projects can proceed. The policy outraged union leaders and members of Gillard's ruling Labor Party, who condemned the agreement to allow mining magnate Gina Rinehart hire 1,700 foreign workers for her massive A$9.5 billion ($9.9 billion) Roy Hill iron ore project. The issue came to a head at a meeting of government lawmakers at which they agreed to closer political scrutiny of the agreements to ensure Australians are not overlooked. "The general view was that it could have been handled better," a government lawmaker who was at the meeting said. The developments came as India's GVK Power & Infrastructure cleared a key hurdle towards developing its A$6.4 billion Alpha coal project, which is 21 percent owned by Rinehart's Hancock Coal. The vote by government lawmakers means Gillard's Labor will examine the agreements to make sure Australian workers, including Aborigines in remote areas, are not overlooked for mining jobs, and that foreign workers are not forced to work for lower wages than Australian workers. Immigration Minister Chris Bowen, however, told Parliament he retained the sole right to approve new agreements for major resource projects. SAME WAGES, SAME CONDITIONS The new Enterprise Migration Agreements are a major policy shift, as they allow both skilled and semi-skilled workers, such as scaffolders and truck drivers, to be hired overseas. Previously, the government only allowed skilled workers, such as engineers, chefs and trades people, to be hired offshore under a "457 visa" scheme. Earlier, Australia's Immigration Department confirmed it was investigating union claims that mining company CITIC Pacific has underpaid Chinese workers at its A$4.5 billion Sino Iron project in Western Australia's remote Karratha region. "The department takes any alleged breach of the subclass 457 visas very seriously," a departmental spokeswoman said, adding the allegations were under investigation. Under 457 visa rules, immigrants must be paid the same wages and offered the same conditions as Australian workers. Australia's booming resources sector is riding high on continued strong demand from its biggest commodities customer China, but resources companies have long complained that it can't find enough workers to guarantee multi-billion dollar developments, often in inhospitable and remote locations. With a population of 22 million and unemployment at 4.9 percent, Australia's government estimates it will need an extra 89,000 workers by 2016 to meet demand, with a peak of 49,000 short-term construction jobs in 2014. The worker shortages means skilled mining workers can demand sky-high wages of around A$155,000 a year, more than double the average wage. Truck drivers can command six figure salaries. Latest government figures show resource projects worth around A$450 billion are planned for Australia, with A$260 billion worth of projects already approved or under way. The Roy Hill project, one of the biggest in the iron ore sector, plans to start shipping ore in 2014, with production expected to peak at 55 million tonnes a year, a level that would match production rates of Australia's third-biggest producer, Fortescue Metals Group. In March, Japan's Marubeni Corp and South Korea's steelmaker POSCO and shipbuilder STX Corp said they would buy 30 percent of the Roy Hill project for A$3.5 billion. ($1=A$1.04) (Reporting by James Grubel; Editing by Nick Macfie) World Australia Julia Gillard Related Quotes and News Company Price Related News Tweet this Link this Share this Digg this Email Reprints We welcome comments that advance the story through relevant opinion, anecdotes, links and data. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of Reuters. For more information on our comment policy, see http://blogs.reuters.com/fulldisclosure/2010/09/27/toward-a-more-thoughtful-conversation-on-stories/ Comments (0) Be the first to comment on reuters.com. Add yours using the box above. 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