Migrant workers in Australia are being subjected to slave-like conditions, sexual propositions and black market labor gangs on farms and factories supplying the country's biggest food businesses.

Migrant workers can enter Australia legally on a 417 working holiday visa -- designed as a cultural exchange program, but shady labor hire contractors sell groups of naive workers to farms and factories producing fresh food, the Australian Broadcasting Corporation (ABC) reported on Monday.

Migrant workers from Asia and Europe are allegedly being abused, harassed and assaulted routinely with some women targeted sexually, being propositioned for sex in exchange for visas.

The visa allows migrant workers to remain in one location for up to six months performing low-skilled jobs, making it ideal for fruit and vegetable picking and poultry factories.

Labor law and migration expert Johanna Howe told the ABC that Australia's reputation was being put at risk by the corrupted 417 visa system.

"We will be known as a country that exploits vulnerable people who are looking for a better chance at life," she said. "We would never accept this if it were Australian workers being treated in this way, but because it's 417 visa holders and we don't know them, there's a lid on it, we accept that it's OK."

Government MP Keith Pitt said the issue spanned multiple government departments and no longer could those agencies ignore the issue.

"It affects Fair Work, taxation, local government, hire services at the state level," he said.

"We need a multi-jurisdictional taskforce. We need to coordinate our enforcement action. To be able to catch these crooks -- and I'll call them crooks because they are -- actually takes a significant amount of intelligence and resources."

The ABC reported that farmers and suppliers that paid correct wages were dumped by supermarket chains seeking the lowest price.

Fast food outlets KFC and Red Rooster are implicated along with the five supermarket chains that make up more than 95 percent of the country's grocery market, according to ABC.

Industry experts are calling for supermarkets and fast food chains to stop shirking responsibility and abandon rogue supplies that do not pay adequate wages.