Australia: Reforms to employer sponsored visas - what you need to know

WHO SHOULD READ THIS

  • registered business sponsors
  • employers seeking foreign workers, and
  • prospective visa applicants.

THINGS YOU NEED TO KNOW

  • significant reforms are being implemented to the temporary and permanent working visas
  • businesses that employ foreign employees under working visas should be aware that some of the changes have immediate effect, and
  • certain occupations previously capable of nomination for a temporary or permanent working visa have been removed.

Reforms have been implemented to both temporary and permanent working visas, with further changes to be rolled out.

Prime Minister Malcolm Turnbull has also foreshadowed changes to citizenship eligibility.

Summary of changes

The renamed Short-Term Skilled Occupations List (STSOL) and Medium and Long-term Strategic Skills List (MLTSSL) take effect from 19 April 2017, with major changes to occupations eligible for sponsorship impacting the Temporary Work (Skilled) (subclass 457) visa (457 visa), the Employer Nomination Scheme (subclass 186) visa (186 visa), the Regional Sponsored Migration Scheme (subclass 187) visa (187 visa), the Skilled Independent (subclass 189) visa (189 visa), Skilled Nominated (subclass 190) visa (190 visa) and the Skilled Regional (Provisional) (subclass 489) visa (489 visa).

The 457 visa will be completely abolished by March 2018, to be replaced with the Temporary Skills Shortage visa (TSS visa). The TSS visa will comprise of the Short-Term Stream which will be granted for up to two years and the Medium-Term Stream which will be granted for up to four years.

Changes to the 186 and 187 visas will be implemented from 1 July 2017, with new English language requirements to be imposed and a lowering of the maximum age requirement for Direct Entry Stream applicants from 50 years to 45 years.

The Department of Immigration and Border Protection (DIBP) will also commence the collection of Tax File Numbers for data matching with the Australian Tax Office to ensure that visa holders are not paid less than their nominated salary. Sponsoring businesses that have been sanctioned for failing to meet their obligations will be publicised by the DIBP.

Strengthened character requirements will also be implemented requiring penal clearance certificates to be obtained for all 457 visa applicants.

These changes are part of the Federal Government's substantial reform package to strengthen integrity by supporting business in addressing genuine skill shortages in their workforces. Businesses that employ foreign employees should be aware that some of the changes have immediate effect.

Background

Changes to the programs were announced on Tuesday, 18 April 2017 by Prime Minister Turnbull, with no forewarning. To assist with understanding the changes, the DIBP has released two fact sheets for businesses and holders of affected visas. Fact Sheet 1 sets out the proposed changes to the 457 visa program and Fact Sheet 2 sets out the proposed changes to the 186 and 187 visa programs.

Current 457 visa holders will not be affected by the changes to the eligible occupations. It is anticipated that 457 visa applicants who have lodged their application on or before 18 April 2017, with an occupation that has been removed from the list will not be accepted for processing by the DIBP. Fact Sheet 1 identifies that nominating businesses and visa applicants 'may be eligible' for refunds of application charges.

The changes to the skilled occupations will affect nominating sponsors for the 186 and 187 visa programs and applicants for the 186, 187, 189, 190 and 489 visas. Fact Sheet 2 does not identify whether it will accept applications lodged prior to 19 April 2017 for visas associated with occupations removed from the list. Taking into account the extensive processing times for these visas (currently around nine months from date of lodgment) there could be considerable impacts on businesses and individuals if current applications are not processed.

The STSOL will be reviewed and updated every six months (based on advice from the Department of Employment), and it is anticipated that the MLTSSL will be reviewed on an annual basis (based on advice from the Department of Education and Training).

Changes to the 457 visa program

The following reforms will come into effect on key dates set out in Fact Sheet 1.

From 19 April 2017

  • applications for 457 visas will continue to be accepted for processing, however positions on the STSOL will only be granted for a maximum of two years, and occupations on the MLTSSL will only be granted for a maximum of four years.

From 1 July 2017

  • a further review of the occupations on the STSOL will be undertaken
  • English language exemptions available to applicants earning over $96,400 will be removed
  • additional training benchmark requirements will be set out in policy documents, which may impact businesses' ability to register as a standard business sponsor, and
  • all 457 visa applicants will be required to provide police clearance certificates (this is currently at case officers' discretion and may cause delays in processing applications).

From March 2018

  • the 457 visa will be abolished - no further applications will be accepted for this type of visa.

Introduction of the TSS visa program

From March 2018, the TSS visa will replace the 457 visa. The TSS visa will comprise of two streams, with the following requirements applicable to both streams:

  • at least two years' relevant work experience (currently none required)
  • labour market testing will be mandatory unless an international obligation applies (currently this is generally not required for Skill Level 1 or 2 occupations)
  • employers must pay the Australian market salary rate and meet the Temporary Skilled Migration Income Threshold requirements (currently workers can be paid below the market salary in some circumstances)
  • penal clearance certificates will be required (currently this is discretionary)
  • a non-discriminatory workforce test to ensure employers are not actively discriminating against Australian workers (currently not required), and
  • strengthened training requirement for employers to contribute towards training Australian workers (details have not yet been released). Currently there are two training benchmarks – a standard business sponsor must either pay at least 2% of its payroll expenditure to an industry training fund related to its business or spend at least 1% of its payroll expenditure on training their Australian citizen or permanent resident employees for each 12 month period of their registration.

Short-Term Stream criteria

  • visas will be granted for up to two years
  • visas can be renewed once onshore
  • no pathway to transitional residence for 186 or 187 visas
  • the STSOL applies, however additional occupations will be available to applicants in regional areas. Interim Guidelines have been released indicating that these occupations will relate primarily to farming, and
  • English language requirements will apply and available exemptions will be reduced.

Medium-Term Stream criteria

  • visas will be granted for up to four years
  • no limitation on renewals
  • transitional residence pathway to 186 and 187 visas available after three years (currently two years)
  • the MLTSSL applies, however additional occupations will be available to applicants in regional areas. Interim Guidelines have been released indicating that these occupations will relate primarily to farming and processing of primary produce, and
  • English language requirements will apply and exemptions will be reduced.

Changes to permanent residency visas

From 19 April 2017, the occupations set out in the MLTSSL will apply to the 186, 187, 189 and 190 visas, and existing and prospective applicants will be affected by the changes to the eligible occupations.

Additional changes will impact on 186 and 187 visas effective from the following key dates (as set out in Fact Sheet 2):

From 1 July 2017

  • changes to English Language requirements will be implemented - it is anticipated that exemptions available may be reduced, and
  • the maximum age for Direct Entry applicants will be reduced from 50 years to 45 years - it is not clear whether existing exemptions will continue to be available.

From March 2018

  • employers will be required to pay the Australian market salary rate and meet the Temporary Skilled Migration Income Threshold (currently workers can be paid below the market salary in some circumstances)
  • Fact Sheet 2 identified that the permanent residence eligibility period will be extended from two to three years - however it is not clear whether this means that the obligation to provide employment will be increased to three years, or if this applies to the Transitional Residence Stream
  • at least three years' relevant work experience will be required for all applicants
  • all applicants must be under the maximum age requirement of 45 at the time of application, and
  • strengthened training requirements will be implemented for employers to contribute towards training Australian workers.

Going forward

It is anticipated that there may be additional changes to the permanent residency pathways on top of those set out in Fact Sheet 2, as well as changes to citizenship eligibility and application processes, based on commentary from Prime Minister Turnbull's speech on 19 April 2017 to the Australian Chamber of Commerce and Industry in Canberra.

It is also anticipated that the exemptions available to the age, English language, skills and salary requirements under the current visa programs will be limited, or may require additional fees to be paid if they cannot be met by an applicant.

The DIBP is currently developing policy guidelines in relation to the above and we will continue to provide updates as more information is forthcoming.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
 
Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement

Mondaq.com (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of www.mondaq.com

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about Mondaq.com’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.

Disclaimer

Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.

Registration

Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to unsubscribe@mondaq.com with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.

Cookies

A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.

Links

This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.

Mail-A-Friend

If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.

Security

This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to webmaster@mondaq.com.

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to EditorialAdvisor@mondaq.com.

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at enquiries@mondaq.com.

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at problems@mondaq.com and we will use commercially reasonable efforts to determine and correct the problem promptly.