457 visa update – Part 2: Transitional arrangements for the 457 visa and next steps
We provide a summary of the additional changes and implications for employers.
Australia
Immigration
Following the Prime Minister's announcement on April 18,
2017 that the 457 visa will be abolished and replaced with a new
Temporary Skill Shortage (TSS) visa from March
2018, the Department of Immigration and Border Protection
(DIBP) has issued further information on the
upcoming changes that will impact the 457 visa programme.
Additional legislative and policy changes may also be released in
the future.
The 457 visa programme (with some changes) will remain in effect
until March 2018 and existing 457 visa holders will not be
affected.
We will provide further guidance on the changes to the Employer
Sponsored Permanent Residence Programme in a separate update.
A summary of the additional changes and implications for
employers is set out below. For more of an overview of these key
reforms refer to our previous
article.
Changes and impacts
|
With immediate effect from
19 April 2017 |
From 1 July 2017 – 31
December 2017 |
From March 2018
|
- The first stage of a number of proposed changes to the skilled
occupations list has been implemented
- The new occupational lists are now referred to as the Short
Term Skilled Occupations List (STSOL) and the
Medium and Long Term Strategic Skills List
(MLTSSL). Employers may nominate occupations from
both lists
- 216 occupations have been removed including for example,
Electronics Engineers, Life Scientist, Human Resources Advisor,
Market Research Analyst, Public Relations Manager and Procurement
Manager
- Caveats have been introduced to 59 existing occupations
including Technical Sales Representative (Not Elsewhere
Classified), Marketing Specialist, Management Consultant, Customer
Service Manager, Chief Executive/Managing Director, Corporate
General Manager, Accountants, Recruitment Consultant, Supply and
Distribution Manager
- These caveats are in the form of 'notes' and are
intended 'to ensure that the subclass 457 programme is, as
intended, focused on filling 'skilled' vacancies, with less
risk of subclass 457 visa holders being hired to complete
semi-skilled or low-skilled tasks, at the expense of the Australian
workforce'
- There are three categories of caveats: work experience,
regional locations and occupation specific (occupation settings,
minimum business turnover, number of employees and base
salary)
- 457 new and/or pending business nominations and visa
applications that have nominated occupations which are no longer on
the occupations list and which have not addressed the caveats
cannot be approved and will be refused unless they are
withdrawn
- Visa validity for applications granted on or after April 19,
2017 will be four years and will only be available to applicants
whose occupation is on the MLTSSL
- For all applicants with an occupation on STSOL, the maximum
visa validity will be two years
- 457 visa holders granted under STSOL cannot access the pathway
to permanent residence under 186 Employer Nomination Scheme –
Temporary Residence Transition stream but they may apply for the
Direct Entry stream
- 457 visa holders granted under MLTSSL may access the pathway to
permanent residence under 186 Employer Nomination Scheme –
Temporary Residence Transition stream following three years of
employment with the sponsoring business
- Current 457 visa holders and their family members are not
impacted. Family members joining the 457 visa holder in Australia
are also not affected
|
- The STSOL will be further reviewed based on advice from the
Department of Employment and will continue to be reviewed every six
months
- The MLTSSL will be reviewed based on outcomes from the
Department of Education and Training
- English Language exemptions based on salary thresholds will no
longer apply; at this stage other English language exemptions will
remain
- Clarifications will be made on the Training Benchmarks
- Mandatory police/penal clearances will be required for all
applicants
- Data collection and matching with the Australian Tax Office to
ensure payment of nominated salary
- Reporting of sponsors who are sanctioned for failing to meet
sponsorship obligations
|
- The 457 visa ceases and new TSS visa will commence
- The two TSS streams will supersede the 457 visa:
Short-Term stream
- For up to two years validity for temporary skill gaps
- STSOL will apply
- English test pass scores of IELTS of 5 with a minimum of 4.5 in
each test component or equivalent test
- Visa renewal once only while onshore
Medium-Term stream
- For up to four years validity for critical skills
- MLTSSL will apply
- Permanent residence pathway after three years with same
employer
- International English Language Testing System score of 5 in
each test component, or passing of an equivalent test
- Visa renewal onshore
General eligibility criteria for both
streams
- Minimum two years relevant work experience
- Mandatory Labour Market Testing for all occupations with the
exception of Australia's international obligations
- Renewed Australian employee training requirements for
sponsorship
- Introductions of non-discriminatory workforce test
- Mandatory police/penal clearances
|
Next steps and
considerations for employers |
- Employers with 457 applications on foot should consider
withdrawal of existing nominations and/or visa applications which
no longer meet the nominated occupation criteria including the
caveats
- Advice should be obtained on the applicant's legal status
in Australia and visa options/strategy if the application is
withdrawn
- Employers should plan project timelines in light of visa
validity
- Potential for extended processing times particularly during the
implementation and transition stages
- Potential limitations of the new STSOL and MLTSSL lists may
impact high growth start-up companies across various industries
including technology and energy where there is a need for world
class talent
|
- Be prepared for potential changes to the STSOL occupation list
every six months which is likely to create uncertainty within the
business community as access to certain occupations becomes
fluid
- Be prepared to satisfy new Training Benchmark requirements for
sponsorship applications lodged after July 1, 2017
- Be prepared to provide tax file numbers for your employees for
data matching purposes across government agencies
- Continue to satisfy sponsorship obligations in light of new
public reporting of sanctioned sponsors
- Consider obtaining legal advice on privacy and confidentiality
considerations in relation to public reporting and use of tax file
numbers
- Be prepared for more stringent monitoring and site visits to
assess compliance with sponsorship obligations
- Ensure 457 visa holders are paid in line with the nominated
salary
- Make prospective employees aware that they will need to provide
a police clearance as part of the application process and factor in
processing times which will differ for each country
|
- New graduates without two years of relevant work experience
will be ineligible for the TSS visa after March 2018
|
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