Lillian Ajuria outlines what the government’s recent changes mean for your business
On 18 April 2017, Prime Minister Malcolm Turnbull announced the abolition of the 457 visa as part of a package of reforms being rolled out in phases between 19 April 2017 and 1 March 2018, when the 457 visa will be replaced by the Temporary Skills Shortage (TSS) visa.
The government’s stated objective was to restore integrity to visa programs intended to meet short-term skills shortages, and to ensure that employment and training opportunities are preserved for Australian citizens and permanent residents, first and foremost.
Few would argue with this objective, and wholesale change in immigration is not new. However, changes of this magnitude have arguably not been seen since the introduction of the 457 visa by the Howard Government in 1996. There is therefore a whole generation of employers who have based their recruitment and retention strategies on the current 457 visa regime and its pathway to permanent residence.
Details of the changes have received widespread coverage, but here are some tips for managing their impact:
- Expect the unexpected
The recent announcement has introduced an element of uncertainty. Even after all new legislation is enacted and ‘fine-tuned’, the uncertainty may linger in the long term, as the government’s announcement has signalled to employers that it can, and will, make changes to the visa program, without warning.
- Prepare for longer lead times
There is some good news for Business Sponsors, with ‘accredited’ status and the benefit of faster processing times becoming available to more employers. However, the time required for preparation of ‘decision-ready’ applications has increased, given new requirements from 1 July 2017 for more English language testing (such as IELTS), skills assessments and police checks. From March 2018, mandatory labour market testing (with some likely exemptions) will also be introduced for all occupations. Given the usual urgency associated with visa applications, the time taken to gather this additional documentation will need to be factored into advice provided to recruiters and employees.
- Be aware of additional costs
Over and above the costs associated with the additional documentary requirements outlined above, the new ‘training levy’ will impose additional costs on all Business Sponsors from March 2018. Annual contributions to the Skilling Australians Fund will be based on the number of temporary visa holders in their employment ($1,200–$1,800 per employee, depending on annual turnover) as well as the number of applications for permanent residence (one-off payment of $3,000–$5,000 per application). The contributions of some employers will be substantially more than expenditure required to meet the current Training Benchmark, and as there will be no offset of current training expenditure, this will need to be factored into overall employment costs.
- Become involved in advocacy
The two new occupation lists have been quite controversial as they will be used to determine whether a position is suitable for sponsorship, whether a two- or four-year visa will be granted, and whether there is a pathway to permanent residence for overseas employees. Some professional organisations and industry bodies have been successful in lobbying for the changes to the revised 1 July lists, and there are ongoing opportunities for advocacy, as the Short Term Skilled Occupations List will be revised every six months and the Medium and Long Term Strategic Skills List every 12 months. The Department of Immigration is keen to engage with stakeholders, and HR professionals are well placed to advocate for change, based on expert knowledge and hard data.
- Manage expectations of employees
Some current (and prospective) employees will be greatly disadvantaged by the changes, in particular the reduced options to apply for four-year visas and, ultimately, permanent residence. However, the government is unapologetic about breaking the nexus between temporary and permanent skilled visas – as well as reducing the age limit for permanent residence from 50 to 45 years, which will further impact on many senior-level employees – and expectations must be carefully managed.
The changes have and will continue to keep law firms busy as we navigate through them, find solutions for our clients, and support their efforts to advocate for some changes to the reforms by the government.
Lillian Ajuria is an accredited specialist in immigration law and principal at immigration law specialists Ajuria Lawyers. For further information, visit www.ajurialawyers.com.au.