Greater flexibility for employers: six month 400 visas

by 28 Nov 2014
Last month’s introduction of changes to the Temporary Work (Short Stay Activity) subclass 400 visa program are offering greater flexibility to employers who now, in some circumstances, have a potential alternative to a 457 visa.

The 400 visa program primarily allows short term, non-ongoing work or activities in Australia. The first of the two main changes, which came into effect on 23 November 2014, extends the period from date of visa grant to date of first entry from three to six months. The second change is that the maximum period of stay that can be granted on the visa from date of first entry has also been extended from three to six months. Applications lodged prior to this date will be assessed under the former provisions.

The previous 400 visa program settings were seen by many businesses to be too restrictive. Despite the maximum visa period being three months, some overseas posts were only prepared to grant a visa period of six weeks unless there were exceptional circumstances. In addition, where projects went over time and exceeded three months in duration – even for a few weeks – in many circumstances the only alternative for the employer was to apply for a 457 visa. 

DIBP’s revised policy indicates that in most circumstances a stay of up to three months will be facilitated, provided all other relevant visa requirements can be met. In exceptional circumstances, a stay of up to six months may be considered under the following three key criteria:

1.    A strong business case exists to justify the longer visa period to ensure the subclass 457 visa program is not being circumvented. 

Relevant factors may include:
  • evidence about the nature, size, duration and importance of a project to the local community;
  • evidence that specialist advice/expertise from overseas is required;
  • whether there are contractual obligations relating to the installation/servicing of equipment; 
  • evidence of unsuccessful attempts to hire an Australian to do the work; 
  • the number of Australians being employed on the project and/or by the business; and
  • time available for an Australian to be trained to do the proposed work over a longer period.

2.    The employment conditions will satisfy Australian workplace standards. 

This will be with reference to the relevant Australian workplace legislation, noting the wage, job classification and industrial instrument the visa applicant will be covered by. It would also be expected under DIBP’s revised policy that:
  • remuneration for positions within ANZSCO major groups 1-3 (Managers, Professionals, Technicians and Tradesworkers) should meet the Temporary Skilled Migration Income Threshold (TSMIT), currently $53,900pa. This may include reasonable allowances such as accommodation; and 
  • remuneration for positions falling within ANZSCO major group 4 or higher should be no less than the Australian minimum wage. Evidence of employment conditions will be requested in most cases for workers in this category where the period of stay is more than eight weeks.

3.    The proposed work or activities will not adversely impact Australian workers. 

DIBP will need to be satisfied that the applicant or the applicant’s employer is not seeking to bypass the Australian labour market and/or the scrutiny of the subclass 457 visa program. In most circumstances where it is clear the work is highly specialised, unable to be filled easily from within Australia and non-ongoing, this requirement will be taken to be satisfied, however where there are concerns, additional documentary evidence may be requested.

With these changes, employers can now consider scenarios where the longer 400 visa may be an appropriate alternative to the 457 visa and how this may impact internal policies and processes. Other factors to consider include:
  • whether any changes should be made to internal policies or procedures, or whether the longer 400 visa should be used in exceptional circumstances only;
  • any specific internal approval processes to be followed where the longer 400 visa is being applied for;
  • ensuring that the applicant’s individual circumstances, such as nationality, practice of the overseas post processing the application, previous travel history to Australia including frequency and duration, form part of the initial assessment. From a business perspective, there may be circumstances where the flexibility offered by a 457 visa may still be preferable; and
  • any wider considerations, for example from a global mobility or tax perspective.

It is expected to take some time for the new policy to settle and to see how DIBP will apply it in practice. As the processing of 400 visas is decentralised to the Australian Embassy or Consulate located in or responsible for the country where the applicant resides, documentary requirements may vary. 

Fragomen will be monitoring the development of this policy closely and can assist businesses to formulate internal policies relating to this change.