The Australian Prime Minister made a shock announcement yesterday that the Immigration department (DIBP) is abolishing the Temporary Work (Skilled) (subclass 457) visa (457 visa) and replacing it with the completely new Temporary Skills Shortage (TSS) visa in March 2018.

For the sake of expediency and to help current clients concerned with the 457 visa changes, some information here is taken from DIBP public information.

Why Are These Changes Being Made?

According to DIBP and for political purposes I believe “these measures will sharpen the focus of Australia’s employer sponsored skilled migration programmes to ensure they better meet Australia’s skills needs, increase the quality and economic contribution of skilled migrants and address public concerns about the displacement of Australian workers.

Who Is Affected?

Current 457 visa applications and holders, prospective applicants, businesses sponsoring skilled migrants and industry. Existing 457 visas will continue to remain in effect.

457 visa applications that had lodged their application on or before 18 April 2017, and whose application had not yet been decided, with an occupation that has been removed from the STSOL, may be eligible for a refund of their visa application fee. Nominating businesses for these applications may also be eligible for a refund of related fees.

Phase 1: Immediate Changes to Occupation Lists

The first phase of a number of intended changes to the approved occupation list for the subclass 457 programme has already been implemented – with amendments made to the existing legislative instrument that specifies approved occupations for the programme.

As of 19 April 2017, the lists contained in these schedules have been re-named:

  • the Skilled Occupation List (SOL) as the Medium and Long-term Strategic Skills List (MLTSSL); and
  • the Consolidated Sponsored Occupation List (CSOL) as the Short-term Skilled Occupation List (STSOL).

For the subclass 457 a total of 216 occupations have been removed from the list of eligible occupations; and caveats added to 59 other occupations.

Occupation lists are already available on DIBP website. The list of occupations removed from the CSOL is at the end of this article.

Visa Validity Changes

457 visas were generally granted for four years. For subclass 457 visas granted on or after 19 April 2017, under DIBP policy, the maximum four year visa period will, however, only be available where the primary applicant’s occupation is on the MLTSSL.

For all other applicants where their occupation is not on the MLTSSL, a maximum visa period of two years will be available. This includes primary visa applications, lodged, which are still pending a decision on 19 April 2017. Note: Subsequent entrants (i.e. secondary visa applicants) wanting to join a primary subclass 457 visa holder will not be impacted by this new policy. That is, subsequent entrants can still have their subclass 457 visa ‘match’ the visa period of the primary visa holder – even if this is longer than two years (unless member of family unit extension limits apply).

Further Changes and Key Dates

Further changes will occur on 1 July & 31 December 2017 and 1 March 2018.

What Is Changing for 1 July 2017?

Further changes to the subclass 457 programme are planned for 1 July 2017. These include:

  • possible further adjustments to eligible occupation lists;
  • an expansion of client cohorts for whom mandatory skills assessments are required;
  • minor changes to the training benchmarks for subclass 457 sponsors; and
  • subclass 457 programme no longer excluded from standard policy around penal checks – with police certificates required to be provided from countries a visa applicant has lived in as per current policy for other visa subclasses
  • From 1 July 2017 some expect there will be revisions to the occupation lists (DIBP has stated as much already on this point) changes to English language requirements of IELTS (or equivalent test) score of 6.0 in each component and age limit decrease to 45 years old at the time of application for applicants in the 186 (ENS) and 187 (RSMS) Direct Entry stream

Changes by December 2017

Before 31 December 2017, for the existing 457 visa:

  • DIBP will commence the collection of Tax File Numbers for 457 visa holders (and other employer sponsored migrants), and data will be matched with the Australian Tax Office’s records to ensure that visa holders are not paid less than their nominated salary.
  • DIBP will commence the publication of details relating to sponsors sanctioned for failing to meet their obligations under the Migration Regulation 1994 and related legislation.

Changes from March 2018 Including Pathway to Permanent Residency

It appears the age requirement of 50 will continue in the Temporary Residence Transition stream for the short-term, however from 1 March 2018 it has been advised that additional changes will be made affecting all ENS and RSMS applications, including:

  • That only the occupations on the MLTSSL will be eligible
  • That an Age limit of 45 years will apply for all applications. This change would have a significant impact on older applicants

The Short-Term stream will include the following criteria:

Renewal:

Capacity for visa renewal onshore once only. – Occupations:

  • For non-regional Australia, the STSOL will apply.
  • For regional Australia, the STSOL will apply, with additional occupations available to support regional employers.

English language requirements:

A requirement of an International English Language Testing System (IELTS) (or equivalent test) score of 5, with a minimum of 4.5 in each test component.

Genuine entry:

A genuine temporary entrant requirement.

The Medium-Term stream will include the following criteria:

Renewal:

Capacity for visa renewal onshore and a permanent residence pathway after three years (not 2 as currently exists).

Occupation lists:

  • For non-regional Australia – the MLTSSL will apply.
  • For regional Australia – the MLTSSL will apply, with additional occupations available to support regional employers.

English language requirements:

A requirement of a minimum of IELTS 5 (or equivalent test) in each test component.

Eligibility criteria for both streams will include:

  • Work experience: at least two years’ relevant work experience.
  • Labour market testing (LMT): LMT will be mandatory, unless an international obligation applies.
  • Minimum market salary rate: Employers must pay the Australian market salary rate and meet the Temporary Skilled Migration Income Threshold requirements. Currently $53,900
  • Character: Mandatory penal clearance certificates to be provided.
  • Workforce: A non-discriminatory workforce test to ensure employers are not actively discriminating against Australian workers.
  • Training requirement: a strengthened training requirement for employers to contribute towards training Australian workers. The detailed policy settings for several of these requirements will be finalised through the implementation process. Further details on these requirements to inform stakeholders will be available in due course.

Caveats

Understanding the caveats Caveats are included ‘as a note’ in the relevant legislative for 59 occupations now. The listing of caveats is detailed, and involves 3 types of caveats, and seeking professional advice is recommended when nominating one of these occupations. Australian immigrationlawyers.com anticipates publishing further advice on this area as more detailed information is released by DIBP.

Conclusion

The sudden unexpected and shock changes to the occupations list for 457 visas have already started to come into effect immediately – this will likely impact many employers and employees quite significantly.

The new TSS visa is likely to be more restrictive than the current 457 visa – of shorter duration with more restrictive requirements in terms of skill level and labour market testing. Visa applicants and businesses seeking to sponsor staff for temporary visas are advised to look at lodging their applications well before March 2018.

Applicants for permanent employer sponsored visas will also be impacted, but it is not yet clear when these changes will come into effect, though it looks as if it may be March 2018. The main changes are in relation to the amount of work experience required, English requirement and age limit. Applicants who are eligible for permanent employer visas are advised to proceed with lodgement as soon as possible to avoid the changes.

Australian Immigration Lawyers anticipates publishing further advice on this in the coming days and weeks.

The above information is provided by way of general advice and not to be relied on as specific for your individual situation.  Where you are seeking guidance in relation to a specific matter, seeking professional advice is recommended.

Feel free to call our corporate and visa applicant hotline on 0416 212 021, or take a look at our visa packages.

We will assist you with the new TSS VISA requirements and readily find the best path for you visa application.

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