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subclass 457 visa

New Subclass 482 Temporary Skill Shortage Visa

As a result of a broad package of reforms relating to employer sponsored skilled visa programs, announced by the Government on 18 April 2017 the 457 visa will cease to exist on 18 March and will be replaced by the new Temporary Skill Shortage (Subclass 482) visa which enables employers to access a temporary skilled overseas worker if an appropriately skilled Australian worker is unavailable.

An overseas worker must be nominated by a sponsoring business and obtain a Subclass 482 visa before they can commence work in Australia. The Subclass 482 visa has three streams:

  • Short-term stream – allows employers to source skilled overseas workers in occupations on the Short-term Skilled Occupation List (STSOL) for a maximum of two years (or up to four years if the two year limitation would be inconsistent with an international trade obligation);
  • Medium-term stream – allows employers to source skilled overseas workers for occupations on the Medium and Long-term Strategic Skills List (MLTSSL) for up to four years; and
  • Labour Agreement stream – allows employers to source skilled overseas workers in accordance with a labour agreement with the Commonwealth, where there is a demonstrated need that cannot be met in the Australian labour market and standard visa programs are not available.

Changes to the Employer Nomination Scheme (Subclass 186) visa and the Regional Sponsored Migration Scheme (Subclass 187) visa will be implemented to complement the introduction of the Subclass 482 visa. The main changes will result in a tightening of eligibility for these visas by reference to criteria dealing with age, employment history, salary, English language, and eligible occupations.

Changes to eligibility requirements for the Temporary Residence Transition stream in the Subclass 186 and Subclass 187 visas will not apply to persons who held or had applied for a Subclass 457 visa when the changes were announced by the Government on 18 April 2017.

If you require further information or advice please contact the experienced team at Nevett Ford Lawyers.

457 News Update: New training levy (March 2018)

The existing Subclass 457 training benchmark requirements will cease in March 2018, with a new Skilling Australians Fund (SAF) levy to be paid instead at the time a Nomination is lodged for the new Temporary Skill Shortage (TSS) visa, as well as the subclass 186 and 187 visas.

Based on currently available information the amounts payable per applicant are set out as follows:

·         The charge will be calculated according to the number of years set out in the nomination.

·         A small business (annual turnover of less than $10 million) will pay $1,200 per nomination per year for a TSS visa.

·         A large business will pay $1,800 per nominee per year.

·         If the employee is applying for a 4 year TSS visa, this will require the 4 annual payments to be made at the time of application. If a large business nominates an employee for a 2 year TSS visa, the business must pay the annual amount for 2 years.

·         For permanent visas, the charge will be $5,000 per applicant for a large business, and $3,000 per applicant for a small business.

·         The maximum amount of the nomination training contribution charge is capped at $8,000 for nominations relating to a temporary visa, and $5,500 for nominations relating to permanent visas, for the financial year commencing 1 July 2017.

·         Nomination contribution charges to be made in later financial years will be indexed in line with CPI.

It is still unclear but it is likely that this fee cannot be passed on to the visa applicant.

For further information and advice please contact Nevett Ford Lawyers:

Telephone: + 61 3 9614 7111

Email: melbourne@nevettford.com.au

457 Visa Update – October 2017

As previously flagged in one of our earlier updates, the 457 visa program will transition to the Temporary Skills Shortage (TSS) Visa from March 2018.  It is expected that there will be ongoing changes to the requirements businesses need to meet in order to nominate visa holders. This update relates to some of the recent changes for businesses and 457 visa holders.

Changes to Market Salary Rate Requirements

The Department of Immigration & Border Protection (DIBP) has strengthened ‘market salary’ requirements, meaning employers will need to provide additional documentation to show they are paying their visa holders equivalent market salary rates to local workers.

In an initiative to prevent visa holders from being exploited where there is no Australian-equivalent employee, employers will need to:

§  Provide a written statement outlining how they have determined the pay for an equivalent Australian worker

§  Prepare references to the job outlook and prospects of the role in the Australian market.

This extra documentation is required in addition to the usual evidence requirements businesses must show to ensure Australian market salary rates have been met.

Labour Market Testing Evidence Arrangements

Businesses who have lodged a nomination application on or after 1 October 2017, will need to provide additional evidence to show they have adequately tested the local labour market.

The main changes for businesses are as follows:

§  A copy of relevant advertisements will need to be provided, including evidence of the duration of the advertising period;

§  Receipts for any advertising fees paid to be submitted at the time of application;

§  Advertisements also need to be nationally accessible, for example through a service such as SEEK, MyCareer, LinkedIn, Gumtree and alike;

§  The Domestic Recruitment Table will no longer be accepted by DIBP as a way of demonstrating that the Australian labour market has been tested.

 

When the 457 visa program transitions to the Temporary Skills Shortage (TSS) Visa in March 2018, businesses may need to meet additional labour market testing requirements. Further information is expected from DIBP in coming months.

The DIBP states that these changes aim to ensure overseas professionals are nominated for positions which demand skills and experience that are difficult to source locally.

Permanent Residence Prospects for Employees Currently on a 457 visa

We can confirm existing subclass 457 visa holders or applicants as at 18 April 2017 will continue to have access to an employer sponsored pathway to permanent residence, however the policies governing the transitional provisions are yet to be confirmed by DIBP. The DIBP has stated it hopes to advise of this before the end of the year.

Managing the 457 visa changes

To support businesses throughout the 457 changes, Nevett Ford Lawyers can advise your business on how to manage and prepare for the additional requirements to nominate visa holders.

Contact us today and speak to one of our team of immigration lawyers and registered migration agents for more information:

Telephone: +61 3 9614 7111

Email: Melbourne@nevettford.com.au

457 Visa - Training Benchmark changes

Changes continue to be rolled out by the Department of Immigration & Border Protection (DIBP).  A recent change relates to the training benchmarks that 457 business sponsors are obliged to meet - this article explains how the changes impact employers.

Benchmark A - Payments to a Training Fund

This involves paying 2% of payroll to an industry training fund. From July 2017 payments may be made to one of the following:

  • Industry training fund
  • Fund managed by recognised Industry Body
  • Scholarship fund operated by Australian TAFE or University.

The following types of expenditure are now not eligible:

  • Funds operated by RTOs or private individuals
  • Funds paying commissions or offering refunds if application fails

The main impact of this change is that the previous practice of private education providers accepting payments for Benchmark A will be discontinued.

Benchmark B - Expenditure on Training Australians in the Business

This involves spending 1% of payroll on training Australians in the business. From July 2017 payments may include:

  • Apprentices, trainees or recent graduates
  • RTO's delivering face-to-face training which contributes to formal qualification
  • e-Learning or training software
  • Formal courses of study + associated costs (e.g. travel)
  • Training officers - must be "sole role" of the employee (to train other employees in the business)
  • Attending conferences for Continuing Professional Development (CPD).

 

The following types of expenditure are now not eligible:

  • Salaries of staff attending training
  • Membership fees - this was previously counted
  • Books, journals or magazine subscriptions - this was previously counted
  • Conferences for purposes other than CPD
  • Hiring a booth at trade show, conference or expo On-the-job training - previously, structured on-the-job training could be counted in some circumstances
  • Training not relevant to business' industry - it is not clear how closely related the training must be to the industry
  • Training of principals or family members - previously, training of family members could be counted providing it was also made available to other employees
  • Induction training.

Based on current information, it appears that payment of external providers to deliver training for Australian employees, is excluded unless it leads to a formal qualification. This would form the bulk of the training expenditure of most businesses and so many will need to restructure their training to comply with the new Benchmark B. Once further clarity is available we will let you know.

What is also unclear at the moment is whether 457 business sponsors who have been calculating their training benchmark expenditure on the previous training benchmark provisions will be deemed to have satisfied the requirement. 

We are awaiting further clarification on these points from DIBP and will provide further updates once available.

Calculating 'Payroll'

As a general rule, payroll includes:

  • wages and salaries as per state payroll legislation, and
  • payments made to contractors or subcontractors if the work completed is related to services or products provided by sponsor

If the business does not have ‘a payroll’ they are expected to count Directors' salaries, fees and drawings, or the profit of the business.

Timing of Training Activities

Payroll and training expenditure must be for the same period.

From July 2017, it has been clarified that this expenditure may be for the 12 months prior to lodgement of an application, or for the previous full financial year - this should help employers to gather relevant information and documentation.

Start-up businesses operating for less than 12 months will be required to show they have an auditable plan to meet these benchmarks.

We will provide ongoing updates as information becomes available, including the training requirements from March 2018 when the new ‘Temporary Skills Shortage’ (TSS) visa commences (replacing the current 457 visa).
Whether you are an individual visa holder considering how these changes affect you personally or an employer wondering how these and the further proposed changes affect your ability to recruit globally please feel free to contact us at Nevett Ford to see how we are able to assist. 

Changes to the Subclass 457 Visa program

Temporary Skill Shortage Visa (TSS visa)

The Temporary Work (Skilled) (subclass 457) visa will be replaced with the completely new Temporary Skills Shortage (TSS) visa in March 2018.

Occupation lists

The occupation lists that underpin the 457 visa have been significantly condensed from 651 to 435 occupations, with 216 occupations removed and access to 59 other occupations restricted.

The Consolidated Sponsored Occupation List (CSOL) is renamed as Short-term Skilled Occupations List (STSOL) and will be updated every six months based on advice from the Department of Employment.
The other occupations list used for skilled migration, the Skilled Occupations List (SOL) is renamed as Medium and Long-term Strategic Skills List (MLTSSL).

Validity period

The maximum duration of 457 visas issued from this date for occupations that are on the STSOL will be two (2) years with an optional two-year extension allowed only once.
Occupations on the MLTSSL will continue to be issued for a maximum duration of four (4) years.

Residency

The two-year short-term visa program will offer no prospect of permanent residency. The four-year medium-term visa holders will be able to apply for permanent residency if certain preconditions are met.

English Requirements

The four-year visas will require a higher standard of English language skills; a minimum of IELTS 5 (or equivalent test) in each test component. English language exemption salary threshold, which exempted applicants whose salary was over $96,400 from the English language requirement, will be removed.

Training benchmarks

Policy settings about the training benchmark requirement will be made clearer in legislative instruments. Training requirement for employers to contribute towards training Australian workers will be strengthened. Please ensure that your clients keep meeting this obligation (training benchmark A or B) as this is expected to be more carefully monitored.

Character

Provision of penal (police) clearance certificates will become mandatory.

Work Experience

Two-years work experience will be required for both visas.

Other documentation

In the majority of cases, mandatory Labour Market Testing (LMT) will be required, unless an international obligation applies. Employers must pay the Australian market salary rate and meet the Temporary Skilled Migration Income Threshold (TSMIT) requirements. A non-discriminatory workforce test to ensure employers are not actively discriminating against Australian workers.

Application fees

$1150 AUD for two-year visa and $2400 AUD for four-year visas apply

Applications already lodged:

457 visa applicants that had lodged their application on or before 18 April 2017 with an occupation that has been removed from the STSOL, and whose application has not yet been decided, 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.

Please contact us for further clarity about how the changes may affect sponsorship, nomination and visa applications.