From 457 visas to 482s: 25 more hurdles to jump?

Analysis

From 457 visas to 482s: 25 more hurdles to jump?

This month sees the controversial but widely-used 457 visa system for recruiting employees from overseas replaced with a new system – bringing with it higher fees for employers and more onerous conditions for approvals.

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What does the overhaul of the 457 visa system mean for employers? Higher fees and a higher degree of difficulty in meeting the new visa requirements.

This month sees the controversial but widely-used 457 visa system for recruiting employees from overseas replaced with a new system – bringing with it higher fees for employers and more onerous conditions for approvals.

457 visas were due to be phased out on 1 March 2018, but the latest advice from the Department of Home Affairs is that it will happen sometime later this month (March). The new visa will be called the Temporary Skills Shortage (TSS) Visa, with the catchy official title of sub-class 482.

The new TSS visas are the final stage of an overhaul of the work visa system that has been underway since April 2017, in response to claims that the 457 visa system was being misused to the detriment of Australian job-seekers.

What do TSS visas allow?


As with 457 visas, a TSS visa will allow an employee to work full-time in Australia for a sponsoring employer in the job specified in the visa application. Unlike 457s, there are now two options:
  1. Short-term visas, for employees in occupations on the Short-Term Skilled Occupations List. These operate for two years, and can be renewed once (for two more years).
  2. Longer-term visas for employees in occupations on the Medium and Long-Term Strategic Skills List. These operate for four years, with eligibility for permanent Australian residency after three years, or renewal of the TSS for a further four years.
If the job is not on one of the lists, the employer cannot obtain a TSS visa.

More stringent procedures


As noted above, the Department of Home Affairs has made eligibility requirements and the application and assessment procedures more stringent. The result for employers is higher costs, more time required to process applications, and the need for more thorough research and preparation by employers.

What steps do employers have to take?


Step 1:  You must first apply to be a Standard Business Sponsor. If you have previously sponsored employees under 457 visas, you already comply. Otherwise, you must provide the Department with various documents (such as an ABN and Business Activity Statements) and provide evidence that you comply with workplace legislation and have a “commitment to training Australian citizens and permanent residents”.

Step 2:  You must provide evidence of “labour market testing” that shows you are unable to fill the specified job with a local employee, e.g. evidence that you have extensively advertised the job in Australia during the previous 12 months. One criticism of the 457 system was that many employers made little attempt at “testing”, or advertised the job in ways to discourage local applicants, eg with a low salary, so it is likely that stronger evidence will now be required.

Step 3: Remuneration for the job must exceed either the Temporary Skilled Migration Income Threshold set by the Department (currently $53,900, plus superannuation) or another higher amount specified by it, and must be line with market rates for similar jobs.

Step 4: by the Department will assess your application, using new procedures which include police checks and an “English language proficiency” assessment (the latter does not apply to applicants from English-speaking countries such as USA, UK or New Zealand).

Changes to fees and other requirements


Application fees have increased considerably, mainly because employers now have to pay a Skilling Australians Fund (SAF) levy.

Businesses with an annual turnover of less than $10 million per year will pay $1200 per year for a TSS visa, and larger businesses will pay $1800 (=$7200 payable up-front for a four-year visa).

Other changes from the old 457 visa requirements are a reduced maximum age for applicants (now 45 years), more stringent minimum relevant job experience provisions, and you will need to provide a Tax File Number for each employee.

Note that the Department of Jobs and Small Business regularly revises the Occupations Lists, so you should check them regularly. The last revision occurred on 17 January 2018.

To enforce compliance, the Department will have increased “name and shame” (of employers) powers and the Australian Tax Office will have increased checking powers.

Too late to turn 457 employees into permanent ones


Once 457 visas are phased out, employers will no longer be able to apply to transition 457 visa employees into permanent ones when their visas expire.

This article first appeared on out sister site HR Advance.

 
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