Prime Minister Malcom Turnbull has announced that the Temporary Work (Skilled) visa (subclass 457) will be abolished and replaced with the completely new Temporary Skill Shortage (TSS) visa in March 2018. But how does this effect you as an employer? Below is everything you need to know about the announced changes.

What was the 457 visa?

This was a visa for foreign workers, which allowed skilled workers to travel to Australia to work in their nominated occupation with an approved sponsor for up to four years. An Australian business was only able to sponsor a foreign worker after proving that they were unable to find a suitable Australian worker to fill the role.

How do the new visas differ to the 457 visa?

The changes are set to completely abolish the current 457 visa system and replace it with two new visa programs; one two-year visa and one four-year visa, called the Temporary Skill Shortage Visa. The key amendments include:

  • 650 jobs are currently available for 457 holders, the changes include a new, more targeted occupation list that reduces this number by 200. The list of eligible occupations can be found here
  • The new visa classes will have higher requirements including
    • “a higher standard of English”;
    • “a proper police record, a criminal check”;
    • a two-year work experience requirement; and
    • “mandatory labour market testing”.
  • A minimum market salary rate will be introduced which ensures that overseas workers cannot be engaged to undercut Australian workers.
  • The cost of sponsoring a foreign worker has risen to $2400 for four-year visa holders and $1150 for two-year visa holders.
  • Holders of the new visas will not be able to apply for permanent residency as easily as 457 holders were. Permanent residency will only be possible after employment within Australia has been held for 3 years.
  • Employers will undergo a non-discriminatory workforce test to ensure they are not actively discriminating against Australian workers.
  • Whilst these changes are not set to begin until March 2018, significant condensing of the occupation lists used for skilled migration visas, including the subclass 457 visa, will occur from 19 April 2017.
  • Concessions for regional Australia will continue to be available.

How does this effect my current employees working on 457 Visas?

Current workers employed under the 457 visa are protected from the changes and will remain under the conditions of their current visas.

Further information on these changes can be found here.

Author: wattsnext Group
The wattsnext Group blog is a compilation of ideas and expertise from the entire team, past and present with a few added gems from guest authors from time to time. With this collaborative approach, we can provide you with a broader perspective and high-level expertise across the small business landscape.