TSS Visa Regulations Take Effect 18 March 2018

Executive Summary

The Australian Government has published regulations to overhaul key employer sponsored visa programmes. The Temporary Skill Shortage (TSS) visa (subclass 482) will replace the subclass 457 visa with effect from 18 March 2018.

TSS visa applicants will need to satisfy new criteria, including criteria related to:

  • Genuine temporary entrant requirement
  • 2 years relevant work experience
  • Higher level of English language skills
  • Character checks and police clearances

Employers must also meet mandatory labour market testing and other requirements including non-discriminatory workforce test requirements and salary minimums above the Annual Market Salary Rate.

Related changes to the Employer Nomination Scheme (ENS) visa (subclass186), and the Regional Sponsored Migration Scheme (RSMS) visa (subclass 187) have also been implemented, with transitional arrangements available for certain existing 457 visa holders. There will be exemptions from certain requirements where international trade obligations apply.

About the TSS Visa Changes

The TSS visa will have three streams: short-term, valid for up to two years (or up to four years if the two-year limitation would be inconsistent with an international trade obligation); medium-term, valid for up to four years; and the labour-agreement stream, which will allow employers to sponsor foreign workers for a visa pursuant to a labour agreement with the Australian Government.

Visa Criteria to be Met

To be eligible for TSS visas, applicants will have to satisfy the following criteria:

  • Work experience: The primary applicant must have at least two years of relevant work experience in addition to the ANZSCO requirements.
  • English language testing: Applicants in the short-term stream will require an International Language Testing score (or the equivalent) of 5 overall, with a minimum score of 4.5 in each test component. Applicants in the medium-term stream will require a score of 5 overall, with a minimum score of 5 in each component.
  • Genuine Temporary Entrant: Applicants will be required to meet a ‘Genuine Temporary Entrant’ requirement in order to undertake temporary and not to maintain ongoing residency in Australia.
  • Minimum salary: Applicants must be paid at least the required salary under the annual market salary rate (AMSR) and meet the Temporary Skilled Migration Income Threshold.
  • Police clearance: Applicants will be required to provide police clearance certificates where applicable.
  • Health Criteria: Applicants will be required to meet the health criteria of the visa, employers can no longer meet the criteria by way of a health undertaking.

Key Impacts for Business

Sponsors may be subject to non-discriminatory workforce tests to ensure employers are not discriminating against Australian workers. The Department of Immigration previously clarified that the tests will not be conducted for all TSS applicants, however further tests can be expected in cases where a company’s workforce does not match the industry norm, for example, in situations where sponsored workers are far greater than the number of Australian workers.

Labour Market Testing will be mandatory for TSS visa applications. Nomination applications lodged on or after 18 March 2018 and before 18 June 2018 must have met labour market testing requirements in the 12 month period immediately before the nomination is lodged. Nomination applications lodged on or after 18 June 2018 must meet the requirement within the 6 months before the nomination is lodged.

International trade obligations may provide relief from some of the new TSS visa requirements. For example, a business may be eligible to nominate a worker in the Short-term stream for a four year visa if the nominated employee is from a World Trade Organisation (WTO) Member country or is a citizen of a country with whom Australia has an international treaty obligation.

TSS Government Charges have been set as follows:

Standard Business Sponsorship $540
TSS Nomination $330
TSS Visa Short Term (2 year) Stream $1150
TSS Visa Medium Term (4 year) Stream $2400

 

Businesses will also need to budget for the pending implementation of a new skills levy that will fund programmes to train Australian workers. Legislation relating to the levy is yet to be finalised. Training Benchmark obligations will continue to apply to existing sponsors, however new sponsors will not be required to demonstrate compliance with training benchmarks until the levy is introduced.

Transferring 457 Visa Holders

A visa holder who transitions from a 457 to a TSS visa will be eligible to apply for a TSS onshore with a limit of 2 TSS visa applications made from within Australia. 457 visa holders may transfer employment to a new sponsor by lodging a TSS nomination. However, in case of a change in occupation a new TSS visa will also be required.

Key changes: ENS and RSMS visa programmes.

New regulations also make changes to the Employer Nomination Scheme (ENS) (subclass 186) and the Regional Sponsored Migration Scheme (RSMS) (subclass 187) programmes.

ENS and RSMS applicants will have to satisfy the following criteria:

  • Occupation lists: The nominee’s job must be on the Medium and Long-term Strategic Skills List (MLTSSL) unless the employer is in a regional area (for which more occupations will be available).
  • Minimum salaries: Employers must pay the nominee the annual market salary rate (AMSR) and meet the Temporary Skilled Migration Income Threshold.
  • Residency period: Workers under the Temporary Residence Transition stream will become eligible for permanent residency after three years (instead of the current two years).
  • Work experience: The employee must demonstrate at least three years of work experience relevant to the particular occupation. This does not substitute for the required work experience required by ANZSCO for the nominated occupation.
  • Age limit: All applicants must be below the maximum age of 45 at the time of application (instead of the current maximum age of 50). Authorities have yet to confirm whether certain exemptions will continue to exist.

Nominees who held a 457 visa, or whose 457 visa application was pending at 18 April 2017 may be eligible for transitional arrangements to permanent residence under the Temporary Residence Transition Stream.

Employers in both subclasses will also be required to contribute to the Skilling Australians Fund once it is implemented.

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