It has happened! On 18 March 2018, we said goodbye to the subclass 457 visa and hello to the Temporary Skill Shortage Visa (TSS).

Permanent employer sponsored visa legislation has also been amended.

Temporary Skill Shortage (TSS) Visa

The TSS visa is the subclass 457 visa with a new name. We have seen many changes to the 457 visa over the past 12 months and these continue into the TSS visa with some further revisions.

These include:

  • Sponsorship applications
    • No longer required to satisfy training benchmarks for the grant of sponsorship
    • Introduction of a simpler renewal process
    • Sponsorship is granted for five years in all cases (no shorter validity sponsorships for new business)
    • Expansion of the criteria for sponsorship accreditation
  • Nomination applications
    • There are now three occupation lists – the short-term list, the medium to long term list, and a regional Australia list
    • Labour Market Testing is mandatory for all applications, except where there is an international trade obligation. The legislation now specifies how, when and where advertising must take place. For example, you must advertise in two national publications, the advertisement must be in English and must state the salary for the position, and you must have advertised within the last six months.
  • Visa applications
    • Visa applicants must have a minimum of two years work experience
    • New visa conditions.

Transitional arrangements are in place for labour market testing criteria in circumstances where a business has advertised the positions before 18 March 2018. These transitional arrangements won’t be in place for long and we expect they will be removed by June 2018.

In addition to the legislative changes, there has also been some procedural changes. For example, you cannot apply to change a TSS visa holder’s nominated occupation by lodging only a nomination application, you must also lodge a visa application.

Permanent Employer Sponsored Visas

For the Employer Nomination Scheme (186) visa the changes relate mostly to which occupations are eligible to apply for permanent residence.

For the Direct Entry Stream, only applicants whose occupation is on the medium and long-term occupation list are eligible apply. This is the same for Temporary Residence Transition Steam for any person who applied for a 457/TSS visa after 18 April 2017 – their occupation must have been on the medium and long-term occupation list.

It is the Regional Sponsored Migration Scheme (187) visa that has been most impacted by the changes. The regional concessions that applied to this program have been removed and the only difference between this visa and the Employer Nomination Scheme visa is the list of occupations, and currently skills assessments are not mandatory for non-trade occupations. This however will change further in July 2018 when we expect the regional occupation list to be greatly reduced and mandatory skills assessments will be introduce.

Age exemptions are still available and the time has been reduced from four years holding a 457/TSS visa down to three years with a salary above the Fair Work High Income Threshold.

Transitional arrangements are in place for 457 visa holders who applied for, or were granted, a 457 visa before 18 April 2017. This cohort can apply for permanent residence regardless of what list their occupation is on.

Training Benchmarks and Skilling Australia Fund

The Skilling Australia Fund (SAF) is still before parliament and once approved, it will be applied to both the TSS and permanent employer sponsored visas. The SAF will impose a training levy on employers which must be paid at the time a nomination application is lodged.

In the meantime, a TSS visa can be obtained without satisfying training benchmarks and without paying the SAF fee.

While training benchmarks are no longer required for new TSS sponsorship, employers that are or have previously been approved as a Standard Business Sponsor, and/or have 457/TSS employees, must continue to satisfy their training obligations. This means, employers need to provide evidence with every permanent residence application, that it has satisfied its obligation to provide training to Australian workers.

Expansion of Adverse Information Definition

Employers have always had to declare whether there is any adverse information known about the business or a person associated with the business.

On all sponsorship and nomination applications, an employer must declare whether there is any adverse information. In answering this question, the Department of Home Affairs is concerned with adverse information in relation to: immigration, discrimination, industrial relations, occupation health and safety, and taxation.

The adverse information provision now extends to family members and associates of directors and office holders of a business. For example, it is possible the Department of Home Affairs will want these same questions answered by the spouse or partner of a company director or office holder.

The changes to the employer sponsorship legislation will impact employers in different ways. We encourage all employers that sponsor overseas workers to obtain advice about how these changes will impact their business, and how to best manage their individual visa program.