IMPACT – MEDIUM

What is the change? New Zealand has finalised changes to its Essential Skills work visa programme that were proposed in April as part of the country’s ‘Kiwis first’ campaign.

What does the change mean? Effective 28 August, New Zealand will (1) introduce remuneration bands to align with new salary thresholds, (2) only allow lower skilled visa holders to remain in the country for a maximum of three years before they have to spend 12 months outside of New Zealand and (3) prohibit lower skilled visa holders from bringing family members as dependants.

  • Implementation time frame: The changes will be introduced 28 August 2017.
  • Visas/permits affected: Essential Skills work visas.
  • Who is affected: New Zealand employers, foreign nationals applying to work in New Zealand and their families. The changes will not be applied retrospectively to current visa holders.
  • Business impact: The measures are part of New Zealand’s broader goal of making businesses consider New Zealand nationals first for jobs and to train the local workforce for skills in demand by business.
  • Next steps: Additional information about the implementation of the policy changes is expected soon.

Background: The New Zealand Government announced the ‘Kiwis first’ campaign in April, saying it would change rules for obtaining residence through the skilled migrant category and proposing new rules for the Essential Skills work visa programme. The changes to the programme were finalised after a consultation period in which 170 submissions were received, according to Immigration Minister Michael Woodhouse.

Under the new rules, any visa applicant earning less than NZ$41,538 per year (85 percent of New Zealand’s median income) will be considered lower skilled. Applicants earning between NZ$41,538 and NZ$73,299 per year will be considered mid-skilled, provided they are in an occupation classified as ANZSCO Level 1-3. Applicants earning more than NZ$73,299 per year will automatically be considered higher skilled, no matter their occupation.

Lower skilled visa holders will only be permitted to remain in New Zealand for a maximum duration of three years before they must spend at least 12 months outside of New Zealand before they can be granted another Essential Skills visa to work in another lower skilled position. They will also not be permitted to bring family members as dependants, though family members will still have access to short-stay visitor visas and can apply for Essential Skills visas on their own if they qualify.

BAL Analysis: The changes are consistent with New Zealand’s move to a ‘Kiwi first’ immigration policy. One bit of welcome news for employers is that the NZ$41,538 cutoff for the lower skilled category is less than the NZ$48,859 cutoff that was initially proposed. Still, the changes could hinder businesses’ ability to recruit lower skilled workers on Essential Skills visas. They will also curb lower skilled workers’ abilities to remain in New Zealand and bring family members while they work in the country.