The new Minister for Immigration and Citizenship, Mr Brendan O’Connor, has announced a suite of proposed changes to the Subclass 457 visa program in response to Australia’s changing economic conditions.

While draft legislation is yet to be released, the following reforms have been foreshadowed:

  • An obligation on employers to demonstrate that they are not nominating positions where a genuine shortage does not exist – this may indicate a strengthening of the current requirement to show that the position is genuine;
  • Stricter English language requirements for certain positions in line with the English language thresholds for permanent employer sponsored visas such as the Subclass 186 Employer Nomination Scheme Visa – current indications are that the exemptions applying to certain professional positions will be removed, though applicants nominated with a salary of greater than AUD92,000 will continue to be exempt;
  • Improved enforceability of existing training requirements for employers that use the program and further strengthening of the current sponsorship obligations to ensure that the working conditions of 457 workers are in line with Australian standards;
  • Increase in the market salary exemption from $180 000 to $250 000 - currently, employers are not required to demonstrate that they are paying ‘market rate’ for positions offering $180,000 per annum or more;
  • On-hire arrangements of 457 visa workers to be restricted;
  • Strengthening of compliance and enforcement powers to deter employers who have routinely abused the system; and
  • Stakeholders will be consulted to ensure market rate provisions more effectively protect local employment.

The length and breadth of these changes remain unknown. It is expected, however, that these changes will come into effect on 1 July 2013 with further details to be released prior to this date.

The Department of Immigration and Citizenship has emphasised that the reforms will not adversely affect the vast majority of employers who are using the program appropriately. Nevertheless, it is clear that employers will be expected to meet greater evidentiary benchmarks in order to sponsor overseas worker in future.