Facts should mean more than speculation in 457 visa review

Wednesday, March 19, 2014
Blog by Philip Duncan, Registered Migration Agent (MARN) 0427769 and Director at AMVL Migrations.

Changes to the 457 system rarely happen without comment, and the recently proposed review of 457s is bound to generate a lot from the interested parties. Debate over the 457 visa between unions, the government and business has often obscured the facts and rational debate is often lost amongst the noise.

Even minor recent changes have provoked significant opposition. On February 14 this year the government removed enforcement of caps on the number of overseas workers that could be sponsored under a standard business sponsorship. This change provoked opposition from unions who labeled the change as “reopening a rort for employers” who could abuse the system by sponsoring unlimited number of overseas workers. 

In reality, recruiting, employing and sponsoring foreign workers is not an easy process for employers. There is a three-stage process of sponsorship approval, nomination of position approval and visa application approval, each with significant cost – none of which an employer would voluntarily spend time  and money on if an Australian worker was available and willing to do the job. In the vast majority of cases, companies are hiring foreign workers because they need their skills, essential skills that they were unable to source here in Australia.

President of the Migration Institute of Australia (MIA), Angela Chan FMIA last week put the 457 visa debate in to perspective when she told SBS that “as of January this year, there were some 12 million workers in Australia. The 457 program last year attracted around one per cent of the entire work force”. 

The union perspective is that there is a fixed number of jobs in the economy, and every job occupied by a foreigner is a job an Australian doesn’t have. But the economy doesn't work that way. Profitable businesses can create jobs, but a restaurant without a chef employs no-one. A broken down truck without a mechanic goes nowhere. A boat without a crew catches nothing. Overseas workers contribute to wealth and prosperity where the process is properly managed, and that’s what the discussion should be about.

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Student visa changes will continue

Thursday, March 13, 2014
Blog by Philip Duncan, Registered Migration Agent (MARN) 0427769 and Director at AMVL Migrations.

The numbers of students coming to Australia are back on the rise, after the slump induced by previous visa processing changes and poor exchange rates.

Overall, total student visa grants increased by 11.5per cent in the December quarter. Total student visa lodgements increased by 13.5per cent with offshore student visa lodgements increasing by 20 percent. Higher Education visas accounted for more than half of those lodgements, as you’d expect – these are the visas which currently benefit from streamlined visa processing (SVP).

At the beginning of 2014 there were more than a quarter of a million international student visa holders in Australia. About a third of these were from China or India.

Student visa changes announced on 29 October 2013 were intended to further improve the situation by extending streamlined visa processing to a broader range of education providers, and reducing ‘assessment levels’ to three, as well as reducing financial evidence for assessment level 3 (AL3) students from 18 to 12 months—provided funds are from a close relative of the student visa applicant.

If these proposed changes pass through the legislative process, many students will be able to apply for a student visa with less money in the bank. Simplifying the assessment level framework should further benefit students from countries such as China and India and should also assist vocational education and training students.

Changing courses
Many students who entered Australia under streamlined visa processing (SVP) arrangements, and changed to a non-streamlined education provider were recently shocked to receive a letter from Immigration threatening to cancel their student visa. After a strong response from teaching institutions and students, Immigration were forced to back down on their threat for students who had already changed course before Immigration announced their so called ‘education campaign’ (on January 14th).

Immigration continue to consider such a change of provider (from SVP institutions to non-SVP institutions) a breach of visa condition, so consider your position carefully and get some advice before making such a change.

More broadly if you have not completed six months of the highest qualification course in which your visa was granted, you need a release letter before you can change your education provider.  If you are refused a release letter you should be able to access an internal appeal process with your education provider.

For further information or assistance with an Australia visa, contact Philip Duncan and our team of Registered Migration Agents at AMVL Migrations.

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457 visa changes for employers

Tuesday, July 09, 2013
Blog by Philip Duncan, Registered Migration Agent (MARN) 0427769 and Director at AMVL Migrations.

Continuing a strong tradition of ongoing change in visa regulations, 1 July saw many significant changes to the 457 program. This bulletin is general advice to describe the most important changes in plain English. 

Initially portrayed as ‘housekeeping’ amendments, the recent changes impose new administrative and cost burdens on businesses who wish to sponsor temporary skilled labour. Businesses will need to plan, and be more disciplined about record keeping to minimize the impact of these changes.

The minimum income threshold for sponsoring on a 457 has increased 4.8% to $53,900m from $51,400. This change is retrospective, and will affect all nominations currently lodged but not decided. Importantly, this is not simply a minimum salary level for 457 holders. What a 457 applicant is paid must also be a market salary – the same terms and conditions as you would pay an Australian to do that job. It’s important to understand how you justify the market salary for a particular position, and make sure you understand whether 457 holders are being paid correctly.

Application and other fees have increased, with application fees now $900 (up from $455) and nomination fees up to $330 (from $85). There are also new fees for each dependant, and extra fees where a second temporary visa application is made onshore.

At the same time, the government has strengthened provisions to ensure that DIAC charges are paid by the sponsor, rather than the applicant. These changes mean that (particularly for families), 457 application fees are now much closer to permanent residency fees, so options for putting people straight to PR should be considered.

As discussed extensively in the media, new requirements for labour market testing have been introduced, which will require businesses to advertise positions before they can be filled by a 457 holder. These changes have not come into effect yet, but will be implemented by the end of the year, if not sooner. Business will need to record their job advertising and their basis for rejecting candidates.

In the past, sponsors had to show they met the training threshold, by spending 1% of total payroll training Australians, in the 12 months before being approved as sponsors. Alternatively, they can contribute 2% to an industry training fund. They also undertook to continue to meet the threshold while they remain a sponsor. This commitment has now been upgraded to an enforceable obligation.  Employers should make sure they are tracking all training expenditure that might count towards to the threshold, to be able to answer any enquiries from DIAC.

English testing has been expanded to all occupations (rather than just trades). That will probably delay applications as applicants book and undertake their tests, so you should take that timeframe into account as part of your planning. This change will also be retrospectively applied to applications lodged but not yet decided.

A new ‘genuineness’ test has been introduced, to ensure that the position associated with the nominated occupation is genuinely required to address skills shortages in Australia. The difficulty with this subjective provision will be applying it properly. Addressing this requirement will probably mean more paperwork is required at the nomination stage.

Sponsors will now need to justify the number of nominations permitted for each sponsorship granted after 1 July. This is a return to the previous system, where there were a limited number of ‘slots’ available under each sponsorship. Start-up businesses will have their sponsorship limited to 12 months and all subclass 457 visa holders sponsored by start-up businesses are limited to an initial 12 month visa. Businesses will need to be able to track their 457 usage accurately to know how many available positions they have at any particular time.

One change which had broad support has been to extend the time period for Subclass 457 holders to find a new sponsor or to depart Australia, if they cease employment with their sponsoring employer. This period of grace is now 90 days, up from 28.

The changes mean that businesses sponsoring skilled people on 457s will need to keep better records for their sponsored staff, and for training for all staff. They will want to plan recruitment better, and also consider whether, in the circumstances, it is better to put someone on a permanent visa. Good planning and record keeping will help minimize the impact of these significant changes. New legislation permits Fair Work Australia inspectors to monitor compliance for 457 visa holders, and good record keeping will minimise your compliance burden.

This bulletin is intended to describe the most important changes in plain English. It is general advice, and does not take into account specific circumstances. 

To discuss how this might affect your business, please contact a member of our team at AMVL Migrations.

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