Changes to Skilled Work Visas

malcom turnbull 457

Yesterday, Prime Minister Malcolm Turnbull announced via his Facebook page that he would be abolishing the 457 visa (see video below).

This announcement is both alarming and confusing to many visa holders and potential visa applicants, as well as employers and the general public at large.

We understand you’ll want to know how these changes could affect you.

Firstly, if you’re one of the hundreds of thousands of skilled migrants already holding a work visa, don’t panic, your current visas won’t be affected – but, your ability to renew your 457 and/or apply for permanent residency via a 186 may be severely impacted.

If you’re not already a skilled visa holder or are thinking of applying for one in future, read on to find out how the changes will work and whether they will affect you.

Has the 457 been abolished/removed/eliminated?

The short answer is, not yet. While you can still apply for 457 visas for the moment, and in the immediate future (probably until March 2018 when it will be renamed the TSS visa), changes to the 457 visa subclass have already been implemented with immediate effect, with more significant changes yet to occur.

When will the changes occur?

The 457 visa will be replaced in March 2018, but some important changes have already taken place, effective today – 19 April 2017, with more critical changes to be rolled out on 1 July 2017.

The Department has now removed 200 jobs (click here to check if your occupation has been removed) and restricted access to 59 others (see important information about “Caveats” below).

If your occupation has been removed, even if you have already lodged your 457 visa application, you will need to relodge a new nomination with an alternative position or your nomination and/or primary 457 visa applications will be rejected.

If your position is subject to a Caveat, then you will need to review the new restrictions to make sure that the pending or potential nomination application can still be approved.

More changes to the list are set to occur every 6 months.

The other change that has immediate effect is the renaming of the Consolidated Sponsored Occupation List (CSOL) as the new Short-term Skilled Occupations List (STSOL). The shorter Skilled Occupations List (SOL) will be renamed the Medium and Long-term Strategic Skills List (MLTSSL) – and only 457 applications which specify a position on the shorter MLTSSL will be eligible for a 4 year visa. The maximum duration issued for occupations on the STSOL will be two years and will not lead to permanent residency via the transitional 186/187 stream.

This means that if you are qualified for a job on the CSOL (but not the shorter SOL) then your ability to apply for permanent residency via a 186, based on this skill, will disappear from March 2018 – once the 457 visa is abolished and replaced with the new Temporary Skill Shortage (TSS) visa.

On 1 July 2017 the ‘high income salary’ exemption to the English requirement will be removed and police checks will become mandatory.

What is the TSS visa?

At this stage it seems that the new TSS will be similarly designed to enable Australian businesses to fill skill gaps with foreign workers on a temporary basis, where a suitably skilled Australian worker cannot be sourced.

A minimum of 2 years’ work experience will be required for the TSS visa (currently, no work experience is required for the 457 visa if the applicant has the relevant qualifications). Police checks will also be required for all TSS applications.

Labour Market Testing will require all employers to prove they have advertised the position to be filled at least 2 weeks before applying, and that a local person is not available to fill the position (currently, Labour Market Testing is only necessary for 457 visas under certain occupations, such as trades, nursing or engineering).

There will be a short-term and long-term stream TSS:

Short-Term TSS

OCCUPATIONS: The former ‘CSOL’ (now ‘STSOL’) will apply to this visa subclass with additional farming occupations available to support regional employers.

RENEWAL: There will be a maximum duration of 2 years, with an option for only one renewal for a further 2 years. Unlike the current 457 visa, this stream will not lead to permanent residency 186/187 visa, either via the transitional or direct entry stream.

ENGLISH: The language requirement will remain the same (overall score of 5, with a minimum of 4.5 in each test component).

Medium-Term TSS

OCCUPATIONS: The former ‘SOL’ (now ‘MLTSSL’) will apply to this visa subclass with additional farming occupations available to support regional employers.

RENEWAL: Capacity for visa renewal onshore and a permanent residence pathway after three years.

ENGLISH: The language requirement will consist of a minimum score of 5 in each test component.

What about changes to the permanent skilled work visas?

Unlike 457 visa applicants, if you have already lodged your permanent visa application you will not be retrospectively impacted by the change in the occupation lists, which is great news. However, if you have not yet lodged, and still plan to apply for a sponsored 186/187 or independent 189 permanent visa from today onwards, you will only be able to apply if you have an occupation on the new lists referred to above.

More significant changes are set to occur on 1 July 2017, when they increase the English language requirement for all 186 visas (including the transitional stream) to a score of 6 in each band. They will also be reducing the age limit to 45 for direct entry 186 visas (the transitional stream will retain the 50 years maximum age limit).

Those applying after March 2018 will be required to have held their 457/TSS visas for 3 years to be eligible to apply for a 186 ENS visa under the transitional stream, rather than 2 years as is presently required. From this date onwards, applicants for both streams (direct/transitional) of the ENS 186 visa will need to be under 45 years of age.

Who will be affected the most?

The most burdensome restriction to be imposed, in our opinion, is set to occur in March 2018, when the Department intends to limit those applying for permanent skilled visas through the Employer Nomination Scheme (subclass 186) to occupations listed on the new MLTSSL (former SOL).

Up until March 2018, applicants should still be able to apply for permanent employer-sponsored visas by nominating any position on the much larger CSOL – rather than the far more limited SOL.

This new restriction could have severe ramifications for those 457 visa holders and potential 186 applicants who were hoping to apply for a 186 under a position listed on the CSOL (but not the SOL) and who cannot meet the requirements to apply before March 2018.

We therefore encourage anyone hoping to obtain permanent residency through a position listed on the former CSOL (now the SSTSOL), which does not appear on the former SOL (now MLTSSL), to get in touch so we can determine whether that migration path remains viable.

Potential 457 applicants who either wish to apply, or have already lodged an application, to fill a position which has been removed from the CSOL as of today, will now need to make alternative arrangements.

Those that are presently eligible to apply for either permanent residency or a 457 visa should do so without delay, especially in light of the proposed ongoing reduction of the skilled occupation list.

More Labour Market Testing could also mean that visa applications are unforeseeably and unavoidably delayed, meaning that employers urgently requiring a role to be filled, or an applicant attempting to renew a visa with an expiration date looming, could also be severely affected once those changes occur on 1 July 2017.

What are the Caveats that have been imposed on certain occupations and how do they affect me?

The attachment below labelled ‘Interim Guideline on caveats’ is a copy of the guidelines issued by the Department to Migration Agents which sets out the caveats that have been imposed on all pending applications effective as of today.

If you have been nominated for any of the following positions, it is important to review the attachment as it may be necessary to submit supplementary documents or lodge a new nomination specifying an alternative position which is not subject to any caveats: –

Cafe and Restaurant Managers;
Pastry Cooks;
Chief Executive or Managing Directors;
Corporate General Managers;
Corporate Services Managers;
Conference and Event Organisers;
Customer Service Managers;
Facilities Managers;
Transport Company Managers;
Supply and Distribution Managers;
Hair or Beauty Salon Managers;
Hotel or Motel Managers;
Management Consultants;
Recruitment Consultants;
Marketing Specialists;
Sales and Marketing Managers;
Technical Sales Representatives NEC;
Massage Therapists;
Animal Attendants and Trainers (NEC);
Mechanical Engineering Technicians.

A wrap up

In short, the new TSS visa looks to be more restrictive than the current 457 and may carry unfairly harsh consequences for skilled foreign workers.

The ominous intention to “ensure Australian workers are given the absolute first priority for jobs” is nationalistic political rhetoric more reminiscent of a ‘post-Brexit’/’President Trump’ foreign policy than our historically delicate approach to regulating migration – which typically involved sufficient warning and a transitional phase or ‘grace period’.

These unforeseen and unprecedented changes are a perfect example of why it is more important than ever to secure your permanent residency, or get on the most appropriate pathway, as soon as possible!

If you are a business or potential visa applicant, please contact us without delay to avoid the potential detriment caused by these new restrictions.

The next step

If you’re a business or individual affected by the abolition of the 457 visa, we’re here to help. We’ll do our best to ensure that you minimise the possible negative affects of these changes – but processes may need to be commenced right away.

Click the links below to download the Fact Sheets published by the Department of Immigration, and the Interim Guidelines regarding Caveats.

Changes to 457 Visa Fact Sheet

Changes to ENS 186 Visa Fact Sheet

Interim Guidelines on caveats