Month: February 2013

Potential Changes to the Subclass 457 Visa Program

The Department of Immigration and Citizenship (DIAC) has announced proposed amendments to the Temporary Work (Skilled) (Subclass 457) visa to be introduced on 1 July 2013. The proposed changes are intended to tighten the regulations in relation to the Subclass 457 visa program.

On its website, DIAC has stated that it is concerned that the Subclass 457 visa regime, which is intended to supplement the Australian workforce, is actually being misused and treated as a means for temporary visa holders (such as working holiday maker and student visa holders) to remain in Australia.

DIAC has also expressed concern that some employers are abusing the Subclass 457 visa program through non-compliance with employer obligations and dishonesty regarding the nominated occupations of overseas workers.

DIAC has stated on its website that the following measures are set to be introduced:

  • the introduction of a genuineness criterion under which DIAC may refuse a nomination if the position does not fit within the scope of the activities of the business;
  • an increase in market salary exemption threshold from $180 000 to $250 000 to ensure that higher paid salary workers are not able to be undercut through the employment of overseas labour at a cheaper rate;
  • the removal of English language exemptions for certain positions. Many long-term 457 workers go on to apply for permanent residence, and this change will ensure that the 457 program requirements are brought into line with the permanent Employer Sponsored program which requires a vocational English ability. Applicants who are nominated with a salary greater than $92,000 will continue to be exempted from the English language requirement;
  • enhanced regulatory powers for DIAC to ensure that the working conditions of sponsored visa holders meet Australian standards and that subclass 457 workers cannot be exploited or used to undercut local workers;
  • amendments to existing training benchmark provisions to clarify that an employer’s obligation to train Australians is ongoing and binding for the duration of their approved sponsorship, including for newly established business;
  • amendments to clarify that 457 workers may not be on-hired to an unrelated entity unless they are sponsored under a labour agreement; and
  • amendments which will allow DIAC to refund a visa application fee in circumstances where an employer nomination has been withdrawn.

There has been a suggestion in the media that labour market testing will be introduced into the Subclass 457 visa regime. However, the 457 program is said to be an important part of how Australia meets a number of international trade obligations. It is arguable that these obligations mean that Australia cannot limit access to its economy to people who wish to do business with Australia. Part of doing business with Australia will often involve sourcing skilled labour from other countries. It is important that Australia remains open for business people and service providers to hire overseas workers.

DIAC is yet to publish exactly what the legislative and policy changes for the Subclass 457 visa will entail. However, it seems inevitable that changes will be introduced to the Subclass 457 visa program on 1 July 2013.


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