Knowledge

11 May 2018

Recent changes to Regional Sponsored Migration Scheme

As part of their transition to the new Temporary Skills Shortage (‘TSS’) visa announced in April 2017, the Government has been progressively rolling out changes to the existing visa schemes.  The first quarter of this year has seen significant changes to the existing visas, and finally, the introduction of the TSS visa to replace the 457 visa.

Part of these changes has been a tightening of eligibility for the Regional Sponsored Migration Scheme (‘RSMS’).  The most recent changes directly affect the ability of Far North Queensland businesses to sponsor employees from overseas under the RSMS.  Given that these changes have now come into effect we thought we would highlight the most significant ones.

Occupation Lists

The eligible occupations for the RSMS will now need to be on either the Medium and Long Term Strategic Skills List or the Regional Occupations List.  The changes in March have not reduced the list in terms of number of eligible occupations, however it remains to be seen if that will continue into the future. The Regional Occupations List is only an interim list and is likely to be revised in July of this year.

Skilling Australia Fund Levy

In addition to changing the available occupations, businesses that wish to sponsor an employee under the RSMS will now be obliged to contribute to the Skilling Australia Fund Levy.

This levy is a one off payment for each employee sponsored. For small businesses it is $3,000 whilst all other businesses must contribute $5,000. A small business is defined as any business with an annual turnover of less than ten million dollars. The levy payment is payable at the time the application to sponsor an employee is made.

Minimum work experience and maximum age requirements

There is a new minimum work experience requirement for workers applying to the RSMS. Workers who wish to obtain a permanent residence visa must be able to show that they have a minimum of 3 years experience relevant to the occupation they are applying for.  This means that businesses are unlikely to be able to sponsor graduates or other students as they previously did.  Further reducing eligibility is the reduction of the maximum age for applicants down to 45 from 50.  Combined, these two factors are likely to cause a significant drop in the number eligible persons.

Minimum and market salary requirements

The last major changes introduced in this wave are the new minimum annual wage requirements.  There are now two measures which help to prescribe the amount that sponsors must pay to sponsored employees.

The first of these is the annual market salary requirement. When making an application to sponsor an employee, the sponsor must prove to the Immigration Department what the annual market salary is for the occupation they are hiring.  To achieve this there are a number of guidelines available but unless there is no available market data, it will simply involve analysing what other people in the same or similar position are paid.

The second requirement is that the salary paid to the employee must be equal to, or greater than, the Temporary Skilled Migration Income Threshold. Upon commencement, this value will be $53,900  exclusive of any non-monetary benefits and is subject to annual review.

Conclusions

On top of the above changes, there remain in place a number of transitional arrangement for people still on 457 visas. The transitional arrangements however are subject to critical cut off dates based mostly on individual circumstances. Given this, and the ongoing rollout of the changes, we recommend that if you have any doubt whatsoever you should contact your legal advisor immediately.

For more information, please contact us.

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