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Migration Amendment (Skilling Australians Fund) Bill 2018

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2016 - 2017 - 2018 

 

 

 

 

 

THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA

 

 

 

 

SENATE

 

 

 

 

MIGRATION AMENDMENT (SKILLING AUSTRALIANS FUND) BILL 2018

 

 

 

 

REVISED EXPLANATORY MEMORANDUM

 

 

 

 

 

 

 

 

 

THIS EXPLANATORY MEMORANDUM TAKES ACCOUNT OF THE AMENDMENTS MADE BY THE HOUSE OF REPRESENTATIVES TO THE BILL AS INTRODUCED

 

 

 

 

 

 

 

 

(Circulated by authority of the Minister for Home Affairs and Minister for Immigration and Border Protection, the Hon. Peter Dutton MP)

 

MIGRATION AMENDMENT (SKILLING AUSTRALIANS FUND) BILL 2017

 

OUTLINE

 

The Migration Amendment (Skilling Australians Fund) Bill 2017 (the Bill) amends the Migration Act 1958 (the Migration Act) to:

 

·          require employers who nominate a worker under the temporary and permanent skilled migration programmes to pay the nomination training contribution charge imposed by the Migration (Skilling Australians Fund) Charges Act 2017 (the Charges Act).  The nomination training contribution charge will offset expenditure from the Skilling Australians Fund, a training fund administered by the Department of Education and Training, to support skills development of Australians;

 

·          allow nominations to be accepted from persons that have applied to be an approved sponsor, or have entered into negotiations for a work agreement; and

 

·          allow the Minister to determine, by legislative instrument, the manner in which labour market testing in relation to a nominated position must be undertaken, and the kinds of evidence that must accompany a nomination.

 

This Bill is to be read in conjunction with the Migration (Skilling Australians Fund) Charges Bill 2017.

 

FINANCIAL IMPACT STATEMENT

 

The training contribution charge is expected to generate revenue of $1.2b over the forward estimates.  Expected expenditure from the Skilling Australians Fund over the forward estimates is $1.47b.

 

STATEMENT OF COMPATIBILITY WITH HUMAN RIGHTS

A statement of compatibility with human rights has been prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011 and is at Attachment A .

 

 

REGULATION IMPACT STATEMENT

 

A regulation impact statement has been prepared and is at Attachment B .

 



 

MIGRATION AMENDMENT (SKILLING AUSTRALIANS FUND) BILL 2017

 

 

NOTES ON INDIVIDUAL CLAUSES

 

Clause 1          Short Title

 

1.                   The short title by which this Act may be cited is the Migration Amendment (Skilling Australians Fund) Act 2017.

 

Clause 2         Commencement

 

2.                   Subsection 2(1) sets out when the provisions of the Act commence.

3.                   Sections 1 to 3 of the Act will commence the day the Act receives the Royal Assent.

4.                   The amendments in Schedule 1 to the Act will commence on a single day to be fixed by Proclamation, unless the provisions do not commence within 6 months of Royal Assent, in which case they commence on the day after the end of that 6 month period.

5.                   The amendments in Part 1 of Schedule 2 to the Act will commence at the same time as Schedule 1, but only if Schedule 1 to the Migration Amendment (Family Violence and Other Measures) Act 2017 commences at or before commencement of Schedule 1 to this Act.  Otherwise, these amendments will not commence at all.

6.                   The amendments in Part 2 of Schedule 2 to the Act will commence at the same time as Schedule 1, but only if Schedule 1 to the Migration Amendment (Family Violence and Other Measures) Act 2017 does not commence on or before commencement of Schedule 1 to this Act.  Otherwise, these amendments will not commence at all.

7.                   The amendments in Part 3 of Schedule 2 to the Act will commence at the same time as Schedule 1 to this Act.

8.                   Subsection 2(2) provides that any information in column 3 of the table is not part of this Act.  Information may be inserted in this column, or information in it may be edited, in any published version of this Act.

 

 

 

 

Clause 3          Schedule(s)

 

9.                   This clause provides that each Act specified in a Schedule to this Act is amended or repealed as set out in the applicable items in the Schedule concerned.  In addition, any other item in a Schedule to this Act has effect according to its terms.

 



SCHEDULE 1 - Nomination training contribution charges

 

Part 1 - Main amendments

 

Migration Act 1958

 

Item 1             Subsection 5(1)

 

10.               This item inserts the new defined terms Finance Minister and nomination training contribution charge.

 

11.               The term Finance Minister means the Minister who administers the Public Governance, Performance and Accountability Act 2013.

 

12.               The term nomination training contribution charge means the charge imposed by section 7 of the Migration (Skilling Australians Fund) Charges Act 2017.

 

Item 2                         Paragraph 140GB(2)(a)       

13.               This item is consequential to item 1 or 19 of Schedule 2 to this Act (whichever commences).  It amends paragraph 140GB(2)(a) to replace ‘sponsor’ with ‘person’. 

Item 3                         Subsection 140GB(2)            (note)

14.               This item is consequential to item 4 of this Schedule.  It replaces ‘Note’ at the end of subsection 140GB(2) with ‘Note 1’.

Item 4             At the end of subsection 140GB(2)             

15.               This item inserts new Note 2 at the end of subsection 140GB(2). Note 2 refers readers to new section 140ZM, which sets out when a person is liable to pay a nomination training contribution charge.

Item 5                         Paragraphs 140GBA(1)(b) and (c) 

16.               This item is consequential to item 1 or 19 of Schedule 2 to this Act (whichever commences).  It amends paragraphs 140GBA(1)(b) and (c) to replace ‘sponsor’ with ‘person’.

Item 6                         Subsection 140GBB(1)                     

17.               This item is consequential to item 1 or 19 of Schedule 2 to this Act (whichever commences).  It amends subsection 140GBB(1) to replace ‘the sponsor’ with ‘the person’. 

Item 7                         Subsection 140GBB(2)                     

18.               This item is consequential to item 1 or 19 of Schedule 2 to this Act (whichever commences).  It amends subsection 140GBB(2) to replace ‘sponsor’ with ‘person’. 

Item 8                         Subparagraphs 140GBB(4)(a)(i) and (ii)               

19.               This item is consequential to item 1 or 19 of Schedule 2 to this Act (whichever commences).  It amends subparagraphs 140GBB(4)(a)(i) and (ii) to replace ‘sponsor’ with ‘person’. 

Item 9             Paragraph 140GBB(4)(b)                

20.               This item is consequential to item 1 or 19 of Schedule 2 to this Act (whichever commences).  It amends paragraph 140GBB(4)(b) to replace ‘sponsor’ with ‘person’. 

Item 10                       Paragraph 140GBB(4)(b)                

21.               This item is consequential to item 1 or 19 of Schedule 2 to this Act (whichever commences).  It amends paragraph 140GBB(4)(b) to replace ‘sponsors’ with ‘persons’. 

Item 11                       At the end of Division 3A of Part 2

22.               This item inserts new section 140ZL to bind the Crown in respect of Division 3A of Part 2 of the Migration Act.  This recognises that an Act is presumed not to bind the Crown, in any of its capacities, in the absence of express words or necessary implication.

23.               New subsection 140ZL(1) expressly provides that Division 3A of Part 2 of the Migration Act binds the Crown in right of the Commonwealth, of each of the States, of the Australian Capital Territory and of the Northern Territory.  The effect of this is that the Commonwealth, States and Territories will be bound by the provisions in Division 3A, subject to new subsection 140ZL(2).

24.               New subsection 140ZL(2) makes it clear that the Crown is not liable to be prosecuted for an offence.  The effect of this is that the Crown cannot be prosecuted for an offence under Division 3A of Part 2 of the Migration Act.

25.               New subsection 140ZL(3) puts it beyond doubt that new subsection 140ZL(2) does not prevent the Crown being liable to pay a pecuniary penalty under Division 3A of Part 2 of the Migration Act.  This means that the Crown may be liable to pay financial penalties as required or permitted by Division 3A.

Item 12                       After Division 3A of Part 2             

26.               This item inserts new Division 3B after Division 3A of Part 2 of the Migration Act.

New section 140ZM - Nomination training contribution charge

27.               New section 140ZM sets out when a person is liable to pay a nomination training contribution charge under section 140GB.

28.               New subsection 140ZM(1) provides that a person who nominates an applicant or proposed applicant for a visa under amended section 140GB is liable to pay a nomination training contribution charge if the nomination is a nomination of a kind prescribed by the regulations. 

29.               The effect of this amendment is that a person who nominates an applicant or proposed applicant for a prescribed visa under section 140GB will be liable to pay a nomination training contribution charge in association with the nomination.  New paragraph 140GB(2)(ab) makes it a condition of approval of the nomination that the nominator is an approved sponsor. However a person does not need to be an approved sponsor at the time of making a nomination application under amended subsection 140GB(1).  It is possible that a person’s application to be an approved sponsor may be subsequently refused (and the nomination application is refused as a consequence).  Provision may be made for the remission or refund of a nomination training contribution charge pursuant to n ew paragraph 140ZN(1)(c) (see new section 140ZN below).

30.               New subsection 140ZM(2) provides that a person is liable to pay a nomination training contribution charge if they have applied under the regulations, or in accordance with the terms of a work agreement, for approval of a nomination of a prescribed kind in relation to a holder of, or an applicant or proposed applicant for a visa of a prescribed kind.  This is intended to enable the nomination training contribution charge to be imposed on nominations other than those made under section 140GB of the Migration Act.  For example, if the regulations prescribe a Subclass 186 visa for the purposes of paragraph 140ZM(2)(a) and prescribe a nomination relating to a Subclass 186 (Employer Nomination Scheme) visa for the purposes of paragraph 140ZM(2)(b), then a person applying for approval of a nomination of a position in relation to the holder of Subclass 186 visa will be liable to pay the nomination training contribution charge .

New section 140ZN - Regulations about nomination training contribution charge

31.               New subsection 140ZN(1) allows the regulations to make provision for, or in relation to various matters.

32.               New paragraph 140ZN(1)(a) allows the regulations to make provision for, or in relation to, when a nomination training contribution charge is due and payable.  For example, the regulations may prescribe that a nomination training contribution charge is payable at the time an application for approval of a nomination is lodged.

33.               New paragraph 140ZN(1)(b) allows the regulations to make provision for, or in relation to the method of paying a nomination training contribution charge , including the currency in which the charge must be paid.  This allows the regulations to prescribe, for example, that a nomination training contribution charge must be paid in Australian Dollars.

34.               New paragraph 140ZN(1)(c) allows the regulations to make provision for, or in relation to the remission or refund of a nomination training contribution charge .  For example, if a nomination training contribution charge is paid in relation to a nomination that is subsequently refused because the associated sponsorship application is refused, new paragraph 140ZN(1)(c) allows the regulations to permit a refund of the charge.  This paragraph also allows the regulations, for example, to permit a refund or partial refund of the nomination training contribution charge in circumstances where the actual period of stay of a nominated visa applicant is significantly less than the anticipated period set out in the nomination.

35.               New paragraph 140ZN(1)(d) allows the regulations to make provision for, or in relation to the overpayment or underpayment of a nomination training contribution charge .  For example, to deal with cases where an applicant makes a payment of the nomination training contribution charge but the amount paid is less than the amount required because the applicant has understated their business’ turnover, the regulations may allow the applicant to pay the difference with a subsequent payment.  Also, for example, to deal with cases where an applicant makes a payment of an amount that is greater than what is required, the regulations may allow for the surplus amount to be paid back to the applicant.

36.               New paragraph 140ZN(1)(e) allows the regulations to make provision for, or in relation to the payment of a penalty in relation to the underpayment of a nomination training contribution charge . For example, where an applicant makes a payment of the nomination training contribution charge but the amount paid is less than the amount required because the applicant has understated their business’ turnover and the regulations allow the applicant to pay the difference with a subsequent payment (pursuant to the power in new paragraph 140ZN(1)(d)), the regulations may also require the payment of a penalty in relation the administration of the underpayment.  The penalty may, for example, be a prescribed fee that reflects the cost to the Department of Home Affairs (the Department) of administering multiple payments.  The penalty may, for example, take the form of an interest payment to reflect the loss of interest revenue resulting from the underpayment.  Such a penalty constitutes a debt due to the Commonwealth (see new section 140ZO below).  A penalty prescribed for the purpose of new paragraph 140ZN(1)(e) must not exceed the upper limit set out in new subsection 140ZN(2).

37.               New paragraph 140ZN(1)(f) allows the regulations to make provision for, or in relation to the giving of information and keeping of records relating to a person’s liability to pay a nomination training contribution charge .  For example, if regulations for the purpose of paragraph 8(2)(b) of the Migration (Skilling Australians Fund) Charges Act 2017 prescribed different charges for different kinds of persons, new paragraph 140ZN(1)(f) would allow the regulations to require a person to provide evidence that they are a particular kind of person, and therefore liable for the applicable nomination training contribution charge .

38.               New subsection 140ZN(2) provides that the penalty for the purpose of paragraph 140ZN(1)(e) must be a civil penalty, and must not exceed 60 penalty units.  This amount is consistent with the existing civil penalty in section 140Q of the Migration Act, which imposes a civil penalty of 60 penalty units if a person fails to satisfy a sponsorship obligation prescribed by the regulations or specified in a work agreement.

39.               It is anticipated that only sponsors who have an annual turnover of $10 million or higher will be affected by any penalty prescribed for the purpose of new paragraph 140ZN(1)(e).  This is because the intention is that the nomination training contribution charge will have two tiers - an amount for sponsors who self-identify as a small business (annual turnover of less than $10 million per annum) and a second (higher) amount for sponsors with an annual turnover of $10 million per annum or higher.  As payment of the nomination training contribution charge is required in full at the time the sponsor lodges an application for nomination of an overseas skilled worker, sponsors with an annual turnover of less than $10 million per annum could not underpay the nomination training contribution charge .   However sponsors who have an annual turnover of $10 million or higher per annum may claim to be a small business, and pay the lower amount of the nomination training contribution charge, when in fact they are not a small business.

40.               Currently, section 4AA of the Crimes Act 1914 defines a penalty unit as the amount of $210.  At this rate, the maximum penalty of 60 penalty units amounts to $12,600.  For sponsors with an annual turnover of $10 million, this would constitute approximately 0.1 per cent of their annual turnover.

41.               It is not the intention that any penalty prescribed under new paragraph 140ZN(1)(e) would be the only means of dealing with the underpayment of a nomination training contribution charge .  New section 140ZO makes it clear that if an amount of nomination training contribution charge is due and payable to the Commonwealth, the amount is a debt due to the Commonwealth and may be recovered by action in a court of competent jurisdiction.  Additionally, new paragraph 140ZN(1)(d) allows the regulations to make provision for, or in relation to the overpayment or underpayment of a nomination training contribution charge

42.               In addition to new section 140ZO and new paragraph 140ZN(1)(d), action may be taken under the existing sponsorship framework set out in Division 3A of Part 2 of the Migration Act in relation to approved sponsors who nominate an applicant or proposed applicant for a temporary visa prescribed for the purpose of current section 140A.  For example, regulation 2.90 of the Regulations prescribes the provision of false or misleading information to the Department as a circumstance in which the Minister may take one or more of the actions mentioned in section 140M of the Migration Act for the purpose of subparagraph 140L(1)(a)(ii).  If the Minister were satisfied that a sponsor had provided false or misleading information in relation to their annual turnover, with the consequence that they had underpaid the nomination training contribution charge , the Minister may cancel the sponsor’s approval as a sponsor or bar the sponsor from sponsoring more people or making future applications for approval as a sponsor under current section 140M(1) of the Migration Act.

New section 140ZO - Recovery of nomination training contribution charge and late payment penalty

43.               New section 140ZO applies if an amount of nomination training contribution charge or a penalty in relation to the underpayment of such a charge is due and payable to the Commonwealth.  New section 140ZO makes it clear that such an amount is a debt to the Commonwealth and is recoverable by action in a court of competent jurisdiction.  

New section 140ZP - Notional application of nomination training contribution charge in relation to nominations made by the Commonwealth

44.               New section 140ZP notionally applies the nomination training contribution charge to nominations made by the Commonwealth.

45.               New subsection 140ZP(1) recognises that the Commonwealth cannot make itself liable to pay Commonwealth taxes or fees.  However, to give effect to the policy intention that Commonwealth departments and agencies are liable to pay the nomination training contribution charge , new subsection 140ZP(1) makes it clear that the Commonwealth (which includes a Commonwealth entity within the meaning of the Public Governance, Performance and Accountability Act 2013 under new subsection 140ZP(5)) should be notionally liable to pay such a charge.  

46.               New subsection 140ZP(2) provides a mechanism for payment of a nomination training contribution charge by the Commonwealth by allowing the Finance Minister to give written directions in relation to the transfer of money within an account, or between accounts, operated by the Commonwealth.

47.               New subsection 140ZP(3) puts it beyond doubt that a direction given under subsection 140ZQ(2) will have effect notwithstanding any other law of the Commonwealth.

48.               New subsection 140ZP(4) provides that a direction under subsection 140ZP(2) is not a legislative instrument within the meaning of subsection 8(1) of the Legislation Act 2003.

49.               New subsection 140ZP(5) provides that references to Commonwealth in new subsections 140ZP(1) and (2) includes a Commonwealth entity (within the meaning of the Public Governance, Performance and Accountability Act 2013 ) that cannot be made liable to taxation by a Commonwealth law.  This reflects the policy intention that Commonwealth entities are notionally liable to pay the nomination training contribution charge and are subject to directions given by the Finance Minister under new subsection 140ZP(2).

New section 140ZQ - Division binds the Crown

50.               New section 140ZQ binds the Crown in respect of Division 3B of Part 2 of the Migration Act.  This recognises that an Act is presumed not to bind the Crown, in any of its capacities in the absence of express words or necessary implication.

51.               New subsection 140ZQ(1) expressly provides that Division 3B of Part 2 of the Migration Act binds the Crown in right of the Commonwealth, of each of the States, of the Australian Capital Territory and of the Northern Territory.  The effect of this is that the Commonwealth, States and Territories will be bound by the provisions in Division 3B, subject to new subsection 140ZQ(2).

52.               New subsection 140ZQ(2) makes it clear that the Crown is not liable to be prosecuted for an offence.  The effect of this is that the Crown cannot be prosecuted for an offence under Division 3B of Part 2 of the Migration Act.

53.               New subsection 140ZQ(3) puts it beyond doubt that new subsection 140ZQ(2) does not prevent the Crown being liable to pay a pecuniary penalty under Division 3B of Part 2 of the Migration Act.  This means that the Crown may be liable to pay financial penalties as required or permitted by Division 3B, for example a penalty in relation to the underpayment of a nomination training contribution charge .



Part 2 - Other amendments

Item 13             After paragraph 140GBA(3)(a)

54.               Current subsection 140GB(2) requires the Minister to approve a nomination made under section 140GB if, amongst other things, the labour market testing condition under section 140GBA (if applicable) is satisfied.

55.               Current subsection 140GBA(3) sets out the requirements for satisfying the labour market testing condition.  

56.               This item inserts new paragraph 140GBA(3)(aa) to make it an additional requirement for satisfying the labour market testing condition that the labour market testing in relation to the nominated position was undertaken in the manner determined under new subsection 140GBA(5).

Item 14           Subparagraph 140GBA(3)(b)(i)

57.               This item is consequential to item 13.  It amends subparagraph 140GBA(3)(b)(i) to replace ‘(see subsections (5) and (6)’ with ‘of a kind determined under subsection (5)’.

Item 15           Subsections 140GBA(5), (6) and (6A)

58.               This item repeals current subsections 140GBA(5), (6) and (6A) and inserts new subsections 140GBA(5), (6), (6A) and (6B).

59.               Current subsections 140GBA(5) and (6) set out the requirements for evidence in relation to the labour market testing, however they do not specify or provide any power to prescribe how labour market testing should be conducted.

60.               To address this issue, new subsection 140GBA(5) will allow the Minister to determine, by legislative instrument, the manner in which labour market testing in relation to a nominated position must be conducted.  New subsection 140GBA(6) provides that, without limiting new subsection 140GBA(5), this may include the language to be used for any advertising, the method of advertising, the period during which the advertisement must occur prior to nomination, and the duration of advertising to be determined by legislative instrument.

61.               New subsection 140GBA(6A) will allow the Minister to determine, by legislative instrument, the kinds of evidence of labour market testing that must accompany a nomination.  New subsection 140GBA(6B) provides that, without limiting new subsection 140GBA(6A), this may include a copy of the advertisement.

62.               New subsection 140GBA(6C) makes it clear that a legislative instrument made under  new subsection 140GBA(5) or 140GBA(6A) may determine different manners of labour market testing or different evidence requirements for different nominated positions, or classes of nominated positions.

63.               Allowing the Minister to determine the manner in which labour market testing must be conducted and the evidence of labour market testing that must be provided will ensure that a person who lodges a nomination under 140GB must properly test the labour market prior to nominating an overseas worker, in order to satisfy the labour market testing condition.

64.               The ability for the Minister to make a determination by legislative instrument under new subsections 140GBA(5) and 140GBA(6A) is consistent with existing provisions in Subdivision B of Division 3A regarding labour market testing.  For example, current subsection 140GBA(4) allows the Minister to determine, by legislative instrument, the period within which labour market testing is required in relation to a nominated occupation.

Part 3 - Application and transitional provisions

Item 16           Application provisions

65.               Subsection 16(1) provides that the amendments to Subdivision B of Division 3A of Part 2 of the Migration Act made by Part 1 of this Schedule apply in relation to nomination applications made, but not decided immediately prior to commencement, as well as new nomination applications made on or after commencement. 

66.               Subsection 16(2) provides that the amendments to Subdivision B of Division 3A of Part 2 of the Migration Act made by Part 2 of this Schedule apply in relation to new nomination applications made on or after commencement.  The effect of this is that nominations made, but not decided prior to commencement will not be subject to the new labour market testing requirements.

67.               Subsection 16(3) provides that new section 140ZM of the Migration Act applies in relation to nomination applications made, but not decided immediately prior to commencement.

68.               Currently, standard business sponsors are required to meet one of two training benchmarks by either making a contribution equivalent to at least two percent of their annual payroll into an industry training fund; or expending at least one percent of their annual payroll into the provision of training to their Australian employees.

69.               Subsection 16(3) reflects the policy intention that a person will not be simultaneously required to comply with the existing training benchmarks and liable to pay a nomination training contribution charge .  Standard business sponsors will be required to meet the training benchmarks until commencement of this item for approval as a sponsor, however they will not be required to continue to meet these requirements after commencement.

Item 17                       Transitional provision

70.               This item preserves exemptions made under subsection 140GBB(2) of the Migration Act that were in force immediately before the commencement of this item.  The effect of this is that such an exemption will continue to have effect under amended subsection 140GBB(2).

 



SCHEDULE 2 - Contingent Amendments

71.               The amendments in this Schedule are contingent on the commencement of Schedule 1 to the Migration Amendment (Family Violence and Other Measures) Act 2017 (the Family Violence Act) .

72.               Schedule 1 to the Family Violence Act amends the definition of approved sponsor in subsection 5(1) of the Migration Act to distinguish between an approved family sponsor and an approved work sponsor .

73.               This Schedule amends various provisions in Division 3A of Part 2 of the Migration Act that, prior to commencement of Schedule 1 to the Family Violence Act, refer to an approved sponsor.

74.               The amendments in Part 1 of this Schedule replace a number of references to ‘approved sponsor’ in Division 3A of Part 2 of the Migration Act.  These amendments will commence if Schedule 1 to the Family Violence Act commences after this Act.

75.               The amendments in Part 2 of this Schedule are equivalent to the amendments in Part 1, but will replace references to ‘approved work sponsor’ in the event that Schedule 1 to the Family Violence Act commences before this Act.

Part 1 - Amendments if the Migration Amendment (Family Violence and Other Measures) Act 2017 commences after this Act

Migration Act 1958

Item 1             Subsection 140GB(1)

76.               This item amends subsection 140GB(1) to allow a person who is an approved sponsor, has applied for approval as a sponsor, or is a party to negotiations for a work agreement, to nominate an applicant or proposed applicant for a visa of a prescribed kind under section 140GB of the Migration Act.  The purpose of this amendment is to clarify that an application for a nomination under section 140GB can be made at the same time as an application for approval as a sponsor.

77.               Allowing a person who has applied for approval as a sponsor, or is a party to negotiations for a work agreement to lodge a nomination is more efficient for both the nominator and the Department, as it allows the sponsorship application and nomination application to be lodged at the same time.

78.               It will continue to be a condition of approval of the nomination that the nominator is an approved sponsor.

79.               Amendments consequential to this item, discussed below, replace certain references to ‘approved sponsor’ to reflect amended subsection 140GB(1).

Item 2                         Subsection 140GB(2)                       

80.               This item is consequential to item 1 of this Schedule.  It amends subsection 140GB(2) to replace ‘an approved sponsor’s’ with ‘a person’s’.

Item 3                         After paragraph 140GB(2)(a)

81.               This item inserts new paragraphs 140GB(2)(aa) and (ab).

82.               New paragraph 140GB(2)(aa) makes it a condition of approval of a nomination that if the nominating person is liable to pay a nomination training contribution charge in relation to the nomination, the charge has been paid.

83.               New paragraph 140GB(2)(ab) makes it clear that a person who nominates an applicant or proposed applicant for a prescribed visa must be an approved sponsor in order for the nomination to be approved, notwithstanding that a person who has applied for approval as a sponsor, or is a party to negotiations for a work agreement may also lodge a nomination under amended subsection 140GB(1)

Item 4                         Subsection 140GB(3)                       

84.               This item is consequential to item 1 of this Schedule.  It amends subsection 140GB(3) to replace ‘an approved sponsor’s’ with ‘person’s’. 

Item 5                         Subsection 140GBA(1)                    

85.               This item is consequential to item 1 of this Schedule.  It amends subsection 140GBA(1) to replace ‘an approved sponsor’ with ‘a person’. 

Item 6             Paragraph 140GBA(1)(a)    

86.               This item is consequential to item 1 of this Schedule.  It amends paragraph 140GBA(1)(a) to replace ‘an approved sponsor is in a class of sponsors’ with ‘a person is, or has applied to be, in a class of approved sponsors’. 

Item 7                         Paragraph 140GBA(3)(a)    

87.               This item is consequential to item 1 of this Schedule.  It amends paragraph 140GBA(3)(a) to replace ‘approved sponsor’ with ‘person’. 

Item 8                         Subparagraph 140GBA(3)(b)(ii)    

88.               This item is consequential to item 1 of this Schedule.  It amends subparagraph 140GBA(3)(b)(ii) to replace ‘approved sponsor’ with ‘person’. 

Item 9                         Paragraph 140GBA(5)(a)

89.               This item is consequential to item 1 of this Schedule.  It amends paragraph 140GBA(5)(a) to replace ‘approved sponsor’s’ with ‘person’s’. 

Item 10                       Subparagraph 140GBA(6)(a)(i)

90.               This item is consequential to item 1 of this Schedule.  It amends subparagraph 140GBA(6)(a)(i) to replace ‘approved sponsor’ with ‘person’. 

Item 11                       Subparagraph 140GBA(6)(b)(i)     

91.               This item is consequential to item 1 of this Schedule.  It amends subparagraph 140GBA(6)(b)(i) to replace ‘approved sponsor’s’ with ‘person’s’. 

Item 12                       Subsection 140GBA(6A)     

92.               This item is consequential to item 1 of this Schedule.  It amends subsection 140GBA(6A) to replace both references to ‘approved sponsor’ with ‘person’. 

Item 13                       Subsection 140GBA(7) (definition of eligible temporary visa holder )       

93.               This item is consequential to item 1 of this Schedule.  It amends subsection 140GBA(7) to replace ‘an approved sponsor’ with ‘another person’. 

Item 14                       Subsection 140GBA(7) (paragraph (b) of the definition of eligible temporary visa holder )           

94.               This item is consequential to item 1 of this Schedule.  It amends paragraph (b) of the definition of eligible temporary visa holder in subsection 140GBA(7) to replace both references to ‘approved sponsor’ with ‘other person’. 

Item 15                       Subsection 140GBB(1)                     

95.               This item is consequential to item 1 of this Schedule.  It amends subsection 140GBB(1) to replace ‘An approved sponsor’ with ‘A person’. 

Item 16                       Subsection 140GBB(4)                     

96.               This item is consequential to item 1 of this Schedule.  It amends subsection 140GBB(4) to replace ‘an approved sponsor’ with ‘a person’. 

Item 17                       Subsection 140GBC(1)                    

97.               This item is consequential to item 1 of this Schedule.  It amends subsection 140GBC(1) to replace ‘an approved sponsor, under subsection 140GB, if the sponsor’ with ‘a person, under subsection 140GB, if the person’. 

Item 18                       Subsections 140GBC(2) and (3)                  

98.               This item is consequential to item 1 of this Schedule.  It amends subsections 140GBC(2) and (3) to replace ‘approved sponsor’ with ‘person’. 

Part 2 - Amendments if the Migration Amendment (Family Violence and Other Measures) Act 2017 commences before this Act

Migration Act 1958

Item 19           Subsection 140GB(1)

99.               This item amends subsection 140GB(1) to allow a person who has applied for approval as a work sponsor, or is a party to negotiations for a work agreement, to nominate an applicant or proposed applicant for a visa of a prescribed kind under section 140GB of the Migration Act.  The purpose of this amendment is to clarify that an application for a nomination under section 140GB can be made at the same time as an application for approval as a work sponsor.

100.           Allowing a person who has applied for approval as a work sponsor, or is a party to negotiations for a work agreement to lodge a nomination is more efficient for both the nominator and the Department, as it allows the sponsorship application and nomination application to be lodged at the same time.

101.           It will continue to be a condition of approval of the nomination that the nominator is an approved work sponsor.

102.           Amendments consequential to this item, discussed below, replace certain references to ‘approved work sponsor’ to reflect amended subsection 140GB(1).

Item 20                       Subsection 140GB(2)                       

103.           This item is consequential to item 19 of this Schedule.  It amends subsection 140GB(2) to replace ‘an approved work sponsor’s’ with ‘a person’s’.

Item 21                       After paragraph 140GB(2)(a)

104.           This item inserts new paragraphs 140GB(2)(aa) and (ab).

105.           New paragraph 140GB(2)(aa) makes it a condition of approval of a nomination that if the nominating person is liable to pay a nomination training contribution charge in relation to the nomination, the charge has been paid.

106.           New paragraph 140GB(2)(ab) makes it clear that a person who nominates an applicant or proposed applicant for a prescribed visa must be an approved work sponsor in order for the nomination to be approved, notwithstanding that a person who has applied for approval as a work sponsor, or is a party to negotiations for a work agreement may also lodge a nomination under amended subsection 140GB(1)

Item 22                       Subsection 140GB(3)                       

107.           This item is consequential to item 19 of this Schedule.  It amends subsection 140GB(3) to replace ‘an approved work sponsor’s’ with ‘person’s’. 

Item 23                       Subsection 140GBA(1)                    

108.           This item is consequential to item 19 of this Schedule.  It amends subsection 140GBA(1) to replace ‘an approved work sponsor’ with ‘a person’. 

Item 24           Paragraph 140GBA(1)(a)    

109.           This item is consequential to item 19 of this Schedule.  It amends paragraph 140GBA(1)(a) to replace ‘an approved work sponsor is in a class of sponsors’ with ‘a person is, or has applied to be, in a class of approved work sponsors’. 

Item 25                       Paragraph 140GBA(3)(a)    

110.           This item is consequential to item 19 of this Schedule.  It amends paragraph 140GBA(3)(a) to replace ‘approved work sponsor’ with ‘person’. 

Item 26                       Subparagraph 140GBA(3)(b)(ii)    

111.           This item is consequential to item 19 of this Schedule.  It amends subparagraph 140GBA(3)(b)(ii) to replace ‘approved work sponsor’ with ‘person’. 

Item 27                       Paragraph 140GBA(5)(a)

112.           This item is consequential to item 19 of this Schedule.  It amends paragraph 140GBA(5)(a) to replace ‘approved work sponsor’s’ with ‘person’s’. 

Item 28                       Subparagraph 140GBA(6)(a)(i)

113.           This item is consequential to item 19 of this Schedule.  It amends subparagraph 140GBA(6)(a)(i) to replace ‘approved work sponsor’ with ‘person’. 

Item 29                       Subparagraph 140GBA(6)(b)(i)     

114.           This item is consequential to item 19 of this Schedule.  It amends subparagraph 140GBA(6)(b)(i) to replace ‘approved work sponsor’s’ with ‘person’s’. 

Item 30                       Subsection 140GBA(6A)     

115.           This item is consequential to item 19 of this Schedule.  It amends subsection 140GBA(6A) to replace both references to ‘approved work sponsor’ with ‘person’. 

Item 31                       Subsection 140GBA(7) (definition of eligible temporary visa holder )       

116.           This item is consequential to item 19 of this Schedule.  It amends subsection 140GBA(7) to replace ‘an approved work sponsor’ with ‘another person’. 

Item 32                       Subsection 140GBA(7) (paragraph (b) of the definition of eligible temporary visa holder )           

117.           This item is consequential to item 19 of this Schedule.  It amends paragraph (b) of the definition of eligible temporary visa holder in subsection 140GBA(7) to replace both references to ‘approved work sponsor’ with ‘other person’. 

Item 33                       Subsection 140GBB(1)                     

118.           This item is consequential to item 19 of this Schedule.  It amends subsection 140GBB(1) to replace ‘An approved work sponsor’ with ‘A person’. 

Item 34                       Subsection 140GBB(4)                     

119.           This item is consequential to item 19 of this Schedule.  It amends subsection 140GBB(4) to replace ‘an approved work sponsor’ with ‘a person’. 

Item 35                       Subsection 140GBC(1)                    

120.           This item is consequential to item 19 of this Schedule.  It amends subsection 140GBC(1) to replace ‘an approved work sponsor, under section 140GB, if the sponsor’ with ‘a person, under section 140GB, if the person’. 

Item 36                       Subsections 140GBC(2) and (3)                  

121.           This item is consequential to item 19 of this Schedule.  It amends subsections 140GBC(2) and (3) to replace ‘approved work sponsor’ with ‘person’. 

Part 3 - Application and transitional provisions

Item 37           Application provision

122.           This item provides that the amendments to Subdivision B of Division 3A of Part 2 of the Migration Act made by this Schedule apply in relation to nomination applications made, but not decided immediately prior to commencement, as well as new nomination applications made on or after commencement.

Item 38                       Transitional provisions

123.           This item preserves regulations made under subsection 140GB(3) and paragraph 140GBA(1)(a) of the Migration Act that were in force immediately before the commencement of this item.  The effect of this is that these regulations will continue to have effect under amended subsection 140GB(3) and paragraph 140GBA(1)(a).



Attachment A

Statement of Compatibility with Human Rights

Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011

This Bill is compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011 .

Overview of the Bill

This Bill relates to the Migration (Skilling Australians Fund) Charges Bill 2017 (Charges Bill) .   The Charges Bill imposes the nomination training contribution charge payable under new section 140ZM of the Migration Act 1958 (the Act), sets a charge limit for the nomination training contribution charge and provides for the indexation of the charge limit.  It also provides that the amount of the nomination training contribution charge is to be prescribed in the Migration Regulations 1994, and that the Regulations may prescribe different charges for different kinds of visas or persons.

The purpose of this Bill is to provide a framework for the collection of the nomination training contribution charge from employers accessing workers under the temporary and permanent employer sponsored migration programs. 

The nomination training contribution charge will offset expenditure from the Skilling Australians Fund (SAF), a training fund administered by the Department of Education and Training.    The SAF will prioritise the funding of apprenticeships and traineeships in occupations that are in high demand and currently rely on skilled migration, or have future growth potential, including in regional Australia.

This Bill amends the Act to provide that persons seeking to nominate a worker for a prescribed visa must pay a nomination training contribution charge. 

The Bill also amends the Act to provide that the Migration Regulations 1994 (the Regulations) may make provision for a range of matters relevant to the nomination training contribution charge, including:

·          the visas that are subject to the nomination training contribution charge;

o    It is intended that the visas to be prescribed are the Temporary Skill Shortage (TSS) visa (which is to replace the Temporary Work (Skilled) Subclass 457 visa), the Employer Nomination Scheme (ENS) (Subclass 186) visa and the Regional Sponsored Migration Scheme (RSMS) (Subclass 187) visa;

·          the amount and method of payment of the nomination training contribution charge; and

·          the remission, refund and recovery of underpayment of the nomination training contribution charge.

Under section 140ZN(1)(e) the regulations may make provision for the payment of a penalty in relation to the underpayment of the nomination training contribution charge.  New subsection 140ZN(2) of the Migration Act 1958 (Cth) (Migration Act) will provide that the penalty for the purpose of paragraph 140ZN(1)(e) of the Migration Act must be a civil penalty and must not exceed 60 penalty units.  The civil penalty may be an amount lesser than 60 penalty units and will depend on the severity and nature of the underpayment.  This amount is consistent with the existing civil penalty in section 140Q of the Migration Act, which imposes a civil penalty of 60 penalty units if a person fails to satisfy a sponsorship obligation prescribed by the regulations or specified in a work agreement.

It is anticipated that only sponsors who have an annual turnover of $10 million or higher will be affected by any penalty prescribed for the purpose of new paragraph 140ZN(1)(e).  This is because the intention is that the nomination training contribution charge will have two tiers - an amount for sponsors who self-identify as a small business (annual turnover of less than $10 million per annum) and a second (higher) amount for sponsors with an annual turnover of $10 million per annum or higher.  As payment of the nomination training contribution charge is required in full at the time the sponsor lodges an application for nomination of an overseas skilled worker, sponsors with an annual turnover of less than $10 million per annum could not underpay the nomination training contribution charge.  However sponsors who have an annual turnover of $10 million or higher per annum may claim to be a small business, and pay the lower amount of the nomination training contribution charge, when in fact they are not a small business.

Currently, section 4AA of the Crimes Act 1914 (Cth) defines a penalty unit as the amount of $210.  At this rate, the maximum penalty of 60 penalty units amounts to $12,600.  For sponsors with an annual turnover of $10 million, this would constitute approximately 0.1 per cent of their annual turnover.

The nomination training contribution charge replaces current requirements that employers sponsoring a worker under the Temporary Work (Skilled) Subclass 457 visa (457 visa) or nominating a worker under the Direct Entry stream of the Subclass 186 visa have recently spent:

·          the equivalent of at least two per cent of their business’ payroll in contributions to an industry training fund (training benchmark A); or

·          the equivalent of at least one per cent of their business’ payroll on the training of Australians (training benchmark B)

The Bill also amends the Act to provide that a nomination of an applicant for a visa of a prescribed kind may be lodged by a person who:

·          is an approved sponsor; or

·          has applied to be approved as a sponsor; or

·          is a party to negotiations for a labour agreement. 

This amendment continues the current practice under policy of accepting nominations from businesses that have lodged an application to be approved as a sponsor, and further extends this practice to include parties that have entered into negotiations for a labour agreement.  This can provide processing efficiencies for both the business and the Department. 

Currently, the Act requires that evidence of LMT must be provided with a nomination by a standard business sponsor unless:

·          an exemption applies due to a major disaster;

·          an exemption applies on the basis of the required skill level and occupation for a nominated position; or

·          it would be inconsistent with Australia’s international trade obligations.

The Bill amends the Act to provide that the Minister may, by legislative instrument, determine the manner in which labour market testing (LMT) in relation to a nominated position must be undertaken and may determine the kinds of evidence of LMT that must accompany a nomination.  The matters to be prescribed in an instrument are expected to include the language in which a job advertisement must be written, the method of advertisement, the period the advertisement occurs in, and the period the advertisement must run for.

This amendment will help ensure that, where LMT is required, businesses properly test the labour market before nominating a foreign worker for a prescribed visa and provide evidence of that LMT.

Human rights implications

Together with the Charges Bill , t his Bill contributes to the provision of training opportunities for Australian citizens and permanent residents by establishing the framework for the nomination training contribution charge , to be paid by employers accessing workers under the temporary or permanent employer sponsored migration programs. 

The nomination training contribution charge will fund initiatives which improve training opportunities and outcomes for Australian citizens and permanent residents.  Such initiatives engage Articles 6.1 and 6.2 of the International Covenant on Economic, Social and Cultural Rights (ICESCR).  Article 6.1 of ICESCR recognizes:

The right to work, which includes the right of everyone to the opportunity to gain his living by work which he freely chooses or accepts, and will take appropriate steps to safeguard this right. 

Article 6.2 of ICESCR states that:

The steps to be taken by a State Party of the present Covenant to achieve the full realization of [the right to work] shall include technical and vocational guidance and training programmes, policies and techniques to achieve steady economic, social and cultural development and full and productive employment under conditions safeguarding fundamental political and economic freedom to the individual.

A civil penalty for the underpayment of the nomination training contribution charge, as described by 140ZN, demonstrates to employers utilising skilled migration programs that there are implications for not complying with the requirements to pay the charge, beyond those that are imposed by the sponsor obligation framework.  This ensures greater compliance with the requirement to pay the nomination training contribution charge, and results in increased reliability of revenue that supports the Skilling Australians Fund and the training of Australian citizens and permanent residents. 

The amendment to the Bill introduces a reasonable limit to the civil penalty (in the context of sponsors with an annual turnover of $10 million) that may be imposed on an employer that underpays the nomination training contribution charge.  The amount of this penalty also aligns to the existing penalties for failing to meet sponsor obligations under section140Q of the Migration Act.   

This legislative framework for the nomination training contribution charge supports the right to work under Article 6.1 in relation to Australian citizens and permanent residents.  Funding a national training partnership through the sponsorship and nomination framework is an effective mechanism to promote training across a broad range of industries and occupations and therefore supporting Australian citizens and permanent residents to be trained and qualified for skilled work.  This supports their right to work.  The measure positively engages Articles 6.1 and 6.2 of the ICESCR as it is a mechanism for Australia to comply with these rights.

The amendment to accept nominations from employers who have applied to be approved as a sponsor or entered into negotiations for a labour agreement does not interact with the right to work, however, it will improve the Department of Home Affairs’ administrative processes and will contribute to faster processing times for applications of this type.

The Bill also contributes to the provision of employment opportunities for Australian citizens and permanent residents by expanding the legislative framework for labour market testing requirements to include the manner in which labour market testing must be undertaken by a standard business sponsor seeking to nominate a foreign worker for a prescribed visa. 

In allowing employers to only employ a foreign worker if a suitable Australian worker has not been found, subject to exemptions, the LMT framework engages the right to non-discrimination under Articles 2 and 26 of the International Covenant on Civil and Political Rights (ICCPR) and Article 2 of the ICESCR, including as it relates to the right to work.

In its General Comment 18, the UN Human Rights Committee stated that:

The Committee observes that not every differentiation of treatment will constitute discrimination, if the criteria for such differentiation are reasonable and objective and if the aim is to achieve a purpose which is legitimate under the Covenant.

Similarly, in its General Comment on Article 2 of the ICESCR (E/C.12/GC/20), UNCESCR has stated (at 13) that:

Differential treatment based on prohibited grounds will be viewed as discriminatory unless the justification for differentiation is reasonable and objective. This will include an assessment as to whether the aim and effects of the measures or omissions are legitimate, compatible with the nature of the Covenant rights and solely for the purpose of promoting the general welfare in a democratic society. In addition, there must be a clear and reasonable relationship of proportionality between the aim sought to be realized and the measures or omissions and their effects.

Neither the ICCPR nor the ICESCR give a right for non-citizens to enter Australia for the purposes of seeking residence or employment.  The UN Human Rights Committee, in its General Comment 15 on the position of aliens under the Covenant, stated that:

The Covenant does not recognize the right of aliens to enter or reside in the territory of a State party. It is in principle a matter for the State to decide who it will admit to its territory. However, in certain circumstances an alien may enjoy the protection of the Covenant even in relation to entry or residence, for example, when considerations of non-discrimination, prohibition of inhuman treatment and respect for family life arise.

Consent for entry may be given subject to conditions relating, for example, to movement, residence and employment. A State may also impose general conditions upon an alien who is in transit. However, once aliens are allowed to enter the territory of a State party they are entitled to the rights set out in the Covenant.

As such, Australia is able to set requirements for the entry of non-citizens into Australia and conditions for their stay, and does on the basis of reasonable and objective criteria. The aim of the skilled entry program is to maximise the benefits of skilled entrants to the Australian economy.  This includes channelling permanent skilled migrants into occupations that have been identified to be in the long term strategic interest of the Australian economy, and restricting short-term temporary skilled migrants to occupations that are currently in shortage but for which there may not be a long term requirement.  Australia sets the requirements for the entry and conditions of stay for skilled migrants and temporary entrants on the basis of reasonable and objective criteria formulated through labour market analysis and stakeholder consultation.    

Further, Article 4 of ICESCR provides that the State may subject the rights enunciated in the ICESCR:

  …only to such limitations as are determined by law only insofar as this may be compatible with the nature of these rights and solely for the purpose of promoting the general welfare in democratic society.

The authority for the Government to grant work rights, and the authority to prescribe conditions or limitations on temporary non-citizens in respect of those work rights (such as requiring certain sponsors to conduct LMT before nominating a foreign worker unless an exemption applies), are lawful as a matter of domestic law.  The objective of these conditions and limitations is to ensure that Australian citizens and permanent residents have continued access to paid employment. 

The limitations imposed by the labour market testing framework are legitimate and justified by Article 4, for the principal reason that they are for the "purpose of promoting the general welfare in a democratic society". In other words, the measure will ensure that persons who are in Australia permanently are given the opportunity to seek work before those seeking to work and live in Australia only on a temporary basis. Such a limitation, noting the discussion in relation to work rights in Article 6 above, is permissible.

Similarly, for the reasons stated above, in order to give effect to Article 6 and Article 4 of ICESCR in relation to Australian citizens and permanent residents, the labour market testing framework is legitimate, reasonable and proportionate. Furthermore, it does not seek to preclude foreign nationals from entering and working temporarily in Australia, but rather conditions that ability with the reasonable and proportionate measures which are further refined by these amendments.

Conclusion

The Bill is compatible with human rights as the measures support the right to work of Australian citizens and permanent residents, and insofar that there are any limitations upon the right to work in Article 6 of the ICESCR for certain foreign workers, these comply with limitation requirements in Article 4 of the ICESCR.  Further, although it is arguable that the measure may have a discriminatory effect within the meaning of Article 2 and 26 of the ICCPR and Article 2 of the ICESCR, the measure is legitimate, proportionate and reasonable.

 

The Hon. Peter Dutton MP, Minister for Home Affairs and Minister for Immigration and Border Protection

 



Attachment B

 

 

Abolition and replacement of 457 visas

 

 

 

Regulation Impact Statement

(OBPR ID: 21946)

 

Department of Immigration and Border Protection

 

August 2017

 

 



 

Contents

Overview: Australia’s employer sponsored skilled visa programme . 29

Current regulatory framework . 29

The problem .. 35

Why is Government action needed . 40

Policy options . 41

Option 1 . 41

Overview of Option 1 . 41

Likely outcomes of Option 1 . 44

Option 2 . 53

Overview of Option 2 . 53

Likely outcomes of Option 2 . 54

Option 3 . 57

Overview of Option 3 . 57

Likely outcomes of Option 3 . 57

Consultation . 57

Best option . 62

Implementation and evaluation . 63

 

 

 



 

Overview: Australia’s employer sponsored skilled visa programme

1.              The employer sponsored skilled visa programme, and the underpinning legal and regulatory framework, is the primary way the Australian Government regulates how non-citizens may enter and remain to work in Australia, as well as many of the circumstances in which they may work. It also provides mechanisms to ensure that migrants do not pose unacceptable health, character and security risks to the Australian community.

2.              The employer sponsored skilled visa programme is part of the broader migration programme, and allows sponsoring businesses to nominate an appropriately skilled non-citizen to fill a temporary or permanent employment vacancy in Australia. This programme regulates both the sponsor and the migrant to facilitate certain policy outcomes, such as ensuring that employers only seek to fill vacancies with overseas workers where appropriately skilled Australian workers are not available.

Current regulatory framework

3.              The employer sponsored skilled visa programme is comprised of the Temporary Work (Skilled) (subclass 457) visa (457 visa) and the permanent Employer Nomination Scheme (subclass 186) visa (ENS, 186 visa) and Regional Sponsored Migration Scheme (subclass 187) visa (RSMS, 187 visa) (permanent employer sponsored skilled visas).

Top named industries for primary subclass 457, 186, and 187 visa grants                                             in 2016-17 to 31 March 2017 [1]

Rank

Sponsor Industry

Total

1

Other Services

8,639

2

Accommodation and Food Services

7,224

3

Professional, Scientific and Technical

7,202

4

Information Media and Telecommunications

6,813

5

Health Care and Social Assistance

5,306

6

Construction

3,634

7

Education and Training

2,899

8

Manufacturing

2,525

9

Retail Trade

2,213

10

Financial and Insurance Services

2,017

 

Top occupations for primary subclass 457, 186, and 187 visa grants in 2016-17 to 31 March 2017

Rank

Nominated Occupation

Total

1

351411 Cook

4,635

2

141111 Cafe or Restaurant Manager

3,031

3

261312 Developer Programmer

2,334

4

351311 Chef

2,004

5

225113 Marketing Specialist

1,987

6

242111 University Lecturer

1,872

7

261111 ICT Business Analyst

1,834

8

224711 Management Consultant

1,550

9

221111 Accountant (General)

1,487

10

261313 Software Engineer

1,464

 

4.              Only certain occupations are eligible for use under Australia’s permanent and temporary employer sponsored skilled visa programmes. [2] Depending on which visa programme is applied for, applicants must nominate an occupation from either:

·          the Medium and Long-term Strategic Skills List (MLTSSL), previously known as the Skilled Occupation List (SOL), which targets occupations that are relevant to the medium to long term skill needs of the economy; or

·          the Short-Term Skilled Occupation List (STSOL), previously known as the Consolidated Sponsored Occupation List (CSOL), which targets occupations that are relevant to the short term needs of the economy. [3]

Additionally, the Direct Entry (DE) stream of RSMS can apply for Australian and New Zealand Standard Classification of Occupations (ANZSCO) skill level 1-3 occupations.

5.              The SOL and the CSOL were replaced with the MLTSSL and STSOL on 19 April 2017, which involved a reduction of 216 occupations from eligibility for the 457 visa. The number of eligible occupations fell from 651 to 435. The replacement of the CSOL with the STSOL represented a significant shift in approach by limiting temporary migrant occupations to those in need in the Australian labour market and distinguishing between short and medium to long term needs. On 1 July 2017, the occupation lists were updated based on stakeholder consultation, labour market analysis, and advice from government departments to ensure they accurately reflect the skill needs of the Australian economy. These lists will be reviewed biannually.

Temporary employer sponsored skilled visa

6.              The 457 visa allows employers to address temporary labour shortages by enabling businesses, as approved sponsors, to nominate overseas workers when an appropriately qualified Australian citizen or permanent resident is not available. It is an uncapped and demand driven temporary visa aimed at meeting genuine temporary skill shortages.

7.              As of 31 March 2017, there were 95,360 primary 457 visa holders in Australia. To be granted a 457 visa, applicants must meet certain requirements including: [4]

·          demonstrating that they have the skills and experience necessary to work in the nominated occupation;

·          holding any mandatory registration, license or professional membership;

·          demonstrating that they have the required English language skills, unless exempt;

·          meeting health and character requirements;

·          holding adequate health insurance, unless covered by Medicare;

·          having no outstanding debts to the Australian Government; and

·          providing biometrics if asked.

8.              In the 2015-16 programme year there were 34,493 active sponsors in the 457 visa programme. There are two ways an eligible business can become an approved sponsor:

·          apply to be a standard business sponsor; or

·          negotiate a work agreement.

9.              To become a standard business sponsor, a business must: [5]

·          be a lawfully operating business;

·          have no relevant adverse information against their business; and

·          if the business is in Australia:

o   meet training requirements;

o   demonstrate a commitment to employing local labour; and

o   not engage in discriminatory recruitment practices.

10.          Alternatively, a business may be able to enter into a work agreement if they have a demonstrated need for skilled migrants that cannot be met by the Australian labour market and which falls outside standard employer sponsored skilled visa programmes.

11.          All businesses who sponsor a 457 visa holder must meet sponsorship obligations including:

·          cooperating with inspectors;

·          ensuring equivalent terms and conditions of employment;

·          keeping records;

·          providing records and information to the Minister of Immigration and Border Protection (the Minister);

·          notifying the Department of Immigration and Border Protection (the Department) when certain events occur;

·          ensuring the visa holder participates in the nominated occupation;

·          not recovering from, transferring or charging certain costs to another person;

·          paying travel costs to enable sponsored people to leave Australia;

·          paying costs to remove sponsored people who become unlawful non-citizens;

·          providing training to Australians and permanent residents; and

·          not engaging in discriminatory recruitment practices.

12.          To nominate an overseas worker for a 457 visa, an approved sponsor must: [6]

·          ensure that the overseas worker works directly for their business or for an associated entity of their business, unless the nominated occupation is exempt; [7]

·          ensure that the overseas worker is afforded equivalent terms and conditions of employment to Australian workers;

·          meet the 'genuineness' criterion;

·          meet the Temporary Skilled Migration Income Threshold (TSMIT) requirements, set at $53,900 as at 31 March 2017;

·          not be subject to adverse information; and

·          conduct Labour Market Testing (LMT) for professional, nursing and engineering occupations, unless it conflicts with international trade obligations.

Permanent employer sponsored skilled visa

13.          The permanent employer sponsored skilled visas were introduced in their current form in 2012 and are demand-driven programmes, which allow employers to nominate skilled workers for permanent residence to fill genuine vacancies in their business. These skilled workers can be overseas or already in Australia on temporary visas.

14.          While ENS applies nation-wide, the RSMS helps businesses in regional, remote or low population growth areas (outside the major metropolitan centres of Brisbane, Gold Coast, Sydney, Newcastle, Wollongong and Melbourne) to recruit the skilled workers they need to manage and grow their operations.

15.          The ENS and RSMS visas each have three streams:

·          the Temporary Residence Transition (TRT) stream is for subclass 457 visa holders who are nominated by their employer after having worked for two years in the same occupation;

·          the Work agreement stream is for skilled migrants nominated by an employer who is party to a work agreement; and

·          the Direct Entry (DE) stream is for other employer nominated skilled migrants.

16.          In the 2016-17 programme year to 31 March 2017, there were 17,044 primary ENS visa grants and 5,228 primary RSMS visa grants. To be granted an ENS or RSMS visa, applicants must meet certain requirements including:

·          having been nominated by an approved Australian employer (in regional Australia for RSMS) within the six months before the application;

·          being under the age of 50 at the time of application, unless exempt;

·          demonstrating that they have the skills and experience necessary to work in the nominated occupation, which may include an assessment by the relevant assessing authority;

·          holding any mandatory registration, license or professional membership;

·          demonstrating that they meet the required English language skills, unless exempt;

·          meeting health and character requirements; and

·          meeting other requirements of the relevant visa stream.

17.          In the 2016-17 programme year to 31 March 2017, 8,315 individual businesses utilised the ENS and 2,933 individual businesses utilised the RSMS. To nominate a worker for an ENS or RSMS visa, a business must:

·          actively and lawfully operate in Australia (in regional Australia for RSMS);

·          have a genuine need for a paid employee to fill a skilled position;

·          offer a skilled position in the applicant's field that is full time and ongoing for at least two years;

·          pay a market salary rate;

·          comply with Australian immigration and workplace relations laws;

·          have no adverse information known about the business or any person associated with the business; and

·          nominate the applicant in one of the three streams and meet the requirements of that stream.

Training benchmark requirements

18.          The current training benchmark requirements are applicable to the 457 visa and the DE stream of the 186 visa. The current framework requires employers nominating a 457 visa applicant or 186 visa applicant in the DE stream to meet either:

·          training benchmark A -The business must provide evidence of recent expenditure, to the equivalent of at least 2 per cent of the payroll of the business, in payments allocated to an industry-training fund that operates in the same industry as the business; or

·          training benchmark B - The business must provide evidence of recent expenditure, to the equivalent of at least 1 per cent  of the payroll of the business, in the provision of training to employees of the business.

The problem

19.          The employer sponsored skilled visa framework is not effectively meeting the Australian Government’s policy objective of enabling businesses to access skilled labour from overseas, when an appropriately skilled Australian is unavailable, while maintaining visa programme integrity. The current framework settings have resulted in:

·          some businesses using the programmes where Australian workers are available. [8] This problem resulted from an inability of the policy settings to make certain that businesses only access overseas migrants for occupations which had been identified as in shortage in the Australian labour market;

·          some businesses and visa applicants not meeting the intended requirements of the programmes. This problem has arisen due to a number of legislative inconsistencies and gaps relating to the current policy settings, including English language, training benchmarks, genuine need, and skills assessment requirements;

·          some individuals and businesses using the temporary visa programme primarily to seek longer term or permanent residence without a further control to determine they continue to meet Australia’s social, economic, and skill needs. [9] This has resulted from current policy settings, such as eligible occupation, English language and age requirements, failing to be set at the requisite levels;

·          skills supplied by the visa programme not fully aligning with Australia’s short or long term needs. [10] This problem resulted from failures in the occupation lists to ensure that the occupations eligible for temporary skilled migration visas reflect Australia’s short or medium to long term needs; and

·          widespread criticism that the programme does not successfully balance the facilitation of skilled workers, and prevention of negative impacts on Australian and overseas workers.

20.          The employer sponsored skilled visa programmes allow employers to address labour shortages by bringing in skilled overseas workers where there is no appropriately skilled Australian workers available. Whilst it is against the intent of the programme, there are many reasons that employers may seek to use an overseas worker instead of an available Australian worker. Some of these reasons may be that the employer:

·          finds it more expeditious to employ an overseas worker than train an Australian worker;

·          perceives the overseas worker to have desirable attributes that are lacking in an equivalent Australian worker; or

·          is helping to achieve a migration outcome for the overseas worker.

21.          The above shortcomings have led to:

·          some overseas workers transitioning to permanent residence without having the attributes which optimise their economic contribution and settlement outcomes;

·          displacement of Australian workers; [11]

·          continuing skills gaps; and

·          overreliance on and an over-supply of skilled overseas workers in some occupations.

22.          The 457 programme has been the subject of a number of enquiries and reviews. These reviews have involved wide consultation and feedback from a broad range of stakeholders, including industry peak bodies/associations, unions, government, businesses, migration agents and academics. The policy options set out in this document take this feedback into consideration.

23.          Evidence of the problems within the employer sponsored skilled visa programmes can be found in:

·          the 2014 Independent Review into Integrity in the Subclass 457 Programme (the 457 Integrity Review);

·          the 2016 Senate Inquiry, A National Disgrace: The Exploitation of Temporary Work Visa Holders (the 2016 Senate Inquiry);

·          the 2016 Productivity Commission Inquiry Report: Migrant Intake into Australia (the 2016 Productivity Commission Report);

·          departmental sponsor monitoring activities outlined in the Department of Immigration and Border Protection Annual Report 2015-16 (the 2015-16 Annual Report); and

·          in the continuing stakeholder representations received by the Department.

24.          The purpose of the 457 Integrity Review was to recommend a system that, operating in the national interest [12] , was sound and resistant to misuse, and, at the same time, flexible and able to respond quickly to economic and business changes. The review examined:

·          the level of non-compliance in the 457 visa programme;

·          the current framework to better understand whether the existing requirements balance the needs of business with the integrity of the programme;

·          the viability of a deregulation strategy of the current programme; and

·          the appropriateness of the current compliance and sanctions.

25.          The 457 Integrity Review found that, whilst contentious, there was strong support from businesses for a programme that enabled them to fill genuine workforce shortages. Unions also supported this function whilst highlighting the need to protect Australian jobs and vulnerable overseas workers. The Review found that Australians who experience difficulties in finding work see 457 visa holders as a threat. [13]

26.          The 457 Integrity Review found that there was a “lack of responsiveness of the current occupation list” and that “employees…say that [the current system] is too easily subverted and, in practice, can turn into a free-for-all, to the disadvantage of Australians”. [14]   The 457 Integrity Review also found that the training benchmarks were flawed and should be abolished.  The review made 22 recommendations, including reviewing the occupation lists, introducing a national training fund, publishing sponsor sanctions and providing the Department with tax file numbers (TFN).

27.          The 2016 Productivity Commission Report examined the costs and benefits of temporary and permanent migration and looked at the scope for reforms within the current system that could deliver superior overall outcomes for the Australian community. The report found that younger and more skilled immigrants are more likely to make a positive economic contribution to Australia. It also noted that employment is a key indicator of integration, and that high levels of English language ability and qualifications result in better employment outcomes.

28.          The 2016 Productivity Commission Report identified that significant gains could be made by recalibrating the intake of permanent skilled immigrants, by tightening entry requirements relating to age, skills and English language proficiency. For example, the Productivity Commission found that the fiscal benefit of skilled migrants decreases with age and recommended that the current 50 year age limit for the permanent employer sponsored skilled visa programmes be reduced. Migrants who arrive at a relatively young age, particularly those who are highly educated, generally contribute more tax revenue over their lifetime and make comparatively lower use of government-funded services.

29.          The 2016 Senate Inquiry looked at the impact that the 457 visa programme has on employment opportunities for Australian permanent residents and citizens. The inquiry looked at concerns raised by employers seeking to efficiently supplement their workforce with overseas workers, and concerns raised by unions seeking to protect the wages, conditions and job opportunities of Australian workers.

30.          The 2016 Senate Inquiry noted that for the 457 programme to be effective “the employment of 457 visa workers must match genuine, short-term skill shortages”. However, the inquiry found that there was evidence that there are occupations eligible for the current 457 programme where there is no skill shortage.

31.          As indicated in the 2015-16 Annual Report, in 2015-16 the Department finalised the monitoring of 1390 temporary work sponsors, the majority of which were 457 sponsors. Approximately 58 per cent of sponsors monitored were considered to have satisfactorily met their obligations, while the remaining 42 per cent were found to be in breach of their obligations. Of the sponsors found to be in breach, a total of 372 sponsors were sanctioned (cancelling and/or barring the sponsor), 210 received a formal warning and 28 were issued with infringement notices totalling just under $272,580. The top industries where employers were found to be in breach were Accommodation and Food Services, Other Services, Construction and Retail Trade. This rate is higher than in past years, reflecting improved targeting of risk. These results are indicative of the continued misuse of the programme by some businesses.

32.          In 2016, the Department received approximately 15,000 enquiries, complaints, suggestions or compliments regarding the 457 visa programme by a range of stakeholders including individuals, legal and industry peak bodies, businesses and migration agents who use the employer sponsored skilled visa programmes and domestic and foreign government representatives. Broadly, the issues raised include:

·          overseas workers using the 457 programme to take Australian jobs;

·          overseas workers being exploited; and

·          certain programme settings make it more difficult for overseas workers to use the programme and prevent businesses and industries from meeting their needs.

33.          The Government has already implemented several measures to address this problem. In particular, the Government has implemented the majority of the recommendations by the 457 Integrity Review, which included measures to strengthen integrity in the 457 visa programme, prevent abuse and protect Australian workers. However, whilst the measures implemented have gone some way to address the problem they have not completely solved it.

Why is Government action needed

34.          The Government regulates the entry and stay of overseas workers in Australia. Given the competing views from employers, employees and employee organisations, the Government is required to balance these views to meet the national interest. It is therefore appropriate that the Government take action on this matter.

35.          External reviews outlined above, and the Department, have identified several failures in the current employer sponsored skilled visa programmes, such as occupation lists that do not sufficiently support Australia’s skills needs and policy settings that do not ensure sufficient programme compliance, are not set at requisite levels and have a number of legislative inconsistencies and gaps.

36.          To resolve issues in the employer sponsored skilled visa programmes, the Government aims to achieve the following objectives:

·          ensure that that employers only seek to fill vacancies with overseas workers where appropriately skilled Australian workers are not available;

·          enhance integrity measures to prevent the misuse of the employer sponsored skilled programmes;

·          ensure that skilled overseas workers have the necessary attributes to successfully contribute to Australia’s social and economic prosperity, either temporarily or permanently; and

·          meet Australia’s skills needs through policy settings which distinguish between short and medium to long term needs.

37.          To resolve issues in the employer sponsored skilled visa programmes, the Government needs to address the areas in which the programmes are currently failing, by:

·          regularly reviewing and updating the occupation lists to ensure they support Australia’s short and medium to long term skills needs;

·          tightening policy settings to support programme compliance;

·          ensuring that policy settings distinguish between short and medium to long term needs and are set at requisite levels to support settlement outcomes; and

·          address legislative inconsistencies and gaps identified within the policy settings.

38.          There are barriers that will impact the Government’s ability to achieve its objectives:

·          the Australian economy is dynamic. Policy settings will need to be responsive to Australia’s changing skill needs while prioritising Australian workers; and there will continue to be people who seek to misuse the employer sponsored skilled visa programmes. Policy settings will need to mitigate risks as they arise.

39.          If the Government does not take action, then the failures identified in the current employer sponsored skilled visa programmes will continue to result in integrity issues and suboptimal economic benefits.

Policy options

40.          Three policy options have been considered:

·          abolish and replace the 457 visa, and implement complementary reforms to the temporary and permanent employer sponsored skilled visas;

·          reform the 457 visa; and

·          retain the employer sponsored skilled visa framework without changes.

Option 1

Overview of Option 1

Temporary skill shortage visa

41.          Under Option 1, by March 2018 the 457 visa would be abolished and replaced with a new Temporary Skill Shortage (TSS) visa with two streams. The two streams would enable greater control over settings by distinguishing between short-term and medium-term skills needs.

42.          The Short-Term stream would enable employers to source genuinely temporary overseas skilled workers to fill short-term positions in a range of occupations for up to 24 months, until they can recruit and train an Australian if the role continues. This would be supported by a genuine temporary entrant requirement and provision for renewal of the visa onshore once only. The Short-Term stream would be underpinned by the STSOL.

43.          The Medium-Term stream would enable employers to source highly skilled overseas workers to fill medium-term critical skill gaps for up to four years, with eligibility to apply for permanent residence after three years. The medium-term stream would be underpinned by the MLTSSL.

44.          Other key features of the TSS visa, distinguishing it from the current 457 visa, include:

·          a requirement that the primary applicant has at least two years relevant work experience;

·          mandatory LMT in a prescribed manner, with limited exemptions to accommodate international obligations;

·          a higher English language requirement for the Medium-Term stream of an International English Language Testing System (IELTS) score of level 5 overall, with a minimum of 5 in each component score; and

·          a non-discriminatory workforce test to allow closer examination of applications from employers whose workforce is predominantly made up of overseas workers.

Complementary reforms

45.          From the date of announcement, the Department would implement a number of complementary reforms leading up to the abolition and replacement of the 457 visa in March 2018.

Changes to temporary skilled employer sponsored visas

46.          Changes to the 457 visa before the introduction of the TSS visa include:

·          reducing the maximum duration of 457 visas issued for occupations that are on the STSOL to two years (unless international trade obligations require a longer period);

·          removing the English language salary exemption threshold, which exempts applicants whose salary is over $96,400 from the English language requirement;

·          Processing efficiencies to expand the expand the scope of sponsorship accreditation and streamline nominations for lower risk-sponsors, including trusted traders and government agencies;

·          mandatory provision of penal clearance certificates;

·          expanded skills assessments; and

·          authorising the Department to publicly disclose the details of sponsors who are sanctioned for breaching the sponsor obligations framework.

Changes to temporary and permanent employer sponsored skilled visas

47.          Proposed changes to both the temporary and permanent employer sponsored skilled visa programmes include:

·          authorising the Department to collect and use TFNs of temporary and permanent skilled visa holders; and

·          tightening and clarifying the training benchmarks policy settings, including regarding the requirements a training fund must meet, and the types of acceptable training expenditure. Then, from March 2018, replacing the training benchmarks with a levy to a government managed training fund payable by employers nominating a temporary or permanent skilled migrant.

Changes to permanent employer sponsored visas

48.     Proposed changes to the permanent employer sponsored skilled visas include:

·          specifying eligible occupations in the MLTSSL, with additional occupations available to support regional employers using the RSMS;

·          extending the residence period required to apply for permanent residence from two to three years;

·          paying a market rate salary not less than the TSMIT; [15]

·          more stringent age, English language, and relevant work experience requirements;

·          requiring migrants who accessed regional concessions for their temporary visa to have lived in regional Australia in order to be eligible for permanent residency;

·          requiring nominators to provide evidence of ‘genuine need’ for the person to work in the nominated position;

·          removing the exemptions to the skills assessment and English language requirements for applicants earning at least $180,001; and

·          providing the ability to refund application fees where an application must be refused or withdrawn at no fault of the applicant.

Likely outcomes of Option 1

Australian labour market

49.          As Australia’s skills needs are constantly evolving and the skilled migration programme is designed to respond to those needs, use of the programme, and the impact of this option, will depend on labour market circumstances in the years ahead. In April 2017, 457 workers accounted for less than one per cent of the Australian workforce, [16] and between 0.17 - 4.47 per cent of any industry. [17] Therefore, the impact that the option 1 measures might have on the overall economy and particular industries is limited but will vary by industry and occupation. A key aspect of option 1 is six-monthly reviews of the occupation list to ensure it remains responsive to Australia’s skills needs.

50.          The measures in option 1 will have a higher impact on occupations that have the highest percentage of 457 workers compared to total employment. The maximum visa period of two years for occupations on the STSOL, such as Cooks, may result in an increase in the training and employment of Australians and/or a higher turnover of temporary skilled migrants. Of the top ten ANZSCO occupation groups with the highest percentage of 457 visa holders, there is only one ANZSCO occupation group (with the smallest historic 457 use) that does not have an occupation eligible for the 457 programme. [18]

Top ten ANZSCO occupation groups with highest percentage of 457 visa holders [19]

 

ANZSCO code

 

ANZSCO occupation group

Employed Total in May 2017 ('000)

457 visa holders at 31 May 2017

% of 457 visa holders to total employment

3514

 Cooks

43.6

6168

14.16%

3125

 Mechanical Engineering Draftspersons and Technicians

5.3

692

13.05%

2632

 ICT Support and Test Engineers

12.2

1373

11.28%

2611

 ICT Business and Systems Analysts

27.3

2900

10.63%

3922

 Graphic Pre-press Trades Workers

1.2

109

9.15%

2252

 ICT Sales Professionals

12.8

1133

8.86%

6392

 Retail and Wool Buyers

4.3

291

6.74%

1411

 Cafe and Restaurant Managers

67.5

4391

6.50%

2613

 Software and Applications Programmers

106.8

6545

6.13%

3123

 Electrical Engineering Draftspersons and Technicians

8.7

509

5.82%

 

51.          There are differing expert opinions on the impact that the option 1 measures might have on the Australian labour market. For example, Dr Birrell has argued that there it is very likely that these measures would significantly reduce the number of overseas workers on the employer sponsored skilled visa programmes, which will benefit domestic job seekers. [20] Whereas, Dr Wright has argued that whilst he agrees that the measures could reduce the number of overseas workers in these programmes, "any claim that a major reduction in workers on temporary visas would have a significant impact upon the Australian labour market is a bit far-fetched”. [21]

Australia’s ability to attract overseas skilled workers

52.          The measures in option 1 are not expected to substantially affect Australia’s competitive position among its peers (Canada, New Zealand, the United Kingdom and the United States) in attracting and retaining the best and brightest skilled migrant workers from around the globe that are in need in the Australian labour market. Visa settings are only one factor in a migrant’s choice of destination, with other key aspects including lifestyle, taxation, and education.  There are also other skilled migration options, such as Work agreements which allow employers with a demonstrated skill need that cannot be met by the Australian labour market to access skilled migrants in occupations outside the skilled occupation lists.

53.          Some industries have expressed concern that the option 1 measures will impact on their international competitiveness to attract talent. This issue has predominately stemmed from removing the eligibility for permanent residency for some occupations. Some of those who expressed concern are:

·          the tertiary education sector, which raised concerns about their ability to attract PhDs, researchers and academics; and

·          multinational businesses, which raised concerns about their ability to attract Chief Executive Officers.

54.          These concerns were considered as part of the review of occupation lists on 1 July 2017, and resulted in 23 occupations moving from the STSOL to the MLTSSL. Occupations on the MLTSSL are eligible for a visa of up to four years, and the option to apply for permanent residency. Occupations which moved from the STSOL to the MLTSSL include Chemist, Chief Executive or Managing Director, Environmental Research Scientist, Software & Applications Programmers ( nec ), and University Lecturer.

55.          Option 1 will also affect the ability for employers to retain a temporary skilled migrant. This will only affect employers who are employing overseas workers in an occupation on the STSOL, which is subject to biannual reviews. These occupations will be restricted to visas of up to two years (unless international trade obligations require a longer period), and the visa holder will only be able to renew once onshore. However, these settings reflect the policy intent to address short term skill needs and encourage the training of Australians rather than reliance of overseas migrants. The industries that have the highest proportion of visa holders in occupations that are on the STSOL compared the MLTSSL are:

·          Accommodation and Food Services;

·          Arts and Recreation Services;

·          Administrative and Support Services;

·          Retail Trade; and

·          Wholesale Trade. [22]

Improving the quality of migrants

56.          The tighter settings would improve the quality of temporary and permanent migrants and ensure they have the necessary attributes to successfully contribute to Australia’s social and economic prosperity. They would also ensure that migrants have the necessary attributes to improve employment and community integration outcomes, and are able to successfully transition to permanent residency, if they are eligible. Key aspects include:

·          more targeted occupation lists based on labour market analysis and stakeholder consultation that differentiate between short-term and long-term skills that are needed in the Australian labour market;

·          reducing the current age limit for the permanent employer sponsored skilled visa programmes from 50 to 45 years will improve the fiscal contribution of these migrants; [23]

·          the increased work experience requirement for temporary and permanent employer sponsored skilled migrants recognises the importance of this attribute for effective productivity, workplace contributions and enhanced fiscal outcomes;

·          higher English language requirements ensure that migrants are less vulnerable to exploitation, are able to integrate more easily in the workforce and community, and enable the transfer of skills from migrants to Australian workers; and

·          enhanced character checking for the temporary employer sponsored skilled visa programme supports visa integrity and aligns with the way in which other visa programmes operate. [24] While applicants would incur regulatory costs associated with police checks, there is benefit in assessing this requirement before permanent residence to ensure that the Australian community is protected and that persons of concern are identified as early as possible.

57.          Whilst the option 1 measures will improve the quality of migrants, they will also result in some migrants not being eligible to use the programmes. For example, recent graduates or those over 45 years old may not meet the new work experience or age requirements respectively.  However, employers may look at other options to source skilled migrants who meet the new requirements where Australian workers are not available and there will continue to be exemptions to the age requirement.

Supporting Australia’s skill needs

58.          The proposed TSS settings under Option 1 would bring a sharper focus on Australia’s labour market and skill needs by implementing more targeted, evidence based occupations lists that differentiate between short and medium term skill shortages. Option 1 supports Australia’s skill needs by ensuring employers can only nominate occupations in short-term need for shorter visa periods with limited renewal (under the Short-Term stream), but can nominate occupations in medium to long-term need for longer visa periods (under the Medium-Term stream, and through permanent visas) and with no renewal limits.

59.          Whether an occupation is, or is not, eligible for the employer sponsored skilled visa programmes will have the most significant impact on employers. For other option 1 measures such as increased English language, skill, age requirements or enhanced LMT, employers will still be able to source an overseas worker if there is a genuine need to fill a skills need. However, employers may need to source skilled overseas workers from outside of existing sources if those sources cannot meet the requirements. In some cases, this may delay, although not prevent, an employer from sourcing skill labour. Some employers may instead choose to recruit an Australian worker.

60.          The 1 July 2017 occupation lists update considered several factors including labour market analysis, and advice from government departments. Stakeholder feedback was also considered, in particular feedback regarding skilled occupations that had been removed from eligibility on 19 April 2017 and that employers considered were still needed to fill skills gaps.  For the for the subclass 186 and 457 visa programmes, the 1 July 2017 update included the addition of:

·          16 occupations to the STSOL. This included Aeroplane Pilot which had been removed from eligibility on 19 April 2017; and

·          20 occupations to the MLTSSL. [25]

Regular review of the occupation lists enables stakeholders to provide timely feedback, and ensures the lists meet Australia’s skill needs.

61.          There will inevitably be differences of opinion as to the need to source overseas migrants in a particular occupation. The occupation lists review process continues to be refined and is designed to consider qualitative labour market data as well as qualitative feedback from industry, unions and the general community. The broad range of stakeholders that have provided input to the occupation list reviews demonstrates the interest in engaging in regular updates of occupation lists.

62.          Work agreements will remain an avenue to sponsor skilled migrants in occupations not on the lists where there is a demonstrated need that cannot be met by the Australian labour market. Work agreements are formal arrangements negotiated between an employer and the Australian Government that let an employer recruit an agreed number of skilled workers from outside Australia. They provide a flexible, tailored skilled migration arrangement for businesses and sectors with specific needs that sit outside the mainstream skilled migration programme.

63.          The impact on business and visa holders who have made investments on the basis of meeting previous permanent residency criteria would be mitigated by grandfathering access to the permanent skilled employer sponsored visa pathway for existing 457 visa holders and applicants at the time of the Government announcement.

Incentivising employers to give priority to Australian workers

64.          Option 1 would incentivise employers to give preference to appropriately skilled and available Australian workers by tightening the circumstances in which overseas workers could be employed. Measures that would incentivise employers to look to the Australian labour market include:

·          better targeted occupation lists, and visa duration linked to the lists;

·          limited onshore renewal, and a genuine temporary entrant requirement for the Short-Term stream of the TSS visa. These criteria reinforce the temporary nature of the Short-Term stream, and provide mechanisms to refuse a visa where a migrant is seeking to use temporary visas to establish longer term residence in Australia;

·          restricting the ability to access permanent residence through the Temporary Transition stream to the Medium-Term stream of the TSS visa only;

·          a national training fund levy which would improve training and employment outcomes for Australians, and reduce longer term reliance on overseas workers;

·          a non-discriminatory workforce test to ensure employers are not actively discriminating against Australian workers; and

·          mandatory LMT in a prescribed manner, with exemptions to accommodate international trade obligations.

65.          The LMT measure will impact employers who have not previously needed to meet this criteria. In particular, this will affect employers of professional occupations.  There is expected to be minimal impact employers who have previously sought to find an available and appropriately skilled Australian prior to hiring an overseas worker. Employers whose default approach was to source overseas workers will now have to first test the local labour market.

International obligations

66.          Currently, the 457 visa is the primary visa that facilitates Australia’s international trade obligations on the movement of natural persons. The measures in option 1 are consistent with Australia’s international trade obligations, which include commitments regarding visa duration, and not imposing LMT and occupations.

Settlement Outcomes

67.          As the Department’s submission to the Joint Standing Committee on Migration’s inquiry into migrant settlement outcomes notes, “poor settlement outcomes can have a detrimental effect on individual migrants’ lives as well as on the economy and society as a whole. Migrants must be equipped with the tools that assist with positive settlement outcomes, an ability and willingness to integrate, and an understanding of Australia.” [26] Characteristics of positive settlement outcomes include social and economic participation, and economic and physical well-being. [27] Settlement outcomes can be improved by measures in option 1 such as:

·          extending the period from two to three years that employer-sponsored migrants must remain in their nominated position before being eligible for permanent residence, because they have had additional time to settle in Australia; and

·          increasing, and removing exemptions to, the English language requirements. [28]

Increased training opportunities for Australians

68.          As the 2016 Productivity Commission Report noted, “ready access to temporary skilled immigration dampens incentives for employers to invest in skills and training”. This highlights the importance of a strengthened mechanism to improve Australian training outcomes. An overarching requirement for employers nominating an overseas skilled worker to pay a levy to a government managed training fund would improve training and employment outcomes for Australians and reduce longer-term reliance on overseas workers. This would also address the integrity concerns with the current training benchmark requirements, which were raised by the 457 Integrity Review.

69.          The proposed new training fund contribution model aims to make compliance and monitoring simpler by removing the need to maintain complex records to demonstrate expenditure to meet the current training benchmark requirements, and replacing it with a levy paid to the Skilling Australians Fund (SAF).

70.          It is expected that for most employers the cost of the SAF levy will be less than the costs under the training benchmarks, and Australian citizens and permanent residents will have improved training opportunities, with more transparent outcomes.

Addressing integrity risks

71.          The Department has identified several legislative inconsistencies and gaps that present integrity risks, which make it easier for employers to misuse the programme. These risks would be addressed by the following measures:

·          tightening the current training benchmarks and then replacing them with a national training fund levy;

·          removing salary-based exemptions to English language (including the English Language Salary Exemption Threshold (ELSET)) and skills assessments requirements to address misuse, improve social cohesion, and decrease the risk of vulnerability in the workplace. This would have regulatory costs to individuals who otherwise would not have been required to provide evidence of English language competence or skills assessments and do not possess that evidence;

·          requiring nominators to provide evidence of ‘genuine need’ for the person to work in the nominated position. This is to prevent positions from being fraudulently created for the purpose of facilitating the grant of a permanent visa;

·          providing the ability to refund application fees where an application must be refused or withdrawn at no fault of the applicant;

·          publishing details of sponsor sanctions. This would help to deter businesses from breaching their sponsor obligations by misusing the employer sponsored skilled visa programme, and address public about the integrity of this programme;

·          enabling the Department to collect and use TFNs to strengthen compliance monitoring and targeting;

·          expanding the skills assessment to cover cohorts of concern, for example, where particular combinations of occupation and nationality have been identified as an integrity risk; and

·          requiring nominators to provide evidence of ‘genuine need’ for the person to work in the nominated position.

Regional Australia

72.          Option 1 is likely to have a positive overall impact on regional Australia. It would recognise that employers in regional areas can find it harder to attract and retain skilled employees in comparison to metropolitan employers, and seek to address this through a number of mechanisms:

·          regional employers would have access to a broader range of eligible occupations than would be available to metropolitan employers. This broader occupation list available under the RSMS would be extended to also apply to the two streams of the TSS visa;

·          the maximum age at time of application for a permanent employer sponsored visa would be reduced from 50 to 45 years of age. However, there are existing age exemptions based on occupation, region (for medical practitioners), employer, salary, and for New Zealand citizens. If needed, these exemptions could be expanded in future to support regional Australia; and

·          a requirement for temporary visa holders who accessed a regional occupation concession to have lived in a regional area for three years to be eligible for a permanent employer sponsored visa would ensure that migrants have a strong incentive to live and settle in regional Australia.

Addressing public concerns

73.          The new framework addresses public concerns regarding negative impacts of the existing 457 visa programme on the Australian labour market. Implementing reforms from July 2017 to tighten the 457 visa and permanent skilled employer sponsored visa settings would address the concerns while the new framework is being built, and more closely align the current legislative framework with the future state of the employer sponsored skilled visa programme.

Regulatory costs

74.          The Office of Best Practice Regulation (the OBPR) has agreed to the regulatory cost savings of $1.193 million on average per annum for option 1. Not all measures in option 1 are expected to have a regulatory impact on businesses or individuals. The ones that do have been outlined below. Since the proposal is deregulatory, no regulatory offsets are identified.

Table 1: Regulatory burden estimate (RBE) table

Average annual regulatory costs (from business as usual)

Change in costs ($ million)

Business

Individuals

Total change in costs

Extended LMT

- $1.839

 

- $1.839

Enhanced character assessment

 

- $3.819

- $3.819

Removal of ELSET

 

- $1.596

- $1.596

Educate sponsors on new visa framework

- $0.445

 

- $0.445

Expanded skills assessment

 

- $0.116

- $0.116

SAF levy

- $0.351

 

- $0.351

Removal of training benchmarks

  $9.359

 

  $9.359

Total, by sector

  $6.724

- $ 5.531

  $ 1.193

 

Option 2

Overview of Option 2

75.          Option 2 would involve retaining the 457 visa, and only implementing integrity reforms to the 457 visa. The key differences between Option 2 and Option 1 are:

·          the 457 visa would be retained; and

·          the Department would not reform the permanent employer sponsored skilled visas, but would instead consider changes as part of future visa reform.

76.          The Department would introduce integrity measures to the 457 visa, including:

·          condensing the occupation list and including additional occupation caveats;

·          removing the ELSET;

·          expanded skills assessments;

·          enhanced character checking;

·          publishing details of sponsors who have been sanctioned; and

·          allowing the Department to collect and use TFNs of temporary and permanent skilled visa holders.

Likely outcomes of Option 2

77.          Option 2 would go some way to improve quality and integrity outcomes for the 457 visa. However, it would not fix all the problems identified in the temporary employer sponsored skilled visa programme and would not address any of the issues with the permanent employer sponsored skilled visa programme until broader visa reforms were introduced. Waiting for broader visa reform means that these programmes will continue to face integrity issues and will in some cases be inconsistent with the temporary 457 visa programme.

78.          Option 2 would not address some current issues inherent in the 457 visa framework. This includes not clearly distinguishing between short-term and medium-term skill needs.  Occupation lists and visa validity policy settings which differentiate between short and medium-term skills needs would go some way to addressing this issue.  However there would be no mechanism to prevent longer term residence for skills that were only in temporary need and for preventing visa holders and sponsors from seeking to use the temporary programme as a vehicle for permanent migration.

79.          Option 2 would also run the risk of creating an imbalance between the temporary and permanent employer sponsored skilled visa settings, with permanent settings being lower in some cases, and create uncertainty as to potential future further changes to permanent residence.

80.          Like option 1, it is expected that the measures in option 2 will have a limited impact on the overall economy and particular industries, which would vary by industry and occupation. Also, the measures in option 2 are not expected to substantially affect Australia’s ability to attract and retain talent. Unlike option 1, the measures in option 2 won’t affect the ability for employers to retain a temporary skilled migrant, as there is no shortened visa stream with restrictions on onshore renewal.

 

81.          Industry stakeholders and migration programme users are expected to be less critical of the changes in Option 2 than Option 1. However, the Department expects there would still be criticism of tightening access to the Australian labour market for overseas workers.

Addressing integrity risks

82.          There would be no measures implemented to address the integrity risks in the permanent employer sponsored skilled visa programmes. This would result in continuing misuse by some employers. However, some but not all of the integrity risks for the 457 visa programme would be addressed through the following measures:

·          publicly disclosing the details of sponsors who are sanctioned for breaching the sponsor obligations framework;

·          enabling the Department to collect and use TFNs to strengthen compliance targeting and outcomes;

·          updating the skilled occupation lists;

·          expanded skills assessments; and

·          removing the ELSET.

83.          The current training benchmarks would continue to exist unchanged. Therefore, the following problems would also continue:

·          a lack of transparency;

·          no demonstrable training outcomes; and

·          the benchmarks are overly complex and inequitable.

84.          As mentioned in Option 1, removing the ELSET and introducing enhanced character checking would increase regulatory costs to individuals.

Addressing public concerns

85.          Not replacing the 457 visa would fail to address public concerns about the employer sponsored skilled migration visa programme. This could impede effective reform to the temporary skilled migration visa programmes and the Government’s ability to support the Australian economy by facilitating access to skilled labour.

Supporting Australia’s skill needs

86.          One of the problems with the current settings of the 457 visa programme is that migrant intake is not necessarily reflecting Australia’s short, medium and long-term needs. A significant factor is that the 457 programme has become a de-facto pathway to permanent residency. This issue would continue with Option 2 and would result in the skills needs of the Australian economy not being adequately met, as visa settings other than the occupation lists would not differentiate between short and medium-term skills shortages.

87.          The occupation list would be condensed, more targeted, and would differentiate between short and medium-term skills shortages. However, the current 457 visa framework would not effectively implement these changes as it lacks the regulatory mechanisms proposed under Option 1 for the Short-Term and Medium-Term stream of the TSS.

Improving the quality of migrants

88.          The tighter settings would slightly increase the quality of overseas migrants using the 457 visa programme. Key aspects include:

·          more targeted occupation lists based on labour market analysis and stakeholder consultation that differentiate between short-term and long-term skill needs; and

·          mandatory penal clearance certificates.

89.          Option 2 would not ensure that policy settings are set at requisite levels to support settlement outcomes support. It would not include measures to support skilled overseas workers to have the necessary attributes to successfully contribute to Australia’s social and economic prosperity on a permanent basis.

Incentivising employers to give priority to Australian workers

90.          Whilst the 457 visa programme currently has some incentives to prioritise Australian workers, Option 2 would not provide further incentives. Therefore, situations would continue where employers do not use the 457 visa programme to meet genuine temporary skill needs, and instead hire skilled overseas workers rather than training and or employing appropriately skilled Australians.

Option 3

Overview of Option 3

91.          Option 3 would involve retaining the employer sponsored skilled visa programmes with no changes (status quo).

Likely outcomes of Option 3

92.          Option 3 would not address the current problems with the temporary and permanent employer sponsored skilled visas. In particular, it would not address the issues within the current framework settings which have resulted in:

·          some businesses using the programmes where Australian workers are available;

·          some businesses and visa applicants not meeting the intended requirements of the programmes;

·          some individuals and businesses using the temporary visa programme primarily to seek longer term or permanent residence without a further control to determine they continue to meet Australia’s social, economic, and skill needs; and

·          skills supplied by the visa programme not fully aligning with Australia’s short or long term needs.

Consultation

93.          The Department provided an interim Regulatory Impact Statement (RIS) to the OBPR at an earlier decision point. The OBPR agreed to the provision of an interim RIS on the basis that a final RIS would be prepared to inform the final decision point.

94.          The Department has drawn on consultation with and feedback received from a broad range of stakeholders to identify issues addressed through the reform, and to obtain stakeholder views on the proposed reforms. The Department identified the following interested stakeholders:

·          individuals, legal and industry peak bodies, and businesses who use the employer sponsored skilled visa programmes;

·          migration agents whose clients use the employer sponsored skilled visa programmes;

·          foreign government representatives; and

·          federal government departments and agencies, including:

o     the Department of Foreign Affairs and Trade;

o     the Attorney-General’s Department;

o     the Department of the Prime Minister and Cabinet;

o     the Department of Finance;

o     the Australian Tax Office;

o     the Department of Health, Austrade;

o     the Department of Education & Training;

o     the Department of Jobs and Small Business;

o     the Department of Human Services;

o     the Department of Industry, Innovation and Science;

o     the Department of Social Services; and

o     the Treasury.

95.          The Department’s consultation process included individual meetings, roundtables, interdepartmental committee (IDC) meetings, submissions, and feedback received through other channels. A range of reforms developed as a result of these consultations have already been implemented. The main consultative processes included:

·          the 457 Integrity Review, which met with over 150 stakeholders and received 189 written submissions;

·          the 2016 Productivity Commission Report, which received over 100 public submissions, met with a range of stakeholders in Canada, New Zealand, the United States and Australia;

·          the 2016 Review of the Temporary Skilled Migration Income Threshold, which involved consultation through 19 one-on-one meetings, a forum with 11 attendees and 40 written submissions;

·          the 2016 Senate Inquiry, from the Senate Education and Employment References Committee;

·          consultation with and input from the Ministerial Advisory Council on Skilled Migration;

·          meetings of the Skilled Migration Officials Group;

·          IDC meetings between the Department and other federal government agencies and departments;

·          eight roundtables in Melbourne, Sydney and Canberra; and

·          meetings, and associated correspondence, with individual stakeholders.

Stakeholder feedback

96.          The feedback from the consultations can be summarised as follows:

·          there is broad support for the intent of the reforms and the use of skilled overseas workers where skilled Australians are not available, so long as those employing them offer employment and training opportunities for Australians;

·          there are some concerns about the impact of the reforms in limiting access to skilled migrants (expanded on below); and

·          there is some support to further tighten policy settings than is proposed.

Stakeholder feedback

97.               Stakeholder consultation shows that the Government needs to consider a wide range of varying, and often opposing views. The Department continues to consider feedback raised by stakeholders in the development of the TSS visa and future reviews of the occupation list.

98.               During the consultation, the Department has considered and subsequently addressed many concerns raised by stakeholders. Some of these have been outlined previously in this RIS and others are outlined in this section.

Initial feedback

99.               Initial media after the Government’s reform announcement made 18 April 2017 (which reflect the option 1 measures) highlighted both support for and concerns of some stakeholders. Some stakeholders, such as the Australian Industry Group, agreed that the programme needed significant reform, and this could be achieved by replacing it with a new visa that more clearly defined its purpose - to address skill shortages that exist in the Australian economy [29] .  The Australian Chamber of Commerce and Industry supported the need for a reset in the way in which the Government handled temporary skilled visas [30] . Other feedback was mixed where stakeholders expressed support for certain aspects of reform, and concerns regarding other measures.

100.           Concerns raised centred on the occupation changes which had immediate impact. Through the consultation process, the Department considered a number of concerns raised by stakeholders and made some adjustments to address these concerns, such as:

·          expanding the number of eligible occupations, particularly on the MLTSSL, on 1 July 2017 where there was evidence to support an ongoing need for particular occupations. This took into account feedback from employers within the horse racing sector, science and research sector, IT tech and retail sector, tertiary sector and the aviation industry;

·          clarifying that the work experience requirement would be assessed in a way that reflects the nature of the particular occupation, including experience in related occupations where relevant. This feedback addresses concerns raised by the tertiary education industry, the medical sector, arts and performance sector and the science and research sector; and

·          providing for a high salary exemption to the English language requirement for intra-company transferees. This addressed concerns raised by some of Australia’s trading partners about the impact of removing the ELSET.

New policy settings for the TSS visa

101.      Stakeholders raised concerns regarding the new policy settings for the TSS visa, including:

·          the reduced visa lengths and access to permanent residence, and whether this would impact on Australia’s ability to attract talent;

·          the reduction in occupations available, and whether this would impact application numbers for permanent skilled employer sponsored visas;

·          the two years’ work experience requirement, which would negatively impact the tertiary industry, the medical sector, arts and performance sector and the science and research sector;

·          increased English language requirements, ELSET removal and introduction of mandatory police checks, which could negatively impact an employer’s ability to access and recruit overseas workers;

·          replacing the training benchmarks with a government managed training fund levy would add to existing training costs for some businesses, and may not address specific skills gaps in those businesses; and

·          the reforms could increase red tape and negatively impact businesses.

Australian labour market

102.      Some members of the public and unions raised concerns about the negative impact of the current temporary employer sponsored skilled visa programme on the wages, conditions and job opportunities for Australian workers will continue under the new TSS visa.

Transitional arrangements

103.      Concerns were raised about how the reforms would impact existing and future visa holders and applicants, particularly regarding:

·          how existing 457 visa holders would be affected where their occupation has been removed from the relevant skilled occupation list; and

·          how exemptions, such as to the age and English language requirements, would apply.

Integrity of the employer sponsored skilled visa programmes

104.      Stakeholders raised concerns about whether the integrity measures would go far enough to address the exploitation of overseas workers.

Consultation

105.      Stakeholders were critical about the lack of transparency and engagement about the reforms prior to the Government’s announcement. Notwithstanding this criticism, stakeholders appreciated the early engagement by the Department on the specific policy settings, following the announcement.

Regional Australia

106.      Stakeholders sought clarification on how the reforms would provide regional concessions. Stakeholders suggested that the Government should consult further with regional Australia and the agricultural sectors on the reforms.

Visa processing

107.      Stakeholders sought clarification on whether the reforms would lead to processing efficiencies or impact visa processing timeframes.

Best option

108.      The recommended option is to abolish and replace the 457 visa, and implement complementary reforms to the temporary and permanent employer sponsored skilled visas (option 1). This option has a deregulatory impact.

109.      Option 1 is the preferred option as it:

·          provides a comprehensive and complementary package of reforms to the temporary and permanent employer sponsored skilled visa framework;

·          incentivises employers to only seek to fill vacancies with overseas workers where appropriately skilled Australian workers are not available;

·          has enhanced integrity measures to prevent the misuse of the employer sponsored skilled programmes;

·          meets Australia’s skill needs through policy settings which distinguish between short and medium to long term needs;

·          ensures that skilled overseas workers have the necessary attributes to successfully contribute to Australia’s social and economic prosperity, either temporarily or permanently; and

·          provides increased training outcomes for Australians.

110.      Options 2 and 3 would not fully differentiate between the short, medium and longer-term skilled labour needs of the Australian economy, and would run the risk creating an imbalance in temporary and permanent employer sponsored skilled visa settings.

111.      Options 2 and 3 would not enable the employer sponsored skilled visa programmes to better meet Australia’s labour market and economic needs.

Implementation and evaluation

112.      Option 1 would have IT systems, processing, resourcing and legislative implications. The Department undertakes changes to legislation and systems using its Change Management Framework. This includes a detailed implementation plan with risk management strategies.

113.      The Department proposes a phased approach for implementing Option 1, with integrity and quality measures introduced between April and December 2017, and the new TSS visa and SAF levy introduced in March 2018. The Department would leverage existing systems, processes and monitoring governance arrangements.

114.      Amendments to the Migration Act 1958 , Migration Regulations 1994, legislative instruments, and policy would be required to change settings for the temporary and permanent employer sponsored skilled visas. Publishing sponsor sanctions and sharing TFNs may also require changes to the Tax Administration Act 1953 and the Income Tax Assessment Act 1936 . The proposal to establish a government managed training fund would require taxing Bills.

115.      It is possible that legislation to enable the Department will not be passed by Parliament. This would mean:

·          in the case of sharing TFNs, the Department would not benefit from an enhanced compliance targeting or enhanced long term research on skilled migration employment outcomes. The overall rating for these risks has been assessed as medium. If this legislation were not to pass, the Department would continue compliance targeting and research using other client identifiers, however this would be less effective than TFN sharing;

·          in the case of publishing sponsor sanctions, the Department would not publish sponsor sanctions . This has been assessed as a medium risk. If this legislation were not to pass, the Department would consider other public facing communication strategies to further deter sponsors from breaching their obligations, however, these would be less effective; and

·          in the case of the government managed training fund, the Department would have to consider other options to improve training outcomes for Australians. This has been assessed as a high risk.

116.      To prepare stakeholders to transition to these arrangements, the Department has developed a communications plan and is continuing to engage closely with stakeholders about the reforms. This engagement plan includes:

·          maintaining up to date information about the reforms on the department’s website, including factsheets with timelines and frequently asked questions and answers;

·          maintaining a register of issues to inform future policy directions;

·          ongoing feedback through broader visa reform stakeholder consultation; and

·          engagement with stakeholders through existing fora:

o    Ministerial Advisory Council on Skilled Migration;

o    Senior Migration Officials Group;

o    annual migration planning;

o    net overseas migration forecasting;

o    migration agents; and

o    public information.

117.      After the measures have been implemented, the Department will evaluate them through existing processes, as well as specific reviews as required. The Department will take into account both internal and external stakeholder feedback to determine if the Government’s objectives have been met. As previously stated, the Government aims to achieve the following objectives:

·          ensure that that employers only seek to fill vacancies with overseas workers where appropriately skilled Australian workers are not available;

·          enhance integrity measures to prevent the misuse of the employer sponsored skilled programmes;

·          ensure that skilled overseas workers have the necessary attributes to successfully contribute to Australia’s social and economic prosperity, either temporarily or permanently; and

·          meet Australia’s skill needs through policy settings which distinguish between short and medium to long term needs.

 

 

 




[1] There were 16,452 visas granted to an industry, which is not specified in departmental reporting systems.

[3] CSOL was an expansive list of skilled occupations not based on labour market shortages, which was used to determine eligibility for sponsored temporary and permanent migration.

[4] Further information about what a skilled overseas worker needs to do to apply for a primary 457 visa can be found at: http://www.border.gov.au/Trav/Visa-1/457-#tab-content-1

[5] Further information about what an employer needs to do to apply for be a sponsor for the 457 visa programme can be found at: http://www.border.gov.au/Trav/Visa-1/457-#tab-content-3

[6] Further information about how a sponsor can nominate a skilled overseas worker can be found at: http://www.border.gov.au/Trav/Visa-1/457-#tab-content-4

[7] A list of exempted occupations can be found in the Legislative Instrument: Specification of Occupations for Nominations in Relation to Subclass 457 (Temporary Work (Skilled)) for Positions other than in the Business of the Nominator - IMMI 13/067 .

[8] In 2016, the Department received approximately 15,000 enquiries, complaints, suggestions or compliments regarding the 457 visa programme. One of the main issues raised is that overseas workers are using the 457 programme to take Australian jobs.

[9] Departmental data indicates that this pathway is taken by many, with 84 per cent of 186 and 187 visas granted from 1 July 2016 to 31 March 2017 being to individuals whose last substantive visa was a 457 visa.

[10] This is supported by labour market analysis undertaken by the Department of Employment who provided advice to the Department in April 2017 identifying over 200 occupations, which were extraneous to Australia’s labour market needs.

[11] The 2016 Senate Inquiry received evidence from several unions that 457 visa holders were being used to fill positions that could have been taken by qualified Australian workers, and were also displacing some Australian workers.

[12] As noted in the 2016 Productivity Commission Report, it is the broad intent of the visa programmes to meet Australia’s national interest (including national security and economic and social development).

[13] The 457 Integrity Review, p23.

[14] The 457 Integrity Review, p8.

[15] Currently, employers are required to pay the market salary rate to permanent skilled employer sponsored visa holders.

[16] As at 18 April 2017, there were 92,896 primary 457 visa holders in Australia. This accounted for 0.78 per cent of the total Australian workforce, which was 11,922,100 as at February 2016.

[17] Based on the same data as footnote 15, primary 457 visa holders accounted for between 0.17 - 4.47 per cent of the Australian workforce in an industry. The highest percentage (4.47 per cent) of primary 457 visa holders are in the Information Media and Telecommunications industry.

[18] The Graphic Pre-press Trade Workers group only has one occupation, 392211 Graphic Pre-press Trades Worker, which is not currently eligible for the 457 programme.

[19] Sources: Department of Immigration and Border Protection, BP0014 Temporary Work (Skilled) visa holders 2017-05-31 ULv100, and Australian Bureau of Statistics, 6291.0.55.003 - EQ08 - Employed persons by Occupation unit group of main job (ANZSCO), Sex, State and Territory, August 1986 onwards, released 22 June 2017.

[20] The Australian Population Research Institute’s research report: The Coalition’s 457 Visa Reset: Tougher Than You Think, August 2017

[21] Dr Wright, of the University of Sydney specialises in labour market regulation and immigration . Quotes sourced from A., 'Numerically insignificant': 457 visa overhaul unlikely to be a game changer for local jobs’, SBS News, viewed 11 August 2017, < http://www.sbs.com.au/news/article/2017/08/10/numerically-insignificant-457-visa-overhaul-unlikely-be-game-changer-local-jobs >

[22] This is based on visa holder data from 1 July 2012 to 30 June 2017 and the breakdown is for occupations that are on the STSOL or MLTSSL as at 1 July 2017.

[23] 2016 Productivity Commission Inquiry Report: Migrant Intake into Australia

[24] Further details on character and police certificate requirements can be found here: http://www.border.gov.au/Trav/Visa/Char

[25] More information on the 1 July 2017 changes to the lists of eligible skilled occupations can be found: http://www.border.gov.au/WorkinginAustralia/Pages/summary-of-1-july-2017-changes-to-list-of-eligible-skilled-occupations.aspx

[27] As noted in Appendix 20 to the Department of Immigration and Multicultural and Indigenous Affairs submission to the Joint Standing Committee on Migration report, To make a contribution: Review of skilled labour migration programs 2004 .

[28] As noted in the 2016 Productivity Commission Report, an overseas worker’s English language ability is an important factor in integration and settlement outcomes.

[29] Sydney Morning Herald, Business welcomes 457 visa changes, warns on red tape, 18 April 2017

[30] Australian Chamber of Commerce and Industry, Media Release: migration changes will help make system sustainable, 18 April 2017