Skills Fund levies on employers to take effect between July and September

IMPACT – HIGH

What is the change? The Skilling Australians Fund legislation will take effect in the first quarter of the 2018-19 fiscal year (July to September 2018).

What does the change mean? When implemented, employers sponsoring foreign workers for Temporary Skills Shortage Visas, or under the Employer Nomination Scheme or Regional Sponsored Migration Scheme will be required to pay a skills levy for each worker at the time of nomination. Updated changes to labour market testing have also been announced.

• Implementation timeframe: July – September.
• Visas/permits affected: TSS visas, ENS, RSMS.
• Who is affected: Employers sponsoring foreign workers under any of the three schemes.
• Business impact: The levies will significantly increase the costs of sponsoring foreign workers.
• Next steps: Employers should anticipate the introduction of the new levies within the next few months and budget for them.

Background: The Skilling Australian Fund legislation was passed on 9 May and imposes levies on employers to fund training and skills programs for Australian workers. Employers must pay the levy in full at the time applications are lodged.

The legislation also amended labour market testing rules, requiring that advertisements be placed for four weeks and no more than four months before the nomination is lodged, and state the skills or experience that are appropriate for the position. These provisions have not yet been implemented and employers can continue to advertise according to current rules for TSS visas.

Authorities have also expanded the acceptable advertising media to include certain online recruitment platforms and industry-specific recruitment websites. The labour market testing changes are available here.

BAL Analysis: Employers should discuss the additional costs and work with their BAL professional to address challenges in recruiting and hiring international talent. Companies may contact their BAL professional for details on the labour market testing rules.

This alert has been provided by BAL Australia. For additional information, please contact australia@bal.com.

MARN: 0101248

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