IMPACT – MEDIUM

What is the change? Several legislative amendments that clarify and reinforce current policies under Subclass 457 regulations will take effect 1 December.

What does the change mean? The amendments affect Subclass 457 visa holders and standard business sponsors (in particular those employers who are seeking to negotiate a work agreement with the Minister of Immigration and Border Protection for concessions to sponsor workers under the Subclass 457 visa programme). The existing policy that business sponsors perform labour market testing when seeking to sponsor foreign nationals under the terms of a work agreement will be codified in regulations and subject to further policy guidelines. Licensing obligations of 457 visa holders have been expanded, and the 90-day work commencement rule for 457 visa holders has been refined.

  • Implementation timeframe: 1 December.
  • Visas/permits affected: Subclass 457 visas.
  • Who is affected: Standard business sponsors and 457 visa holders.
  • Business impact: The amendments make some changes to the terms and conditions of 457 sponsorship and elevate certain policies related to work agreements into a legislative framework.
  • Next steps: Employers should contact their BAL team for recommendations in individual cases.

Amendments:

The amendments are contained in the Migration Amendment (Clarifying Subclass 457 Requirements) Regulation 2015, dated 12 November.

The key provisions and effective dates are as follows:

  • The requirement that standard business sponsors prove that the terms and conditions of employment of a 457 visa holder are no less favorable than an equivalent Australian worker will also apply to enterprise agreements under the Fair Work Act 2009. This provision takes effect for applications for subclass 457 nominations made on or after 1 December. As a result, employers will have to make sure that employment conditions of their 457 visa holders are the same or exceed those required in the relevant enterprise agreement. The requirement that the base rate of pay be greater than the temporary skilled migration threshold (TSMT) still applies even if there is an enterprise agreement.
  • Labour market testing will be required of employers before the Government enters into a work agreement. This provision takes effect for work agreements entered into on or after 1 December and reaffirms current policy. Details of the evidence required to satisfy this requirement will be set out in policy guidelines. The Department of Immigration and Border Protection will also be required to publish policy guidelines on its website regarding work agreements and policy agreements.
  • The requirements that 457 visa holders have the proper licensing or registration to perform their job have been expanded. The worker must hold the license while performing the job and within 90 days of arrival/granting of the visa and must comply with each condition of the license and not engage in work inconsistent with the license. In addition, the workers must notify the DIBP if a license application is refused or revoked. These rules take effect for visas granted on or after 1 December.
  • Individuals granted a subclass 457 visa outside of Australia must commence work within 90 days of arrival, and those granted a visa while in Australia must commence work within 90 days of the granting of the visa. This rule takes effect for visas granted on or after 1 December.

BAL Analysis: The amendments refine and clarify some important criteria for subclass 457 sponsors and visa holders, and indicate that the Government is seeking to reinforce policies to ensure that the use of the Subclass 457 visa programme to sponsor overseas workers under work agreements is limited to those circumstances where suitability qualified local Australian workers are not available.

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

MARN: 9683856

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