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457 Visa: What You Should Know about the New Levy Changes

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Changed were announced to the 457 visa this year, as part of the reforms that are being released in various phases periodically, from April 2017 through March 2018. By then, the 457 visa will be completely replaced by the Temporary Skills Shortage or TSS visa.

The primary aim behind the move is to restore the original integrity for short term visa programs which cater to shortages or skills. This would ensure that employment opportunities are first preserved for the Australians and permanent residents. Some people do argue over the objective, and state that whole immigration changes are nothing new. However, modifications to this extent have never been seen before, ever since the Howard Government introduced the 457 visa in 1996.

So many employers planned their recruitment strategies using the current 457 visa, but things have changed now. So, it is best you take advice from experienced migration lawyers; they would clear all your concerns, advise you and give you recommendations based on your particular scenarios.

Here is what you can do to minimise the impact of all these changes.

Be prepared for the unexpected

Recent changes have introduced some uncertainties that are expected to linger even when the legislation has been fully rolled out. The government has already signalled employers that it can and probably will make more changes to the visa program and this too, without any warnings.

Expect longer lead times

If a Business Sponsor has an accredited status, then good news for them because they can enjoy faster processing times. But the preparation time for ‘decision ready’ applications has risen in light of the new requirements, effective since the first of July. These are related to skills assessment, language testing and police checks. Mandatory labour market testing will be introduced as well in March 2018.  

Do factor in the time which applicants would require for additional documentation.

Add additional costs to the budget

The new levy increases costs for all business sponsors when the reforms have been completely rolled out. The annual contributions that are made to the Skilling Australians Funds will now be determined using the number of temporary visa holders who have been employed and the number of PR applicants Rates can vary from $1,200 to $1,800 for temporary visa holders, based on the annual turnover rate. For PR applicants, an on-off payment between $3,000 and $5,000 is made for every application.

Considering the rates, some employers will have to contribute a lot more than the expenditure which is required for meeting the current Training Benchmark. Since there is no offset for training expenditure, the costs should be included in the total employment costs.

Manage employee expectations

Some of the current employees and even future prospects will be disappointed with the changes, especially the reduced four year visa options which lead to PR. Age limit has also been decreased to 45 from 50. Senior employees will also be impacted, but employers would have to manage all employee expectations carefully.  

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