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Australian Government abolishes 457 Visas

20 April 2017 by News Desk

Australian Prime Minister Malcolm Turnbull stated that he is ‘putting Australians first’ by giving them priority for jobs currently open to foreign workers

On 18 April 2017 in a shock move, Australian Prime minister Malcolm Turnbull announced that the Federal Government will abolish the 457 visa (“Temporary Work Skilled visa subclass 457) and replace it in March 2018 with the stricter “Temporary Skill Shortage” (TSS) visa. The implementation of the reforms will begin immediately and will be completed in March 2018. The scrapping of the 457 visa is part of an overall package of reforms that also focuses on skills training for local workers.

The 457 visa was introduced in the 1990s to quicken the entry of business professionals and highly skilled migrants but over time it was opened up for a broad category of workers and it allowed holders to bring members of their family to Australia on a 457 secondary visa.

The new TSS visa programme which will replace it will be comprised of two different sub classes of visa:

  1. The first is a Short-Term stream of up to two years. Immigration Minister Peter Dutton said the new two-year visa would not allow permanent residency but holders can apply for one onshore renewal. The number of occupation classifications available for the two year visa will be reduced by 216 from the current total of 651. The application fee will be $1150.
  2. The second is a Medium-Term stream of up to four years “targeted at higher skills” which will be available to an even smaller list of higher skilled occupations. This will require a higher standard of English language skills as well as a proper criminal record check. Holders of this visa will however be eligible to apply for visa renewal onshore and permanent residency after three years. The application fee will be $2400

Both streams will include:

  • Mandatory labour market testing with limited exemptions
  • A new non-discriminatory workforce test
  • Mandatory criminal history checks
  • A market salary rate assessment
  • Applicants to have two years’ work experience

The new “Temporary Skill Shortage Visa” programme will also be underpinned by more focused occupation lists that are responsive to genuine skill needs and regional variations across Australia.

However, current 457 visa holders will not be affected by the changes. Mr Dutton said there would be a grandfathering arrangement for current visa holders.

Minister Dutton said the current 457 visa program allowed foreign workers to apply for permanent residency and become a citizen “which is a significant part of the attraction of using the 457 visa”. The changes would stop the “open-ended” nature of the 457 scheme. “The existing 457 visa program is conducted for a period of four years, but essentially it is open-ended, and it results, in many cases, in a migration outcome,” he said.

There have been long-running concerns over the functioning of the visa and its claimed effects on the Australian workforce. Almost 96,000 people are currently in Australia on 457 visas. The majority of the visa holders are from India, which accounted for almost a quarter of the intake, followed by the UK and China at 19.5 per cent and 5.8 per cent respectively. Accommodation, food services, information, media and telecommunications are among the top sectors that use the 457 visa scheme.

The abolition of the 457 visa is seen by many as the Turnbull government’s reaction to pressure from opposition parties concerned about the effects of the 457 visa programme on Australian workers. The decision has been broadly welcomed by employers but dismissed as ‘tinkering at the edges’ by trade unions who have been strongly opposed to the 457 visa.

Darrell Todd of thinkingaustralia stated that whilst an overhaul of 457 visas was expected, the actual move by the Australian government was sudden. “It has generated some uncertainty and concern among many visa applicants and businesses and affected their ability to plan ahead. In addition, those who have applied for a 457 visa but have not yet received a decision will be affected if the occupation they have applied for has been removed from the list. People in this position and anyone else who is affected by the changes need to evaluate their position and our team at thinkingaustralia is here to help.”

Mr Todd said that whilst many details at present are lacking “The replacement TSS visa is still very similar to the old 457 visa system with some additional restrictions and requirements.” Because of this, he said, quality applicants seeking to move to Australia should remain positive. “For those who are serious, have the right qualifications and experience and are flexible about accepting a job offer anywhere in Australia, then the situation is good and they can realise their dream for Australia.”

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