The most famous route to Australia—the subclass 457 visa category for skilled overseas workers— has been abolished by the Australian government. Instead, a new Temporary Skill Shortage (TSS) visa has been introduced from March 18.
The abrogated visa was a famous route for Indians headed to work Down Under. Of the 90,000-odd holders of the 457 visas, 22% were Indians.
While TSS will continue to enable overeseas workers to be hired, the bad news for Indians eyeing permanent residency is that the new norms are restrictive. Further, new job entrants, including Indian students who have qualified from Australian varsities, may find it more challenging to get a job as a minimum work experience of two years is required. Hiring overseas workers will be comparatively more costly as it is proposed that sponsoring firms must contribute additionally to a skilling fund.
Labour testing norms, aimed at assuring locals are given the first opportunity for a job vacancy, are expected to be more stringent, even as final rules have not yet been declared.
Australia lists occupations where there is a skill shortage and for which overseas workers can be hired. The migration reform process started several months ago, in January an updated list for skilled migration visas was issued with significant pruning of occupations and some reshuffling of skill categories. Another list may follow in the coming months. For the year ended September 30, 2017, cooks, resident medical officers and restaurant managers were the top three occupations to be allotted the 457 visas.
The 457 visa had a maximum duration of four years. According to the Australian Department of Home Affairs, TSS visa has two main streams. A short-term stream that enables hiring of temporary expat skilled workers in occupations included on the Short term Skilled Occupation List (STSOL). The duration of this visa is a maximum of two years, it can be extended to up to four years, only if an international trade obligation applies. The second stream is a medium-term stream where expats can be hired for occupations included in the Medium and Long-term Strategic Skills List (MLTSSL) and its duration is for up to four years.
Dan Engles, Managing Director, Visa Solutions Australia says, “Short term TSS visa holders are not eligible to apply for permanent residence. The medium or long term TSS visa holder may apply for permanent residence, after having held the TSS visa for a minimum period of three years.” He adds, “Unless you (i.e your occupation) are on the correct list, options for permanent residency are restrictive.”
Perth based, Cyrus Mistry, director at Easy Migrate Consultancy Services, explains: “In some cases, the permanent residency pathway through company sponsorship has been removed. To illustrate: There were a lot of applications in the hospitality industry (cooks, restaurant and hotel managers) under the 457 visa category. Many of them came from the international student stream who, after qualifying, found Australian employers to sponsor their visa. These occupations are now on the STSOL list which means they can’t apply for company-sponsored permanent residency.”
“On the flip side, a management consultant was moved from STSOL to MLTSSL list, which means they can now apply for permanent residency pathways,” adds Mistry. TOI’s review of the occupation lists for IT workers shows that computer network and system engineers, and software engineers are on the MLTSSL list, but software testers and hardware technicians fall in the STSOL list, eligible only for a short duration TISS visa.
Hiring expats will be more costly. “A ‘Skilling Australia Fund’ (SAF) Bill is being debated in the Parliament. Once passed, the sponsoring company may need to contribute to the SAF at about Australian $ 1,200 per employee nomination, for each year of the visa tenure. So if a company wants to hire an expat software engineer for four years, they may have to pay a levy of Australian $ 4,800,” says Mistry.
Engles sums up the migration reform procedure, “The new rules are more stringent and are aimed at paving the way for higher skilled, higher qualified individuals to permanently migrate to Australia. We are already seeing a higher numbers of refusals across all visa subclasses—not just work visas. The Department of Home Affairs has been adopting a stricter approach over the past six months or so, visa applications are being refused without prior warning or communication.”
– Occupations for which there is a skill gap are listed on either of the two streams
– Those holding a short term TSS visa cannot seek permanent residency
– Sponsoring employer may have to contribute to a ‘Skilling Australia Fund’