AUSTRALIA: 457 Visas to be Abolished

April 18, 2017

The Prime Minister Mr. Turnbull announced today the abolition of the 457 visa program and its replacement with a new Temporary Skill Shortage (TSS) visa. At present there is no law or policy, and we can only provide you with information which is currently in the public domain:

Mr. Turnbull said 457s would be replaced by “a new visa that better targets skills shortage”. The new program will fully replace the 457 visa by March 2018.  In the meantime, DIBP has announced that the culling of the 457 occupations list begins tomorrow.

The new rules will not apply to the 95,000 people already in the country on existing 457 visas.

“For those people here on a 457 visa at the moment, there will be a grandfathering arrangement. They will continue under the conditions of that visa,” the Prime Minister said.

The new visa system will have stricter requirements including previous work experience (at least 2 years work experience), English language proficiency and a greater onus on employers to fill to jobs locally first.

There will be a Short-Term two-year visa stream with a greatly reduced list of occupations, and this visa will not be a path to permanent residency. There is however, capacity for one onshore visa renewal under this Short-Term stream.

There will also be a Medium-Term stream which will be for a four-year period for higher skilled, strategic jobs with significantly tighter restrictions and an even narrower occupations list. There will be capacity for visa renewal onshore and a permanent residence pathway after three years.  The permanent residence eligibility period will be extended from two to three years.

The new temporary scheme will strengthen a non-discriminatory workforce test to ensure employers are not actively discriminating against Australian workers, it will strengthen the requirement for employers to contribute to training Australian workers and DIBP will collect Tax File Numbers and data will be matched with the Australian Tax Office’s records.

DIBP’s website states that mandatory labour market testing will only apply if there is no corresponding international obligation.

DIBP will tighten eligibility requirements for employer sponsored permanent skilled visas, including but not limited to:

  • Tightening English language requirements
  • A requirement for visa applicants to have at least three years’ work experience
  • Applicants must be under the maximum age requirement of 45 at the time of application
  • Strengthening requirement for employers to contribute to training Australian workers
  • Employers must pay the Australian market salary rate and meet the Temporary Skilled Migration Income Threshold.

Concessions for regional Australia will continue to be available:

  • Employers in regional Australia will continue to have access to occupations under the temporary and permanent visas, to reflect their skills needs
  • Existing permanent visa concessions for regional Australia, such as waiving the nomination fee and providing age exemptions for certain occupations, will be retained. Consideration will be given to expanding the occupations in regional Australia that are exempt from the age requirement

We will continue to monitor announcements from the Minister and DIBP, and will provide further updates as more information about the proposed changes becomes available.

As always, should you have any questions please contact your Newland Chase consultant or email us at [email protected].