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Understanding the Transition from Subclass 457 to TSS Visa


Written By Will Aldous
Fri, Jan 12, 2018
Will Aldous

The March deadline of The Government’s proposed introduction of the TSS Visa is rapidly approaching. The Department of Home Affairs, of which The Department of Immigration is now a component, has released further information on the proposed transition.

We hope to ensure that our current and prospective clients are prepared for this transition and that it will be as smooth as possible. We encourage anyone with questions on any aspect of this release to make contact with our Registered Migration Agents to discuss further.

The following was adapted from The Department’s January Newsletter and remains their content. More details will be provided closer to the changes in March.

An Overview of the Proposed TSS Visa

The Subclass 482 TSS visa will be introduced in early March 2018 to ensure businesses can access the critical skills they need to grow, where no skilled Australian worker is available. There will be three options available under this new visa program:

  • Short-term stream – this is for employers to source genuine temporary overseas skilled workers in occupations included on the Short-term Skilled Occupation List (STSOL)1 for a maximum of two years (or up to four years if an international trade obligation applies)
  • Medium-term stream – this is for employers to source highly skilled overseas workers to fill medium-term critical skills in occupations included on the Medium and Long-term Strategic Skills List (MLTSSL)*1 for up to four years, with eligibility to apply for permanent residence after three years
  • Labour Agreement stream – this is for employers to source overseas skilled workers in accordance with a labour agreement with the Commonwealth, on the basis of a demonstrated need that cannot be met in the Australian labour market and standard visa programs are not available, with the capacity to negotiate a permanent residence option.

1 Employers in regional Australia will have access to a broader range of occupations when the TSS visa is introduced.

At the time of lodging a TSS nomination application, employers will need to select an employment period of up to:

  • 1 year or 2 years for the short-term stream (unless an international trade obligation applies); and
  • 1 year, 2 years, 3 years or 4 years for the medium-term or labour agreements stream

Streamlining Temporary Skilled Work Visa Applications

The TSS visa is part of the Government's reform agenda to strengthen the integrity and quality of Australia's temporary and permanent employer sponsored skilled migration programs. This is, however, an important opportunity to introduce a number of initiatives to help streamline processing of temporary skilled work visas and contribute to reduced processing times, particularly for lower risk applications.

A number of initiatives are planned in this space which will help the TSS visa support business to fill skill shortages. They include:

  • a new standard five year sponsorship agreement period (including for start-ups)
  • implementing auto-approval of complete streamlined lower-risk nomination applications lodged by accredited sponsors2
  • a new streamlined 'renewal process' for existing sponsors – that is, a shorter application form to fill out and possible auto-approval of such sponsorship applications
  • new online forms for the new TSS visa
  • a complete review of correspondence to ensure that TSS correspondence templates are easier to use and understand.

Transitioning Arrangements

Employers who are already approved standard business sponsors for subclass 457 visa will be able to sponsor skilled overseas workers under the upcoming TSS visa program. It is, however, important to understand that transitional arrangements are expected to be in place for nomination and visa applications to avoid applicants waiting until the last minute to lodge.

Subject to final approval of transitional arrangements, it is expected that:

  • if subclass 457 nomination and visa applications are both lodged prior to TSS implementation, they will be processed under the current framework.
  • if a subclass 457 nomination application is lodged without an associated 457 visa application being lodged before the commencement of TSS, it will, however, effectively become 'redundant' as subclass 457 nominations cannot be linked to TSS visa applications, even where the nomination has already been approved (subject to the specific scenarios below).

Arrangements will be put in place to ensure that such 'redundant applications' can be finalised and/or withdrawn with a refund of the fee provided. To avoid delays or unnecessary additional processing steps we strongly encourage applicants to:

  • lodge complete subclass 457 nomination and visa applications together before the end of February, or
  • postpone lodgement until the commencement of TSS.

Note:

  • Secondary visa applicants (of 457 visa holders or pending 457 visa applicants) will be able to lodge a subsequent dependent TSS application and if they meet requirements, will be granted a TSS visa linked to their family's subclass 457 visa/nomination application. The validity period of the TSS visa will match the expiry date of the subclass 457 primary visa holder.
  • Subclass 457 visa holders whose visa is not expiring but wish to change employer after the implementation of TSS, can get their new employer to lodge a TSS nomination application to facilitate this as per current arrangements.
  • Subclass 457 visa holders who wish to change occupation or need a new visa (for example: with longer validity), they will, however, need to lodge a new TSS visa application referencing a new TSS nomination application.

Salary and conditions arrangement for TSS

As per current arrangements, sponsors seeking to employ an overseas worker at a salary of under AUD250,000 will need to provide additional information to demonstrate that they are going to pay the market salary rate to ensure that overseas workers are protected and the local labour market is not undercut.

Changes to some salary and conditions provisions are, however, planned to:

  • clarify provisions in this complicated area, with feedback received that terms such as 'base rate of pay' and 'guaranteed annual earnings' are misunderstood
  • ensure that salary arrangements more adequately reflect the different payment arrangements in place for different industries
  • ensure that overseas workers are protected and that market salary rate information cannot be inflated by unscrupulous employers, and
  • ensure that sponsors understand that they must comply with Australian employment laws as well as immigration requirements.

Changes to Permanent Residency (186 and 187 Visas)

As previously communicated, the Employer Nomination Scheme (ENS) visa (Subclass 186) and the Regional Sponsored Migration Scheme (RSMS) visa (Subclass 187) programs will also be impacted by the March 2018 changes. The main changes, as outlined in Fact sheet two: Reforms to Australia's permanent employer sponsored skilled migration programme (598KB PDF) are as follows:

  • the nominee's occupation will need to be on the Medium and Long-term Strategic Skills List (MLTSSL) unless: their employer is in a regional area, in which case additional occupations will be available for selection (more details to come in February), as well as occupations on the MLTSSL; or the transitional arrangements outlined below apply.
  • TSS salary and condition provisions will apply, with employers required to pay the Australian market salary rate and meet Temporary Skilled Migration Income Threshold (TSMIT) requirements
  • the eligibility period for the Temporary Residence Transition (TRT) stream will be extended from two to three years
  • at least three years' work experience relevant to the particular occupation will be required
  • subject to any age exemptions, all applicants must be under the maximum age requirement of 45 at the time of application, unless the transitional arrangements outlined below apply, and
  • sponsors will be required to pay a contribution to the Skilling Australians Fund (SAF) at nomination stage.

Transitional arrangements - Subclass 457 visa holders and applicants applying for permanent residence after March 2018

Advice regarding the impact of recent reforms on subclass 457 visa holders and applicants who wish to apply for permanent residence remains available on the Department's website at: Impacts for existing 457 visa holders wishing to apply for permanent residence.

These arrangements remain subject to final approval.

Note: These transitional arrangements are relevant for TRT stream applications only. No transitional arrangements are in place for Direct Entry (DE) stream applicants who are expected to meet the requirements in place at time of application. New requirements will not be applied to pipeline applications.

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