Senate Committee Releases Report and Recommendations on Temporary Skills Visa System

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At a Glance

This week, the Australian Senate Legal and Constitutional Affairs References Committee released its recommendations following its inquiry into the temporary skilled visa system and related issues, exploring the below key issues:

• The interaction between the temporary skilled visa system and the system in place for training Australian workers, including how a skills shortage is determined;
• The current skills assessment regime;
• The effectiveness of the current labour market testing arrangements; and
• The use and effectiveness of labour agreements.

 

As Australia heads for a Federal Election in May, and with the possibility of a change of government, Fragomen will report any changes adopted in immigration rules.

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The situation

This week, the Senate Legal and Constitutional Affairs References Committee in Australia released its report regarding the effectiveness of the current temporary skilled visa system in targeting skills shortages. 

A closer look

• Key recommendations. The final report makes recommendations about the interaction between the temporary skilled visa system and the system in place for training Australian workers; the current skills assessment regime; the effectiveness of the current labour market testing arrangements; and the use and effectiveness of labour agreements.
• Fragomen’s analysis. Fragomen believes that any further restrictions to temporary skilled migration would damage the Australian economy and make it more challenging for Australia to compete for global talent.

 

Potential impacts of recommendations

Global mobility and human resource teams should take note of the following key recommendations that the Committee made:
 

• Publish reasons for future changes to the skilled migration occupation lists. The current occupation lists are by their nature retrospective. Fragomen believes that the current occupation lists fail to consider shortages in new or emerging occupations and has advocated to make the lists more predictive of future skills shortages.
• Review of the ANZSCO framework. The committee recommended that the Australian Bureau of Statistics prioritise its review of the Australian and New Zealand Standard Classification of Occupations (ANZSCO) framework, which was last reviewed in 2009, to bring the categorisation of occupations up to date with the changing nature of the Australian economy and rapid emergence of new industries, skills and niche occupations.
• Establish new authority to provide recommendations on skilled migration issues. Few details were provided about this proposed authority in the report, but Fragomen would not support any measures that would add further administrative hurdles to foreign nationals seeking to work in Australia. Subject to this recommendation going forward, Fragomen will seek further details and engage in consultation on the practical operation and impact on clients.
• Introduce stricter evidentiary requirements for Labour Market Testing (LMT). The committee suggested implementing more stringent LMT rules. Fragomen believes the existing rules are already problematic, especially when employers make genuine attempts to test the labour market but where minor technical non-substantive errors in advertisements are made that delay and negatively impact the ability to do business effectively. The recommendation also includes a suggestion to not enter into any trade agreement that would waive labor market testing. Fragomen will advocate against these recommendations.
• Review of Labour Agreements. This recommendation was premised on the finding that labour agreements may lead to the exploitation of migrant workers or migrants being favoured as a cheap alternative to an Australian workforce.  Fragomen’s opinion is that labour agreements play an important role for employers and industries with labour occupational shortages, especially in regions experiencing skills shortages in occupations that differ from the national average. Fragomen will continue to stand by labour agreements for Australian employers.
• Increase funding for compliance activities. The committee recommended increasing government funding to ensure employers and foreign nationals comply with immigration rules. Fragomen supports measures to ensure the integrity of the program is maintained.
• Require employers to pay wages for temporary visa holders into an Australian bank account and increase the income threshold for skilled migrants to $62,000 a year, indexed annually. Fragomen supports any measures to protect migrant workers but notes the practical challenges of mandating payment into Australian bank accounts, particularly in situations where the employee remains on home country payroll.

 

Background

The committee that produced this report is one of several that the Australian Senate designates to hear evidence on specified matters. Committees provide an opportunity for stakeholders to participate in policy making in Australia. More information on this process is available on the Australian Parliamentary website.

Looking ahead

With the Australian Federal Election likely to be announced in the coming days, it is unclear what recommendations will be taken forward by the next government.  While the Labor party is ahead in the polls and a change of government is possible, the Opposition Immigration Minister has also been vocal about prefering Australians for local jobs and has already announced plans to establish the Australian Skills Authority (ASA) – an independent labour market testing body which would determine skill needs and restrict temporary work visas to only those areas. Fragomen will report on government changes and relevant immigration rule updates.

This alert is for informational purposes only. If you have any questions, please contact the global immigration professional with whom you work at Fragomen or send an email to [email protected].

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