Panel Recommends Subclass 457 Reforms

The Australian Minister of Immigration and Border Protection largely favors a plan to reform the subclass 457 visa program – the key temporary skilled worker visa category - based on the recommendations of an independent panel that was commissioned to study the program earlier this year. The subclass 457 process is expected to be streamlined based on the recommendations, but employers will also face new compliance obligations and tougher penalties for program violations. 

The most prominent proposed change is the elimination of labor market testing requirements. Currently, employers applying for subclass 457 visas for particular positions must provide evidence of recruitment efforts to demonstrate that there are no suitably qualified Australian workers to fill the position. The panel found that the current labor market test is not reliable and should be replaced by an Advisory Council that will hear grievances about visa criteria and respond to changes in the Australian labor market. 

Additionally, the suggested reforms contemplate a new sponsorship approval system that would recognize trusted employers with a strong compliance history and allow them to benefit from streamlined sponsorship procedures. Another anticipated change includes allowing employers a longer period of time to report sponsorship changes. Additionally, the panel suggested mandating that sponsors demonstrate their commitment to training Australian citizens or permanent residents in their business operations by contributing to a new centralized training fund directed at training programs for locals rather than through the employer directly training and paying for training programs for local Australian employees. 

Other recommendations include the easing of English language and certain minimum salary evidentiary requirements, a new risk-profiling approach to monitoring sponsors' compliance with their obligations, as well as additional allocation of financial resources to educational programs, monitoring and prosecution of sponsors. 

Fragomen participated in the program reform by submitting a comprehensive report to the independent panel based on a wide-reaching client survey. 

Fragomen Australia will be holding educational webinars on the suggested reforms next week. There will be a discussion of the proposals, the likely government response, and the impact on business immigration programs. To register for the webinar held on September 24, 2014 at 8am AEST, please click here, or 5pm AEST, please click here. 

What This Means for Employers 

Should the Australian government adopt the recommended changes, employers who seek to obtain subclass 457 visas for foreign nationals will face fewer administrative hurdles as a result of the elimination of labor market tests. Employers with strong compliance histories may benefit from a more streamlined sponsorship process. All employers will have access to a grievance-airing process to provide feedback on visa programs via the Advisory Council. 

This alert is for information purposes only. If you have any questions, please do not hesitate to contact the global immigration professional with whom you work at Fragomen or send an email to [email protected]. 

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