What has happened?
On Saturday, 7 December 2024, the Government released the new Skills in Demand (subclass 482) visa, replacing the Temporary Skill Shortage (subclass 482) (TSS) visa.
As part of the changes, a Core Skills Occupation List has been introduced. This list will guide eligibility for the Core Skills Stream of the Skills in Demand visa and the Direct Entry stream of the permanent Employer Nominated Scheme (subclass 186) visa.
Employers should be aware of these immediate changes resulting from the introduction of the Skills in Demand visa:
- TSS Visa Applications Closed: New applications for the TSS visa can no longer be lodged. However, existing applications submitted before 7 December 2024 will continue to be processed.
- New Skills in Demand Visa: Employers and visa holders can submit nominations and applications under the new Skills in Demand visa, which operates under the same subclass 482 as the TSS visa. The work experience requirement for applicants has been reduced from two years to one year.
- Core Skills Occupation List Released: A revised Core Skills Occupation List now applies to the Employer Nominated Scheme (subclass 186) visa, Direct Entry stream, and the Skills in Demand visa, Core Skills stream.
- Sponsor Obligations Updated: Sponsors are no longer responsible for ensuring workers remain in their nominated occupation after their employment ends. This aligns with changes introduced in July 2024 that allow subclass 482 visa holders to work for other employers during a grace period after leaving their sponsor.
- Employment Flexibility for ENS Visa: Employment periods with any sponsor in Australia will now count toward the two-year requirement for the Employer Nominated Scheme (subclass 186) visa in the Temporary Residence Transition Stream. This change, together with earlier changes to visa conditions, offers employees greater flexibility to move between sponsors.
Background
Recent changes to the employer sponsored visa program have been implemented through new regulations and legislative instruments, despite the Senate failing to pass the relevant bill during its final sitting week of 2024.
The Skills in Demand visa is a key pillar of the Government's Migration Strategy, released in December 2023, aimed at reforming the temporary work visa program.
The New Skills in Demand Visa
The new Skills in Demand Visa has three streams:
- The Specialist Skills stream – addressed below;
- The Core Skills stream – addressed below; and
- The Essential Skills (Labour Agreement) stream - at this stage, the Labour Agreement stream of the TSS visa will carry across to the Skills in Demand visa. The Government is further evaluating how best to develop the planned Essential Skills stream pathway for lower paid workers with essential skills.
The following key changes apply to both the Specialist Skills stream and the Core Skills stream of the Skills in Demand visa:
- Time Period: The visa will now provide a 4-year stay for all streams;
- English Language Requirements: The English language level replicates the Medium Term stream of the TSS visa, requiring a minimum score of IELTS 5.0 or PTE 36 in each test component.
- Employer's Financial Capacity: A new financial capacity requirement has been introduced for employers, who must demonstrate the ability to pay the market salary rate of the position for the duration of the visa.
- Reduced Work Experience Requirements: The work experience requirement has been reduced from two years to one year. Applicants now only need to demonstrate 12 months of full time equivalent work in the last five years, which can include full-time, part-time, or casual work.
Skills in Demand Visa - Specialist Skills Stream
The Specialist Skills Stream offers greater flexibility for employers recruiting skilled workers for high salary roles.
Key features and requirements of this stream, which differ from the TSS visa, include:
- Occupation Eligibility: Employers can nominate any occupation from the Australian and New Zealand Standard Classification of Occupations (ANZSCO) excluding trades workers, machinery operators and drivers, and labourers.
- Minimum Earnings: Nominated positions must meet the Specialist Skills Income Threshold, set at A$135,000 (subject to annual indexing).
- Fast Processing: The Government originally committed to a 7-day median processing time for visas under this stream. However no details have been released as to whether this will be a guaranteed timeframe.
Skills in Demand visa - Core Skills Stream
The Core Skills Stream combines the old TSS Medium Term and Short Term streams into a single pathway for temporary skilled migrants.
Key features of this stream, and requirements that differ from the TSS visa, include:
- Largest Pathway for Skilled Migrants: This will become the main route for temporary skilled migrants.
- Consolidated Core Skills Occupation List: The new list removes several occupations from the previous lists but introduces a number of new occupations.
- Removal and Retention of Caveats: Some restrictions, such as those limiting occupations to regional areas, have been removed, while others remain in place.
- Minimum Earnings Requirement: Nominated positions must meet the Core Skills Income Threshold, which replaces the TSMIT. This is currently set at A$73,150 and is expected to be indexed annually.
Key Changes Not Yet Implemented:
Several reforms outlined in the Government's Migration Strategy have not yet been introduced, primarily due to the relevant bill failing to pass the Senate before the end of the parliamentary sitting year. These include:
- No Change to Labour Market Testing (LMT): While the Government intended to extend the validity period of advertisements from 4 to 6 months, this change will require the relevant bill to be passed in 2025 before it can be implemented.
- No Public Sponsor Register: The Government plans to create a public register of approved sponsors that will list the number of sponsored workers and their occupations, helping migrants find new sponsors. This has not yet been introduced.
- No Reduction of Upfront Employer Costs: The Government had previously indicated a potential reduction in upfront employer costs by shifting fees to a monthly or quarterly payment model. However, this has not been introduced, meaning the Skilling Australians Fund levy remains a significant upfront cost for employers sponsoring workers.
Action required
Whether occupations relevant to your current visa-holding workforce have been removed. While this won’t affect granted visas, it could impact the ability of sponsored workers to switch employers or apply for a further visa.
Whether new occupations relevant to your workforce have been added.
- Consider Alternate Visa Streams: If an occupation is not listed on the Core Skills Occupation List, determine if workers are eligible under the Specialist Skills stream or Essential Skills (Labour Agreement) stream.
- Evaluate Workforce Needs: Review workforce needs over the next 12 months to identify positions likely requiring overseas recruitment.
- Implement Retention Strategies: Given the increased mobility of visa holders, consider strategies to retain skilled workers.
We're here to help navigate the changing landscape of Australian immigration and how organisations can strategise to attract and retain needed skilled workers. If you have any questions, please don't hesitate to contact us.
