Red Tape to be Removed for 457 Business Sponsorship Program
By Mark Webster
Thursday, 19 March 2015
Training Benchmarks for 457 SponsorshipWe are likely to see a much simpler training requirement to replace the current training benchmarks which require a certain percentage of payroll to be spent on training of Australian permanent residents or citizens. The Report suggested a training levy which depends on the size of the employer and the degree to which they use the 457 program. Establishing an employers' training record currently involves a significant amount of evidence, and this change can be expected to significantly reduce paperwork. Further consultation may be required before the changes are formally announced, and are likely to come into effect in 2016.
English Requirement for 457 Visas457 applicants currently require a score of at least 5 in each band of IELTS (Vocational English). An average band score of 5 will be accepted, providing the applicant has at least 4.5 in each band. We are also likely to see the adoption of the Alternative Tests of English which are already being used for other skilled visas. There is currently an exemption from English language testing if the 457 applicant has studied for 5 years continuously in English medium. This can cause issues if the 457 applicant has taken a break from studies. We are likely to see a change which means that the exemption will require a cumulative period of 5 years of study, rather than requiring continuous study. These changes will make the English language requirement far less onerous for applicants, and are likely to come into effect in the near future.
Business Sponsorship Validity PeriodsEmployers must be approved as a business sponsor before they can sponsor staff under the 457 program. Most employers are approved for a period of 3 years, during which they can sponsor staff for 457 visas. If the business has been operating for less than 12 months, the sponsorship approval will be valid for only 12 months under the current rule. The Report proposes that the validity period for sponsorship approvals be increased to 5 years or 18 months for recently established businesses. This change will mean employers do not need to renew their sponsorships as often. The changes will only affect sponsorships approved after the changes come into effect, and this is likely to happen in the next 6 months.
Salary LevelThe Government has indicated that they support the following changes to the salary level for 457 visas:
- The current minimum salary level (TSMIT) be maintained at $53,900 for the next few years
- Reviewing the level of TSMIT and whether it should be varied by locality - this could involve accepting a lower minimum salary level for regional positions
- The minimum salary for waiver of the market rate salary requirements be reduced from $250,000 to $180,000
Salary level for 457 visas is a politically charged issue - the Government may face opposition in the Senate in implementing the changes to salary level.