A raft of changes to the 457 visa program come into effect on 14 September. The changes impact existing and future business sponsors of 457 workers. As such, it is important for all business sponsors to be aware of the changes to avoid the consequences of non-compliance.
Changes to Subclass 457 visa program
The Subclass 457 program has been subject to a wide range of changes in 2009. The next tranche of regulations, which come into effect in September, are the most wide ranging.
The changes impact existing and future business sponsors of 457 workers. As such, it is important for all business sponsors to be aware of the changes to avoid the consequences of non-compliance.
A key driver behind the changes is to ensure overseas workers enjoy the same conditions of employment as Australian workers.
A summary of the changes are as follows:
As part of the changes to the regulations, there is a greater requirement of business sponsors to:
- Cooperate with Government inspectors who have increased powers to audit and monitor business sponsors.
- Ensure the terms and conditions of employment of a 457 visa holder are no less favourable than those provided to an Australian worker in the same role.
- Pay travel costs to enable sponsored workers and their dependents to leave Australia if requested in writing by the Department of Immigration and Citizenship (DIAC) or the sponsored worker.
- Pay costs incurred by the Australian Government to locate and remove unlawful non-citizens.
- Maintain sponsorship-related information in a format that can be provided on request by the Government. Records must be kept for five years.
- Providing information to DIAC within 10 days of certain events occurring, including:
- Appointment of new directors or partners
- Cessation of employment of 457 visa holders
- Changes to the legal structure including the closure of the business
- Payment of return travel costs (as per above travel obligation)
- Appointment of an administrator, declaration of bankruptcy or insolvency etc.
- Change of address
- Ensure the sponsored worker does not work in an occupation other than an approved occupation.
- Pay some costs associated with recruitment that could previously be recovered from sponsored workers. For example, it will no longer be possible for business sponsors to recover migration agent costs and costs associated with becoming an approved sponsor from sponsored workers.
Market rate salaries
As of 14 September 2009, employers will be required to pay all 457 visa holders at the ‘market rate’. Although the details of this requirement have not yet been released, the principle behind this change is to ensure that 457 workers are paid an equivalent salary to that provided to Australian workers in the same role.
Health insurance responsibility
As of 14 September, 457 visa holders will be responsible for their own health insurance. Currently business sponsors are responsible for the health costs of sponsored workers and their families for treatment in a public hospital (other than costs that are met by health insurance or reciprocal health care arrangements).
Sponsors will no longer be responsible for medical or hospital expenses for sponsored workers treated in a public hospital. Under the new legislation the visa applicant will be required to provide evidence of adequate arrangements for health insurance during the period of the applicant’s intended stay in Australia.
Subclass 457 visa holders will now have to achieve an IELTS test score of at least 5 in each of the four test components (speaking, reading, writing and listening) compared to the current requirement to achieve an average band score of at least 5 based on the four test components.
Organisations seeking to become a business sponsor must be able to demonstrate their commitment to training Australian citizens and permanent residents. The specific details of this requirement have not yet been released.
Business sponsor and visa duration
From 14 September 2009, a business sponsorship will only be valid for a specified period or for a specified event (e.g. duration of a project). For individual visa holders, a minimum of three months will no longer apply. The maximum period of stay in Australia will continue to be four years.
Sponsors will be able to request a variation to duration and number if requirements vary and they can demonstrate that they have been compliant with sponsorship conditions.
Removal of generic nominations
Under the new requirements, sponsors will need to identify the specific applicant and their family members when nominating a position. Sponsors will no longer be able to apply for a position without having identified the applicant. The qualifications and experience of the visa applicant will also have to be provided as part of the nomination to demonstrate they have the skill level required for the position.
Monitoring of the 457 visa program will be increased with the involvement of the Department of Education, Employment and Workplace Relations assuming responsibility for the monitoring of market rate salaries. DIAC will continue to monitor the compliance of sponsoring companies.
The regulation changes will increase the reporting requirements of sponsors. As such it is essential for business sponsors to review current reporting practices and ensure that systems are in place to capture all the information required as part of the new regulations.
Failure to comply with sponsorship obligations may result in the cancellation of a sponsorship and/or a ban on future applications for sponsorship. The Department of Immigration and Citizenship can also impose a fine.
Non-compliance can include providing misleading information or a change in circumstances that precludes a sponsor from meeting its obligations.