From March 2018, the Australian Government has announced that the 457 visa will be abolished and replaced with the Temporary Skills Shortage (TSS Visa). The TSS visa will be comprised of a Short-Term stream of up to two years, and a Medium-Term stream of up to four years.
The Short-Term stream is designed for Australian businesses to fill skill gaps with foreign workers on a temporary basis, where a suitably skilled Australian worker cannot be sourced.
The Medium-Term stream will allow employers to source foreign workers to address shortages in a narrower range of high skill and critical need occupations, where a suitably skilled Australian worker cannot be sourced.
TSS Visa – Short-Term Stream
The Short-Term stream will include the following criteria:
- Renewal: Capacity for visa renewal onshore once only.
- English language requirements: A requirement of an International English Language Testing System (IELTS) (or equivalent test) score of 5, with a minimum of 4.5 in each test component.
- Genuine entry: A genuine temporary entrant requirement.
TSS Visa – Medium-Term Stream
The Medium-Term stream will include the following criteria:
- Renewal: Capacity for visa renewal onshore and a permanent residence pathway after three years.
- Occupation lists:
- English language requirements: a requirement of a minimum of IELTS 5 (or equivalent test) in each test component.
TSS Visa – Eligibility
Eligibility criteria for both streams will include:
- Work experience: at least two years’ relevant work experience.
- Labour market testing (LMT): LMT will be mandatory, unless an international obligation applies.
- Minimum market salary rate: Employers must pay the Australian market salary rate and meet the Temporary Skilled Migration Income Threshold requirements.
- Character: Mandatory penal / police clearance certificates to be provided.
- Workforce: A non-discriminatory workforce test to ensure employers are not actively discriminating against Australian workers.
- Training requirement: see Skilling Australians Fund Levy below.
Skilling Australians Fund Levy
From March 2018, employers sponsoring foreign workers on a TSS visa will be required to pay a Skilling Australians Fund Levy which will replace the current Training Benchmark arrangements which apply to the 457 visa program. The amounts payable will be different for small and large businesses:
Small Businesses (under $10 million annual turnover)
- TSS Visa – Upfront payment of $1200 per year (or part thereof) per employee on the TSS visa, so for instance an application for a 4 year (Medium Term Stream) TSS visa would attract a levy of $4800 and an 18 month TSS visa would attract a levy of $2400.
- ENS and RSMS Visas – a one off payment of $3000 for each employee sponsored.
Large Businesses ($10 million or more annual turnover)
- TSS Visa – Upfront payment of $1800 per year (or part thereof) per employee on the TSS visa.
- ENS and RSMS Visas – a one off payment of $5000 for each employee sponsored.
NOTE: It is currently not clear how employers who have a mix of 457 visa holders and TSS visa holders will be affected moving forward.
Visa Application Charges
The Australian Government has announced that the Visa application charges for the new Temporary Skills Shortage (TSS) visa will be:
- $1150 per visa (primary applicant) for the short term stream
- $2400 per visa (primary applicant) for the medium term stream
This is in comparison with the $1060 currently charged for a 457 primary applicant.
NOTE: This information is provided on the basis of facts sheets issued by DIBP on 19/4/2017 and the Australian Government Budget Announcement on 9/5/2017. Please note that at this time there is no supporting legislation for these changes. It is possible that more changes will follow.
Last updated 11/5/2017. This page will be updated as more information becomes available