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No Initial Reference to Changes Regarding Insurance in 457 Visa Reforms

Posted By Eric Klatt 20 April 2017

The Government has announced that the Temporary Work (Skilled) visa (subclass 457 visa) will be abolished and replaced with the a new Temporary Skill Shortage (TSS) visa. The implementation of these reforms will be staged up to March 2018 with changes implemented 19 April 2017, 1 July 2017, before 31 December and from March 2018.

This is part of a package of policy changes which according to the Government will strengthen integrity and quality of Australia’s temporary and permanent employer sponsored skilled migration programmes. The decision to close this stepping stone from temporary to permanent residency may have far reaching impact upon net overseas migration.

“Grandfathering arrangements” will apply to current 457 visa holders (approximately 95,000) and there will be no change to their visa status.

There was no initial reference to any changes regarding insurance or compliance for these visa holders.  

The TSS visa programme will be comprised of a Short-Term stream of up to two years and a Medium-Term stream of up to four years.  Plus the obligation to evidence genuine skilled shortages will require more robust Labour Market Testing (LMT). The maximum validity of 457 visas issued from 19 April (ie. 2 years or 4 years) will also be affected depending on the occupation.

The two year stream ‘Short term skilled Occupation List’ (STSOL) will involve no prospect of permanent residency at the end.  It would be available to 430 occupations following the removal of 216 occupations and access to 59 other occupations restricted.

The four year stream “Medium and Long-term Strategic Skills List (MLTSSL) will be available to 183 high-end occupations but with a permanent residency option being available after three years.  

Both streams will have stricter requirements including having to prove two years of previous work experience, a clean criminal record, English language proficiency, minimum market salary level, collection of Tax File Numbers and data matched with ATO records, while there will be a greater onus upon employers to fill jobs locally first.

A more detailed understanding of the likely impact of these changes can only be provided once the proposed legislation is available for review.

Disclaimer: The information contained in this publication provides only a general overview of subjects covered, is not intended to be taken as advice regarding any individual situation and should not be relied upon as such. Insureds should consult their insurance and legal advisors regarding specific coverage issues. All insurance coverage is subject to the terms, conditions, and exclusions of the applicable individual policies. Statements concerning legal matters should be understood to be general observations based solely on our experience as insurance brokers and risk consultants and should not be relied upon as legal advice, which we are not authorized to provide. All such matters should be reviewed with your own qualified legal advisors. Copyright 2017 Marsh Pty Ltd. All rights reserved. LCPA No. 17/0047

Eric Klatt