Australia launches independent review of 457 income threshold

30 Dec 15

AUSTRALIA

IMPACT – MEDIUM

What is the change? The Australian Government has commissioned a review of the Temporary Skilled Migration Income Threshold (TSMIT).

What does the change mean? The TSMIT sets the salary floor for Subclass 457 visa holders. The review will be led by John Azarias, who also led a broader review of the Subclass 457 programme that was completed in 2014. Until the Government has time to consider any of Azarias’s recommendations, the TSMIT will remain at A$53,900 per year (about US$39,280).

  • Implementation time frame: Ongoing.
  • Visas/permits affected: Subclass 457 visas.
  • Who is affected: Sponsoring employers and foreign workers in the 457 visa category.
  • Business Impact: Costs for some employers could go up if the Government decides to raise the TSMIT.
  • Next steps: The review is expected to be completed in April, at which point the Government will begin consideration of any recommendations.

Background: The Independent Review into Integrity in the Subclass 457 Programme, released in 2014, recommended that the TSMIT remain at its current rate “until such time as a full review is conducted” to allow for a better understanding of the labour market and the income needs of skilled temporary migrants. The Government announced on 23 December that Azarias would lead the review, and that it would consider a range of issues, including the appropriate base level, the role of indexation and possible regional concessions. A statement from Minister for Immigration and Border Protection Peter Dutton said the review would reflect the Government’s commitment that “the 457 programme (act) as a supplement to, and not a substitute for, local workers and the protection of potentially vulnerable foreign workers in Australia.”

BAL Analysis: An increase in the TSMIT would increase business costs for some employers. Any possible change, however, is months away, and the TSMIT will remain at its current level until the review is completed and the Government has a chance to review any recommendations.

This alert has been provided by BAL Australia. For additional information, please contact australia@balglobal.com.

MARN: 9683856

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