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Migration Newsflash: New Temporary Skill Shortage visa program introduced

Migration Newsflash: Temporary Skill Shortage visa

Belinda Wright outlines the new Temporary Skill Shortage (TSS) visa.

Belinda Wright

Partner, National Leader, Immigration Services

KPMG Australia


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The new Temporary Skill Shortage (TSS) visa program has taken effect from 18 March 2018. Changes to the employer sponsored permanent skilled migration program have also come into effect.

A further new visa scheme, the Global Talent Scheme (GTS), to attract highly skilled global talent to Australia, will also be piloted from 1 July 2018. We will publish our insights on this shortly.

New TSS visa regime

The TSS visa is predicated on the need for employers to source foreign workers to fill genuine short-term positions for up to 2 years and also to address critical skills demand in medium-term occupations for up to 4 years.

Certain features of the now-defunct 457 visa have been preserved. However some key changes included in the new TSS visa framework are:

  • 5-year sponsorship approval for employers approved as Standard Business Sponsors, and no requirement to meet training benchmarks (pending the introduction of new Skilling Australians Fund levy)
  • visa grant period of one to four years if nominated under the Medium-term (MT) stream, or generally 1 or 2 years if nominated under the Short-term stream 
  • mandatory 2 years of full-time (equivalent) work experience (in the last 5 years)
  • Labour Market Testing (LMT) for all occupations unless an international trade obligation applies.

A prominent feature of the TSS visa regime will be the new Skilling Australians Fund (SAF) Training Levy, which is still subject to the passage of legislation. The training levy would replace the training benchmark expenditure requirements of the 457 visa program.

Employer sponsored permanent skilled migration

The changes to the employer sponsored permanent skilled migration program include:

  • primary applicants under the Direct Entry (DE) stream must be in an occupation on the Medium and Long-term Strategic Skills List (MLTSSL) or on the new Regional Occupation List (ROL)
  • primary applicants under the Temporary Residence Transition (TRT) stream must generally be either a holder of a TSS visa under the MT stream, or a 457 visa-holder who has worked full-time for their nominating employer in Australia for three out of the preceding 4 years 
  • primary applicants must be under 45 years of age unless exemptions apply.

With the introduction of the TSS visa framework, employers will need to carefully navigate the new LMT requirements, including the new policy specification on acceptable advertising to demonstrate that no suitably skilled / qualified Australians are available to fill the roles.

Once legislated, the new SAF training levy will need to be factored into the costs of nominating existing employees seeking to extend their stay in Australia with a TSS visa, or prospective employees applying for a TSS visa to enter Australia. Furthermore, administering the upfront payment of the SAF training levy will need to be duly considered as the levy must be paid at the time of nomination.

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