In late December 2018 the Government announced its decision to invite feedback on their proposal to radically change the employer-assisted work visa policies. These changes are aimed at improving the current temporary work visa outcomes by ensuring that visas are granted for roles where there are genuine skills shortages, and to shift the focus from a migrant-led process, to more of an employer-centred scheme.
The proposed changes are substantial and will affect every New Zealand employer who employs migrants on work visas. In fact, they are so wide reaching we cannot outline them in detail in one (readable) article. We will distribute more in depth thought pieces in due course on the separate parts. In the interim we set out a summary of the main proposed changes to give you a general understanding of what is being proposed.
Which visa policies will be impacted?
The proposals will have an impact on the following six temporary work visas:
- Talent (Accredited Employer)
- Essential Skills (including the Essential Skills in Demand Lists)
- Approval-in-Principle
- Work to Residence – Long-term Skill Shortage List Occupations
- Silver Fern (Practical Experience)
- Silver Fern (Job Search)
The proposals
The current proposals, which have been released for consultation, include the following recommendations:
- Removal of all employer-specific work visa categories and introducing a new streamlined framework which will be led by employers, rather than the current migrant-led system.The new framework is proposed to involve three separate and distinct stages:
- Gate 1: Assessing the Employer
- All employers wishing to hire migrants will need to apply for accreditation status with INZ; being Standard Accreditation (recruiting 5 or less migrants in a 12 month period), Premium Accreditation (recruiting 6 or more migrants in a 12 month period), and Labour Hire Company Accreditation (that already exists).
- All three will have an initial validity period of 12 months, with Premium Accredited Employers able to extend after that initial term for periods of up to 24 months.
- Standard Accreditation will cost approximately $600, Premium and Labour Hire Accreditation will cost approximately $2,000.
- Gate 2 : Assessing the Position
- There will be four visa options available for employers to employ migrants. Three of the four options are based on what is currently available (with amendments), and one of them (Sector Agreements) is a new development. They are as follows:
- Any role that meets the threshold of being higher-paid ($78,000 p.a. for Premium Accredited Employers [yes, an increase from current level of $55,000 p.a.] and $101,046 p.a. for Standard Accredited Employers); will not require a labour market test.
- Any role that is listed on the new Regional Skills Shortage List (ANZSCO Level 1-3, refer below) will also not require a labour market test.
- Any role (but predominantly low-to-mid skilled ANZSCO Level 4-5, refer below) which involves a Sector Agreement – will require a labour market test dictated by the applicable Sector Agreement; and
- Regional labour market tests for all other positions where the bar can be raised or lowered by INZ as needed, to reflect regional and industry labour demands.
- Gate 3 : Assessing the Migrant
- This stage is likely to remain similar or identical to the current requirements that applicants need to satisfy for the grant of the applicable work visas.
- These include meeting the requirements regarding identity, health and character.
- Applicants must also demonstrate that they have the qualifications, skills and/or experience necessary to undertake the role.
- There will be four visa options available for employers to employ migrants. Three of the four options are based on what is currently available (with amendments), and one of them (Sector Agreements) is a new development. They are as follows:
- Gate 1: Assessing the Employer
In addition, the remuneration rate for mid-skilled visa holders (who can currently secure three year work visas) is proposed to be increased from a minimum of $21.25 per hour to $24.29 per hour, meaning that approximately 10,000 current work visa holders in this mid-skilled tier (ANZSCO Levels 1-3) will be classed as lower-skilled. Therefore, they will only be able to secure visas for a maximum period of 12 months for three years in a row before being stood down (offshore) for 12 months. Note however the consultation also seeks feedback on whether this stand down policy should remain in its current form.
The above change will also mean that there will also be approximately 3,000 less Skilled Migrant Category resident visa applications submitted from visa holders getting paid less than $24.29 per hour.
- Replacing the current Essential Skills in Demand Lists with Regional Skills Shortage Lists
The Government is of the view that the Immediate Skills Shortage List and the Long Term Skills Shortage List do not necessarily provide the most accurate reflection of occupational shortages as the focus remains on the roles, rather than the regions.
The proposed change to use Regional Skills Shortage Lists to replace the current system is aimed at not only improving the assessment of genuine need as part of the labour market test, but also as a directory in equipping migrants with greater insight into regional employment opportunities.
- Introducing Sector Agreements, which aim to address structural issues to avoid over reliance on migrant labour
Sector agreements are proposed to provide greater certainty to businesses which rely more heavily on migrant labour – in terms of their ability to access temporary migrant workers. However, in return for that certainty, those employers impacted by the Sector Agreements will be required to increase their level of commitment to furthering pathways for recruiting and training New Zealand citizens and residents, with a view that over time their reliance on offshore labour will be reduced.
These negotiable agreements are primarily targeted at industries which have a large migrant workforce in mainly mid to lower skilled positions where the Government believe these industries need to do more to employ and train young New Zealanders, such as the tourism and hospitality, residential aged care, dairy farming and transportation industries.
Have your say
Consultations currently remain open to all individuals and organisations who wish to make a submission on the proposal. The deadline for submissions is 5pm on Monday, 18 March 2019.
We encourage all employers and other interested parties to make sure you have your say by responding to the consultation. As with previous consultations, our firm is able to assist employers and industry bodies with formulating submissions on the consultation.
Stay informed
The outcome of the consultation process is expected to be finalised in mid-2019, and the staged roll out of these new policies will then follow over the following 12-18 months with the first changes likely to come into force as early as August 2019.
Despite the consultation process, we anticipate the majority of these recommendations will be implemented in some form or another as they have already been signed off by Cabinet. For the majority of New Zealand employers there is likely to be a significant level of investment required in order to maintain business continuity as the changes are implemented and take effect.
Lane Neave will be providing more detailed articles on all the changes as announcements are made, in addition to undertaking a series of national seminars to explain these changes on the following dates/locations:
Auckland
Date: Thursday 14 February 2019
Time: 8.30am-10.00am
Location: The Green Room, Level 4, Seafarers Building, 52 Tyler St, Britomart, Auckland
Christchurch
Date: Monday 18 February 2019
Time: 8.30am-10.00am
Location: Lane Neave, Level 5, 141 Cambridge Tce, Christchurch
Wellington
Date: Tuesday 26 February 2019
Time: 10.30am-12.00pm
Location: TBC (Central Wellington)
Queenstown
Date: Thursday 28 February 2019
Time: 10.30am-12.00pm
Location: The Rees, 377 Frankton Rd, Queenstown
Email communications@laneneave.co.nz to register.
These articles and seminars will allow informed views to be formulated and for those employers who stand to be affected by the proposal time to reflect and draft a submission for consideration.
To stay on top of current developments, sign up for our free regular briefings and articles on the changes click here.
