Employer Sponsored Permanent Residence 186/187 Changes – Where do you stand now?

2017 has seen unprecedented changes made to the Employer Sponsorship program by Australia’s Department of Immigration (DIBP). The 19th of April introduced the first round and more were made on 1 July 2017. More are mooted for March 2018 as well. These changes are far reaching and some prospective 186 or 187 applicants as well as existing 457 visa holders will be very negatively affected by them. Applying the changes to existing 457 visa holders is essentially a retrospective change as many people applied for 457 visas with a view on applying for permanent residence. In fact, even the Department of Immigration (DIBP) called it a “pathway” to permanent residence previously in their literature and now are saying that a temporary residence work permit is in no way connected to a permanent residence application. It would seem that some at the DIBP have short memories. Let’s take a closer look at the changes and their impact.

• New skilled occupations lists are in force. The 2 lists are the Medium and Long Term Strategic Skills List (MLTSSL) replacing the Skilled Occupations List (SOL) and the Short Term Skilled Occupations List (STSOL) replacing the Consolidated Skilled Occupations List (CSOL). It is very important to note that now there are different versions of the occupation lists depending on whether you are applying for a subclass 457 visa, a subclass 186 visa or a subclass 187. These are listed in separate Legislative Instruments. Applicants need to be very careful when applying and it makes getting the right advice even more important. This can affect planning for an employer sponsored permanent residence application through visa subclass 186/187.
• From 1 July 2017 applicants must be under 45 years if applying through the Direct Entry Stream of visa subclasses 186 or 187 and under 50 years of age for the 457 Transition Stream. The age requirement will be time of application requirement. There though still some age exemptions for certain applicants, but these are limited. NZ citizens are exempted
• From 1 July 2017 the English language requirements for both Direct Entry and 457 Transition Stream are now IELTS Competent or the equivalent. There are a small number of exemptions here as well
• The exemptions arising from a high salary to avoid Skill & English requirements have been removed from 1 July for all new applications. Initially DIBP was going to apply this retrospectively to existing lodged but not decided application. They subsequently backed down on this and it only applies to new applications from 1 July.
• More clarification was provided by DIBP as to what meets the training benchmarks for a Direct Entry Stream application of visa subclass 186. One good change made here is that employers can choose the previous 12months before the application or the last financial year. One clarification that will have a negative effect on employers is that the salary of an employee providing internal training for employees can only be counted if the SOLE role is to provide training. Also, induction training can no longer be claimed as part of your training expenditure.
• DIBP has also provided further clarification of what constitutes “payroll” to assist employers to meet the training benchmarks. Training Benchmarks A and B requiring 2 or 1 % of payroll to be spend on training.
• The new caveats introduced on certain applications will apply to Direct Entry Stream applications from 1 July 2017.
• From March 2018 all applicants must be under 45 years of age unless you meet the limited age exemptions.
• From March 2018 only occupations on the MLTSSL can be sponsored for permanent residence (PR). If your occupation is on the STSOL you CANNOT be sponsored for PR.
• The occupations lists are being reviewed every 6 months by DIBP. This could end up having a positive or negative effect on your situation and makes it very difficult for businesses and people to plan.
• From March 2018 if you are applying under the 457 Transition Stream of visa subclass 186 or 187 you will need to work for your employer for 3 years up from the current 2 years.
• You will need at least 3 years relevant work experience when applying for PR from March 2018

I think these changes are huge. Some people simply won’t be able to apply for PR and will need to look at other visa options such as General Skills Migration or Partner Visas. Occupations could move from the STSOL to the MLTSSL but you don’t know when this will happen and vice versa. It looks like people on existing 457s who cannot apply for PR prior to March 2018 and their occupation is on STSOL are in trouble. The same applies for people on existing 457s whose occupation has been removed completely. The “grandfathering” mentioned by the Minister is unclear as well. Will people on existing 457 visas just have their 457 visa protected or will their pathway to permanent residence also be available? It is unclear but seems to be for 457s and not for PR applications from the information provided so far. If you can apply for PR then I would be doing it now and particularly before March 2018. There is still uncertainty around this and the actual legislation and regulations are not available at present. It is advisable to get good advice and keep updating that advice when more information becomes available.

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