Labour Market Testing - 457

Misuse of the 457 visa scheme apparently continues and the response this time around is to introduce labour market testing ("LMT"). Getting rid of LMT was one of the big reforms the last time there was a major overhaul of the Employer Nomination Scheme…never mind!

I am very grateful to the MIA's email to members this afternoon which provided a very useful summary of the new requirements and which I summarise below:

LMT must be undertaken by standard business sponsors prior to lodging a nomination. Standard business sponsors must provide information with their nomination about:

• Their attempts to recruit Australian workers;

• How they have determined on the basis of these attempts that there is not a suitable qualified and experienced Australian citizen, permanent resident or eligible visa holder available to fill the position.

There are some exemptions for Working Holiday Makers and for Work and Holiday visa holders in the agricultural sector. Thankfully LMT is not needed where it would conflict with Australia’s international trade obligations.

Evidence of LMT must be provided with the nomination. This includes a completed "domestic recruitment summary table" which includes the following:

• List all modes of advertising or recruitment efforts in the last 12 months for that occupation, for example, online, social media, newspaper, internal recruitment, trade publications);

• Provide details of where the advertisement or recruitment effort took place (for example, name of publication, website, job or careers expo);

• Period/dates of advertising or recruitment;

• Fee(s) paid for advertising or recruitment;

• Provide details of who the fees were paid to;

• Geographical target audience;

• Number of applications received;

• Number of applicants that were hired;

• Reasons candidates were not successful;

An authorised person then has to sign off on it: I declare that the information I have provided in this document is, to the best of my knowledge, true and accurate and I am aware of the penalties for providing misleading or false information to the Commonwealth. 

Policy will be released later in the month. In the interim keep checking the DIBP website for more info.

The Market Salary Requirement

On 14 September 2009, the Migration Legislation (Worker Protection) Act came into force. There are many changes which are "blog worthy", but one which is already causing some difficulty is the abolition of the minimum salary level for the 457 visa and it's replacement with the requirement to employ overseas workers on equivalent terms and conditions to those for Australian workers. One way this manifests itself is that the worker must be paid the market salary rate.

The policy behind this change is sound - it's to prevent the exploitation of overseas workers and to protect the local work force. It brings many concepts from the Fair Work Act into alignment with the Migration Act. For larger organisations where there are industrial or workplace agreements this is not a problem, but in smaller business where there is no-one else doing the job it is difficult to show what market rates are. I have pasted in below an extract from the current DIAC request for information:

"If there are no other employees in your business occupying similar positions, please provide independent evidence demonstrating that the terms and conditions of employment and base rate of pay are ones that would be provided to a local employee in an equivalent position.  This may include remuneration surveys, published earnings data or evidence of what employees are paid in similar workplaces."

It turns out that a salary survey by itself is not good enough unless the employer can show that they use the survey relied on as a guide to setting salaries. This requirement is causing some problems for some of my clients at the moment!

More details are on the DIAC website.

Worker Protection Legislation

The Migration Legislation (Worker Protection) Act 2008 was proclaimed this week to commence on 14 September 2009.

The purpose of the Act is to preserve the integrity of the local labour market and to ensure that the working conditions of foreign workers (mostly 457 visa holders) meet Australian standards.

There are four broad categories of changes:

1. the sponsorship undertakings will now be legislated (rather than being a promissory undertaking). This means that the undertakings can be changed by amendment;
   
2. there will be tougher sanctions, including civil penalty provisions for non-compliance with the undertakings. These powers will include powers of a Court to order repayment of debts owing to visa holders (currently recourse is through employment laws). The objective is to provide more meaningful penalties for non-compliance;
   
3. there will be greater sharing of information about visa holders between government departments and agencies; and
4. there will be a monitoring regime to promote compliance with sponsorship obligations which provides for the appointment of inspectors with powers to enter premises and require documents or things in relation to a sponsor’s compliance with the sponsorship obligations and other requirements.

These changes won't affect the great number of honest employers who already meet their obligations, but it may help to clamp down on the small rogue element that is always present.

457 Info Pack

DIAC have very helpfully published on their website a package outlining the recent (and proposed) changes to the 457 visa program.

That package is available by clicking here.

Another 457 Change

Effective from 15 May 2009 the 457 visa is no longer available to applicants with occupations that fall within ASCO 5-7. In plain terms, this means that the skills threshold has been raised. It used to be possible for employers who wanted to sponsor workers in these categories to do so provided they had approval of a regional certifying body (ie there was a concession where the employee was to work in a regional area). Now the only way to achieve this outcome is to negotiate a labour agreement with the Commonwealth. Click here for more details.

This change comes hot on the heels of the increase in the English threshold and is designed to protect local employment. It also means that employers with large infrastructure projects outside of the metropolitan areas are going to have to have a labour agreement before they can get lesser skilled workers on their construction sites. I appreciate there is a difference between a labour shortage and a skills shortage, but this change doesn't recognise that there may be both in remote areas.