Last February, I wrote Good news and bad news for overseas skilled workers in Australia which foreshadowed the changes to Australia’s 457 visa program.
The changes are now upon us. Last Tuesday, the Office of Senator Chris Evans, Minister for Immigration and Citizenship announced the changes principal of which is the indexation of the minimum salary level by 4.1% on 1 July 2009 and implementation of a market based minimum salary for all new and existing 457 holders from mid September 2009.
These are key recommendations in the Deegan Review authored by AIRC commissioner Ms Barbara Deegan.
According to the government, these measures will ensure overseas workers are not exploited, and local wages and conditions are not undermined.
In my previous “Good news and bad news… ” post, I mentioned that the draft regulations included the setting of minimum salary and market based salary levels for 457 visa workers. I also commented in that post that for those who will make it to the grade, it would be a bonanza as they would be receiving a higher compensation.
On the other hand, it also means that overseas skilled workers would have lost their built-in cost effective advantage and they would now be competing with Australian local labour. Australian businesses would now be thinking twice before hiring workers from overseas on account of costs.
Those are realities we have to live with. It is a harsh reality especially in the current global financial crisis.
Higher IELTS score required
The other measures announced relate to an increase in the minimum language requirement from 4.5 IELTS to 5 IELTS.
The announcement however did not include details as to whether the 5 IELTS score includes the written component. This is one area that needs to be spelled out, especially as the Deegan Review recommended that the current English language requirements for subclass 457 visa program be retained with the exception that applicants “should also be found to have met their requirement should they achieve an average score of 4.5 without reference to the written component.”
With an increase of the minimum requirement to 5 IELTS, this exemption now becomes critical.
The four other measures in general terms prescribe conditions which Australian businesses need to meet in order to avail of the 457 visa program.
These are the progressive introduction of formal skills assessment for 457 visa applicants, employers being able to demonstrate a strong record of employing local labour, employers being able to demonstrate a commitment to training local labour, and employers using the 457 visa program to access ASCO 5 – 7 occupations should satisfy obligations on local training and employment.
The assessment framework, according to the government, is not finalised yet. The skills assessment aims to provide assurance that visa applicants meet the expectation of Australian workplaces.
What’s on the horizon?
The Deegan Review contained more than 60 recommendations which were meant to address concerns raised about the exploitation of migrant workers, salary levels and English language requirements, and to restore public confidence in the 457 visa program.
Would the changes announced last Tuesday be prelude to a series of measures “to improve the integrity and operation of the temporary skilled migration (Subclass 457 visa) program” ?
The 457 visa program is uncapped and is entirely driven by employer demand for skills that are not available locally. But under current economic climate, it is realistic to anticipate – at best – a flat demand for skilled migrants by Australian businesses.
The government has reported that for the immediately preceding quarter, the average number of primary 457 visa applications lodged was 430 a week compared to an average of 700 primary 457 visa applications lodged each week during the last six months to December 2008.
Australia cannot be any different from other countries tending to be more inward looking in times of recession.
What do you think? Is this bad news for 457 visa workers?