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Australia – Temporary Skills Shortage Visa Regime


Profound changes to the business visa regime were announced in April 2017, some with immediate effect and some to take effect in 2018. The Government has discontinued the sub-class 457 visa that had been in operation since 1996, and replaced it with a “Temporary Skills Shortage” (TSS) visa from March 2018.

On 18 March 2018 details of the TSS visa requirements were announced, with immediate effect.

Major changes include:

  • The TSS visa has a short-term stream (visa up to 2 years validity, with one extension, no path to permanent residency) and a medium-term stream (visa up to 4 years validity, can be renewed, includes the possibility of permanent residency).
  • Labor Market Testing – advertising to ensure employers do not overlook suitably qualified Australians.
  • Expenditure on training of Australians to change from a requirement to spend a minimum % of payroll to a fixed amount payable at the time of application for each visa (Skilling Australia Fund).
  • Requirements for visa applicants have been tightened, for example, there are now requirements that that applicants for visas under the short-term stream have worked in their nominated occupation, or a related field, for at least two years and are a genuine applicant for entry and stay as a short term visa holder.

Major changes in May 2018:

  • Implementation of legislation to give effect to Labor Market Testing and the Skilling Australia Fund passed through the Australian Senate on 8 May 2018. The Labor Market Testing (LMT) requirements in particular look likely to be quite onerous, and are already delaying further the submission of applications.

Currently some of the requirements are not consistent with the way businesses would go about finding candidates in the open market recruiting. For example searching for candidates vis social media, such as LinkedIn does not count towards fulfilment of LMT requirements.


Timeframes for 457 and TSS visa approvals:

At the time of the changes in mid-March 2018 the Department of Home Affairs was advising that it was processing applications lodged in early-October. In early May the Department had updated that guidance by only 4 days, and later in the month ceased giving guidance.

The halt in processing is probably due to the amount of Department resources that have needed to be devoted to learning and training on the new system and dual processing of 457 visa applications and TSS visa applications.

It is too soon to provide guidance for the new TSS visa, as not enough applications have yet been lodged. It is worth noting that the onerous information requirements have probably delayed the lodgement of many applications .

Consequently we are not currently in a position to give meaningful guidance on likely timeframes for processing applications beyond the broad advice that employers and visa applicants can expect delays of several months and should plan accordingly.

The situation is affecting all organisations seeking to bring staff to Australia.

Webinar Updates:

We have been running a series of webinars since the changes were announced in March 2018 to provide updates on some important aspects of the new visa regime, including permanent residency applications.

To listen to our most recent webinar follow the link below:

To register for the next webinar follow this link:

31 May 2018