Subclass 457 Visa Reforms – Frequently Asked Questions

What are the immediate changes to the 457 visa system I should be mindful of?

As of 19 April 2017:

  • The CSOL (Consolidated Skilled Occupation List) has been replaced with the new STSOL (Short Term Skilled Occupation List).
  • The SOL (Skilled Occupation List) has been replaced with the new Medium and Long Term Strategic Skills List (MLTSSL).
  • 216 occupations have been removed from the skilled occupation lists.
  • 59 caveats are now in place for specified occupations.
  • New visa validity periods apply under the current 457 visa programme with a 2 year period available for occupations that are eligible for the 457 visa programme but are not on the MLTSSL. That is, for occupations on the STSOL.

Do the changes impact cases that have a review application pending?

The Administrative Appeals Tribunal must make a decision based on the current framework – that is, they are required to take into account recent occupation removals and caveats.

What are caveats?

Occupational caveats are additional requirements for certain occupations to demonstrate the nominated position is appropriate for the 457 visa program. These caveats limit the use of various occupations in certain circumstances.

Where the caveat requires a business to have a turn over of at least $1M, what is the period in which $1M turnover is considered?

From 1 July 2017, the subclass 457 nomination form will collect information regarding the turnover of the business for the last financial year, which will be used to determine whether or not the relevant caveat will apply.

Will occupational caveats apply to businesses that have traded for less than 12 months? If so, will projected turnover suffice where relevant?

Occupational caveats will apply to businesses that have traded for less than 12 months. However, the Department of Immigration will consider exceptional circumstances on a case by case basis.

Where the caveat requires a business to have a minimum of five employees, are there any restrictions on the type of employee?

If your business declares that they have five employees and this is consistent with other information provided (e.g. structure chart for business etc.), then this will be accepted unless the Department of Immigration has concerns that this is not the case. From 1 July 2017, the subclass 457 nomination form will ask companies to declare their total number of employees and how many are Australian/overseas workers, as per the current subclass 457 sponsorship form.

What does it mean where the caveats require at least two years of work experience?

This means that a successful candidate for the nominated position would be expected to have completed at least two years full-time work experience in the relevant occupation post qualification.

Is the Regional Sponsored Migration Scheme impacted by the 19 April 2017 changes? 

No – this is because visa applicants can nominate any occupation that is ANZSCO skill level 1 to 3 for this programme. That is, applicants are not currently restricted to the MLTSSL and the STSOL at this stage.

Do the caveats impact permanent visa applications? 

The new caveats only impact subclass 457 applications. Caveats existing prior to 19 April 2017 that impacted other visas remain unchanged.

Can you still apply for ENS if your occupation is on the STSOL but not the MTSSL? 

If your occupation is on the STSOL or an eligible occupation on the MLTSSL you can apply for the ENS Direct Entry stream.

Current holders of subclass 457 visas continue to be eligible to apply for permanent residency through the Temporary Residence Transition (TRT) stream of the ENS visa. Access to the TRT stream is not based on the occupation lists and is therefore unaffected by these changes.

1 July 2017 changes 

Key reforms that will be implemented from July 2017 for subclass 457 visas include:

  • expanding mandatory skills assessments;
  • introducing mandatory penal clearance checks consistent with other visas;
  • tightening existing training benchmarks; and
  • removing English language exemptions based on a skilled migrant’s salary (e.g. if their salary is higher than $96,400).

Will there be further changes to the occupation lists for 1 July 2017? 

It is expected that the occupation lists will be regularly updated, based on a range of factors including advice from the Department of Employment and the Department of Education and Training.

Why are mandatory skills assessment requirements being expanded?

The skills assessment requirements are being considered for expansion to cover a small number of new cohorts of concern. For example, where particular combinations of occupation and nationality have been identified as an integrity risk.

What nationalities/occupations will be impacted? 

A final decision has not been made in this space. Registered migration agents will be informed of the specific changes proposed via an agents newsletter prior to 1 July 2017.

What changes are being made to character requirements and why?

As of 1 July 2017, all subclass 457 applicants aged 17 years or older will be required to provide penal clearance certificates for countries in which they have lived for a significant period.

This measure will strengthen current character and integrity measures and will bring subclass 457 visas into line with other longer stay temporary visa products.

What reforms will be implemented on 1 July 2017 for ENS and RSMS?

On 1 July 2017, the additional changes below will be implemented for ENS and RSMS:

  • raising English language requirements to “competent” for all applicants (IELTS 6) – with TRT and Direct Entry requirements to be consistent;
  • upper age limit of 45 for Direct Entry applicants;
  • 3 years skill and experience for Direct Entry applicants; and
  • further changes to the occupations lists and their application to relevant visas
March 2018 changes 

What is the Temporary Skill Shortage (TSS) visa? 

The new TSS visa will replace the 457 visa. It will have two distinct streams: a Short-term stream of up to two years and a Medium-term stream of up to four years.

What are the changes to the English language requirements?

The English requirements for the Short-term stream of the new TSS visa will be the same as the current Subclass 457 visa, with a minimum IELTS result (or equivalent) of 4.5 in each test component required, and an overall score of 5.

There will be a higher standard required for the Medium-term stream with a score of 5 required in each test component.

Will holders of the TSS visa have a pathway to become Australian permanent residents? 

TSS visa holders will be able to transition to Permanent Residency under the Medium-term stream only.

What reforms will be implemented for ENS and RSMS in March 2018? 

From March 2018, new eligibility criteria for ENS and RSMS will include:

  • an upper age limit of 45 (from 50) for most applicants;
  • occupation must be on the MLTSSL (unless an additional occupation approved for regional areas);
  • a minimum market rate salary: all visa holders must earn at least a minimum salary of $53,900 – that is the TSMIT;
  • at least three years’ relevant work experience; and
  • a pathway to permanent residence through TRT requires 3 years on Medium-term TSS visa.