In August 2017, Immigration New Zealand (INZ) officially released the much talked about policy overhaul for the Essential Skills work visa and Skilled Migrant residence visa categories that will have a significant impact on both migrant workers and their employers.
The changes aim to restrict low skilled workers from being able to settle in New Zealand on a long term basis where they have no obvious pathway to gain residence in New Zealand. Correspondingly the policy overhaul seeks to improve the quality of applicants able to apply for and obtain residence. Numerous more minor changes have also been made to other areas of policy.
With lower skilled and lower paid workers to be subjected to 12 month stand down periods and potentially more frequent visa renewals, employers will need to be far more proactive about managing their migrant workforce to ensure its maintenance and continuity. Also, as residence will become more difficult to obtain, employers will face increased pressures to assist and promote migrant workers to gain residency.
It is critical that employers take proactive steps now to minimise the future impact of these new restrictions, which will be brought about through the following key changes as outlined by INZ:
Essential Skills visa
- Re-designating essential skills work visas into low-skilled, mid-skilled and high-skilled based on occupation and salary, with any position attracting an hourly wage of less than $19.97 automatically being deemed low-skilled regardless of occupation.
- Prohibiting low-skilled workers from obtaining a visa of longer than 12 months in duration, and prohibiting partners and children of such workers from obtaining visas on the basis of their relationship with that worker.
- Imposing a 12 month stand down on the grant of a further essential skills work visa to low-skilled workers who have received 3 years of essential skills work visas (with that 3 years starting from when the first visa granted after 28 August 2017) in low skilled positions.
Skilled Migrant residence
- Imposing a minimum salary requirement of $48,859 per annum/$23.49 per hour in order to be eligible to apply for residence under the skilled migrant category.
- Increasing the points available for work experience but limiting the ability to claim such points to only work experience in skilled positions.
- Removing lower value points for future growth, close family and certain skills shortage categories
We strongly recommend employers immediately conduct a review of their employees holding temporary visas to determine which of them will be affected by the changes, what impact this will have on business continuity, and what steps could be put in place to minimise the impact.
In particular, consideration needs to be given to how best to balance any increased costs in meeting the wage thresholds being imposed by INZ (and therefore expected by migrants) against the costs associated with staff attrition and loss of business continuity through experienced staff being forced to cease work for a 12 months period if they haven’t progressed to mid or high-skilled employment within the next three years.
The Immigration and Employment teams at Saunders & Co can help employers to work through these changes to determine any potential impacts on their business. We can also provide pragmatic and practical advice around the most appropriate next steps.