Budget 2017: Foreign Workers and Your Business

Does your business employ foreign workers? If you do, or you’re considering doing so, changes to work visa legislation in the 2017/2018 Budget could affect you heavily. There are a number of modifications on the cards, including more restrictions on who can get a visa, increased costs for applying and sponsoring visas, and new annual levies on businesses that employ foreign workers. In other words, it’s highly likely that in the next few months, it will become a lot more expensive for Australian businesses to not only bring foreign workers over to Australia, but also to keep them here.

457 visas replaced

457 visas are to be replaced with two temporary skill shortage visa types, one short-term (up to 2 years) and the other medium-term (2-4 years). Application methods are likely to change, potentially making the process longer and more difficult. See the Budget statement for more information.

Visa application charges increased

Applying for a temporary skill shortage visa is set to become more expensive, with the application fee increasing: $1,150 per short-term primary visa and $2,400 per medium-term primary visa. This isn’t a huge jump for short-term visas, but the new medium-term visa fee is substantially higher the old 457 application fee.

New levy on foreign workers

A new levy would impose annual fees on businesses employing foreign workers who are on temporary work visas. Small businesses with an annual turnover of less than $10 million will be required to pay $1200 per foreign employee, per year. Businesses with a greater annual turnover will be required to pay $1800 per foreign employee, per year.

One-off visa sponsorship fee

Sponsoring foreign employees for permanent skilled visas would get more expensive if the Budget measures make their way into legislation. Small businesses with less than $10 million would pay a one-off fee of $3000 for each employee sponsored for a permanent skilled visa; for larger businesses the fee would be $5000 per sponsored employee.

Skills shortage list revised

In April 2017, 200 occupations were removed from the skills shortage list, including a number in the arts and primary production fields. You can view the removed skills on the Department of Immigration and Border Protection’s website.

Summary

While some of these changes are already in operation, most are still to be passed into legislation. But the Budget does show the government’s keen interest in encouraging local skills improvement rather than bringing in foreign workers to fill skill shortages. If you’ll be affected, consider adding these costs to a provisional budget for the next financial year; also keep an eye out for new skills training programs in Queensland that might offer subsidies or grants to businesses offering apprenticeships and traineeships to local people.

Contact us if you would like to discuss your situation in detail.

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