12 October
2022
PDF version [506 KB]
Dr Susan
Love
Social Policy
The Temporary
Skill Shortage (subclass 482) visa (TSS visa) came into effect in March
2018, replacing the Temporary
Work (Skilled) (subclass 457) visa. It is intended to help meet skills
shortages in the Australian labour market while ensuring protection of local
jobs, wages and conditions. It allows employers to sponsor overseas workers
where no Australian workers are available. Visa holders can stay in Australia
up to 2–5 years, as long as they continue to work for their employer. There is
no cap on the number of visas which can be granted in any year.
There are 3 main streams for the visa: Short-term,
Medium-term and Labour Agreement. The table below summarises the visa settings
for applicants and employers, with further explanations given in the discussion
that follows. These settings are current as at September 2022.
Employer requirements
Employers must meet a range of requirements before they
are able to sponsor migrant workers.
Employers must be approved as a standard
business sponsor, which requires paying a fee, demonstrating they are
running a legally established and operating business, and having ‘a strong
record of, or a demonstrated commitment to, employing local labour’. To
maintain their status, employers must continue to meet sponsorship
obligations.
Employers must undertake labour
market testing to demonstrate they cannot find an Australian resident to do
the work. Labour market testing generally requires advertising the position for
at least 4 weeks within the 4 month period immediately prior to lodging the
nomination application (part of the visa application process). The advertising
must meet certain requirements, including that it be via methods or media with
national reach in addition to being on the Workforce
Australia website.
Labour market testing applies to labour agreements (see
below), but there are flexible arrangements in place for some agreements, for
example, a longer advertising window for jobs in certain regional areas.
There are some exemptions to labour market testing
requirements where an International Trade Obligation applies. There are also
alternative requirements in place in specific cases, including if the salary
paid will be over $250,000; for a small number of specified professions; or for
intra-corporate transfers.
Employers must pay the employee at least the annual
market salary rate and above the
Temporary Income Skilled Migration Threshold (TSMIT, set at $53,900).
The Skilling Australians Fund levy
Employers sponsoring a visa applicant must pay the Skilling Australians
Fund levy. The fund aims to ensure that businesses that sponsor migrant
workers are also benefitting Australian workers. The levy must be paid for each
worker, as noted in the table above (see the Department of Home Affairs webpage
on costs
of sponsoring for further details).
The fund supports projects to provide training
opportunities including apprenticeships and traineeships, pre-apprenticeships
and pre-traineeships, and other employment-related training opportunities (see
the Skilling Australians Fund fact
sheet for further information).
The Skilled Occupation List
The vacancy the employer wishes to fill must be for an
occupation on the Skilled
Occupation List. The list specifies occupations for eligibility for a range
of skilled visas (permanent and temporary, including the TSS), and is aimed at
identifying occupations where there are skills gaps in the Australian labour
market which would be appropriate to fill using skilled migration. The list is
revised periodically by the National
Skills Commission.
The combined Skilled Occupation List is made up of 3 main
lists: the Short-term Skilled Occupation List (STSOL), the Medium and Long-term
Strategic Skills List (MLTSSL), and the Regional Occupation List (ROL). There
is also currently a Priority
Migration Skilled Occupation List (PMSOL), introduced as a temporary
measure in September 2020 in response to the COVID‑19 pandemic to facilitate
the entry of workers in critical sectors.
Applicants for the Short-term
stream of the TSS visa must have an occupation on either the STSOL or the
PMSOL. Applicants for the Medium-term
stream must have an occupation on either the MLTSSL or the PMSOL. The lists
do not apply to applicants for the Labour
Agreement stream, but applicants must meet the requirements to be sponsored
by an employer with a labour agreement in place.
Labour Agreements
If an employer cannot meet their skills needs through
Australian workers or existing skilled visa programs, they may be able to use a
labour
agreement. Labour agreements are negotiated between employers (or a state,
territory or regional authority) and the Department of Home Affairs
(representing the Australian Government). There is a range of types of labour
agreements, covering designated regions, industries (largely in the
agricultural sector), specific large projects or specific companies. The
agreements function as a contract, setting out terms that employers must comply
with in addition to sponsorship obligations similar to the standard business
sponsorship obligations (see above).
Labour agreements use existing visas, including the TSS
(and permanent skilled visas), but may provide concessions in relation to the
standard requirements or occupations for those visas. The annual market salary
rate still applies, so that a worker under a labour agreement should not be
paid less than an equivalent Australian worker, even if the labour agreement
allows them to be paid below the TSMIT.
Employment conditions and
entitlements
Employers of TSS visa holders must ensure that the terms
and conditions of employment are no less favourable than those they provide to
Australian citizens or permanent residents performing equivalent work in their
workplace. This includes minimum wages, hours of work and leave entitlements.
The Fair Work Ombudsman website has information on the workplace
rights and entitlements for 482 and 457 visa holders and a page for
migrant workers on how to access help regarding unfair workplace treatment.
Requirements for applicants and
visa conditions
TSS visa applicants must be nominated by an approved
sponsor, prove they have the required skills and experience to meet the
relevant occupation as listed on the Skilled Occupation List (such as via a skills
assessment if required), and meet English language requirements. All visa
applicants must generally comply with standard visa requirements including
health, character and security checks.
TSS visa holders must work only for their sponsor or
associated entity, and only in the occupation they were nominated for, unless exempt.
If their employment ends, they have 60 days to find a new employer to sponsor
them, or they must leave Australia.
TSS visa holders (primary visa holders) may bring
dependent family members (secondary visa holders) to Australia with them. These
family members can live, study and work in Australia, with no restriction on
the kind of work they can do.
TSS visa holders, like other temporary
visa holders, are generally not entitled to social security benefits or Medicare,
and must have adequate health insurance.
The employer may sponsor the worker for further TSS visas
after the time limit on the initial visa. The employer may also sponsor the TSS
visa holder for permanent residence through the Employer
Nomination Scheme (subclass 186) visa, if the employee has been working for
them for at least 3 years and the occupation is on the Medium and Long-term
Strategic Skills List or the Regional Occupation List. The Short-term stream of
the TSS visa usually allows only one subsequent TSS application and no pathway
to permanent residence; however, for
a 2-year period from 1 July 2022, this pathway is open to Short-term stream
applicants.
Medium-term and Labour Agreement TSS visa holders are also
able to apply for other kinds of visas if they meet the criteria.
Visa trends
The following chart shows trends in TSS and subclass 457
visas granted and visa holders in Australia over the past 10 years (‘snapshot’
figures are as at 30 June for each year). The figures are for primary visa
holders only.
The effects of the COVID-19 pandemic over the past 3
financial years are evident. The dip in 2017–18 possibly reflects the changeover
between the subclass 457 and the TSS visas; however, see also this 2018 Parliamentary
Library FlagPost, which noted a number of possible factors influencing trends
in subclass 457 visa applications.
Figure 1 Temporary Skill Shortage and subclass 457 visas: numbers of visas
granted and visa holders in Australia, 2012–13 to 2021–22
Source: Department of Home Affairs,
Temporary Work (skilled) visa program, data.gov.au.
Further resources
Home Affairs visa data and reports
The Department of Home Affairs issues quarterly statistical Temporary resident
(skilled) reports on
its website, including a detailed report and a separate 3-page summary. Pivot
table data is available at data.gov.au. These reports cover the TSS and its
predecessor, the subclass 457 visa.
Recent parliamentary inquiries
A number of recent parliamentary
inquiries have examined the TSS visa as part of their remit. The reports cover
considerations, stakeholder views and recommendations on settings, including
the TSMIT, labour market testing, the Skilling Australians Fund levy, the
Skilled Occupation List, exploitation of migrant workers and pathways to
permanent residence.
The Select
Committee on Temporary Migration tabled its report in September 2021. The
report considers the TSS visa in addition to other temporary visas (including
student, working holiday, seasonal and temporary graduate visas). It also discusses
challenges in addressing skills shortages and labour market gaps.
Chapter 4 discusses workplace exploitation of temporary visa
holders, including a summary of previous inquiries, the Migrant Workers’
Taskforce, the role of the Fair Work Ombudsman, and the Migration
Amendment (Protecting Migrants Workers) Bill 2021, which was at that time
released as an exposure draft. The Bill lapsed at the dissolution of the 46th
Parliament. For more on the Bill, see the Library’s Bills
Digest.
The Inquiry
into Australia’s skilled migration program focused on permanent skilled
visas but included consideration of the TSS visa. Its final
report was tabled in August 2021.
The Legal and Constitutional Affairs References Committee
tabled its report on the Inquiry
into the effectiveness of the current temporary skilled visa system in
targeting genuine skills shortage in April 2019. The report looks primarily
at the TSS visa and the previous subclass 457 visa but also notes other
temporary work visas (subclasses 400, 403 and 408). It considered a number of
issues raised in later (and earlier) reports, but at that point the TSS visa had
not been in place very long, so the committee recommended further monitoring.
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