Work Visa Rules Decoded – Sort Of

June 8, 2021
Iain MacLeod

As has been widely signaled, new work visa rules are being rolled out over the next 18 months or so. Government continues to drip feed details. No rules have been published.

The new process adopts three stages (only one of which is new) including:

  1. Vetting the employer and ensuring they are not likely to be in the minority that exploit or rip off their workers; and
  2. Some roles will require labour market testing and some will not be depending on location or effective hourly rate. The pressure to prove labour market shortages rises in the big cities OR at the lower end of the pay scale
  3. Applicants demonstrating that they are qualified by training and experience to do the job offered – by replacing the current ‘substantial match’ to a particular occupation to one based on salary or wages (‘effective hourly rate”)

What we know is the aim of accrediting all employers and making things ‘simpler’ has as always run into the small detail of reality. It isn’t simple and it does add layers of complexity although it seems Government has listened to Advisers like us and employer groups who made one very strong point – the focus going more on the employer I not a bad move but if the total time it takes to secure a work visa is longer than it is today (can be months if you don’t know what you are doing) then it is economic suicide.

With over 150,000 work visa holders in the country at any given time, this economy depends on migrant workers to fill those skill gaps – or in the case of the current tight labour market – yawning chasms. This was no time to cut back on temporary workers and I believe the politicians have worked that out. Thousands of jobs continue to be created – they are literally raining down on the overwhelming majority of our clients – December has yet again defied history as clients continue to secure skilled employment two weeks out from Christmas. It has been like this the past three ‘slowdown’ periods.

So, what details do we have?

  1. The process will depend on whether you employ (might want/need to, it is not yet clear…) five migrants. For these employers there is one set of rules. The reality is most employers will fall into this bracket. They will need to demonstrate an historical legal compliance with employment and immigration law along with compliance with any industry registration requirements and we imagine it won’t be much more involved than the current process in terms of the information they need to provide INZ. Certainly far less onerous than government outlined in the discussion paper released earlier this year or as part of their election hot air two years ago. Accreditation is basically permission to offer migrants jobs – for these employers the status will last for 12 months. It can then be renewed in chunks of two years.
  2. Higher (visa) volume employers will get 24 months’ accreditation off the bat but they must demonstrate an as yet undefined commitment to training – shades of the Australian visa system perhaps where invoice/receipts have to be shown to demonstrate they aren’t just committed to training action but they are carrying out their training/up-skilling strategy.
  3. Employers offering jobs paying 200% the national median salary (around $104,000) will not have to demonstrate they cannot find a local to fill the vacancy
  4. Employers offering jobs paying $25 per hour (for a 40-hour week) being the national ‘median’ outside of Auckland, Hamilton. Wellington, Christchurch and Dunedin will also have the requirement to prove a labour shortage removed. In the five biggest cities however, stupidly, this requirement to test the local labour market will continue.
  5. Applicants offered a job paying less than $25 an hour will not only be required to demonstrate an effort to fill the vacancy locally but will also require an employer to deal with the state functionaries (more useless than most) at the Ministry of Social Development and essentially get their support for the ‘hire’.
  6. The duration of the visa will continue to be tied to the income level – the more you earn the longer you can stay. Maximum will be 3 years – down from 5 years.
  7. No more use of the Australia New Zealand Standard Classification of Occupations (ANZSCO) to determine if applicants are qualified by training and/or experience to do the job – that decision will now be made based on the ‘effective hourly rate’ of the job offered (thus removing the need for the bureaucrat to have to apply their mind to whether a job is skill level 1,2, 3, 4 or 5 (nowhere near as hard as they have always made it out to be).

The upshot is for our clients here at IMMagine there isn’t a lot of downside because few if any of our clients earn below $25 an hour and most earn considerably more. Government watering down the accreditation process for employers is major policy U-turn but one that should make things no more onerous to employ migrants than it is today.

Of course the proof will be in the pudding. Thirty years in this game tells me that what politicians want, and what the migrant and their employer get, is usually poles apart.

If the new process can speed things up all the better. I’ll believe that however when I see it. INZ’s backlogs have in recent months have got worse and worse. Processes that used to take a few short weeks are now taking months, residence, that used to be 4-6 month process for our clients is turning into an 18 month nightmare. The department is not just in chaos but crisis.

The key point though is for most of our clients, or would be clients, no need to panic. Work visas are not about to be harder to come by.

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