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AUSTRALIA - Skilling Australia Fund Bill Passed by the Senate

On Tuesday 8 May the Migration Amendment (Skilling Australians Fund) Bill 2017 was debated and passed by the Senate. The Bill was passed with three notable amendments:

  • LMT must be conducted within a four-month period prior to submission of a nomination application (currently LMT must be conducted within 12 months);
  • Advertising to meet LMT requirements must be run for a minimum of four weeks to provide adequate opportunity for the position to be targeted to Australians (currently advertising must run for at least 21 days);
  • An independent review of the operation of the Skilling Australia Fund is to be undertaken after 18 months, and is to be completed within 6 months.

While the Bill was passed by the Senate, the legislation must now return for further debate and passage by the House of Representatives. As yet, legislation has not yet passed both houses of parliament and has not yet received Royal Assent. As such, the date of implementation is yet to be confirmed.

Budget 2018/2019 update – Skilling Australia Fund

Treasurer Hon Scott Morrison MP announced in last night’s Federal Budget that a number of expansions will be applied to refunds for sponsors in relation to the Skilling Australia Fund. Refunds will now be available where:

  • a visa holder leaves a sponsor’s employ within the first 12 months and before the completion of the two- or four-year visa period. (A refund request can be made for any full years the visa holder is not employed);
  • a visa holder does not commence work with the sponsoring employer;
  • an employer’s sponsorship application is approved but the subsequent visa application is refused on health or character grounds.

Budget announcements also included that religious organisations will be exempt from paying the SAF levy under the Minister of Religion Labour Agreement or a company specific Labour Agreement covering specific nominated religious occupations.

About the Skilling Australia Fund

The Migration Amendment (Skilling Australians Fund) Bill 2017 (The Bill) was introduced for a first reading in the House of Representatives in October 2017 to impose a training levy payable into the Skilling Australia Fund (SAF).

Contributions will be required in relation to both permanent and temporary visas, and will be payable by sponsors accessing overseas workers through employer sponsored subclasses:

  • Temporary Skill Shortage visa (subclass 482);
  • Employer Nomination Scheme (subclass 186);
  • Regional Sponsored Migration Scheme RSMS (subclass 187).

The SAF will be administered by the Department of Education and Training with the purpose of supporting the skills development of Australians.

The introduction of the SAF levy charge will replace the current training benchmarks that employers must meet; a contribution equivalent to either 1% (benchmark B) or 2% (benchmark A) of payroll.

Contributions to be paid into the SAF will be required to be paid in full at the time of lodging the nomination, and must be paid by the sponsor (cannot be passed on to the visa applicant). The proposed levy fees are:

Temporary Skill Shortage (subclass 482)

  • Businesses with turnover of less than AUD 10m: AUD 1,200 per nomination for each visa year;
  • Businesses with turnover of more than AUD 10m - AUD 1,800 per nomination for each visa year.

Employer Nomination Scheme & Regional Sponsored Migration Scheme (subclass 186 & 187)

  • Businesses with turnover of less than AUD 10m - AUD 3,000 one off payment for each nomination;
  • Businesses with turnover of more than AUD 10m - AUD 5,000 one off payment for each nomination.

The Bill also sets out the new requirements for Labour Market Testing (LMT), which were introduced as a mandatory criterion to be met at the nomination stage of the new Temporary Skill Shortage (subclass 482) visa on 18 March 2018.

To date all information in relation to the LMT requirements has been provided in migration policy, so passage of legislation in this regard is expected to provide clarity for sponsors.

Action items

  • Although there are no new regulations or implementation period in place for the SAF as yet, companies should be prepared to pay the SAF once it has been implemented.

This news alert was prepared using information provided by Newland Chase.

DISCLAIMER: The information contained in this immigration alert has been abridged from laws, court decisions, and administrative rulings and should not be construed or relied upon as legal advice. If you have specific questions regarding the applicability of this information, please contact Peregrine © 2017 Peregrine Immigration Management Ltd.