Developments in corporate immigration in Australia
October 2014 | 10QUESTIONS | EMPLOYMENT LAW
FW speaks with Alex Paterson, a partner at Fragomen, about corporate immigration in Australia.
FW: How would you describe the thinking around corporate immigration in Australia at present? Are the country’s corporate immigration policies relatively open or closed to foreign nationals?
Paterson: Generally speaking, the subclass 457 program is an effective entry pathway for corporate immigration. However, the process became more burdensome during 2013 due to a number of additional requirements imposed by the then Labour government, in light of the more challenging economic circumstances Australia is facing. These led to significantly longer lead times for intra-corporate moves and international hires into Australia. The new government called for an independent review of the operation of the 457 visa program earlier this year. The review panel reported to government on 10 September and recommended a number of ways that the program could be simplified and deregulated. The government appears to be attracted to many of the proposals as part of its overarching agenda that Australia must be ‘open for business’, which is a positive indicator. We will see how this translates into regulatory reform over coming months.
FW: Could you briefly outline the main rules and regulations governing corporate immigration in Australia?
Paterson: Intra-corporate transferees and local international hires must be sponsored by an employer, which requires the employer to demonstrate its commitment to employing and training Australians. The position must meet certain criteria including occupation type, salary level and in some cases, labour market testing. The individual must meet relevant skills requirements – including qualifications and relevant work experience – and English language proficiency requirements, which include testing requirements in many cases. The validity period of the visa is tied to the duration of employment, up to a period of four years, and may be renewed by lodging a new application. Sponsoring employers have significant ongoing obligations to ensure that working conditions are maintained and to ensure that the sponsor has primary responsibility for the presence of the visa holder in Australia.
FW: What visa options are available to individuals seeking to relocate to Australia for work, as well as for businesses looking to bring overseas staff into the country?
Paterson: The subclass 457 visa allows work in a business through employer sponsorship. Individuals wanting to relocate to Australia for work will generally need to find a business that is willing to employ and sponsor them for a 457 visa. Highly skilled individuals with in-demand qualifications and work experience may be able to relocate to Australia as permanent migrants. They would need to present their credentials through an initial ‘expression of interest’ and may apply for permanent residency once invited to do so. There are a range of other temporary visas that allow different types of business activity. Training visas allow businesses to assign staff to their Australian office on talent development rotations designed to increase occupational skills and exposure to different markets. There is also a short-term work visa for one-off, project based assignments of up to three months; and business visitor visa options.
FW: Significant changes continue to be made to the 457 visa program. Can you discuss the major amendments, both actual and proposed?
Paterson: The previous government introduced a range of changes during 2013 including labour market testing, English language proficiency testing, skills testing, and a significant hike in government lodgement fees. The review panel has recommended a number of reforms including the following: the abolition of labour market testing; retaining the English language requirements but making it easier for visa applicants to evidence their proficiency; reviewing the role of skills assessments in assessing the genuineness of roles nominated under the 457 program; a two year moratorium on further fee increases; and providing a streamlined application approval process for sponsors with a history of sound use of the program and who are nominating ‘low risk’ occupations. The Minister is expected to announce the government’s legislative agenda in response to the review panel’s recommendations, during the fourth quarter this year.
FW: How have these amendments been received by Australia’s business community? What major criticisms have been voiced?
Paterson: The most significant impact of the 2013 changes has been the longer lead time required to prepare a 457 visa application for lodgement, in order to meet the additional requirements. This has affected business’ ability to mobilise staff to Australia efficiently, particularly for those businesses that have been accredited as regular and reputable users of the 457 program but have been impacted by the universal application of the new restrictions. These changes have also made short term work assignments of 3-12 months a much more difficult proposition. The migration program does not cater well for such assignments because of a ‘gap’ between the 400 visa, which is valid for up to three months, and a 457 visa, which has become quite a burdensome and expensive process to undertake for assignments of up to a year only. The suggested reforms include the introduction of ‘light touch’ processing for these types of intra-corporate transfers in managerial and professional level occupations. The 457 visa program continues to be a politically hot topic and sponsoring businesses are experiencing ‘change fatigue’ due to the constant ‘tinkering’ with the 457 rules. We are hopeful that the current review will result in a more stable 457 process that is predictable, efficient and streamlined while ensuring that program policy goals are met.
FW: What effect do Australia’s immigration laws have on domestic employers? How, in your opinion, do they impact the search for skilled foreign workers in a competitive global market?
Paterson: The 457 visa provides a pathway for all Australian employers to recruit internationally, but the 2013 changes were designed as a ‘brake’ on the flow of workers from overseas as part of an ‘Australians first’ policy. The concern is that additional hurdles and high lodgement fees may delay, or even prevent, some businesses from accessing the best and the brightest from the global pool of talent. It is laudable that Australia wants to protect its own workforce. That said, the government needs to recognise the inherent value proposition in the global movement of skilled human capital. There is a key global shortage of specific skills in the science, technology and engineering sectors and it is vital that Australia is seen to facilitate global graduate and talent development schemes, with planned rotations in Australia. If it does not, Australia risks losing its position as a participant in such schemes – with the Australian workforce missing out on the opportunity to gain vital international opportunities that are so important to building a successful business career.
FW: What considerations should companies bear in mind when designing programs and procedures to control and monitor their organisation’s immigration strategy?
Paterson: The Australian corporate immigration program facilitates most business based assignments. It is about ensuring companies fully understand the program and select the relevant visa subclass for the foreign national required to travel to Australia. Each visa type is intended for a different purpose or activity and has conditions imposed which limit the visa holders’ activities and the way that the company is able to engage that person. Taking the time to factor immigration into global mobility and business visitor policy design will reap dividends in streamlining processes and ensuring a strategic approach is adopted. It is also important to ensure there are sufficient checks in place to monitor compliance. Sponsor obligations are extensive and the imposable sanctions on any employer found to be employing workers in breach of their visa conditions can be severe. Ensuring all key stakeholders in the business are fully briefed and actively engaged in determining business immigration strategy and protecting compliance reputation can make a real difference, as can conducting regular audits and reviews of process.
FW: What is your advice to firms in the event they are faced with an immigration breach or sanction notice? What immediate steps can they take to respond quickly and effectively?
Paterson: A breach or sanctions notice is a serious matter that may result in financial penalties, bars from visa sponsorship, and even cancellation of all 457 visas currently sponsored by that business. This could have a significant impact on business given staff assigned to Australia through intra-corporate transfers are invariably key appointments in ‘mission critical’ roles. Businesses should work with their immigration counsel in a proactive way to ensure that regular checks are made to identify and address any compliance risks before they become problems. When issues do arise, often further to monitoring activities by the Department of Immigration and Border Protection, it would be important to immediately notify their in-house counsel. They in turn can seek immediate advice from an immigration specialist firm that has an advisory, compliance and litigation team able to assist with these complex and sensitive matters.
FW: Going forward, what predictions can you make about further amendments to the 457 visa pathway in the next 12-18 months?
Paterson: The current government has an appetite for deregulation, up to the point that doing so will not impact the integrity of the 457 visa program. Over the next 12-18 months we expect changes to the 457 visa program which are consistent with the review panel’s recommendations and the government’s stated intention to let business get on with what it does best. The government’s ability to do so is to some extent dependent on how favourably the new Australian Senate treats the government’s legislative agenda in this area.
FW: What final advice can you offer to companies in Australia on managing corporate immigration issues?
Paterson: Ultimately, it is about having full knowledge of the Australian visa program and ensuring a mechanism to keep abreast of forthcoming changes. This area of law will always change frequently given immigration is a hot topic politically. If Human Resources and Global Mobility teams maintain dialogue with their external adviser, they can strategically plan in advance of changes to ensure key business needs continue to be supported as foreign workers are hired or selected for deployment to Australia. Establishing protocols to review and audit 457 populations regularly to ensure ongoing compliance with sponsor obligations is also critical. One final suggestion I would make is the value of proactively engaging with government when the opportunity presents itself, either directly or through your external counsel. Acquired knowledge of the ‘real challenges’ business faces can maximise the opportunities for further regulatory and policy refinement of the corporate immigration program, whilst maintaining its integrity.
Alex Paterson is a partner of the Australian Practice of Fragomen within the firm’s extensive Asia Pacific operations. Previously, Ms Paterson was managing partner of Fragomen’s London office for five years. Her role is to jointly lead Fragomen’s Sydney practice and to lead its Western Australian practice based in Perth. Ms Paterson also manages a number of global and regional client relationships. She is a dual qualified solicitor of England and Wales/Australia and has practiced in the field of immigration law since 1995, providing legal advice to some of the world’s largest global companies and many start-ups and small to medium sized enterprises. She can be contacted on +61 2 8224 8540 or by email: email@example.com.
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