Review of work visas

The Ministry of Business, Innovation and Employment (MBIE) is proposing some significant changes to New Zealand’s main work visa, the Essential Skills work visa. The purpose of this visa is to allow employers to recruit non-NZ citizens and residents for positions that they have been unable to fill locally.

The changes should be considered as part of a suite of changes underway to the immigration program, as the Essential Skills visa has, to date, formed an important platform for many temporary workers to apply for residence in NZ. For an increasing number of temporary workers, however, the grant of an Essential Skills work visa has come with unrealistic expectations of residence eligibility. Long term temporary residents who are undertaking valuable lower skilled roles (often outside of the main centres) inevitably settle into their local communities, and become irreplaceable to their employers. At first glance this seems like a win-win situation, however the reality is that for this group of workers, there are very little options for residence. And this will be further emphasised with the impending changes to the Skilled Migrant category, effective mid-August 2017.

It would be irresponsible for the government to continue to allow these workers and their families to hold unrealistic expectations as to their long term options in NZ. If employers and potential temporary workers understand the longer terms options (which may be minimal) from the outset, there is an avoidance of unrealistic expectations and both parties can make an informed decision about whether to proceed or how long the employment may last. It should also encourage NZ employers to look to resolve their reliance on temporary workers in lower skilled roles, encouraging the recruitment and training of local staff (particularly in the younger working age groups where unemployment rates are disproportionately high).

This will inevitably cause some pain and force the return home of some workers who will be caught in the middle until the new changes are bedded in (whatever format they take). Some NZ employers will struggle, in the short term, to bridge the gap when their temporary workers may need to return home. This will be alleviated somewhat by the government’s announcement of a one-off residence pathway for some long term, settled workers in the South Island but this is just that; a once-only opportunity for those who would otherwise be significantly disadvantaged by the proposed rule changes. Further information on this pathway visa is due to be announced during May, with an application window opening from 22 May 2017.

What are the proposed changes?

In summary, MBIE are proposing to make five key changes to the Essential Skills visa, namely:

  • Introduction of remuneration thresholds to determine skill levels then associated visa conditions
  • Introduction of a maximum duration of stay for lower skilled workers, punctuated by a mandatory stand down period where the visa holder must remain outside of NZ before attempting to return
  • Requirement for partners of lower-skilled visa holders to meet the requirements for a visa in their own right
  • Requirement for children of lower-skilled visa holders to meet the requirements for a visa in their own right
  • Explicitly linking the period of employment condition to seasonal work

Introduction of remuneration thresholds to determine skill level and associated visa conditions

This proposal will introduce the concept of remuneration being the principal guide for whether an occupation is determined to be higher-skilled, mid-skilled or lower-skilled. As the table below indicates, this classification will then dictate visa length and whether family are eligible for visas based on dependency. The remuneration bands are directly linked to the impending Skilled Migrant category changes, thus if adopted there will be clarity for those workers about residence eligibility from the outset.

Introduction of a maximum stay for lower-skilled workers, combined with a mandatory stand-down period

This proposal has seen the greatest reaction in the press. It does not mean that NZ employers will lose access to lower-skilled temporary workers, but it will limit the length of time that they can be employed in NZ. Allowing a total of three years will force employers to use the time to recruit and train local employees, or to look at other ways of decreasing reliance on temporary workers. Forcing the visa holder to exit NZ will prevent the holder from applying for any other visas, thus bypassing the stand-down period by the changing of status.

Requirement for partners and children of lower-skilled work visa holders to meet the requirements for a visa in their own right

Whilst attempting to minimise the inevitable settlement of temporary workers, the government has departed from a long-standing approach with regards to keeping families together. This may or may not affect too many NZ employers, but for those who do regularly have lower-skilled workers who also have families in NZ, this could hold more impact than the wage-based distinctions and shorter stays.

Partners will need to find their own employment, and children will need to pay overseas student fees should they wish to accompany their parents and who are of school age. By virtue of the fact that this affects the lowest income group of workers, it will likely end all possibility of dependent, school age children coming to NZ with their parents where the parents are employed in a lower-skilled job (as defined by the proposed changes).

Employment conditions tied to seasonal work

This proposal relates only to those in industries where there is an element of seasonality about worker demand. In such affected industries, it is proposed that work visas will only be issued for the period of work that is available, ie for a season rather than for 12 months by default. Note that this is for seasonal work that is NOT covered already under the Recognised Seasonal Employer (RSE) Scheme or the Supplementary Seasonal Employment Scheme.

The following occupations are currently being considered as part of this proposal:

  • Rural contractors
  • Dairy farm workers
  • Meat workers
  • Adventure tourism workers
  • Shearers and shed hands
  • Ski season workers
  • Winery and viticulture workers
  • Horticulture workers
  • Forestry workers
  • Seafood workers

Summary of proposed changes to Essential Skills visas

How can I provide feedback?

Visit the MBIE website to download the discussion papers and submission document here.

Note that the deadline is Sunday 21 May 2017.

For any questions or further information please contact me.

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