Changes to Essential Skills Work Visa from 28 August, 2017
The Government has made decisions on proposals announced in April to change the settings for temporary migrant workers under the Essential Skills policy.
The changes will support already announced changes to the Skilled Migrant Category (SMC) residence policy and strike the right balance between ensuring New Zealanders are at the front of the queue for jobs and preserving access to the temporary migrant labour necessary for New Zealand’s continued economic growth.
The changes follow a consultation exercise and include:
The introduction of remuneration bands to assess the skill level of roles offered to Essential Skills visa applicants
The introduction of a maximum duration of three years for lower-skilled Essential Skills visa holders, after which they will need to spend 12 months outside New Zealand before they can be granted an Essential Skills visa to work in another lower-skilled role, and
Requiring the partners and children of lower-skilled Essential Skills visa holders to meet the requirements for a visa in their own right (they will still have access to short-term visitor visas).
The changes are designed to continue to enable employers to employ temporary migrant workers where there are genuine shortages while ensuring that lower-skilled migrants are clear about their future prospects in New Zealand.
The changes will be introduced on 28 August this year, at the same time as the changes to the SMC.
Detailed information about the application of these policy changes will be available within the next fortnight. That information will be published on the INZ website and will include how the remuneration threshold will be calculated, implications for family members of workers in lower-skilled roles, and how the stand-down period will be applied.
Minister's media release
Skilled Migrant Category (SMC) changes announced in April
Questions and answers
Why are we introducing remuneration bands and what will they be?
Remuneration is an excellent proxy for skills and the introduction of remuneration bands will complement the qualifications and occupation framework (ANZSCO). The bands are:-
Higher-skilled – Any Essential Skills visa holder earning above 1.5 times the New Zealand median full-time income (currently $73,299 per year), regardless of their occupation
Mid-skilled – Any Essential Skills visa holder earning above 85 per cent of the New Zealand median full-time income (currently $41,538 per year), in an occupation classified as ANZSCO Level 1-3, and
Lower-skilled – Any Essential Skills visa holder earning below the mid-skilled remuneration threshold.
The changes mean that overseas workers who are in an occupation classified as ANZSCO level 4-5 will be classified as lower-skilled unless they earn above one and a half times the New Zealand median full-time wage (currently $73,299 per year).
How many lower-skilled Essential Skills visa holders will be affected by the proposals?
Setting the mid-skilled remuneration threshold at 85% of the New Zealand median wage would mean that between 9,700 and 11,800 Essential Skills visa holders at ANZSCO levels 1-3 would be classified as lower-skilled (totalling between 38% and 46% of Essential Skills visa holders at ANZSCO levels 1-3). As at 13 May 2017 there were 11,214 Essential Skills visa holders in occupations at skill levels 4 and 5. While a small number may earn above the higher-skilled threshold we expect the majority to remain lower-skilled under the new definition.
How will employers be able to source the labour they need under the proposals?
Immigration policy is premised on a New Zealanders first approach and employers are required to ensure they are doing all they can to train and employ New Zealanders. However, these changes are not designed to reduce the number of migrants coming in on temporary work visas. Where there are genuine skills shortages, employers will still be able to recruit temporary migrant workers, as long as they can demonstrate there are not New Zealanders available to do the job.
Why has three years been chosen as the maximum duration for lower-skilled Essential Skills work visas?
A maximum duration of three years provides a balance between giving lower-skilled Essential Skills visa holders the opportunity to transition to a higher skilled Essential Skills visa or obtain residence, while also ensuring that migrants with no pathway to residence do not become well-settled in New Zealand. It also provides employers with time to recruit new staff or upskill existing staff to fill the role.
How will the decision to limit lower-skilled Essential Skills visa holders to a maximum initial three-year period affect people already here?
The change will not be applied retrospectively for lower-skilled Essential Skills workers already in New Zealand. The three year maximum duration will start from the date their next lower-skilled Essential Skills visa is granted after the introduction of the changes to the Essential Skills policy.
Why are you restricting the ability of partners and children of lower-skilled migrant workers to come here?
The changes are designed to ensure that lower-skilled migrants are clear about their future prospects in New Zealand. Lower skilled Essential Skills workers will take up employment in New Zealand with a full understanding that they will only be able to bring their family to New Zealand as a short-term visitor, unless they meet visa requirements in their own right. Removing eligibility for open work visas for partners of lower-skilled Essential Skills visa holders will potentially provide more opportunities for local workers to take on those roles. While some lower-skilled Essential Skills visa holders could be discouraged from coming to New Zealand it is not expected to reduce the numbers of principal Essential Skills applicants.
Will the change affect families already here?
Families of lower-skilled Essential Skills visa holders already in New Zealand will be able to remain here for the duration that the Essential Skills visa holder remains legally in New Zealand.