It has been bought to the attention of the migration agents working at TEP Pty Ltd that there will be substantial changes to the 457 Business Visa category over coming months that will significantly effect employers in the horse and rural industries.

Please find attached to this information leaflet a copy of the press release relating to these changes from the office of Chris Evans, Federal Minister for Immigration. A summary of the outlined changes can be found below.

Minimum salary level increase

The current minimum salary level (MSL) for 457 visa holders is $37,665 for regional areas and $41,850 for all other areas. It is important to note that no deductions other then income tax can be taken from this base salary, and that the salary is for a 38 hour week. This MSL has been in place for more then 2 years.

From August 1, 2008 the MSL will increase 3.8 percent to $39,100 for regional 457 holders and $43,440 for all other 457 holders. This base salary, again, is for a 38 hour week. All 457 applications lodged with DIAC that have not been approved, as well as all applications not lodged with DIAC before this date, will need to be at the new MSL.

While the media release attached states that ALL holders of 457 Business Visas will need to be paid the new MSL, regardless of when their application is approved, we believe this may take longer to come in. As a precaution we’d recommend where
possible employers increase the salary of their 457 visa holders to the new levels from August 1, 2008.

Increased & stricter monitoring requirements

As many 457 employers would already know, DIAC monitor sponsors to ensure they are maintaining their obligations to their employees. The monitoring on the 457 category is only going to get more onerous, and we would suggest ALL 457 sponsors will be monitored at least annually in the near future.

Additionally, DIAC now require a very quick response to monitoring requests. Employers are initially given 14 days to provide the information requested, and are only allowed one additional extension of 7 days to get the information required to DIAC. There is no flexibility on this, so it’s important there is always someone within your business who can deal with these monitoring requests quickly. These requests will include copies of pay slips showing hours worked and salary paid. If after 21 days the requested monitoring has not been provided the employer will receive a breach and will temporarily be suspended from applying for any further 457 visas, until satisfactory monitoring has been completed.

Increased penalties & sanctions for employers

If employers are found NOT to be complying with their sponsorship obligations, or a monitoring report is not completed satisfactorily, sanctions and penalties can be imposed on an employer. Currently DIAC can only cancel or suspend an employer’s rights to sponsor 457 visa holders, however later this year they will bring in a range of sanctions for employers who breach employment conditions, as well as hefty fines ranging from $6,600 for individuals to $33,000 for a corporation.

Monitoring of visa holders as well as sponsors

As well as increased monitoring for 457 employers, DIAC intends to implement monitoring of 457 visa holders. This is to increase the communication and transparency between the department, 457 holders and also employers in an effort to stamp out 457 holder exploitation. 457 visa holders may be contacted by the department and asked questions about their employment conditions, or they may be sent a form to complete along with information about their rights. This has not yet been implemented but will be in the very near future.

So as an employer of 457 visa holders, what do I have to do?

1. Check that all of your 457 employees are currently paid the correct MSL as stated on their original visa application, and that if they are earning the lowest allowed base salary that they are working a 38 hour week. If they obtained their visa after October 2007 and they are working more than 38 hours they should be paid an additional equivalent hourly rate. This is important as you WILL be monitored on this.
2. If you receive a monitoring request from DIAC act quickly by either sending it through to us at TEP to complete or by completing it yourself.
3. Have pay slips including tax and superannuation information readily accessible just in case you are monitored by DIAC.
4. Where possible increase the salary paid to your current 457 holders to the new MSL from August 1, 2008.
5. COMMUNICATE with your 457 employees – make sure they understand what salary they are on, annually and per pay cycle, and that they understand what hours they work. Also let them know that DIAC may contact them to clarify this information.
6. And lastly, call us at TEP if you have any questions or concerns.

Many employers are finding that by having a migration agent such as TEP handle all their migration applications AND monitoring, it can streamline the whole process. In future months this will become increasingly the case.