Immigration Minister Peter Dutton has signalled he is willing to compromise on the Turnbull government's tough foreign labour regime, assuring universities they won't be hamstrung by new work experience requirements.

Vice-chancellors, academics and the powerful Group of Eight universities were alarmed the Turnbull government's abolition of the 457 visa may prevent them hiring overseas researchers straight out of a PhD program.

In a letter to Prime Minister Malcolm Turnbull, Go8 chairman Peter Hoj warned the changes could be "extremely damaging" to Australia's reputation for welcoming international academics.

Particular concern surrounded the introduction of a two-year work experience prerequisite for temporary work visas, which universities feared would stop them hiring researchers who had spent their adulthood studying.