On Tuesday 17 September the Government announced significant changes to work visas in New Zealand. Aaron Martin, Principal Lawyer at New Zealand Immigration Law, weighs in on the impact these changes will have for employers.

Talent work visa changes 2019

The changes to the work visa system are the most significant in over a decade. By 2021, 6 different types of work visas will be replaced with one employer-assisted work visa.

Under the changes, accreditation status will be mandatory by 2021 for all employers who are seeking to hire workers from overseas. But the systems and processes for application (and the cost) have not been created.

The announcement demonstrates that the ‘consultation’ conducted at the beginning of the year was in fact just ‘show and tell’ by the government. As usual, people who engaged in the ‘consultation’ were listened to but not heard.

The Impact for Employers:

Employers who were wise enough to obtain accreditation status under the existing programme will be transitioned into the new system in 2021. They are likely to experience an easier time of it than those who did not bother to engage with the accredited employer scheme.

Current accredited employers will be familiar with the processes and requirements that are likely to come. They will be better placed to address any new criteria than those who are trying to learn after implementation of the new system. More importantly, they will experience less disruption to the recruiting process.

A major problem I foresee is that, if all employers need to become accredited, there will be a substantial queue of applications. We have no idea how Immigration New Zealand will have the resources to deal with this. The Government is promising a ‘streamlined process’. I’ve been an immigration lawyer since 1996, and I can honestly say that what Immigration New Zealand considers ‘streamlined’ is very different to the interpretation of the private sector.

The new proposed accreditation status will have three types: standard, high-volume, and labour hire accreditation.

Standard accreditation is for those who intend to employ one to five expatriate workers in a 12-month period. High-volume accreditation is for those who intend to employ five or more expatriate workers. For high-volume accreditation status there will be more stringent requirements around providing training, up-skilling local staff, and increasing wages and conditions.

But it is still undecided how the new system will work. When exactly will it be implemented? How long will it take to process applications? What will it cost? What evidence will be required? And what will an employer do if they don’t know before applying exactly how many workers they need from offshore?

The initial accreditation status will last for 12 months, and on renewal 24 months. This seems somewhat ludicrous, as it overburdens an already overburdened application processing system. It would have been far better to have simply offered the initial accreditation status for a 24-month period.

The welcome news (to a degree) is that ANZSCO codes will no longer be used to determine skill level. The unwelcome news is that skill level will now be arbitrarily assessed by whether a person is above or below the median wage. This is likely to have significant adverse impact in some sectors.

In other refinements, the current skill shortage list system will be replaced by one better targeted to skill shortages pertinent to the needs of major urban centres as well as the rural sector.

Changes as of 7 October

Employers who already hold accreditation status will only be able to obtain work to residence visas for staff who are paid $79,560 and over from 7 October.

Those employers who were wise enough to on-board staff members under the current regime will be able to sleep comfortably knowing those staff will proceed through to residence under the salary/wage requirement of $55,000.

Employers who are accredited can also rest easy knowing their accreditation status will stay in place until 2021, when they will be transitioned over to the new system.

Workers who hold a work to residence visa under the current rules will also be relieved their immigration status is safe. Work to residence visa holders who had hoped they would be able to apply directly for the permanent resident visa (as opposed to the standard resident visa) will be disappointed. But at least they can still acquire a resident visa – they just need to remain in New Zealand in order to acquire the permanent resident visa.

If you are concerned about these changes or another immigration or visa issue, you can contact NZIL here.

To read more of Aaron’s thoughts on the work visa changes, check out our earlier article “Employer accreditation – avoid the log jam and act now”