Hospitality employers should take steps now to avoid the 457 visa salary threshold increase

hospitality-workers

As it presently stands subclass 457 visas are only available for eligible employees who earn above the Temporary Skilled Migration Income Threshold (TSMIT). The current TSMIT has effectively been frozen at $53,900 since July 2013.

As set out in our recent alert, the TSMIT is expected to be increased from July 2016 and estimates suggest it could be increased as high as $59,540. Employer sponsors who pay employees in this salary range should take immediate steps to nominate workers for sponsorship, otherwise the increase in the TSMIT will increase costs and potentially affect their ability to sponsor workers in certain positions.

Eligible sponsorship positions in the hospitality and leisure industry that are likely to be affected include, but are not limited to, the following:

  • Cook
  • Cafe or Restaurant Manager
  • Pastry Cook
  • Program or Project Administrator
  • Sales and Marketing Manager
  • Chef
  • Hotel or Motel Manager
  • Marketing Specialist
  • Accommodation and Hospitality Managers
  • Accountant (General)

An increase to the TSMIT may have the result that it will be cost prohibitive for many employers to nominate workers for 457 sponsorships in the positions above.

What can be done to take advantage of the current TSMIT?

The applicable TSMIT governing market rates is the TSMIT in place at the time the nomination application is approved.

At present, the service standard published by the Department of Immigration and Border Protection for processing 457 visa applications is up to 3 months. Therefore, immediate steps need to be taken by employer sponsors to lock in the current TSMIT prior to the anticipated increase. Finalising sponsorship arrangements now will effectively preserve the lower TSMIT for up to 12 months (the standard validity period of an approved 457 visa nomination).

If you would like to discuss how the expected TSMIT increase can be managed or the effect of the increase on your sponsorship arrangements generally, please contact Jacob Wyllie or Alex Kaufman on 02 9922 5188.