Employer-assisted work visas and regional workforce planning

Employer Assisted Work Visas and Regional Workforce Planning - Hospitality New Zealand

The Government have released their employer-assisted work visas and regional workforce planning consultation documents.

They say:

The proposals primarily impact all skilled and lower-skilled temporary migrant workers and employers of these workers across the six employer-assisted temporary work visa categories:

  • Essential Skills including the Essential Skills in Demand Lists (ESID)
  • Approval In-Principle
  • Talent (Accredited Employer)
  • Work to Residence – Long-term Skill Shortage List Occupation
  • Silver Fern (Practical Experience)
  • Silver Fern (Job Search)


Employer-assisted visas are generally those in which an employer can demonstrate through labour market tests that there are no suitable domestic workers available. Around 20 percent (47,000) of the 230,000 temporary work visas issued in 2017/18 were employer-assisted.


The remaining temporary work visas have ‘open’ work conditions, meaning the visa holder may work in any job. These visas include visas for working holidays, partners of workers and New Zealanders, and post-study work. These visas are out of scope. Temporary work visas obtained under the Recognised Seasonal Employer Scheme are subject to a separate review process and are therefore also out of scope.

 

Submissions close:

5pm Monday 18 March 2019


You can provide feedback via the options below:

 

We encourage all members to make a submission and give their views to the government on this.

Consultation documents are available to read at the following link:

Employer-Assisted Work Visa and Regional Workforce Planning

Overview from the consultation documents:

Desired Strategic Outcomes:

The discussion paper proposes to achieve two strategic outcomes:

  1. Employers place more New Zealanders into jobs, which help their businesses to grow and thrive, and result in better jobs for New Zealanders.
  2. Temporary migrant workers, when they are employed, are not exploited and have wages and conditions that are consistent with New Zealand values.

Policy Objectives:

The strategic outcomes are proposed to be met by the introduction of an immigration gateway framework which aims to deliver to four policy objectives:

  1. Strengthen employer standards and improve employer incentives and compliance
  2. Tailor labour market tests to types of skill shortages, sectors and regions
  3. Trigger integrated responses to demand for temporary migrant workers from the skills/education and welfare/employment systems to improve domestic labour supply
  4. Simplify immigration processes making it easier for employers and migrants to use the system

 

Why the proposed changes?:

MBIE undertook research, which they say has revealed a number of issues with how the immigration system is currently functioning:

  • Displacement of New Zealanders;
  • Growth in lower-skilled temporary migrant workers; 
  • Unresponsive labour market test; 
  • Lack of incentives;
  • Inadequate signals;
  • Limited compliance;
  • Operational complexities;

There is opportunity to reform the employer-assisted temporary work visa system by introducing a new gateway framework and integrating it with the broader domestic labour market system.

 

Proposed Changes:

The Gateway Framework:

It is proposed that the six employer-assisted temporary work visa categories are unified under one category called the ‘employer-assisted temporary work visa.’ All applications for this visa would be processed through a new gateway framework comprised of three distinct gates where checks on employers and migrants are completed by INZ:

  1. The employer gate where employers are accredited to employ temporary migrant workers;
  2. The job gate where checks are made to make sure no New Zealander is able to fill the job the employer is recruiting for; and
  3. The migrant gate.

 

Summary view of the proposed gateway framework

 

Gateway 1 - Employer Gate: Compulsory Employer Accreditation Proposal:

Proposed changes

It is proposed that compulsory employer accreditation is introduced for all employers who want to recruit temporary migrant workers and the minimum standards, incentives and compliance are strengthened to encourage employers to recruit New Zealanders. It is proposed that accreditation will reduce the risk of exploitation when migrants are employed.

Accreditation would require employers to demonstrate that their business practices:

  • Incentivise training and upskilling of New Zealanders
  • Put upward pressure on wages and conditions
  • Meet minimum immigration and employment regulatory standards to minimise the exploitation of migrant workers
  • Maintain the integrity of the immigration system

There are three types of accreditation proposed: Standard, Premium, and Labour Hire Company accreditation.

 

Reasons for exclusion from accreditation – all accreditation types:

 

Reasons for exclusion from accreditation – all accreditation types

Standard Accreditation Requirements:

  • Available for employers recruiting five or fewer temporary migrant workers in 12 months
  • Approval lasts for 12 months, and requires annual renewal to maintain accreditation
  • Proposed fee is indicated at around $600 (for initial approval, and for each renewal)

 

Standard Accreditation Requirements

 

Premium Accreditation Requirements:


• Compulsory for employers recruiting six or more migrant workers in a 12 month period
• Voluntary for low-volume employers (five or fewer) who want to access more benefits
• Initial accreditation lasts for 12 months, and requires renewal every two years
• Proposed fee is indicated at around $2000 (for approval, and for each renewal)

Premium Accreditation

 

Gateway 2 - Job Gate:


Proposed changes


It is proposed that there are four job pathways available to employers to recruit temporary migrant workers in the future. Three of these pathways (the highly-paid threshold, regional skills list and regional labour market test) are enhancements of the status quo. One of these pathways (sector agreements) is a new pathway.

  1. Highly-paid threshold
  2. Regional skills shortage list
  3. Sector agreements
  4. Regional labour market test

 

Future job pathways available to employes recruiting temporary migrant workers

1. Highly-paid threshold

It is proposed that no labour market test will be needed for skilled migrant workers paid a sufficiently high remuneration. This is because paying a migrant worker a high remuneration generally reflects a genuine skills shortage and the value that the employer has placed on that migrant’s unique skills and experience.
The current national median income is $25.00 per hour or $52,000 annually. It is proposed that the highly paid threshold is:

  • 150 percent of the national median income for premium accredited employers; or
  • 200 percent for all other employers.

2. Regionalised skill shortage lists

The skills shortage lists will be recast by region when they are published next in April 2019 and renamed as Regional Skills Shortages (RSS) lists. This is proposed to reflect the skill shortages that exist in the regions and provide a stronger signal to temporary migrants of opportunities in regional areas.
Further changes are being considered including the criteria for assessing what occupations are placed on the lists and how these lists will signal a domestic labour market supply response from employers and the education/skills and welfare systems. There are no specific proposals on this matter at the moment but we welcome your general comments.

3. Sector Agreements

The proposed purpose of the sector agreements is to provide certainty for employers in industries that rely heavily on migrant workers. In return for that certainty, employers will need to make commitments including the commitment to employ more New Zealanders over time and reduce their reliance on migration. Sector agreements will help businesses to grow and thrive and deliver better jobs for working people. They propose that sector agreements will also help ensure that migrant workers are not exploited and have wages and conditions that are consistent with New Zealand values.

The introduction of the agreements propose to reflect the increasing demand from employers for ‘bulk recruitment’ of mid-to lower-skilled migrant labour in some sectors. This demand may reflect genuine shortages of local labour or may arise because the terms and conditions offered are not attractive to local workers. There is a need to ensure that the recruitment of temporary migrant workers into these jobs complement rather than substitute jobs for New Zealanders.


Agreement parameters

It is proposed the agreements are negotiated with representative industry bodies and made compulsory for employers seeking to recruit migrants in that sector. The agreements would set out specific occupations covered by the agreement, employer accreditation standards, how the labour market test will be applied, required wages and conditions, caps on the total numbers of migrant workers that can be recruited, training commitments and any special regional or other considerations. This is proposed to also address situations where standard visa application processes and the ANZSCO framework don't adequately fit the skill and occupation structure of the sector. The agreements would last for three years and then be renegotiated to reflect changing conditions.


Benefits and obligations

These sector agreements propose to provide employers with the benefit of greater certainty of access to temporary migrant workers (over the three-year duration of the agreement) and could also provide employers with the benefit of commitments to more efficient visa processing of visa applicants and possibly more favourable visa conditions. Other commitments could also be made by the Government (for example, in relation to the education/skills and welfare/employment systems) as part of the negotiations for these agreements.

In return, employers would need to commit to improvements to industry productivity, investment in the training and development of domestic workers and better conditions for both domestic and migrant workers. The aim is to create better jobs for New Zealanders and to incentivise changes that would increase productivity and reduce demand for lower-skilled workers in the sector, reducing the reliance on lower-skilled temporary migrant workers over time.


Types of Sectors

It is proposed the agreements are initially focused on sectors that have already demonstrated that they are facing significant supply issues for mid-or-lower-skilled labour and/or are ready to engage. These sectors are residential aged care, dairy farming, tourism and hospitality, and road freight and transport.

It is proposed that negotiations begin with the residential aged care sector and the tourism and hospitality sector in mid-2019 with the expectation that the agreements could come into effect by early 2020.

The Recognised Seasonal Employer policy, which provides access to lower-skilled workers mainly from the Pacific in the horticulture and viticulture industries, would be reviewed separately in 2019.


4. Regional Labour Market Test

The labour market test will be reviewed to make it easier or harder to recruit temporary migrant workers in a region. How it is applied will depend on how the regions are differentiated.
The regions will be differentiated based on a set of indicators which reflect the labour market dynamics and growth pressures of New Zealand’s sixteen regions.

How regional dynamics might impact the type of regional labour market test

Regional characterisation indicators

 

Gateway 3 - Migrant Gate:

Proposed changes

It is proposed that migrant checks remain largely as they are to ensure INZ continue to manage the risks associated with temporary migrant workers. There is potential scope to allow employers, rather than INZ, to undertake capability checks to ensure that the migrant genuinely has the skills required to do the job. This is because there is an incentive for the employer to only hire workers that have the skills, experience and knowledge required to do the job. However, there are also risks with this approach as it could increase the risks of migrant exploitation or provide a ‘backdoor’ to immigration. We are interested in hearing your views on this matter.

The Domestic Labour Market System

Proposal 6: The job pathways will trigger a signal from the immigration system to the broader labour market system to ensure there is an adequate domestic labour supply response.

There is an opportunity to build on and enhance the successful outcomes delivered by the education/skills, welfare and immigration systems and improve how these systems collectively contribute to labour market outcomes for New Zealanders, through better alignment with each other and with employers’ needs. Employers have a key role in the operation of the labour market and education/skills system and can influence the main supply-side levers. In particular, we want the proposed changes to the immigration system to trigger a domestic response to the increased demand for workers.

To illustrate, there are two key existing mechanisms where this could occur:

  • Many employers must meet a labour market test before they can employ a temporary migrant worker. This requires the welfare system to undertake a check to see if there are suitable or trainable beneficiaries available to do the job. At present, employers reject a large proportion of candidates forwarded to them for consideration, even though they are available for work and appear to match the employers’ needs. The system does not currently capture the reasons for rejection or trigger further support for the candidates which could range from language literacy and numeracy training to work readiness training. Stronger feedback loops could help improve success.
  • The inclusion of occupations on immigration skills shortage lists facilitates employers’ access to migrant workers. There is scope to improve the skills shortage lists through specifying at regional level the number of people needed in particular occupations and over what period and through clearly setting out the skills and competences required rather than just specifying a qualification and the length of experience required.

Both these mechanisms could potentially provide signals to the welfare and employment support functions of MSD as well as to education providers and the public/students to assist decision making. However, at present neither the labour market tests undertaken for visa purposes nor the inclusion of occupations on the immigration skills shortage lists elicit a strong response from the education or welfare systems to address the implied skills shortage.

There is scope to improve the skills shortage lists through specifying at regional level the number of people needed in particular occupations and over what period and through clearly setting out the skills and competences required rather than just specifying a qualification and the length of experience required.

The proposed changes to the immigration system could provide other opportunities for closer alignment of the immigration, education/skills and welfare/employment systems.

Synergies from wider changes across the education/skills and welfare/employment systems

The education/skills and welfare/employment systems are undergoing wide-ranging systemic reviews. Agencies are likely to consult on the outcomes of these reviews, including proposals for changes, in 2019. This current consultation process is seeking views on the sort of regional mechanisms that could more closely align the wider labour market, particularly in the regions. Agencies will work closely together to further develop the ideas, to ensure alignment with changes in the education/skills and welfare/employment systems as the direction and settings of those reviews are agreed.

Proposal 7: How regions are differentiated will influence the domestic labour supply response. This would require a collaborative response led by Government which considers education/skills, welfare, employer and other local mechanisms. This could be supported by a new regional governance framework including a regional body, strategy, information capability and skills and job hub.

Testing ideas to improve alignment and coordination domestically

Reviews are underway within the education and social welfare portfolios that will improve how the skills, welfare and employment, and immigration systems work together. More information on these will be provided in 2019.

In the meantime, there is a need to gain a better understanding of skill needs at a regional level, so that solutions can be developed to bring educators, employers and potential employees together.

The proposition is that differentiating the regions will allow stakeholders to identify priority areas and target responses more effectively. The intention is to facilitate and better enable an integrated and targeted response across the immigration, education/skills and welfare/employment systems, at a regional level.

In particular, agencies are considering how to get better regional planning, information flows and more coordination between the education/skills and welfare/employment systems, to support regional and national labour markets. This could mean using existing structures which have a demonstrated track record or developing new mechanisms. Importantly, the development of new and existing mechanisms will likely progress alongside reviews in the education and welfare systems. Some possible ideas are discussed in the consultation documents.

  • regional labour market strategies and plans
  • regional decision-making and coordinating bodies/groups
  • regional education, skills and employment hubs

Other Arrangements

Proposal 9: Some other changes impacting lower-skilled temporary migrant workers will be made to support the move to the gateway framework:

  • The remuneration threshold for mid-skilled workers will be adjusted to reflect the remuneration thresholds for the Skilled Migrant Category
  • All lower-skilled migrant workers will have the ability to support partners and children for the length of their visa, with partners remaining subject to a labour market test should they seek paid employment

Current settings

Mid-skilled migrant workers at ANZSCO levels 1-3 who are paid between 85 to 100 per cent of the median wage ($21.25 to $25.00 per hour), are able to continuously roll over their temporary work visa without a stand down period, subject to a labour market test. These workers do not, however, have a clear pathway to residence as they do not qualify for residence under the Skilled Migrant Category remuneration threshold.

Proposed changes

It is proposed that the mid-skilled remuneration threshold is raised to 100 per cent of the national median wage. This would bring it into line with the threshold for the Skilled Migrant Category and ensure some groups of temporary migrant workers are unable to continuously roll over their visa without having the stability of a pathway to residence.

Questions from the consultation documents:

Gateway Framework:

  • Do you support the gateway framework approach? Why/Why not? Please indicate what you think the impacts might be where relevant

Accreditation:

  • Do you have any comments to make on the different accreditation groups for employers with particular reference to accreditation types, standards, duration and incentives? Please indicate any particular impacts including impacts on smaller businesses.
  • Are there any other ways in which employers could demonstrate that they meet the standards?
    Highly-paid threshold:
  • Do you agree with the highly paid threshold job pathway? Why/Why not?

Regionalised Skill Shortage Lists:

  • Could the skills shortage lists be improved?
  • How could the skills shortage lists be improved?

Sector Agreements:

  • Do you agree that sector agreements should be introduced?
  • Why/Why not?
  • Do you have any comments on what could be included or excluded from the sector agreements?

Regional Labour Market Test:

  • Do you agree the labour market test could be more responsive to better reflect the different needs of the regions? Why/Why not?
  • How could the labour market test be redesigned to make it more responsive to regional needs?
  • Are there any more general improvements that could be made to the labour market test

Regional Indicators:

  • Do you agree a set of indicators could be used to differentiate regions? Why/Why not?
  • Do you have any comments on the proposed regional indicators including how they could be applied to differentiate the regions and how the regions could be classified?

Domestic Labour Market System

  • Do you agree that demand for temporary migrant workers should trigger a response from the labour market system to optimise opportunities for New Zealanders? Why / Why not?
  • Do you agree that closer alignment of the immigration, educations, skills, welfare and employment systems will optimise employment opportunities for New Zealanders? Why/Why not?
  • Do you agree that a regional response is a useful approach to improve domestic labour market outcomes for New Zealanders? Why/Why not?
  • Do you agree that a regional labour market strategy and plan would be a useful mechanism to improve domestic labour market outcomes? Why/Why not?
  • What purpose might a labour market strategy and plan serve in your region? What would its focus be and what would it need to contain in order to work well?
  • Who do you think should be responsible for developing and implementing a labour market strategy
  • Do you agree with the concept of regional skills bodies to support improved regional labour market outcomes?
  • What useful functions could a regional skills body serve in your region?
  • How might such a body work and what powers/ abilities would it need to have (e.g. decision-making powers or powers to recommend or direct?
  • Do you think that regional jobs and skills hubs could be a useful way to support coordination in the regions? Why/Why not?
  • In what circumstances could hubs be most useful?
  • What do you think would be critical to making the hubs work effectively?
  • What other ways are there to get regional labour markets working better to ensure employers are placing more New Zealanders into better jobs, reducing our reliance on temporary migrant workers?
  • What do you think the costs and benefits of a regional approach would be?
  • At a more general level, what other ways are there to improve labour market outcomes for New Zealanders?
  • What aspects of overseas approach to improving labour market outcomes do you think would work in New Zealand?

Migrant Gate:

  • Do you agree that employers rather than Immigration New Zealand should do the capability checks and manage their own associated risks? Why/Why not?
  • What tools could employers use to do capability checks on their own and manage the associated risks?

Other Arrangements:

  • Do you have any comment to make on increasing the remuneration threshold for mid-skilled work from 85 to 100 per cent of the median income?
  • Do you have any comment to make on allowing lower-skilled temporary migrant workers to bring their partners and dependent children to New Zealand for the duration of their visa?
  • Do you have any comment to make on providing partners of lower-skilled temporary migrant workers with a work visa provided they meet the labour market test for a specific job?
  • In the context of the proposals in the discussion document, are there other ways to meet the policy objectives behind the stand-down period for lower-skilled visas?
  • What information and tools would be useful to help you transition to the new gateway framework?
  • Do you have any comments to make on the costs and benefits?

FAQs for Employers:


Q7: Could I employ migrants who are on a working holiday visas or other visas without being accredited?

Yes, at this stage the changes proposed are only for employer-assisted temporary work visas.

Q8: Could I put my accreditation on hold if I won’t need to recruit for a period of time?

No, accreditation is an assessment of an employer at the time of accreditation and would be valid for a specified period of time. It cannot be placed on hold.

Q9: How long would it take to get my accreditation processed?

The time will depend on a number of factors including demand for INZ processes at the given time, whether you provide sufficient information and the type of accreditation you are seeking. Under current settings, for example, employer accreditation can take up to three months, though most are shorter than this. INZ will endeavour to ensure the transition period is as smooth as possible.

Q10: What happens if I do not supply the correct information in my accreditation application? Can I just provide supplementary material or do I need to re-apply?

INZ will ask for further information if applications are incomplete or insufficient which will delay the final decision on an application. If a decision has been made to decline an application, an employer will have to submit a new application.

Q11: What happens to existing employer accreditation? Is it automatically transferred?

Further information on the transition period for existing accredited employees will be provided when final decisions are announced. INZ will endeavour, however, to ensure the transition period is as smooth as possible.

Q12: What happens to Approvals in Principle?

Approvals in Principle would be replaced by the new gateway framework. Further information on the transition arrangements for existing Approvals in Principle will be provided when final decisions are announced.

Q13: Is it the number of migrants I employ or the number of visas I support each year that determines whether I will need to meet the higher employer accreditation standard?

Employers that support visas for six or more individual migrants in a 12 month period would need to meet the higher accreditation standard.

Q14: If I am an employer in a sector with a negotiated agreement, can I hire temporary workers if I have not signed up to that agreement?

Once sector agreements are negotiated, they would be compulsory for employers seeking to recruit migrant workers in occupations covered by the agreements.

Q15: Can I advertise a job and line up a migrant worker while my accreditation is being processed?

Yes you can advertise the job. However, applications for temporary work visas from employers that have not been accredited will be declined.

Q. 16: Will fees go up?

Fees will need to be reset if decisions are made to implement the gateway framework.

Q. 17: Can you provide some indication on how fees might change?

Migrants currently bear the cost of the visa application in most cases. If the gateway framework is approved then some of the costs of a visa application will be transferred from the migrant to the employer. An indicative range is that the fee for migrant applicants will decrease from $440-$580 to approximately $300. Employers will offset this decrease plus additional cost attributed to the new gateway framework (e.g. employer accreditation). An indicative range for employers is $600 for standard accreditation to $2000 for premium and labour hire company accreditation.