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2017-05-16 20:34:41Staff and EmployeesEnglishBy March 2018, the 457 visa will be replaced by the Temporary Skill Shortage visa (TSS). Read a summary of the changes & how this may...https://quickbooks.intuit.com/au/resources/staff-and-employees/cheat-sheet-457-visa-changes/Your Cheat Sheet to the 457 Visa Changes | QuickBooks Australia

Your cheat sheet to the 457 visa changes

3 min read

By March 2018, the 457 visa will be abolished and replaced by the new Temporary Skill Shortage visa (TSS). Here’s everything you need to know about the changes and how they could affect your business.


What is the 457 visa?

It’s a four year visa that allows a foreign worker and their family to come to Australia. The visa was designed to fill job vacancies which are difficult to fill using Australian workers. It was often seen as the go-to visa for fulfilling a dream of working in Australia. There are over 650 eligible occupations, ranging from goat farmer and turf grower to gym manager and actor.


Why is it being ditched?

It’s being replaced, not ditched. That aside, the Prime Minister Malcolm Turnbull described the move as a push to safeguard Aussie workers.

It’s believed the 457 visa eligibility had become too broad — covering hundreds of different occupations, many of which could easily be filled by Australian workers. Because of this, sources say the visa had lost ‘credibility’ in attracting skilled workers, and instead was being used as a pathway to permanent residency and even citizenship.

The replacement, the Temporary Skill Shortage visa (TSS), will restrict the number of occupations eligible, so that it’s only available to Australian industries with genuine skill shortages.


Employees on the 457 visa

If you have an employee on the 457 visa, the changes won’t force them out the door immediately. Instead, they’ll be able to see their visa to its expiry, in a term called ‘grandfathering’.

Plus, if they’re employed in one of the defined ‘high-demand occupations’ in industries such as health care (doctors and nurses), food services (chefs and restaurant management) and most IT occupations, they will remain eligible to work in Australia under the new TSS visa.


Introducing the Temporary Skill Shortage (TSS) visa

Breathe a sigh of relief, because if you really can’t find an Aussie to do the job, you’ll be able to employ a foreigner under the TSS visa. It’s been designed to improve only areas of genuine shortage, and the occupations under this ‘shortage’ blanket will be updated every 6 months.

The TSS visa will be more costly to obtain. And it’ll be split into two types: short term visas (2 years) and medium term visas (up to 4 years) for more high skill and critical need occupations. And upon expiry, TSS visa holders will not easily be able to apply for permanent residency.

On top of occupation restrictions, applicants may also have to undergo tighter eligibility requirements including:

  • English language tests
  • Mandatory labour market testing
  • A new non-discriminatory workforce test
  • Mandatory criminal history checks
  • A market salary rate assessment
  • A new two-year work experience requirement


Knowing that good help can be hard to find, there are also concessions if you’re hiring in regional Australia, including:

  • Waiving the nomination fees
  • Having certain occupations age-exempt
  • Accessing the list of occupations that are available under the temporary and permanent visas


The replacement isn’t designed to rinse you of the skilled workers you need. It’s simply the government’s way of protecting the jobs of locals. And to encourage training of Australians.

What’s next?

Skilled workers are vital for your business’s growth and innovation. To encourage Australian businesses to invest in training to fill skill gaps, the government announced it would establish a new training scheme.

The scheme would be funded from the increased fee charged when employers bring in temporary skilled foreign workers.

Small businesses with a turnover of less than $10million will have to pay $1,200 up front for each employee on a TSS to the new Skilling Australians Fund.

The good news is, you won’t have to start paying until March 2018.

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Information may be abridged and therefore incomplete. This document/information does not constitute, and should not be considered a substitute for, legal or financial advice. Each financial situation is different, the advice provided is intended to be general. Please contact your financial or legal advisors for information specific to your situation.

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