Work Visa Changes - Back to the Future?

Great Scott!

I almost announced that loudly yesterday afternoon, as I was trying to enjoy a sunny Sunday afternoon, before being bombarded with rule changes from INZ - why they release these over the weekend or on Friday afternoons, is beyond me. However the changes to the Accredited Employer Work Visa (AEWV) scheme, as promised by our new Minister, have now arrived, seemingly having travelled to us from the recent past (albeit not in a DeLorean).

For the most part, the newly announced changes are in line with the signals that this Government has been sending, having inherited the mess left behind by Labour in late 2023, yet none of it is revolutionary and in fact apart from one or two items, most of what we have now, is policy we had prior to the AEWV, covered under the previous Essential Skills Work Visa program.

That isn’t overly surprising, given change had to be made quickly to address the issues with the AEWV and its operations and the most efficient way to achieve that, without having to come up with anything new, was to simply roll back to policy that was tried and tested.

We break down those changes and their impacts on applicants and employers in this article.

Summary of Changes

Yesterday’s announcement was followed by three separate and fairly lengthy set of policy updates, which have taken a bit of reading to get through. Below is a summary of the key changes that were introduced, across both the Work Visa scheme and also impacts on specific Residence pathways.

• INZ has moved towards relying more heavily on the Australian New Zealand Standard Classification of Occupations (ANZSCO) to determine skill level, as opposed to simply using the median wage test. Roles at skill level 4 or 5 now have more stringent criteria. Roles at skill level 1 to 3 remain largely untouched in terms of the process.
• ANZSCO will also play a more significant role in the job check stage, whereas previously it was only used “lightly”. Employers will need to be more careful when selecting ANZSCO codes that match the role on offer.
• English language testing is being introduced for all skill level 4 and 5 roles, unless the applicant is exempt.
• A minimum skill threshold has been introduced for all applicants - either three years of relevant work experience or a qualification at level 4 or higher. For all qualifications being claimed between level 4 and 6, an NZQA assessment will be required and the qualification needs to be relevant. For degree level qualifications, no NZQA required and the degree does not have to be relevant to the job offer.
• AEWV’s for skill level 4 and 5 roles will now come with a two year visa, regardless of salary level with a further one year able to be applied for. After the three year total, applicants will have to leave New Zealand for 12 months or apply for a higher skill level AEWV.
• Employers aiming to recruit for a skill level 4 and 5 role must engage with Work and Income as part of the labour market test requirement.
• Employers must take reasonable steps to ensure the applicant is suitably qualified, notify INZ if an AEWV holder leaves their employment and put more effort in to demonstrating labour market shortages for lower skill level roles.
• Advertising requirements for skill level 4 and 5 roles have been increased from 14 days to 21 days.
• The 17 occupations slated to be added to the Green List in March of 2024 has been reduced down to nine, leaving eight off the list with no pathway to Residence.

In addition to the above, changes have been made to the Care Workforce and Transport Sector, Work to Residence pathways.

• The Work to Residence pathway for the transport sector (bus and truck drivers) has been removed for applicants that are not yet working. Those on an AEWV already will still have that pathway available to them.
• Clarifications have been added for claiming work experience for both of the above sectors and principally reinstating the $27.00 per hour experience claim between September 2021 and June 2022.

Of course within the 151 pages of policy updates there were plenty of other tweaks, including a greater focus on employer compliance and penalties, but the above changes are the most important in terms of general eligibility.

All in all, the changes are clearly targeted at lower skilled level roles, which has been the issue this Government has been grappling with. There have been an increasing number of Work Visa applicants coming to New Zealand to take up roles that carry little to no experience requirement and an increasing number of these have resulted in fraudulent applications. The English requirement will also knock out a large proportion of those applicants and employers who were gaming the system as a means to get a foot in the door to NZ.

For applicants at skill levels 1 to 3, which includes most trade related roles, nothing really changes. No English language imposed, and the minimum skill thresholds would be easy enough to meet. The advertising requirements and onus on employers to back up their job check claims alter slightly but not out of step with how the AEWV was supposed to operate.

However, as is always the case, the rumour mill is heading into overdrive, with the usual questions as to whether the process just got a whole lot harder.

Thoughts for Employers

In truth, for lower skilled level roles (4 and 5 in ANZSCO) the process did just get a lot harder, or rather harder than the AEWV allowed for but not that much harder than previous policy, that was in place for a very long time beforehand. The old Essential Skills program included liaising with Work and Income as part of the job check and placed a much greater emphasis on the credibility of the job check. Granted, the English language requirement is new, but that is a nod to specific migrant markets, where the exploitation was a cottage industry.

For employers looking to bring in skilled applicants, including trade level roles, nothing has really changed. Yes there are a greater level of compliances requirements, but again none of these are overly cumbersome.

Good employers should be vetting their applicants to make sure they are suitably qualified for the role on offer and employing them in full time roles, all the time. Notifying INZ when someone leaves is hardly an onerous task as well. For employers looking to bring in good quality, skilled migrants with the skills and experience they need, it is very much status quo.

For employers looking to recruit for lower skill levels, these changes will essentially require them to reassess whether a) they want to invest in that process with the added steps and b) whether the people they were hoping to bring across are the right fit (many wont meet the various new skill and language requirements). If that then pushes them to source more locally and invest in more local training to get people in to these roles, that realistically local applicants should be able to do - the kiwi in me says that is a good thing overall.

All of this comes at a time when the Government will be staring down the barrel of (slowly) rising unemployment, so politically this is a good move, however as I wrote about last week, labour markets, particularly in a country of this size change rapidly. It would take one significant weather event or a sudden spike in building demand for the Government to be backed in to the corner again with the potential for exemptions or sector-specific carve-outs.

Whilst change is always unsettling, overall I dont see any of these changes as being any more dramatic than the policy everyone was used to, only a few years ago. Employers have short memories when it comes to immigration however, so expect there to be a period of settling in for these updates.

Thoughts for Applicants

In a similar fashion, there will be many migrants confused over these changes, both those already here and those planning to make the move here in the near future. For those that might be working in jobs at the lower skill levels (4 and 5), they will need to consider how much time they will be able to secure here, given the new restrictions to the maximum continuous stay. This is no longer being dictated by the salary on offer, but is now based on skill levels instead.

Unfortunately our system, particularly with the previous introduction of the five year AEWV for any skill level job, being paid the median wage or higher, created the illusion that there was a pathway to Residence, when in reality that never existed for most of these applicants. Interestingly in listening to the Minister speak this morning, she compared the intake of ‘migrants’ in the last 12 months to that under the previous Key Government…the issue however being she was comparing apples with feijoa’s. The previous number she mentioned was for Resident Visa approvals and yet the recent hype has been about temporary Visa arrivals…very different numbers.

For applicants who are in the higher skill brackets, including trades, ICT, engineering, healthcare, education, construction management, financing, marketing (and so on), nothing has really changed at all. Yes there are some additional requirements to prove, but these would most likely have been part of the application process anyway. If anything, the fact that INZ has just taken a chainsaw to the lower skill level roles, should free up the system for everyone else. However, now more than ever, it is absolutely crucial for applicants to understand the separation between temporary visa policy and the rules for Residence.

The Wrap Up

Overall these changes were not unexpected, and realistically the only surprising element was the introduction of English language requirements - everything else feels and looks very familiar to someone with any experience in this process. While they were needed, I can’t help thinking that the Government has missed one really important point.

The problem that all these changes are aiming to fix, didn’t come about because of the wrong set of rules - it came about because the previous Government, desperate for good media headlines, simply took the brakes off and instructed INZ to get applications through the door as quickly as possible. They (INZ) were told to stop checking anything, and unless it was on fire or about to explode, every application was to be approved under the “high-trust” model. That is a problem of politics, politicians and an administration that bends like a rubber arm.

Yes, we do need to tighten up on the type of skills we bring in to the New Zealand, but equally we could have done that without necessarily rolling policy backwards. This could have been achieved with some less dramatic impacts or changes and the need to produce 151 pages of tweaks.

There will also be some unintended consequences to this as NZQA will now be lumbered with a significant increase in qualifications to assess (and they already take several months) and English test delays which will make the Work Visa process a nightmare - not to mention the fact that immigration officers will now have to go back to understanding how to operate the ANZSCO manual.

In the meantime for those applicants looking to make the move, who have good experience, qualifications and skills, there is really nothing here that would change their potential plans - a nod from this Government at least, that we still are still open for business for the right type of skilled applicants.

Stay tuned…