Category Archives: Skilled Migrant Visa

Increase in work visa thresholds will only add to skilled labour crisis

New Zealand Work Visa

The skilled-labour crisis is about to get worse, thanks to increases in minimum wage rates for skilled migrant workers.

The Government-imposed increase in wage and salary thresholds will come into effect from November 26, for both the Essential Skills Work Visa and the Skilled Migrant Residence Visa.

This increase has major implications for both migrants and employers. The inflation is based on new calculations of the “average” wage rate in relation to an increase in the cost of living, demonstrating the insanity of pay rate being a proxy for skill.

In a free labour market, supply and demand are supposed to determine wage/salary rates. But in the labour market for migrant workers, the Government is directly influencing wages under the guise of pay being a proxy for skill level.

The metric is artificial and arbitrary. It’s designed to make things easier for bureaucrats to manage but has become an overly complex system with unintended and major consequences for migrant employees and employers alike.

Implications for employers:

The new thresholds will increase pressure on staffing costs for employers in the healthcare, trade, and hospitality sectors if they wish to keep migrants whose wage/salary sits below these thresholds.

Recently some healthcare workers managed to get a pay increase to $24.65 – partly based on the pay parity case brought by care worker Kristine Bartlett. This put some migrants in the healthcare sector within reach of residence.

The threshold increases mean this residence is no longer a realistic reality. This could mean a loss of valuable human resources for employers as these workers either give up, move into other sectors, or leave the country, tired of being stuck on what seems like an endless round of work visas with no end in sight.

These issues will also impact employers in the hospitality sector. Pathways to residence for occupations in this sector that are more junior will now prove more difficult. A survey of wage rates nationally showed they varied considerably across the regions, but on average a senior chef de partie earned about $45,000, well below the cut-off level. If these valuable employees have no potential to attain residence, we will lose them.

The new thresholds will also introduce difficult pay parity issues for employers. The new wage rates that migrants require as dictated by Government policy are out of kilter with market increases across the board. Employers will not be able to simply pay migrants the extra required without also raising the wages of their local workers. How could they justify this to the local staff? Any pay disparity will engender a level of upward wage pressure for everyone. Many employers are not in a position to be able to raise wages across the board.

Implications for migrants: 

Work Visa

Immigration New Zealand uses pay rates as part of the process of determining the skill level of a job. This determines the length of visa allocated and has flow-on impact for a migrant’s ability to bring family into New Zealand under this category.

Under the new rules:

  • For skill level 1-3 occupations you will need a pay rate of $21.25 to get a three-year work visa (up from $20.65)

  • For skill level 4 and 5 occupations you will need an hourly rate of $37.50 to secure a three-year visa (up from $36.44).

For example, a chef paid $21 an hour would currently be considered mid-skilled, and get a three-year visa. If the same person applies after 26 November, they will be considered low-skilled, and only get a one-year visa.

Residence

For residence purposes, the pay rates you need to have a job classified as skilled will increase from 26 November. If you are not being paid at least $25 for a ANZSCO skill level 1-3 role, the job won’t be considered skilled for visa purposes. The skilled remuneration threshold for ANZSCO skill level 4 and 5 occupations has also increased to $37.50 per hour. So, the minimum required salary threshold will be $52,000.

What will this mean in practice? Under the current rules, a person in a skill level 3 job (which includes many trades) who is paid, say, $24.50 per hour is regarded as in skilled employment and has a chance at residence. After 26 November, they will no longer be regarded as being in skilled employment and will lose that opportunity.

In addition, under the new rules, to get bonus points for an occupation with “high remuneration” you will need an hourly rate of $50.

 Macro considerations

How do you explain to a person that when they go to bed they are regarded as in skilled employment and eligible for residence, but when they wake up the job is not regarded as skilled employment?

How do you explain to somebody that when they go to bed they are eligible for a three-year work visa because their job is regarded as mid-skilled, but when they wake up they are only eligible for a one-year work visa because now their job is regarded as low-skilled?

Furthermore, how do you explain to employers that their staff will need a pay rise if you want to keep them?

In a time where employers are crying out for skilled migrants, these changes are an arbitrary and illogical hurdle against solving our skilled worker shortage. The changes also clearly demonstrate the lack of deep-thinking around implications of arbitrary measures of “scoring eligibility” used by Immigration New Zealand.

To see the full schedule of changes, click here. 

If you’re wondering how this will affect your current Employer Assisted Work Visa, contact NZIL

Work visa wage rate increase

 

Information about the increased wage threshold for NZ visas coming into effect Nov 26 2018

The Government-imposed increase in wage and salary thresholds will come into effect from November 26, for both the Essential Skills Work Visa and the Skilled Migrant Residence Visa.

This increase has major implications for both migrants and employers. The inflation is based on new calculations of the “average” wage rate in relation to an increase in the cost of living.

Here is the overview of the rate changes for each visa category affected:

Hourly rates from 26 November 2018

From 26 November 2018, we are making changes to what an applicant in the Skilled Migrant Category must earn.

Threshold Between 15 January 2018 and 25 November 2018 From 26 November 2018
Threshold for skilled employment in an occupation at ANZSCO 1-3 $24.29 per hour or above (or the equivalent annual salary) $25.00 per hour or above (or the equivalent annual salary)
Threshold for skilled employment in an occupation at ANZSCO 4-5, or which is not included in ANZSCO $36.44 per hour or above (or the equivalent annual salary) $37.50 per hour or above (or the equivalent annual salary)
Threshold to earn bonus points $48.58 per hour or above (or the equivalent annual salary) $50.00 per hour or above (or the equivalent annual salary)

 

After 26 November 2018, we are making changes to what an applicant in the Essential Skills work visa category must earn.

Threshold Between 15 January 2018 and 25 November 2018 From 26 November 2018
Threshold for mid-skilled employment in an occupation at ANZSCO 1-3 $20.65 per hour or above (or the equivalent annual salary) $21.25 per hour or above (or the equivalent annual salary)
Threshold for higher skilled employment in any occupation (including those at ANZSCO 4-5) $36.44 per hour or above (or the equivalent annual salary) $37.50 per hour or above (or the equivalent annual salary)

 

FAQs:

What if I am a current Essential Skills work visa holder and my job does not meet the new threshold? What if I’m an employer and one of my staff hold a current visa but their wage does not meet the new threshold?

Ans: Visas that people already hold will not be affected. Changes to the income thresholds will not affect the duration or conditions of visas that have already been granted.

If you apply for, or have applied for, an Essential Skills work visa and your application was received by INZ before 26 November 2018, the old thresholds will be used to assess your application and determine your visa application. Only new applications made on or after 26 November 2018 will be assessed against the new threshold.

This may mean the conditions or visa duration of the next visa could be different. For example, a chef paid $21 an hour would currently be considered mid-skilled, as the occupation is ANZSCO level 2 and the pay is above the existing threshold of $20.65. However, if they applied for a further visa after 26 November, they would be considered low skilled, unless their pay increased to above the new threshold of $21.25.

If I am an employer who has already advertised and prepared to support an Essential Skills work visa, but the person cannot get his application in before 26 November 2018, what happens then?

Ans: If an application is received and accepted after 26 November 2018, the new thresholds will apply, even if, for example, the employment agreement has been signed prior to 26 November 2018.

What happens if I was invited to apply for the Skilled Migrant Category under the old thresholds?

Ans: We will assess your application against the thresholds in place on the date your expression of interest (EOI) was selected from the Pool, if that selection results in an invitation to apply. For example, if your EOI was selected on 21 November and you were invited to apply before 30 November, the old remuneration thresholds will apply, even though you weren’t invited to apply until after the new thresholds were introduced.

If you are concerned about your visa status based on these changes, get in touch with our team here.

All you need to know about migrant worker rights in NZ

There has been a lot in the news recently about migrant employee exploitation, and there seems to be some common themes. As most migrant’s visas are tied to an employer they can often feel trapped, unable to report issues as their lives in New Zealand depend on the linked employer. So what kind of exploitation are migrant workers facing? And more importantly, what can they – even better, our Government – do about it?  We talk to the experts to find out.

Migrant workers in New Zealand face several unique challenges. To find out more we spoke with Aaron Martin of NZIL, employment lawyer Mark Donovan, and Anu Kaloti, founding member of the Migrant Workers Association. All work in areas that help migrants with issues of employment, and all have successfully dealt with many cases of exploitation.

Most major issues that migrant workers face involve exploitation. This usually means the employer is denying the employee their basic rights and entitlements. All New Zealand workers, whether residents or migrants, are entitled to certain rights. Read the full list of rights (in a variety of languages) here:

Employers must include these basic rights and entitlements in their written contract with an employee. But the rights aren’t always put into practice. A migrant on a work visa who wants to live in New Zealand relies on their employer to comply with the rules. Often visas restrict migrants to one particular employer, so a migrant’s fate may be dependent on that sole employer doing the right thing.

 

Migrants are particularly vulnerable to exploitation because if a migrant employee is dismissed or their employer is identified as non-compliant, the migrant’s visa can be revoked. Kaloti often hears of employers threatening migrant workers with “if you don’t do XYZ we’ll get your visa cancelled or report you to Immigration”. She specifies that it is not uncommon for migrants to be verbally and even physically abused.

So, what are the common issues migrant workers face? And what can they do?

1. Wages

Employers must pay migrants a wage specified by the salary band linked to their visa. This wage must be clearly stated on a written employment agreement that has been signed by both parties. Unfortunately, some employers are finding ways around this.

Kaloti explains that often the employer will deposit the correct pay into the employee’s account “so the paper trail is perfect”, only to later demand a portion of that pay be given back. Often this is justified by claiming the employee was in debt to previous loans or training costs. The paper trail is kept clean by asking for the payment in cash or as a bank transfer to a friend or colleague’s account that is then paid back to the employer.

Another common example is hiring migrants under a “two-for-one deal”. Kaloti and the Migrant Workers Association are currently working through such a case with a married couple. The wife is employed by an IT company, which has enabled her to get a work visa. But her employment is on the condition that her husband works for her employer’s other business, an orchard. The wife is receiving the correct salary specified by her visa conditions; the husband, however, doesn’t get paid at all.

If an employee raises these kinds of issues in a public arena, it usually just causes them more grief. “Getting a third party involved can be like putting a fox in a hen house,” Martin says. The Labour Inspectorate works directly with Immigration New Zealand. So, if you report your employer for wage exploitation and you’re in the process of applying for a visa, your case can be denied on the grounds of having a non-compliant employer. This is why, as Martin advises, employees in this situation “usually just shut up and carry on”.

2. Leave and breaks

There are many reports of migrant staff working unpaid overtime or being denied leave or rest breaks. It is easy for an employer to specify the correct hours on a contract, then fail to monitor overtime and keep correct records. Sometimes this can be credited to an overly “relaxed” approach on the employer’s part, but often cases are of a less innocent nature.

Employees can work double the time recorded by an employer but be forced to sign false records in fear of losing their job. Then, if they raise a dispute, the evidence is against them. Employees being denied leave and break entitlements have similar problems providing proof.

If there’s no evidence, it’s can be hard to put together a case. But Mark Donovan offers some reassurance: “Immigration New Zealand and the Labour Inspectorate are alert to the risks around these issues with migrant employers. If the evidence of the employee is only their word and the employer cannot produce any evidence to contradict them, they’re still often likely to be believed as they are putting their life in New Zealand on the line.”

3. Business sold or liquidated

Complications arise for an employee when a business their visa is tied to is sold or liquidated. Sometimes, depending on the conditions of the visa, an employee can apply for a variation. If not, the migrant must submit a completely new visa application.

If the employer has another business, they can offer the employee a new position or a transfer. Martin, having worked on at least four such cases, believes this is an easy fix. If you’re working under an Essential Skills visa, provided the role and the location don’t change, it is likely you will be able to simply apply for a variation. If the role is different or in a new location, Martin says: “Effectively the Work Visa holder has to find another job – but they’re still in a situation of being tied to that employer.”

If a business is getting liquidated, an employee can be out of work without any notice. In some cases, and legally in all cases where a business is sold, notice will be given as specified in the terms of the contract. Immigration New Zealand won’t enforce immediate deportation, but it is imperative employees contact them as soon as they know they’re facing unemployment. Immigration New Zealand can issue a Visitor Visa, which will give the employee up to nine months to find more work.

Unfortunately, many employers don’t want to hire a migrant on a Visitor Visa or an open visa that is due to expire. It can be hard to find an employer willing to work through the gamut of a work visa application, especially if it is only for a short-term role. While it is legal to look for work on a Visitor Visa, it is not legal to actively work. Both parties must be mindful that if a visa’s conditions are not honoured, there can be serious legal implications.

4. Unfair dismissal

Unfair dismissal includes failing to follow a fair and reasonable process, giving less notice than is stated on a written agreement, or failing to provide an adequate reason for dismissal.

Where there is an unfair dismissal, legal action can be taken provided the employee raises a personal grievance with their employer within 90 days of being dismissed. Often disputes of this nature are resolved between the parties in a confidential meeting convened by the Ministry of Business, Innovation and Employment, known as a “mediation”.

Although often straightforward, unfair dismissal cases still can pose a difficult situation for migrant employees. While waiting for a mediation date, or for their case to be considered by the Employment Relations Authority, they will lose their main source of income and no longer meet the visa criteria that keeps them in the country. In a lot of cases, the employer will also unlawfully hold onto the final pay owed to the employee. If the employer has enforced an instant dismissal, or is withholding payout entitlements, the employee is left with no means to pay their rent and basic living costs.

5. Dismissal within the 90-day trial period

Employment agreements can specify a trial period of 90 days or less that allows the employer to dismiss an employee within this period if they aren’t suited to the role. The trial period can be a fairly daunting time for any new worker. For migrants with work visas tied to their employer, it’s not just a job they might lose – it’s their future, and their family’s future, in New Zealand.

This is a hard issue to resolve, as the employer is within their legal rights to dismiss the employee within the period stated on the employment agreement, provided they meet the legal tests for imposing such a trial period. As Martin says: “If you’re dismissed within the 90-day trial period, there’s no way around it other than getting a new job with a new visa or obtaining a Visitor Visa.”

Donovan says that the condition attaching an employer to a work visa is creating many of these issues: “It allows the employer to say ‘Aha! You’re mine!’ and the employee is stuck, even if their wages aren’t getting paid.” Employees avoid seeking legal help or even joining a union from fear of losing their employer and the right to live and work in New Zealand.

Kaloti believes that to reduce exploitation, all work visas should be open. “Tying work visas to an employer is too harsh,” she says.

Martin disagrees that all work visas should be open, but strongly believes most exploitation could be remedied with a simple policy change. “When a migrant raises an issue or needs to leave their job due to exploitation, instead of issuing a Visitor Visa we should give them a 6-month open work visa so at least they can apply for other jobs on a better footing,” he says. A Visitor Visa gives a migrant more time in the country, but they can’t legally work. And the application process for a new work visa once they’ve found an employer can take some time. “The government says it’s trying to protect migrants from exploitation,” says Martin, “but they sadly don’t give a hell of a lot to assist people in those circumstances.”

It’s important that migrant employees know they have the same rights as a resident employee. If you’re a migrant employee and a dispute happens at work, the Citizens Advice Bureau is a good place to start for free advice. They will likely refer you to the Labour Inspectorate or, if it is a personal grievance, the Employment Relations Authority. Alternatively, an employment or immigration lawyer can provide individual support and legal advice.

Kaloti believes that more and more migrants are beginning to speak out about exploitation. Workers who are concerned about jeopardising their visa if they seek legal help could consider a union for support and advice. Kaloti recommends migrants join a union relative to their area of work or one of several unions specific to migrants such as the Migrant Workers Association of Aotearoa, Migrant Action Trust, or the Indian Workers Association.

For more information about resolving workplace issues, check out this Employment New Zealand resource page

If you need help with an Employment or work related issue, contact Mark Donovan here

If you need help with an immigration related issue, contact NZIL here

For a list of work unions available in New Zealand, have a look on the Trade Unions of New Zealand web page here.

Why NZ needs skilled migrants

NZ needs skilled migrants

Immigration is a hot topic in the news, stories highlighting an increase in migrant workers often brings a backlash from the public as there is a perception that skilled migrants are taking opportunities for lower pay that could be filled by a local workforce.

 So why does New Zealand have to recruit workers from overseas?

Immigration New Zealand’s website currently lists over 60 areas that immediately need skilled workers. These include IT, agriculture, education, the health sector, and trade and construction.

If the job is not in an area of skill shortage, and the visa applicant is not qualified as detailed in that list, current visa criteria requires companies to make significant attempts to fill vacancies with New Zealanders. And it goes without saying that companies would prefer to hire locally. As prominent immigration lawyer Aaron Martin says: “Why on earth would an employer go through the paperwork of a visa application process if they don’t have to?”

But, as the lengthy list of shortages shows, there just aren’t enough Kiwis with the required training and experience to fill the gaps. Talent is the single most important factor in the future prosperity of many industries, in fact the lack of available talent will be the greatest restriction in their growth.

Even in areas facing skill shortages, hires can take months or more. Catherine Clarke of Roam Creative, a leading digital product and innovation agency, told us: “It can take at least two to three months to fill a vacancy. Roam has been recruiting continually all year to fill roles including testers, designers, developers, and product managers. With perseverance and a strong employer brand, we’ve been lucky enough to source some amazing talent recently, but it is challenging as there simply aren’t enough skilled local candidates to cope with the growth of the IT industry in New Zealand.”

Roam recently set up an office in Sydney, but shortage of IT personnel is a problem there, too. With difficulty filling roles in New Zealand, and even stricter immigration laws in Australia, Clarke knows the vacancies won’t be filled quickly.

Crop production is another area on the immediate skill shortage list. Pedro Wylaars, National General Manager of Zealandia, has over 220 staff working to grow and supply millions of plants to commercial growers and garden centre businesses across the country. The company is always advertising for staff, and it struggles even to fill roles that offer on-the-job training.

It’s also a challenge for Zealandia to find New Zealanders with relevant tertiary qualifications. “The universities in New Zealand can’t fill up the horticulture papers,” says Wylaars. “And most of those students end up switching over to the agricultural sciences anyway.”

Wylaars says that if they couldn’t take on staff from other countries, they’d be “in big trouble”.

But aren’t migrants taking jobs from Kiwis who need work?

Both Roam and Zealandia are in industries on the skills shortage list, and are lucky enough to be able to recruit from overseas. But some people think these jobs should go to unemployed Kiwis.

Martin says this is a misconception of the realities of operating a business. “Some New Zealanders have a myopic view of the needs of New Zealand employers who are (often) trying to compete internationally” he says. “Some think ‘being a Kiwi’ is a qualification in itself that should put them first in terms of candidate selection”

Martin believes that employers should be able to choose staff who are the best fit for their company, with the best skills and the highest expertise. “If you miss out on a job to someone from overseas, it means you were not the best-qualified person, and you need to get out and upskill yourself. The best-skilled people get the jobs – it’s that simple”.

What benefits do migrants bring to jobs? 

It’s not just skills, training, and experience that migrants bring to roles; it’s a whole different ethos. Drive, ambition, energy, and a willingness to continuously upskill come as part of the package.

Martin credits this to one simple reason: “When you uproot yourself and family, and say good bye to your friends, your professional networks, and the comfort of a labour market that understands your skills, and you drop yourself into a completely foreign country, there’s no room for failure.”

Most migrant employees come from countries where there are several billion people. With intense competition for jobs and employment it’s necessary to adopt a strong work ethic to make yourself shine. New Zealand employers find this incredibly attractive. “It’s not a one-way equation,” says Martin. “It’s not as if migrants are the only ones benefitting – we actually get something that we need, too. It’s a two-way exchange. We get the benefit of their skill and experience. We get an opportunity to learn new things and that knowledge transfer benefits business and local employees.”

 Migrants also bring valuable diversity to the workplace. Roam, which creates apps and digital solutions across a variety of industries, finds this hugely beneficial. “Every product we build is designed with the user in mind. Migrants have been so valuable in bringing new insight and different perspectives when it comes to designing products for the user, which gives our Product teams a broader understanding of users on a global scale, empowering us to design products for the global market.”

The skills and experience migrants bring can also help take businesses up to another level. Wylaars experienced this first-hand when he employed an overseas candidate who is recognised globally as one of the top five in their field. “We thought we were already doing a pretty good job,” says Wylaars. “But this new employee has taken us two or three rungs further up the ladder – we’re now getting global attention for some our new techniques and processes.”

What benefits do migrants have on the economy?

Clarke says that areas experiencing skill shortages, such as IT, have become “candidate-driven job markets” where locals can demand high salaries. “In some cases, IT salaries have been driven up because of this,” she says.

High salaries obviously impact employers, with the cost usually passed onto clients. But the claim that migrant labour dampens wages is not the reality of employers experience.

Clarke states: “Our employees are hired for their expertise and their value to the business. Whether they were hired locally or overseas, this is irrelevant. It’s neither fair, nor sustainable to offer migrants lower pay as they’ll just move on to another job”.

International employees use their previous connections with overseas companies to help businesses grow, as well as create new businesses. This helps our overall economic growth. Migrants bring innovative concepts, methods and different perspectives with them from overseas.

“When you look at the net gain on economic activity of New Zealanders versus migrants, migrants perform well as their draw on publicly funds services is often low,” Martin says.

Migrants are less likely to claim benefits and, contrary to popular belief, actually create more jobs, mostly due to supply and demand. “As more migrants come into to the country we begin to see more smaller businesses established,” says Martin. “Migrants are often entrepreneurial and seek economic freedom and control over their own destiny by being self-employed. These new Kiwis create vital economic activity for our country.”

Looking for Immigration advice? If you have a concern about your visa or would like to speak to our expert immigration team for support with a migrant employee application, get in touch today.

Migrant employers need to get the record straight…

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Migrant employers need to get the record straight…

Employers hiring migrants have been making headlines lately for breaching immigration and employment law. Leading immigration lawyer Aaron Martin and solicitor Eleanor Gregan of Davenports Harbour Law discuss the most common mistakes made by migrant employers and how to avoid them.

From 1 April 2017, employers who incur a penalty for breaching employment standards have faced a stand-down period preventing them from recruiting migrant labour. The stand-down period is for six months, one year, 18 months, or two years, depending on the severity of the breach.

Continue reading Migrant employers need to get the record straight…

Major bureaucratic flaws in New Zealand’s immigration system

Leading Auckland immigration lawyer Aaron Martin knows from extensive experience with clients exactly where the frustrations and incompetencies of the current process lie. He has some suggestions for the new Government about where its focus should be when it comes to immigration.

The Labour Party election campaign focused on positive messages. So I eagerly looked forward to an equally positive message from the new Minister of Immigration. But in an article on the Newsroom website on 1 December the Minister started on a negative: the immigration system was broken and required more money to catch those who try to shaft it.

Continue reading Major bureaucratic flaws in New Zealand’s immigration system

Time to ask for a pay rise…

If you want to be granted a Skilled Migrant Category Residence visa in 2018 you should check your eligibility against the new Ministry of Business Innovation and Employment SMC criteria.

On the 26th of November, the MBIE updated the SMC visa and changed the remuneration (payment) threshold that will meet the eligible criteria for migrants.

Continue reading Time to ask for a pay rise…

A letter to the New Zealand Government

To the Right Hon. Jacinda Adern and the Hon. Iain Lees-Galloway,

Welcome to Government. I am looking forward to the next 100 days. I am hoping some of rank injustice created by your predecessors will be swept away.

You said your Government will be empathetic. I am hoping you’ll have some empathy for those New Zealanders whose parents have been left in limbo since the National Government’s cancellation of the Parent Category.

Continue reading A letter to the New Zealand Government

Immigration net migration numbers will be cut to 30K a year

New Zealand’s new prime minister Jacinda Ardern has vowed to honour Labour’s election promise to cut net migration to 20,000 to 30,000 a year.

She also predicted that New Zealand will be facing an economic slowdown which she plans to prepare for:

Continue reading Immigration net migration numbers will be cut to 30K a year

What impact will Winston Peters bring to the migrant community?

What Impact will Winston Peters bring to the migrant community?

The results of the election suggest the next year will be very interesting for the migrant community.

As predicted, Winston Peters is kingmaker. For 21 years Peters has pushed an anti-migrant platform, and we can expect that any coalition deal New Zealand First makes – whether with Labour or National – will include some attempt to curtail immigration numbers.

Continue reading What impact will Winston Peters bring to the migrant community?