01/APR/2020

'Can I reduce my employee's wages?' and other COVID-19 FAQs for employers and temporary visa holders


Note: The following is general information only. Seek the advice of a qualified migration agent or lawyer to discuss how specific requirements apply to your own circumstances. Abacus Visa is here to assist.

What’s the situation?

We understand lockdown measures to contain the spread of COVID-19 have had a substantial impact on individuals, workers and businesses. Employers are dealing with business closures and the pressure to keep workers on payrolls, while employees face uncertainty over jobs. For temporary visa holders, restrictive travel and visa conditions pose additional immigration challenges.

This is a tough time for many. To help, we have put together a list of key issues employers and employees – in particular Subclass 457 and 482 visa holders – should be aware of in the coming weeks and months.


Will visa exemptions be made for COVID-19?

In short – we don’t know yet.

Two key areas of law govern the obligations of employers and sponsored workers:

  • Sponsorship obligations: These are legal obligations requiring sponsors to maintain certain employment conditions, keep records and advise the DHA of business changes.

  • Visa conditions: Similarly, these are legal obligations that visa holders must meet in order to lawfully stay in Australia.

Until otherwise stated, employers and workers should assume all obligations and visa conditions apply as usual.

About two weeks ago, the migration industry peak body MIA requested the Department of Home Affairs (DHA) to provide flexibility and clarity around various visa conditions (eg. allowing workers to undertake different jobs, or for employers to reduce worker hours and salaries).  However, no response has yet been received.

It seems the government is currently prioritising relieving the impact of COVID-19 on Australian citizens and permanent residents. We hope some kind of relief and flexibility will be given to sponsored skilled workers and their employers. In the interim, it is essential that employers seek appropriate legal advice when making decisions around redundancy and/or reduced wages. 

The situation continues to be very fluid, and we will keep our clients updated as more information from the DHA becomes available.


Employer FAQs

Can I stand down employees, or put them on leave without pay?

Extended leave without pay – that is, a period of leave greater than 3 months - is generally not permitted for Subclass 457 and 482 visa holders. This is because these visas are intended for full-time positions that fill specific skill shortages in Australia.

Additionally, leave without pay is generally only acceptable if it is for maternity or paternity leave, sick leave, a work-based injury, or significant personal reasons. At this stage, it is unclear whether circumstances caused by COVID-19 fall under these exceptions. The terms of leave must also be mutually agreed upon by the employer and employee, and clear records of the agreement should be kept.

In sum, employers considering putting temporary visa holders on leave without pay must be prepared to make the case to the DHA that the leave is temporary, mutual, and justified in the circumstances. Employers should seek advice in relation to their individual situation.


Can I reduce my employees’ hours or pay?

Reducing pay or the number of hours worked is generally not allowed for employees holding Subclass 457 or 482 visas. This is because employers are required to stick to the same conditions of employment that were specified in the approved nomination. These visas are also granted with the expectation that they are for full-time positions.

Similar to leave without pay, periods of part-time work or reduced hours might be considered if it relates to return from maternity leave, sick leave, a work-based injury, or significant personal reasons. It must also be mutually agreed upon by the employer and employee, and be properly documented.

However, employers should note that a decline in business is generally not an acceptable reason for reducing hours. The DHA may consider leniency due to extraordinary circumstances, but this has not yet been confirmed.


My sponsored employee’s visa is about to expire. What do I do?

You will need to consider whether it is feasible for the employee to either apply for a new temporary visa, or commence an application for permanent residency.

Note that employers must still be able to make a genuine business case for sponsoring overseas workers, especially if operating in an industry that has been significantly impacted by COVID-19. The annual market salary requirement must be met when making the new application.

If a visa extension or applying for a new visa is not possible, employers may need to pay for the necessary travel costs for sponsored employees and their family members to leave Australia.

 

Should I continue with pending Subclass 482 (Temporary Skilled Shortage) visa applications?

It is likely the DHA will delay approvals of temporary visa applications for potential employees who are offshore (ie. outside of Australia) until the travel ban is lifted. Given there is no set date for when this will happen, employers will need to consider whether they want to go ahead with these applications.

For employers who had planned to commence the application process for offshore applicants, it would be better to wait until more certainty is provided.

The DHA will continue to process applications for onshore applicants (ie. in Australia) whose visas are due to expire. However, given the ongoing COVID-19 crisis, questions remain over whether employers will be able to meet the stringent sponsorship obligations mentioned above. 


Employee FAQs

What happens if I’m made redundant?

Unfortunately, some workers are facing the possibility of being made redundant.

Subclass 457 and 482 visa holders have 60 days from the last day of employment to find another approved sponsor, or apply for and be granted another type of visa. However, we acknowledge it is proving difficult for retrenched temporary visa holders to find new sponsors in the current economic downturn. 

Visa holders who are departing Australia may be able to make a request for a return travel airfare to their home countries. We recommend both employers and employees seek professional advice in this case.


Can temporary visa holders access government support?

Temporary visa holders are generally unable to access social security payments.

While financial support measures were recently announced, only New Zealand citizens on the Subclass 444 visa are eligible. Though the government has signalled they are considering options for other temporary visa holders, further details have not been made public. Again, we will update clients as soon as information becomes available.


I want to apply for permanent residency. How will I be impacted?

There is concern over how changes in employment status might affect permanent residence applications under the 186 Employer Nomination Scheme. For example, it is currently unclear what impact a disruption in employment will mean for someone who is applying for a Subclass 186 visa under the Temporary Residence Transition (TRT) stream, which requires employees to have worked full-time for a minimum of 2 or 3 years.  

Additionally, the sponsor must also guarantee that the position nominated will be available for a minimum of 2 years. For some, this may be a difficult requirement to meet. 

Applicants who have already lodged their applications and are awaiting a decision will be refused if they lose their employment prior to receiving a positive outcome.  

For employees whose employers are unable to continue sponsorship, there may be independent visa options available. This is especially the case for highly in-demand health care professionals. Many state and territory governments are giving priority to nominate health care workers. You can find out more from the respective state and territory migration websites.


We are here to help

We’re doing what we can to make sure our clients are looked after during these difficult times. To discuss your individual circumstances and better understand the options available, feel free to book an online or phone consultation with our immigration experts. For news on the latest in immigration policy changes, check out our other resources as well:

To find out more about how visa conditions or sponsorship obligations apply in your particular situation, book a consultation with one of our migration agents today.

contact us

+61 2 9212 4008

51 Albion Street,
Surry Hills,
Sydney NSW 2010
AUSTRALIA

Monday to Friday
9am - 5:30pm
(or flexible by appointment)

Abacus Visa Pty Ltd. ACN: 147099303
Abacus Visa & Migration Services Pty Ltd. ABN: 58169966036
© COPYRIGHT 2020  ABACUS VISA / +61 2 9212 4008 / PRIVACY POLICY

DISCLAIMER: No material on this website, including but not limited to documents, articles, general comments, responses and other communications should be interpreted as relevant or accurate legal advice for any individual or specific situation. The information is of a general nature and cannot substitute for professional legal advice. Such advice is only provided by our firm following the acceptance by a client of our written agreement, and the payment of the required fees.