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Update: The Australian Government Announces Temporary Skilled Migration Income Threshold Increase

10th May 2023

In response to the independent Review of the Migration System, the Albanese Government has made a notable announcement regarding the Temporary Skilled Migration Income Threshold (TSMIT), which will increase to $70,000 effective 1 July 2023. This decision will notably affect businesses that wish to sponsor foreign workers under employer-sponsored skilled migration programs. In this article, All Access Migration’s team of lawyers examine the implications of this announcement.

THE CURRENT TEMPORARY SKILLED MIGRATION INCOME THRESHOLD

When sponsoring a worker under an employer-sponsored skilled migration program, businesses are required to pay them an annual minimum salary that excludes superannuation contributions, known as the Temporary Skilled Migration Income Threshold (TSMIT). The rationale behind this requirement is to prevent the exploitation of migrant workers and to ensure that their salaries are comparable to those of Australian workers.

Since 2013, the TSMIT has been fixed at $53,900, without being adjusted for inflation, causing concern that the minimum salary for migrant workers no longer corresponds with the current labour market in Australia, and that it could be compromising the effectiveness of the skilled migration system.

REASONING BEHIND THE INCOME INCREASE FOR TEMPORARY SKILLED MIGRANTS

By raising the TSMIT to $70,000, the government is demonstrating its dedication to ensuring that all workers are treated fairly and equitably within the skilled migration system. According to the independent Review of the Migration System, the current TSMIT is inadequate in keeping up with changes in the labour market and is ineffective in protecting migrant workers against exploitation.

The aim of the government’s decision to increase the TSMIT to $70,000 is to ensure that migrant workers receive a just and competitive salary that is consistent with the salaries paid to Australian workers in equivalent positions.

HOW WILL THIS AFFECT BUSINESSES THAT WISH TO SPONSOR FOREIGN WORKERS?

The alteration to the TSMIT could potentially have a notable effect on companies interested in sponsoring foreign workers under employer-sponsored skilled migration programs. With the minimum salary requirement rising from $53,900 to $70,000 per year, businesses must now pay their sponsored workers a significant amount more.

Furthermore, businesses must guarantee that the salary they offer to sponsored workers is at least equivalent to the market salary for the position they hold (i.e., the Annual Market Salary). This requirement aims to prevent businesses from leveraging skilled migration to undercut the local labour market.

HOW SHOULD BUSINESSES RESPOND TO THE TEMPORARY SKILLED MIGRATION INCOME THRESHOLD CHANGES?

For businesses that depend on skilled migration to fill crucial positions, it is essential to take notice of the modifications to the TSMIT and begin planning for the future in anticipation of their implementation on 1 July 2023. It is crucial for businesses to confirm that they are paying their sponsored workers a salary that is both fair and competitive, while also adhering to all necessary requirements throughout the sponsorship and nomination process.

Additionally, businesses should seek legal counsel to ensure that they are complying with all pertinent laws and regulations. All Access Migration are able to offer expert advice on the changes to the migration system, as well as help businesses manoeuvre through the complicated legal terrain associated with skilled migration.

CONCLUSION

The increase of the Temporary Skilled Migration Income Threshold (TSMIT) to $70,000 is a notable modification to Australia’s skilled migration system. This alteration reflects the government’s dedication to establishing an impartial and equitable system that is in line with the current labour market and benefits all workers.

ALL ACCESS MIGRATION – HOW WE CAN HELP  WITH TEMPORARY SKILLED MIGRATION INCOME

If your business has been affected by the changes to the Temporary Skilled Migration Income Threshold (TSMIT), All Access Migration can offer professional advice and legal guidance. Our team can aid clients in ensuring that they comply with all applicable laws and regulations, including the minimum salary obligation for sponsored workers. We can also provide guidance on navigating the complicated legal terrain associated with skilled migration and assist clients in devising strategies to address their workforce requirements in the changing environment. With our expert legal advice and guidance, businesses can make well-informed decisions and take proactive measures to adjust to the changing skilled migration system in Australia.

Don’t hesitate to contact our experienced team of migration lawyers for assistance.

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