Uncertainty around residence pathways continues despite latest Immigration announcements

The Immigration Minister has today announced further adjustments to visa settings, following on from announcements made at the end of 2020. The key updates are as follows:

Further extensions for certain visa categories

Working Holiday visas and Supplementary Seasonal Employment (SSE) work visas with expiry dates between 21 June 2021 and 31 December 2021, will be automatically extended for a further 6 months. The conditions of SSE visas will also be opened up, allowing holders of these visas to work in any sector. It is estimated that this will impact around 10,000 visa holders.

INZ states it will contact all eligible visa holders by 25 June 2021 however as with previous extensions, anyone who believes they are eligible for an extension but does not receive confirmation of this will need to contact Immigration to ensure their extension is issued.

This move allows New Zealand employers to continue to access this onshore workforce to fill their vacancies, and helps to address the ongoing labour shortage in seasonal roles. It also gives affected visa holders the security of being able to remain in New Zealand for the foreseeable future. The Minister has indicated that these two visa types could be extended again in the future, should there be a continued need for this; the labour market and border settings will continue to be monitored and decisions on further extensions will be made accordingly.

Essential Skills work visas have not been extended, and will not be given any future automatic extensions. Essential Skills work visa holders will therefore need to make arrangements to submit new visa applications if they wish to remain in New Zealand.

Duration change for low-paid Essential Skills work visas, and postponement of stand-down period

Presently, Essential Skills work visas for jobs paid less than the median wage are granted for up to 6 months only. This will be increased to 12 months, representing a return to the policy in place up until July 2020.

In addition, the stand-down period (meaning the period during which low-paid Essential Skills visa holders have to leave New Zealand for 12 months before they can apply for a further low-paid work visa) for these jobs will be postponed again. Those who have held low-paid (or previously lower-skilled) Essential Skills work visas for 3 years or more will therefore not need to depart New Zealand until July 2022 at the earliest.

Median wage increase

From 19 July, applicants with jobs paying $27 per hour or more will be eligible for 3-year Essential Skills work visas and potentially residence under the Skilled Migrant Category. Essential Skills applicants with jobs paying less than this will be eligible for 12-month visas only, and will need to carry out labour market testing that includes consultation with, and a Skills Match Report from, WINZ. This new pay threshold will apply to applications submitted on or after 19 July; applications submitted before this date, or visas already issued, are not affected.

This reflects the recent increase to the median wage as determined by Statistics NZ, and is an increase of $1.50 per hour from the current threshold, which was based on the 2019 median wage.

The Minister states that this increased pay threshold applies to Essential Skills work visa applications, Skilled Migrant Category residence applications, and the Other Critical Worker border exception category.

It is important to note that this does not impact Skilled Migrant Category applications that have already been lodged and are in processing with Immigration New Zealand, regardless of whether they have been allocated to a case officer or not; they remain subject to the pay threshold that was in place at the time they were submitted. It will only apply to applications made from 19 July on, however with EOI draws having been suspended for over a year, there are no SMC residence applications being submitted presently.

It is not clear what impact this will have on EOIs that have already been submitted, for roles with a pay rate of less than $27 per hour. Current INZ policy states that EOIs are subject to any change in policy up to the date they are selected and assessed, however INZ has the scope to select all current EOIs before formally updating the residence policy to reflect the new pay threshold. Whether it will do this, and act in good faith to the roughly 10,000 applicants awaiting an answer on their EOIs, is currently uncertain, with the Minister unwilling to give any certainty or indication on his intentions in this space at present. It is possible to edit EOIs that have already been submitted so those who have the ability to negotiate a pay increase are strongly advised to update their EOI accordingly, to safeguard against this change.

Winners and losers

Today’s announcements bring good news for holders of WHVs and SSE work visas, who gain the benefit of a free 6-month extension and the certainty of knowing they can remain in New Zealand for longer. This is also a positive announcement for employers who need WHV and SSE visa holders to fill their seasonal roles.

Applicants with lower-paid jobs will also welcome the news that they no longer need to renew their visa every 6 months, and do not face having to leave New Zealand for at least the next year, while the COVID situation is ongoing.

However the losers of today’s announcements are those with pay rates above $25.50 per hour, but less than $27; while these applicants are currently eligible for 3-year Essential Skills work visas, from 19 July they will only be able to apply for 12-month visas if they cannot negotiate a pay increase from their employers. Anyone in this position with a visa expiring within the next year should therefore consider submitting new applications as soon as possible, to get new work visas and secure their position for the next 3 years rather than face having to settle for 12 months at a time after the new pay threshold takes effect.

And, as ever, there remains uncertainty around when EOI draws will resume, and how INZ plans to treat the EOIs currently in the pool – particularly those who won’t meet the new pay threshold. While the Minister states that today's announcements give certainty to visa holders, uncertainty remains for those awaiting a decision on the future of the Skilled Migrant Category.

We will continue to report on all updates to INZ policy and processing; for bespoke advice, please contact one of our team.