IMMIGRATION LAW UPDATE RACHAEL MASON
A tough road ahead Rachael Mason from Lane Neave explains that, with the pending go-live of the new Accredited Employer Work Visa (AEWV) system, the government’s ‘Immigration Rebalance’ is upon us. For some employers, it will be brutal.
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n 4 July, the new AEWV system will go live. The finer details have now been released. The new system is based on government objectives to reduce exploitation of migrant workers and to address a perceived over-reliance by employers on migrant workers to fill low-skilled and low-paid positions that should be able to be filled by Kiwis.
High minimum income requirement
The most significant and challenging component of the new system for many employers will be the minimum income requirements. Employers will only be able to sponsor migrant workers who are paid at least the appropriate minimum pay rate for that role. For most roles, the pay rate will be set at the median wage ($27.76 per hour, or $57,750 per year based on a 40-hour week). However, some concessions will be 38
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WINTER 2022
available where lower minimum pay rates will apply: • certain roles in tourism and hospitality, and construction and infrastructure industries: $25 per hour • certain roles in the care industry: $25.39 per hour. The lower pay rate for these sectors is a temporary measure only and is in place until April 2023. New sector agreements will also be in place later in 2022, allowing for temporary reduced minimum pay rate levels for work visas issued in the care, tourism and hospitality, meat and seafood processing, construction and infrastructure, seasonal snow and adventure tourism sectors. This will support the transition to the new system for employers in these sectors where, traditionally, it has been difficult to recruit New Zealanders and employers have relied heavily on migrants. The intent is to allow these employers time to improve working conditions and put significant effort into recruiting, training and upskilling New Zealanders. The new minimum pay rates will pose significant challenges for many employers, even those who have been the beneficiaries of the socalled ‘concessions’. If an employer needs to access migrant workers to
plug gaps in its workforce, the only way to do that will be to pay that worker the relevant minimum income for that role. Put simply, no minimum pay rate = no work visa. For many employers, paying $27.76 per hour is not a viable option. Even the lower $25 per hour rate for some sectors will not be a realistic possibility in many cases. Employers will also need to be careful to ensure consistency across job roles, for migrants and Kiwis alike. Hiking pay rates to these levels will be a dealbreaker for many businesses that rely on migrant workers in their hard-tofill roles.
As things currently stand, there is a lot of pain ahead for employers who have roles that pay below the minimum income threshold and who have been struggling to find enough staff to fill them.
Working holiday visa hopes
The government has reopened working holidaymakers visa programmes, with the expectation that this group may be able to help fill workforce shortages for these lower-paid roles. These visa holders
