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Thread: Changes to the Essential Skills Work Visa from 27 July 2020

  1. #1
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    Default Changes to the Essential Skills Work Visa from 27 July 2020

    INZ has announced the following changes to the Essential Skills Work Visa, to take effect for applications lodged on or after 27 July 2020:

    Goodbye ANZSCO, hello wage threshold

    ANZSCO will no longer be used to determine whether someone is low, mid or high skilled.

    Instead, the assessment will now be based purely on remuneration, based on the hourly rate. Applicants will be assessed as either:

    • at or above the median wage, or
    • below the median wage.


    INZ will use the current median wage of $25.50 per hour.

    Effectively, applicants who are assessed as at or above the median wage will be processed as mid-skilled applicants are now, and applicants who are assessed as below the median wage will be processed as low-skilled applicants are now. So:

    • Visa duration: 3 years for work paying at or above the median wage, 6 months for work paying below the median wage. Essential Skills visa durations of 5 years now fall away.
    • Stand-down period: applies to work paying below the median wage. Once you have been in New Zealand for 3 years for work paying below the median wage (or work previously assessed as low-skilled), you are required to leave New Zealand for 12 months before you can apply for another Work Visa that pays below the median wage. (This is pretty much the same provision that was previously applied to low-skilled Essential Work Visas.) Note that there is a delay to the stand-down period in some cases as a COVID-19 response.
    • Skills match report from MSD: required for work being paid below the median wage (previously required for work assessed as low-skilled).


    The requirement for employers to make genuine attempts to hire New Zealanders over migrants remains unchanged.

    Eligibility to support family

    For those assessed as being paid at or above the median wage, this remains the same as previous mid-skilled or high-skilled Essential Skills Work Visas. You will continue to be able to support a Work Visa or Visitor Visa for your partner, and a Visitor Visa or Student Visa for dependent children.

    For those assessed as being paid below the median wage, the eligibility to support family has been widened from previous low-skilled Essential Skills Work Visas. You are now able to support a Visitor Visa for your partner (but not a Work Visa; your partner would need to qualify for a Work Visa in his or her own right). You are now also able to support a Visitor Visa or a Student Visa for a dependent child, but only if you meet the minimum income threshold (currently $43,322.76 or more per year).

    In conclusion

    It looks drastic, but it really isn't. Effectively, ANZSCO disappears and wage thresholds replace the skill band assessment, and all existing instructions and restrictions now fit around the wage threshold assessment.

    This will, however, have a negative impact on people previously assessed as mid-skilled with pay rates below $25.50 per hour: they will now fall into the new "lower-pay" band and in the same boat as people previously assessed as low-skilled currently are.

    None of these changes should come as a surprise though: we've known since 2019 that they were coming.

  2. #2
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    Hi Kelerei,

    Are you, or is anybody else, aware of when and/or how often the median wage 'rate' is reviewed/updated and used by INZ? Is it annual, or much more regularly?

    Also, is someone cleverer than me able to advise if it's likely that the median wage will decrease or increase due to the current Covid situation and overall economic climate?

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    Quote Originally Posted by AlexKiwi2019 View Post
    Are you, or is anybody else, aware of when and/or how often the median wage 'rate' is reviewed/updated and used by INZ? Is it annual, or much more regularly?
    It seems to have been revised annually in the past, usually towards the end of the calendar year. I personally have no reason to believe that this won't continue.

    Quote Originally Posted by AlexKiwi2019 View Post
    Also, is someone cleverer than me able to advise if it's likely that the median wage will decrease or increase due to the current Covid situation and overall economic climate?
    You'll need to ask the economists that...

  4. #4
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    Thanks Kelerei!

  5. #5
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    Quote Originally Posted by Kelerei View Post
    INZ has announced the following changes to the Essential Skills Work Visa, to take effect for applications lodged on or after 27 July 2020:

    Goodbye ANZSCO, hello wage threshold

    ANZSCO will no longer be used to determine whether someone is low, mid or high skilled.

    Instead, the assessment will now be based purely on remuneration, based on the hourly rate. Applicants will be assessed as either:

    • at or above the median wage, or
    • below the median wage.


    INZ will use the current median wage of $25.50 per hour.

    Effectively, applicants who are assessed as at or above the median wage will be processed as mid-skilled applicants are now, and applicants who are assessed as below the median wage will be processed as low-skilled applicants are now. So:

    • Visa duration: 3 years for work paying at or above the median wage, 6 months for work paying below the median wage. Essential Skills visa durations of 5 years now fall away.
    • Stand-down period: applies to work paying below the median wage. Once you have been in New Zealand for 3 years for work paying below the median wage (or work previously assessed as low-skilled), you are required to leave New Zealand for 12 months before you can apply for another Work Visa that pays below the median wage. (This is pretty much the same provision that was previously applied to low-skilled Essential Work Visas.) Note that there is a delay to the stand-down period in some cases as a COVID-19 response.
    • Skills match report from MSD: required for work being paid below the median wage (previously required for work assessed as low-skilled).


    The requirement for employers to make genuine attempts to hire New Zealanders over migrants remains unchanged.

    Eligibility to support family

    For those assessed as being paid at or above the median wage, this remains the same as previous mid-skilled or high-skilled Essential Skills Work Visas. You will continue to be able to support a Work Visa or Visitor Visa for your partner, and a Visitor Visa or Student Visa for dependent children.

    For those assessed as being paid below the median wage, the eligibility to support family has been widened from previous low-skilled Essential Skills Work Visas. You are now able to support a Visitor Visa for your partner (but not a Work Visa; your partner would need to qualify for a Work Visa in his or her own right). You are now also able to support a Visitor Visa or a Student Visa for a dependent child, but only if you meet the minimum income threshold (currently $43,322.76 or more per year).

    In conclusion

    It looks drastic, but it really isn't. Effectively, ANZSCO disappears and wage thresholds replace the skill band assessment, and all existing instructions and restrictions now fit around the wage threshold assessment.

    This will, however, have a negative impact on people previously assessed as mid-skilled with pay rates below $25.50 per hour: they will now fall into the new "lower-pay" band and in the same boat as people previously assessed as low-skilled currently are.

    None of these changes should come as a surprise though: we've known since 2019 that they were coming.
    Hi @Kelerei - does this mean if you have a current SMC lodged and are currently on an ESV you can change employers using a VOC - this means you do not have to stay within the same ANZSCO code anymore? As long as you are earning above the $25.50 p/h

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    Quote Originally Posted by robbo1234 View Post
    Hi @Kelerei - does this mean if you have a current SMC lodged and are currently on an ESV you can change employers using a VOC - this means you do not have to stay within the same ANZSCO code anymore? As long as you are earning above the $25.50 p/h
    There were some minor changes to E3.26.1.1 (the immigration instruction relating to varying the conditions of an Essential Skills Work Visa), but those were all to do with replacing references to high/mid/low-skilled employment with references to the median wage. The requirement to obtain a new visa for occupation changes remains unchanged.

    If you think about it, it makes sense for this requirement to remain. The Essential Skills Work Visa is subject to a labour market test (per WK3.10), and allowing a change in occupation without testing that new occupation against the labour market defeats the purpose.

    Note however that the labour market test waiver for SMC applicants (WK3.20.10) remains unchanged -- but one must meet all the requirements of WK3.20.10 for this to be applied (in particular to your question, WK3.20.10 does not apply when changing role/occupation due to WK3.20.10(a)(ii) not being met).
    Last edited by Kelerei; 4th August 2020 at 02:08 PM.

  7. #7
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    Quote Originally Posted by Kelerei View Post
    There were some minor changes to E3.26.1.1 (the immigration instruction relating to varying the conditions of an Essential Skills Work Visa), but those were all to do with replacing references to high/mid/low-skilled employment with references to the median wage. The requirement to obtain a new visa for occupation changes remains unchanged.

    If you think about it, it makes sense for this requirement to remain. The Essential Skills Work Visa is subject to a labour market test (per WK3.10), and allowing a change in occupation without testing that new occupation against the labour market defeats the purpose.

    Note however that the labour market test waiver for SMC applicants (WK3.20.10) remains unchanged -- but one must meet all the requirements of WK3.20.10 for this to be applied (in particular to your question, WK3.20.10 does not apply when changing role/occupation due to WK3.20.10(a)(ii) not being met).
    Thank you! So to change from mid-skilled employment (staying within the same ANZSCO) - I have to apply for a new ESV and I can't do a VOC on my current ESV?

  8. #8
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    Quote Originally Posted by robbo1234 View Post
    Thank you! So to change from mid-skilled employment (staying within the same ANZSCO) - I have to apply for a new ESV and I can't do a VOC on my current ESV?
    It depends on what you're changing. An Essential Skills Work Visa will need a new Work Visa if changing occupation or place of employment (E3.26.1.1 again). If it's only the employer is changing, but both the role and location of employment remain the same, a variation of conditions may be applied for. Again, if one thinks about it, you would have already proved with your original Essential Skills application that there are no New Zealanders in your occupation and in your location available to do the work on offer, but if one changes either occupation or location, one is now in a different labour market which consequently needs testing as per WK3.10.

    Note, however, that a VOC (if you're eligible for one) doesn't change the expiry date of the visa -- if your visa is due to expire imminently, getting a new Work Visa may be better than a VOC, since you'll have to apply for the new Work Visa anyway. Also, I know that JandM and myself sound like a stuck record on this, but INZ's own advice on making sure your Work Visa correctly reflects the details of your employment at all times is of critical importance (the consequences of failing to do so can be deportation).

  9. #9
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    Quote Originally Posted by Kelerei View Post
    It depends on what you're changing. An Essential Skills Work Visa will need a new Work Visa if changing occupation or place of employment (E3.26.1.1 again). If it's only the employer is changing, but both the role and location of employment remain the same, a variation of conditions may be applied for. Again, if one thinks about it, you would have already proved with your original Essential Skills application that there are no New Zealanders in your occupation and in your location available to do the work on offer, but if one changes either occupation or location, one is now in a different labour market which consequently needs testing as per WK3.10.

    Note, however, that a VOC (if you're eligible for one) doesn't change the expiry date of the visa -- if your visa is due to expire imminently, getting a new Work Visa may be better than a VOC, since you'll have to apply for the new Work Visa anyway. Also, I know that JandM and myself sound like a stuck record on this, but INZ's own advice on making sure your Work Visa correctly reflects the details of your employment at all times is of critical importance (the consequences of failing to do so can be deportation).
    Thank you!

  10. #10
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    Is it possible that I entered a different ANZSCO code(lower) for the Essential Visa and use different code(higher) for SMC visa filling ?

    My work belongs to a particular higher Anzsco code level 1 but I dint satisfy the requirements for that ANZCO code, hence I had to put a lower code level 2 for my Essential Skills visa filling.
    In next few months, I will be available for higher level Anzsco code level 1 and might use that code for my SMC filling whenever it open. Do I need to update my Essential skills visa again later with the new updated code before filling SMC?

    Its just that that new Anzco code falls in the LTSSL and I will be able to get bonus points, hence asking.

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