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New wage rates may impact work visas

Auckland-based immigration lawyer, Aaron Martin, believes that the government’s decision to increase the minimum wage could impact the eligibility of migrant workers for work and residence visas.

The New Zealand Government has lifted the minimum wage to $18.90 per hour effective April 2020 – before raising it to a $20 minimum wage by 2021.

Around a quarter of million workers will be better off next year, thanks to another $1.20 an hour increase to the minimum wage, the biggest equal lift ever,” says Immigration Minister Iain Lees-Galloway.

The government estimates 242,000 workers will benefit, which includes people working on $17.70 and between $17.70 and $18.90 an hour.

The new rate will put an extra $48 per week before tax in the hands of employees currently on minimum wage for 40 hours a week.

The government derives its confidence in raising the minimum wage from a low unemployment rate at 4.2 per cent, with a prediction to add 43,600 jobs in 2020, and New Zealand economy growing at a faster rate than other OECD nations, including Australia, Canada, the USA and European countries. The rise in minimum wage is estimated to boost wages by $306 million annually.

“We’re implementing a balanced approach to the minimum wage increases and have provided certainty to businesses who told us they wanted to know how much the minimum wage will increase and when the changes were going to happen,” says Iain Lees-Galloway.

The starting out and training wages will also see a boost, with a rise to $15.12 per hour from 1 April 2020, remaining at 80% of the adult minimum wage.  

At the same time, migrants whose pay packet is not at the required threshold will either end up with a 1-year work visa (as opposed to 3-year visa) or be rendered ineligible for residence on 24 February 2020, says Auckland-based immigration lawyer, Aaron Martin

“Imagine a stonemason on an essential skills work visa who earns $21.25 per hour. On 23 February their job would be classified as mid-skilled and they would be granted a 3-year work visa. One day later their job will be classified as low-skilled because of their pay rate.

‘Or, imagine a carpenter who earns $25 per hour and is seeking a residence visa. On 23 February they are eligible for residence; on 24 February they won’t be.

“To still qualify for a visa under the new thresholds, these migrants on the cusp will need a pay increase of 2%. This may seem like only a small increase. But for an employer, a pay increase is not a quick and easy decision. Incremental increases can add up to make it unfeasible to employ a migrant.

“Pay rate is a factor outside the control of most migrants. These threshold changes disempower them from being able to secure a visa on a long-term basis with a view to making a commitment to our country.

Implications for the aged-care industry

Immigrants on visas make up a third of New Zealand’s 22,000 aged-care caregivers and 5000 nurses.

Aaron points out that the government recently granted a small window to the aged-care sector reclassifying some of their jobs as skilled employment. “Workers in the industry have also fought hard to get wages up to the $25 an hour benchmark for residence eligibility. This move will set the sector back again.

“Many migrant nurses and caregivers must now be reconsidering whether to stay in New Zealand.

Why now?
Employers in many industries say they would struggle without a supply of overseas workers.

The immigration system automatically adjusts wage levels as a result of annual review, say Aaron. “But continually placing the goal of residence out of reach leaves people disheartened and wondering whether there are greener fields elsewhere. In a globally competitive market for skills, New Zealand runs the risk of losing to the competition.

“Our immigration system is already under pressure from a large number of applications, and New Zealand is looking like an uncertain place to get residency.

Proposed work and residence visa payrate changes effective 24 February 2020

The new thresholds are based on the New Zealand median salary and wage rate of $25.50 per hour (up 2% from last year), equivalent to $53,040 per annum for a 40-hour per week job.

Skilled Migrant Category

1.       The threshold for gaining skilled employment points will change from $25.00 to $25.50 per hour for jobs at ANZSCO skill level 1,2, or 3, and jobs at skill level 4 or 5 that are included at Appendix 7 of the operational manual.

2.       The threshold for gaining skilled employment points will be $38.25 per hour for jobs at ANZSCO skill level 4 or 5 that are not included at Appendix 7 of the operational manual.

3.       The threshold for bonus points for high remuneration will be $51 per hour.

 Essential Skills Visa

1.       The threshold for mid-skilled employment will change from $21.25 to $21.68 per hour for jobs at ANZSCO skill level 1,2, or 3.

2.       The threshold for mid-skilled employment will be $25.50 per hour for jobs at ANZSCO skill level 4 or 5 in Appendix 7 (This visa was treated as an exception due to changes made at the end of October.)

The threshold for higher skilled employment for all other skill level 4 and 5 roles will change from $ 37.50 to $38.25 per hour

Immigration News Study Abroad Work Abroad

US lacks high-skilled talent to stay competitive – CEO group

Ethnic people in New Zealand

The US saw a 14% decline in international business school applications—a steeper decline than any other country; Canadian and European MBA programs saw application increases.

Calling attention to the challenges the U.S. faces, 63 CEOs and deans from leading business schools in the US, have signed an open letter seeking a substantial change in the U.S. approach to high-skilled immigration. The letter expresses urgent concern that the U.S. does not have the high-skilled talent it needs or the capacity to train enough people with these skills to remain competitive in a global economy.

The CEOs are proposing pro-growth changes:

  • Removing “per-country” visa caps, modernizing the visa processing system, and reforming the H-1B visa program to make it possible for skilled migrants to have a reasonable chance of gaining entry to the United States.
  • Creating a “heartland visa” to encourage immigration into the regions of the United States that could benefit from these talented individuals.

Regions in which students desire to study are likely to be the winners in economic development because they are attracting talent—which has implications for homegrown talent as well by creating hubs of innovation and economic growth. Early Warning Signals: Winners and Losers in the Global Race for Talent provides a look into the current flow of talent into specific countries, citing data from GMAC’s 2019 Application Trends Report, an annual snapshot of admissions trends for graduate business programs.

Quality business schools are emerging around the world and the competition for talent is fierce, the sign of a vibrant marketplace, says Sangeet Chowfla, President and CEO of GMAC.  “Business schools don’t hold all the cards, however. Policy makers also have a responsibility to seed an environment conducive to student mobility.”

More Students choosing Canada over the US

In 2019, the United States experienced a 13.7 percent decline in international business school applications—a steeper decline than any other country in the world, and a drop that came amidst largely rising or stable applications everywhere else in the world.

Conversely, both Canadian and European programs saw application increases, which were driven primarily by rising international demand. For the US, these numbers are a worrisome indicator for the future mobility of talent—especially for business leaders who now cite the hiring and retention of talent as their number one concern, says GMAC report.  

Canada plans a million new residents by 2021

As a positive signal for the country’s future mobility trends, Canada saw an 8.6 percent uptick in international business school applications in 2019—a positive signal for the country’s future and mobility trends ahead. This follows on the heels of a 16.4 percent increase in the prior year. Canada also gained 286,000 permanent residents in 2017 and aims to have a total of 1 million new residents by 2021—with a focus on high-skilled labor. This positions the nation to yield economic benefits in the years and decades to come.

UK’s skills shortage to worsen

Three in five UK firms reported experiencing a more difficult time finding talent over the previous year, and 50 percent expected the UK’s skills shortage to worsen further in the future. However, 61 percent of UK business programs reported an increase in international applications in 2019 over the prior year, and the share of Graduate Management Admission Test (GMAT) score reports sent to UK programs has increased slightly since 2016, according to a report released by GMAC in March of 2019.

India continues to lose talent

The movement of talent from India to other countries continues, with increasing interest in domestic schools. The percentage of Indians sending their scores from the GMAT exam to United States business schools fell from 57 percent in testing year 2014 to 45 percent in testing year 2018, according to the most recent GMAC data. During that same period, the percentage of Indian GMAT test takers sending their test scores to Indian schools rose from 15 percent to 19 percent.

China now home to 6 of the Top 50 MBA programs

Similarly, Chinese business schools saw a 6.8 percent increase in domestic applications this year, and domestic volumes were up year-on-year at 73 percent of programs. While 86 percent of applicants to these programs currently come from within the region, the rising profile of China’s business schools could begin to attract more global candidates. China is now home to six of the Financial Times’ Global Top 50 MBA programs, including the fifth-ranked overall school, China-Europe International Business School (CEIBS). In 2009, just two of the top 100 were in China.

Immigration News

New business visa to attract talent and create jobs

Michael Woodhouse | Immigration

A new business visa will encourage migrants to set up high-quality businesses and create new jobs, according to Immigration Minister Michael Woodhouse.
“Starting today, the new Entrepreneur Work Visa will help New Zealand attract talented, well-connected business people to invest and grow businesses in New Zealand,” Mr Woodhouse says.

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New business visa to attract talent and create jobs


Immigration advisers’ regime to be reviewed

Michael Woodhouse | Immigration

Immigration Minister Michael Woodhouse has announced a review of the Immigration Advisers Licensing Act 2007, which regulates immigration advice and created the Immigration Advisers Authority (IAA) and the Immigration Advisers Complaints and Disciplinary Tribunal.
“The Act is now more than five years old and a review is timely to ensure the new system is working as effectively and efficiently as possible.

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Immigration advisers’ regime to be reviewed

Immigration Study Abroad Work Abroad

Indian visa applicants unfairly treated by NZ

Work visa

Close to 500 visa applications from Indian couples declined by Immigration New Zealand will be re-assessed, following complaints to the Ombudsman.

The immigration authority had wrongly turned down the visa applications of the partners of Indian migrants, the Ombudsman found.

The investigation was caused by 14 complaints against Immigration NZ’s offices in New Delhi and Mumbai.

The immigration department has accepted the Ombudsman’s findings that the staff had put too much weight on ensuring applicants had incentives to return home.

The immigration department has contacted all potentially affected applicants and informed them if they were eligible for reassessment, says INZ area manager Michael Carley.

The New Zealand Immigration department has set up “a dedicated team of immigration officers not involved in any previous decisions relating to the cases” for the reassessment process.

INZ has also decided to reassess these applications “as a matter of priority by dedicated specialists” in India. INZ has also provided extra staff training.
Work visa

However, INZ’s handling of these cases was not taken lightly by immigration advisers and New Zealand’s leading professional association for immigration specialists, the New Zealand Association for Migration and Investment (NZAMI) who had made complaints to the Ombudsman.

These complaints related to cases where applicants were declined temporary entry class visas “despite appearing to comply with the requirements”, a statement from NZAMI said. “All were partners of student or work visa holders already here in New Zealand.”

Immigration New Zealand is currently notifying the 480 applicants who may have been affected to advise them of the review process and possible reassessment of their case or refunding of fees paid.

The initial assessments in India were very badly handled, says NZAMI chairperson, Walter Stone. “They show a lack of training and bias. This reflects poorly on Immigration New Zealand.”

“These potential migrants have applied for visas because our immigration policies allow for partners of foreign students and workers to come to New Zealand to join them.

“In the majority of cases the student partner has already come to New Zealand and invested tens of thousands of dollars in an education here.

Walter believes that the situation is worse for applications processed in India. “Partners applying through the Indian branches have been declined at much higher rates than through other branches, including China.

“It is precisely this inconsistent and poor decision-making that impacts very negatively on the reputation of New Zealand as a migrant destination – not to mention the cost to taxpayers of re-opening over 480 cases.”

The adverse outcomes of these applications seem to contradict with the government’s  recently announced plans to encourage growth in education sector.

Tertiary Education, Skills and Employment Minister Steven Joyce had recently reiterated New Zealand’s commitment to international education which contributes $2.6 billion a year to NZ economy and 28,000 jobs for New Zealanders. “Plus it helps build strong linkages with the countries that are our trading future,” the minister had said.

Walter believes that allowing partners to join international students is a great way for New Zealand’s education sector to market courses to overseas students who pay around three times the fees of national students.

“Many of those students then go on to contribute through gaining skilled employment and working their way to becoming NZ residents,” says Walter.

Let us know if you were affected by an adverse immigration decision.

Check your eligibility to get a visa to New Zealand, on the Immigration NZ website.

For US visa applicants too, the process to obstaining a visa and staying with the spouse in the U.S. is not easy.

“You’re engaged or married to a U.S. citizen or permanent resident, and all you want is the right to be together in the U.S. Should be easy, right? It’s not,” says Ilona Bray J.D., author of “Fiancé & Marriage Visas: A Couple’s Guide to US Immigration”.

“Information can be hard to find, the government bureaucracy isn’t helpful, delays are inevitable.”

To help prospective US visa applicants, Ilona wrote the book Finance and Marriage Visas which attempts to make obtaining a visa and green card as painless as possible. “It helps you make sure you’re truly eligible and decide the fastest and best application strategy — whether you’re married or unmarried, living in the U.S. or overseas.

Buy now your copy from Amazon: “Fiancé & Marriage Visas: A Couple’s Guide to US Immigration” (Affiliate link.)