Increase to Essential Skills and SMC remuneration thresholds

Immigration NZ has announced changes to the remuneration thresholds under the Essential Skills and Skilled Migrant Category instructions from

26 November 2018.

 

For employers, these changes may result in:

  •  a higher turnover of lower skilled staff
  •  more frequent labour market tests
  •  requests for salary increases
  •  requests for confirmation of salary to support a visa application (SMC)

 

Essential Skills work instructions 

The mid-skilled remuneration threshold under the Essential Skills work instructions will increase from $20.65 per hour to $21.25 per hour for roles with an ANZSCO skill level of 1, 2 or 3. The threshold for roles with an ANZSCO skill level of 4 or 5, and the higher skilled remuneration threshold will increase from $36.44 to $37.50 per hour.

 

Hourly rate Annual salary ANZSCO Level 1-3 ANZSCO Level 4-5
$37.50 per hour or more $78,000 per annum* or more High High
$21.25 - $37.49 per hour $44,200 - $77,979 per annum* Mid Low
$21.24 per hour or less $44,179 per annum or less Low Low

*Based on a 40-hour work week

This change will not impact employees who currently hold Essential Skills work visas. However, the changes may impact some Essential Skills visa holders when they renew their work visa on or after 26 November 2018. 
For instance, if an employee, who currently sits within the mid-skilled band earning $21.00 per hour, renews their visa after 26 November and earns the same salary, they will fall into the lower-skilled remuneration threshold and will incur the following restrictions:

  • they will only be eligible for a 12 month visa (to a maximum of 3 visas before a 12 month stand down
    period applies)
  • their family members on dependent visas will no longer be eligible to obtain dependent visas and will need to be eligible for, and obtain visas in their own right

 

Skilled Migrant Category 

Applicants under the Skilled Migrant category ("SMC") must be paid at a rate that meets the threshold for their relevant skill level. From 26 November 2018, the threshold for gaining points for skilled employment will increase from $24.29 to $25 per hour for roles that have an ANZSCO skill level of 1, 2 or 3. The threshold for skilled employment in a role which has an ANZSCO skill level of 4 or 5 or which has no corresponding ANZSCO
code will increase from $36.44 to $37.50 per hour. The threshold to claim bonus points for high remuneration will increase from $48.58 per hour to $50 per hour.


If you would like more information regarding the remuneration thresholds, please contact us.


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Jennifer Dewald-Harrison

Director, Wellington, PwC New Zealand

+64 21 896 231

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Matt Fistonich

Senior Manager, Wellington, PwC New Zealand

+64 21 843 578

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Jaq Chong

Senior Manager, Auckland, PwC New Zealand

+64 21 897 485

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