The Temporary Skilled Migration Income Threshold, or TSMIT, is an important rule in Australia’s skilled migration program. It sets the minimum salary employers must offer to sponsor skilled workers on a Temporary Skill Shortage. This ensures that overseas workers are paid fairly and prevents local wages from being undercut.
Recently, the Australian Government announced an increase in the TSMIT, and this has raised questions among employers and skilled workers. For businesses, the new TSMIT means adjusting budgets and recruitment processes, while for workers, it affects visa eligibility. Let’s explore these changes and understand how they could impact you.
Please Note: This article serves as a general guide to help you understand the topic, with information accurate as of the publication date. We recommend consulting a registered migration agent or The Department of Home Affairs for precise, up-to-date guidance tailored to your specific circumstances.
Key Changes to TSMIT: Higher Salary Thresholds for Fairer Wages
The most significant change to the TSMIT is an increase in the minimum salary threshold. From 1 July 2024, the threshold has increased to $73,150 per year, plus superannuation, up from the previous $70,000. This adjustment is based on the Consumer Price Index (CPI), reflecting a rise of about 4.2%–4.5% to keep up with Australia’s living costs.
This change aims to:
- Ensure salaries match the rising costs of living in Australia.
- Maintain fair compensation for overseas workers.
- Protect the local job market by setting competitive wage standards.
In short, these updates are designed to support both workers and employers by promoting fair pay and a strong economy. Now, let’s look at what employers need to do.
What Employers Need to Know: Adjusting to the New TSMIT Rules
If your business sponsors skilled workers on a 482 visa, you must meet the new TSMIT requirements. Here’s what that means:
1. Review Your Job Offers
All new employment contracts must meet or exceed the new $73,150 threshold.
2. Adjust Budgets
Employers may need to re-evaluate salary structures to ensure compliance with the updated rules.
3. Avoid Penalties
Failing to meet TSMIT requirements can lead to visa rejections and disrupt your recruitment process.
By acting early, you can ensure a smooth transition and avoid last-minute complications. Next, let’s discuss how Labour Market Testing (LMT) connects with these changes.
Labour Market Testing (LMT): Ensuring Compliance with Updated Salary Requirements
Labour Market Testing, or LMT, is a key requirement for sponsoring skilled workers. Employers must prove they tried to hire local Australian workers before offering the job to an overseas applicant. With the new TSMIT, this process becomes even more important.
Here’s what’s new for LMT under the updated TSMIT:
Job Advertisements
Any job ads you post must reflect the new minimum salary threshold.
Accurate Records
It’s vital to document your LMT efforts thoroughly to avoid compliance issues later.
By meeting these requirements, you not only stay on the right side of the law but also show a genuine commitment to supporting local workers. Let’s move on to how you can prepare for these changes.
How to Prepare for the TSMIT Changes: Tips for Employers and Skilled Workers
Preparation is the key to avoiding disruptions and staying compliant. Here’s how you can get ready:
For Employers
- Audit Current Offers: Review and update your job offers to ensure they meet the new salary requirements.
- Update Recruitment Processes: Make sure your LMT and job advertisement processes reflect the new TSMIT.
- Plan Budgets: Adjust salary budgets to account for higher thresholds, ensuring smooth hiring processes.
For Skilled Workers
- Check Eligibility: Make sure the salary offered by your prospective employer meets the new threshold.
- Upskill if Needed: If your salary doesn’t meet the requirement, consider enhancing your skills or qualifications to qualify for higher-paying roles.
Preparation not only helps you comply but also keeps you ahead in a competitive job market. If you’re unsure where to start, Knowbal offers expert guidance to make the process easier.
Impact on Skilled Migrants: Navigating the Higher TSMIT Criteria
For skilled workers planning to apply for a 482 visa, the higher TSMIT brings new challenges. While it ensures fair pay, it may also make it harder for some roles to qualify, particularly in industries with traditionally lower salaries.
To stay competitive, focus on:
- Upskilling and Reskilling: Gain new qualifications or improve your expertise to access better-paying positions.
- Target High-Demand Jobs: Look for roles in industries or regions with high demand, as they are more likely to offer salaries that meet the TSMIT.
These changes may seem tough, but they also encourage workers to aim for better opportunities.
Final Thoughts
The updated Temporary Skilled Migration Income Threshold (TSMIT) marks an important step toward creating a more equitable and competitive workforce in Australia. By increasing the salary threshold, the Australian Government aims to protect both local and overseas workers, ensuring fair pay while addressing economic challenges such as rising living costs.
If you need help understanding these changes, Connect with Knowbal today. Whether you’re an employer looking to stay compliant or a skilled worker preparing for a 482 visa, Knowbal offers the guidance you need to succeed.
