Work visas and immigration, issues you cannot avoid as unemployment rises. What employers and employees need to know (part four)

The International Monetary Fund predicts that New Zealand’s unemployment rate will reach a high of 9.223% by December this year. Even after the 2008 financial crisis, it fluctuated around only 6%. Such a high rate means roughly one in ten people in New Zealand would be unemployed. Last month, we already saw many companies enter insolvency proceedings, including Burger King. This month, Bunnings announced it would close 7 stores. Over the next 3 to 6 months, more businesses may cut pay or make redundancies, directly affecting their employees on work visas and those applying for residence.

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This raises some questions.

Will reduced working hours or pay affect my employer-sponsored work visa?

It depends on the circumstances. Immigration New Zealand explicitly defines full-time employment as work of 30 hours or more per week. Therefore, if your hours are reduced but remain at least 30 hours per week, your employer-sponsored work visa will not be affected. However, if your weekly hours fall to 29 or fewer, it will be affected. In addition, changes in working hours will not affect holders of open work visas.

If your pay is reduced below the minimum required for your visa, strictly speaking, you no longer meet the conditions for continuing to hold it. However, Immigration New Zealand has indicated that it will take a reasonable approach in the current exceptional circumstances and assess such issues on a case-by-case basis when processing visas. This means there is currently no uniform assessment standard for these issues. Approval will depend largely on the immigration officer’s judgement, leaving application outcomes uncertain.

We believe these are certainly not isolated cases. We hope Immigration New Zealand will promptly introduce a response and assessment standards, and we will then provide more detailed answers on these issues.

 

Will reduced working hours and pay affect my residence application?

Simply put, changes in working hours follow the rules outlined above: there should be no problem as long as you continue to work at least 30 hours per week. However, keep written records of the changes and notify Immigration New Zealand.

Even after a pay cut, your pay must meet the minimum requirement. From 24 February 2020, the minimum pay requirement for skilled residence applications is $25.5 per hour, while applications submitted before that date require $25 per hour. If your pay falls below $25.5 or $25 per hour respectively, you no longer meet the minimum pay requirement for skilled residence. This could become a potential issue while your residence application is being assessed. However, given the current circumstances, Immigration New Zealand has announced that it will take a reasonable, case-by-case approach to these issues. As noted above, Immigration New Zealand should introduce a comprehensive response. Once further information becomes available, we will analyse how you can respond.

 

What should I do to reduce the impact of these changes on my visa and residence application?

If your working hours fall below 30 per week or your pay no longer meets your visa’s minimum requirement, strictly speaking, you no longer qualify to hold an employer-sponsored work visa. You should notify Immigration New Zealand or seek advice from an immigration lawyer as soon as possible. We usually advise clients to actively seek new employment or suggest alternative visas suited to their circumstances, to keep them compliant and avoid unnecessary difficulties with future visa applications.

When looking for a new job, seek a role that matches your work experience or qualifications and also meets the role and pay requirements of your skilled residence application.

 

What should I do if I am made redundant?

If you are unfortunately made redundant, notify Immigration New Zealand or your immigration lawyer as soon as possible and seek a visa solution that allows you to remain lawfully in New Zealand. If you need to stay in New Zealand longer to deal with personal matters, we recommend notifying Immigration New Zealand and then submitting a new temporary visa application to maintain your lawful status.

If you are made redundant while a residence application is being processed, notify Immigration New Zealand or your immigration lawyer as soon as possible. Assess whether you can switch to another visa category and, if so, submit a new application. If you can find similar employment quickly, your residence application may still have a chance. Otherwise, you may need to arrange to leave New Zealand or seek another short-term option to remain.

 

What if my work visa becomes invalid while I am stranded overseas and unable to enter New Zealand?

At Alert Level 2, New Zealand’s border remains largely closed. Employees overseas who hold work visas still do not meet the entry criteria. To return to New Zealand, they must obtain advance approval from Immigration New Zealand through a Request for travel to New Zealand, or they will be refused boarding. Note that not all overseas work visa holders qualify to submit a request, and assessment criteria are strict.

Check the following link for details and to determine whether you qualify, or consult your immigration lawyer:

https://www.immigration.govt.nz/about-us/covid-19/border-closures-and-exceptions

If employees confirm that they cannot return to New Zealand for the time being, they may face either of two situations:

• The employee is made redundant because they cannot return to work as normal. Employers must still strictly follow New Zealand’s legal redundancy procedures. For employees, once their work visa becomes invalid, those wishing to return to New Zealand must seek another route, such as applying for a different temporary visa category.
• If the employer is willing to keep the employee’s position open but the employee’s visa expires while overseas, they must apply for a new work visa. This could be an employer-sponsored work visa. Provided they meet the relevant work visa requirements, they can still return to New Zealand once restrictions are lifted.

What can I do as an employer for employees on work visas?

• When considering pay cuts or reduced working hours, employers should, where possible, keep work visa holders’ hours at no fewer than 30 per week and their hourly pay above the minimum required for their work visa or residence application.
• For skilled work visa applications, employers can complete labour market checks early so applicants can submit their applications sooner. Over the next 3 to 6 months, rising unemployment will make sponsoring employees for skilled work visas increasingly challenging. Employers can also provide supporting letters where needed; professional advice should be sought on their specific content.
• As part of longer-term planning, employers can also consider applying for accreditation. Immigration New Zealand grants this status to reputable New Zealand employers, enabling them to recruit overseas staff quickly and easily without labour market testing, and ultimately help those employees gain residence without English language, qualification or work background requirements. Immigration New Zealand has also announced major changes to work visa policies this year and next, and applications in this category are expected to become a trend.

Please note that this article provides general information only, and its contents do not constitute legal advice.

About the author

Kera Wang 

Immigration advisory specialist

Raised in China, she migrated to New Zealand in 2012, graduated from Massey University and now works at Turner Hopkins law firm. She holds a Bachelor of Laws from China and a Master of Management. She excels at seeing matters from clients’ perspectives and understanding the varied challenges and pressures of the immigration process. Thorough and meticulous, she helps identify potential issues from the outset so clients can avoid them or prepare for them. She usually works alongside our Western lawyers on applications.