On the 29th August, 2014 the Assistant Minister for Immigration and Border Protection Senator the Hon Michaelia Cash announced that the Department of Immigration and Border Protection has finalised guidelines for Designated Area Migration Agreements (DAMA).

In a move that has inflamed recent union criticism, and concerned Norther Territory employers; the DAMA arrangements are designed to supplement local labour in areas experiencing labour and skills shortages. The DAMA proposal, which under the former Labor government was started and known as ‘regional migration agreements’ (likely re-named due to a possible conflict with the name for registered migration agents (RMA’s) or enterprise migration agreements (EMA’s)), has been developed after the government has had at-length negotiations with state and territory governments and other stakeholders.

The guidelines released by the Minister’s media announcement show that the DAMA will effectively create some flexibility in the 457 programme, however must be endorsed by the relevant State or Territory government before the department would consider an application. According to the media release, “unions, business and community stakeholders must be consulted prior to requesting a DAMA”, and we are expecting this will be similar to the current Labour Agreement application process. The spirit of the DAMA is to supplement the local workforce in areas that are losing people to the lucrative mining and resources or oil and gas industries. As is the case for all 457 processes, “DAMAs are designed to ensure employers recruit Australians as a first priority and prioritise initiatives and strategies to facilitate the recruitment and retention of Australian workers” (this is expected to be similar to the current ‘labour market testing’ requirements in the 457 programme).

The Temporary Skilled Migration Income Threshold (TSMIT) requires that all 457 visa applicants are paid a minimum guaranteed annual salary of $53,900 (at the present day). This will be the same for 457 visa applicants sponsored under a DAMA, however there will also be a facility for an ‘up-to 10%’ salary concession, meaning the minimum wage could only go as low as $48,510 (well in excess of the award wage for Australians). According to the Minister’s media release, “a pilot agreement is being finalised with the Northern Territory Government to cover areas where it has been difficult to obtain Australian workers”.

A number of facts on DAMA’s (taken from the Minister’s media release):

• DAMAs do not permit overseas workers to undercut Australian workers: overseas workers must be provided with terms and conditions no less favourable than Australian employees
• DAMAs do not allow entry of unqualified overseas workers: overseas workers must hold appropriate qualifications and experience, and meet any registration and licensing arrangements
• DAMAs do not allow employers to substitute Australian workers with overseas workers: employers must show that they have sought to recruit Australian workers within the previous six months
• DAMAs do not allow employers to avoid training Australians
• Employers participating in a DAMA must meet subclass 457 sponsorship obligations, including training benchmarks
• DAMAs do not allow employers to bring in unskilled overseas workers. Overseas workers must be skilled or semi-skilled

We note here that we are still awaiting final information on the legislation proposed for DAMA’s, and therefore some of the information in this post is assumption. We will inform the market as soon as information is received. You can see the minister’s media release here.