The New Zealand Government’s new KiwiBuild scheme will see changes to immigration settings in order to help the construction and housing sector to attract overseas skilled workers.
The government’s response to New Zealand’s shortage of affordable housing is the new KiwiBuild scheme which will see the construction of 100,000 starter homes for first home buyers over the next ten years, with half of those new houses earmarked for the Auckland region.
The Ministry for Business, Innovation and Employment (MBIE) projected in late 2017 that there could be a potential shortfall of approximately 30,000 workers to meet increasing demand in housing and infrastructure, with this number likely to rise as a result of the KiwiBuild initiative. The shortage affects all skills categories in the construction sector but particular growth is expected in the demand for plumbers, electricians, builders, civil engineers and project managers.
The proposed changes, which are expected to come in to force late 2018 or early 2019, include three key components.
The first is a dedicated KiwiBuild Skills Shortage List. This list will identify specific roles for which the immigration process will be streamlined. The list will expand on the innovations introduced in the Canterbury Skills Shortage List, which was brought in after the Christchurch earthquake to help with the city’s rebuild.
For roles included on the KiwiBuild Skills Shortage List, an employer may not need to prove to Immigration New Zealand that they have made a genuine attempt to employ a New Zealand citizen or resident visa holder for the position.
The second component of the change will provide advantages for companies who have proven standards as good employers in the construction sector. Employer accreditation or pre-approval should see faster processing and greater simplicity in visa applications.
Employers will be able to benefit from this streamlined process if they reach high standards of health and safety, have good business practices and can demonstrate good employment conditions, pay, training, skills development and pastoral care.
For employers who comply with the pre-approval criteria this will offer greater opportunities to plan their workforce and hire overseas workers to meet the expected demand.
During periods of skills shortage there is often concern around the risk of exploitation of migrant workers through lower wages and poor working conditions. The third component of the proposed changes will put in place steps to minimise that risk by introducing specific requirements for labour hire companies, establishing a mandatory accreditation scheme to cover third party arrangements.
This Immigration New Zealand accreditation is likely to require labour hire companies to pay workers at least the market rate and offer terms and conditions equivalent to the hire company’s other employees, as well as ensuring equity across all employees’ terms and conditions. The accreditation may also see hire companies having to meet the upfront costs of worker recruitment.
Hire companies will also likely be responsible for ensuring that contracted third parties uphold good practices in the workplace. Failure to comply with this and any of the new proposed changes could mean that Immigration New Zealand could cancel the hire company’s accreditation and the benefits that go with it.
The Government may also consider the option that work visas issued under the KiwiBuild Skills Shortage list may have more flexible conditions and could, for example, require the worker just to work in their specific role and not restrict the worker to a particular employer or location.
Recruiting to meet periods of high demand and maintaining legal and ethical obligations in employing migrant staff can be complex. We recommend that employers begin this process with the benefit of professional advice and assistance on visa matters from an experienced Licenced Immigration Adviser or Immigration Lawyer.
The Pathways New Zealand team will be monitoring progress on these proposals and will confirm the final details of the changes once they are announced.