Employers need to plan ahead for new residence visa pathways

The Government has released further detail on changes to the Skilled Migrant Category (SMC), aimed at improving the retention of skilled overseas workers by providing more realistic residence pathways for both employers and their workers. These changes are scheduled to take effect from late August 2026 and represent a clear shift towards recognising practical skills, New Zealand work experience and long term contribution.

For employers, this is significant. Obtaining New Zealand residence remains the primary long term goal for most overseas workers, and the availability of credible residence pathways is a key factor in workforce stability and retention. Expanding these pathways is therefore beneficial for both the workers and the businesses that employ them.

Two new residence pathways will be introduced under the SMC - the Skilled Work Experience (SWE) Pathway and the Trades and Technician Pathway.

The Skilled Work Experience Pathway is intended for migrants who may struggle to reach the current six point SMC threshold through qualifications, occupational registration or high pay. Instead, applicants can qualify by demonstrating at least five years of relevant skilled work experience, including time spent working in New Zealand, and being paid at least 1.1 x the median wage.

Workers in occupations on the Trades and Technician list may qualify if they hold a relevant Level 4 or higher qualification and have four years of relevant skilled work experience, gained post qualification – and including at least 18 months of New Zealand work experience paid at or above the median wage. There are currently 110 occupations on the Trades and Technician Pathway list, including construction, manufacturing, infrastructure, technical and trade roles. For many employers in these sectors, this pathway offers a long awaited and more achievable pathway to residence for many of their overseas workers.

Alongside the new pathways, the Government has introduced two occupation lists which impose additional restrictions for certain roles.

Occupations on the Amber list are not eligible for the Trades and Technician Pathway and may only apply for residence under the Skilled Work Experience Pathway if higher thresholds are met. Specifically, applicants must demonstrate at least five years of relevant New Zealand work experience, including two years of skilled work paid at least at 1.2 x the median wage. There are currently 15 occupations on the Amber list, including café manager, chef and ICT support technician.

Occupations on the Red list are excluded from residence eligibility under the new pathways, and may only apply through the existing points based SMC. There are six occupations on this list, including retail manager and beauty therapist. For these roles, employers need to recognise that a clear residence pathway may be difficult or unavailable under current settings.

From August, migrants applying under any SMC pathway, based on work experience, will no longer need to meet the median wage rate in effect at the time they apply for residence. Instead, they must meet the wage rate that applied when they began gaining their New Zealand skilled work experience and maintain at least that rate. This is a welcome change that will materially improve residence prospects for many workers, and reduce uncertainty for employers managing long term pay progression.

These residence changes must also be viewed in the context of the maximum continuous stay limits, of 3 or 5 years, which apply to Accredited Employer Work Visa (AEWV) holders, and after which a mandatory 12 month offshore stand down applies. Employers who wish to retain overseas staff long term need to be proactive. This means working early with employees to ensure that roles, duties and pay rates are aligned with a viable residence pathway wherever possible, and well before any AEWV stand down limit is reached.

As labour market conditions tighten again and net migration slows, employers who treat immigration as a long term workforce strategy, rather than a short term fix, will be best placed to retain the skilled workers they have invested in.