Australia is rolling out significant work permit reforms from 2026, marking one of the most important changes to its employer‑sponsored migration system in years. At the center of these reforms is the Skills in Demand (SID) Visa, which replaces the long‑standing Temporary Skill Shortage visa. The new system is designed to align migration more closely with real labour market needs, ensuring that skilled foreign workers are brought in only where shortages are genuine and urgent.
The reforms affect Australian employers, skilled migrants, and future permanent residence pathways, making it essential to understand how the new rules work
Why Australia Is Changing Its Work Visa Rules
Australia’s labour market has evolved rapidly. Ongoing shortages in healthcare, construction, technology, engineering, and essential services have highlighted gaps that cannot be filled quickly by the local workforce alone. At the same time, the government aims to reduce misuse of temporary visas, improve worker protections, and make employer sponsorship more accountable.
The 2026 changes respond to these pressures by focusing on skills, salary levels, and employer responsibility, rather than broad occupation categories.
What Is the Skills in Demand Visa
The Skills in Demand Visa is a new employer‑sponsored work visa introduced from 2026. It replaces the Temporary Skill Shortage visa and is specifically designed for jobs that Australia urgently needs. To qualify, a foreign worker must have a confirmed job offer from an approved Australian employer for a role listed on the Skills in Demand Occupation List.
This list will be updated regularly to reflect changing workforce needs.
Key Features of the Skills in Demand Visa
The new visa introduces several important changes:
- Employer sponsorship is mandatory
- Occupations must appear on the Skills in Demand list
- Salary levels must meet Australian standards
- Stronger compliance and reporting rules for employers
- Clearer pathways toward permanent residence for eligible workers
The aim is to create a more transparent, targeted, and fair system for both employers and workers.
Overview of Australia Work Permit Changes From 2026
Here is a simplified overview of the new system:
- Country: Australia
- Year: 2026
- New Visa Name: Skills in Demand Visa
- Old Visa Replaced: Temporary Skill Shortage
- Visa Type: Employer‑sponsored
- Authority: Department of Home Affairs
- Who Is Affected: Skilled foreign workers and Australian employers
- Official Portal: immi.homeaffairs.gov.au
Skills in Demand Occupation List Explained
Under the new rules, only jobs included on the Skills in Demand Occupation List qualify. This list is reviewed and updated regularly, ensuring it reflects actual shortages rather than outdated workforce assumptions.
Employers must demonstrate that the position is genuine and cannot be easily filled by the local workforce.
Skill‑Based Streams Under the New Visa
The Skills in Demand visa is divided into different streams, based on skill level and salary. These streams help the government target specific types of workers more accurately.
Each stream has its own income threshold, compliance rules, and monitoring requirements, ensuring that workers are paid fairly and not used to undercut local wages.
Eligibility Requirements for Workers in 2026
To qualify for the Skills in Demand visa, workers must meet all of the following conditions:
- A valid job offer from an approved Australian employer
- The role must appear on the Skills in Demand Occupation List
- Required skills, qualifications, and work experience
- Salary must meet the relevant income threshold
- Compliance with Australian health and character requirements
Unlike some older visa categories, eligibility is strictly tied to employer sponsorship.
Employer Responsibilities Under the New System
Employers sponsoring workers under the Skills in Demand visa face greater accountability. They must:
- Pay fair wages at or above required thresholds
- Follow Australian labour laws
- Report changes in employment status promptly
- Maintain accurate records for compliance checks
Failure to meet these obligations can lead to penalties, sponsorship cancellation, or bans.
Length of Stay and Work Rights
The Skills in Demand visa allows eligible workers to live and work in Australia for up to four years. During this time:
- Workers may only work for their sponsoring employer
- Any employer change requires a new approved nomination
- Work rights remain valid only while sponsorship continues
This structure is designed to balance worker mobility with employer accountability
Can Skills in Demand Visa Holders Change Employers
Yes, but under strict conditions. A worker cannot begin working for a new employer until:
- The new employer is an approved sponsor
- A new nomination has been lodged and approved
Until approval is granted, the worker must not start the new role.
Rules on Changing Work Hours and Salary
Under the new system:
- Core Skills Stream: Salary must always remain at or above the Core Skills Income Threshold
- Specialist Skills Stream: Salary must stay at or above the Specialist Skills Income Threshold
Employers may increase pay at any time, provided job duties do not change.
Job Duty Changes and Promotions
If an employer changes a worker’s role in a way that adds new duties or significantly alters responsibilities, a new nomination is required.
However, promotions that keep job duties essentially the same do not require a new nomination, even if pay increases.
What Happens If Employment Ends
If a worker resigns or sponsorship ends:
- The employer must notify the Department within 28 days
- Notification can be submitted via ImmiAccount or official email
- The worker then has up to 180 days to:
- Find a new approved sponsor
- Apply for another visa
- Leave Australia
This grace period provides time to secure legal status without immediate departure
Sponsorship Transfers Between Employers
If one employer wants to take over sponsorship from another:
- The new employer must already be approved or submit a new nomination
- The worker usually does not need a new visa unless:
- The visa is close to expiry
- The sponsorship type changes
This simplifies employer transitions while maintaining oversight
When a New Visa Application Is Required
A new visa application is required if:
- The current visa is about to expire
- The employer wants to continue employment beyond visa validity
- The worker changes from a Labour Agreement to a standard sponsor
Planning ahead is critical to avoid gaps in lawful status
Pathway From Skills in Demand Visa to Permanent Residence
While the Skills in Demand visa is temporary, it can support permanent residence (PR) pathways. Eligible workers may be sponsored by their employer under the Employer Nomination Scheme, provided they meet:
- Skill and experience requirements
- Salary thresholds
- Ongoing employment criteria
This makes the new visa more attractive for long‑term settlement planning.
Benefits for Skilled Workers
For foreign workers, the 2026 changes offer:
- Clearer eligibility rules
- Stronger wage protections
- Better alignment with PR pathways
- Reduced uncertainty around occupation eligibility
Workers with in‑demand skills and employer support stand to benefit most.
Benefits for Australian Employers
Employers gain:
- Faster access to genuinely needed skills
- A clearer sponsorship framework
- Reduced risk of future policy reversals
- A more stable sponsored workforce
The system encourages long‑term workforce planning rather than short‑term fixes.
Compliance and Monitoring Under the New Rules
The government has strengthened monitoring to ensure wage and sponsorship rules are followed. Employers may face audits, and workers are encouraged to report non‑compliance.
This improves system integrity and protects both local and foreign workers.
What Applicants Should Do Before Applying
Prospective applicants should:
- Confirm their occupation appears on the Skills in Demand list
- Verify employer sponsorship approval
- Review salary thresholds carefully
- Prepare evidence of skills and experience
Accurate preparation reduces delays and refusal risks.
Common Reasons for Visa Refusal
Applications may be refused due to:
- Incorrect occupation selection
- Insufficient skills or experience
- Salary below required thresholds
- Employer compliance issues
- Incomplete or inconsistent documents
Understanding requirements early is essential.
Role of the Department of Home Affairs
The Department of Home Affairs oversees policy, approvals, and compliance for the new visa system. All official guidance, updates, and application processes are published through its online portal.
Applicants should rely only on official information to avoid misinformation.
Long‑Term Impact of the 2026 Reforms
These changes signal Australia’s move toward a skills‑driven, demand‑focused migration system. Temporary work visas will increasingly serve as stepping stones to permanent roles, rather than short‑term labour fixes.
Looking Ahead
Australia’s work permit reforms from 2026 reshape how skilled migration works. With clearer rules, stronger protections, and better alignment with labour needs, the Skills in Demand visa is set to become a central part of Australia’s workforce strategy.