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How to sponsor an employee in Australia

See all articlesYour guide to employer visa nomination scheme costs
Work & Skilled
Associate - Australian Migration Lawyer
April 9, 2024
minute read

Guide for employers

Sponsoring skilled overseas workers has the potential to allow an Australian employer with an opportunity to address labour shortages where they have been unable to source an appropriately skilled Australian worker. Under the available employer sponsored visas, which include the subclass 482 Temporary Skill Shortage visa (TSS), the subclass 494 Skilled Employer Sponsored Regional (Provisional) (SESR) visa, or the subclass 186 Employer Nomination Scheme (ENS) visa lets skilled workers in occupations recognised by the Australian Government as experiencing shortages, work and live in Australia. The 494 and 482 applications result in a temporary visa, while the 186 provides for permanent residence.

The process of sponsoring workers can be time consuming and comes with a number of related costs, so it is crucial that employers seeking to benefit from the skilled migration program navigate the process correctly.

This blog aims to simplify the sponsorship process, offering clear guidance for Australian employers on successfully sponsoring an employee.

Sponsoring an overseas employee

As discussed above, sponsoring foreign workers is crucial to the continuing success of many Australian businesses. The process can fill skill gaps, injecting new skills into the workplace, contributing to the growth of the business and enhancing the culture and diversity within the business.

While the program is enticing for many employers, there are a number of considerations that it is important to factor into a decision to sponsor. The first is the legal requirements and obligations that you will be subject to. When becoming a Standard Business Sponsor for the SESR or temporary skill shortage visa, employers agree to keep the Department informed of any and all changes to the sponsored employee’s working conditions, and must keep records of all foreign workers. The employer is also obliged to ensure that the overseas skilled worker is employed under the same terms and conditions as an equivalent Australian worker, which is designed to prevent exploitation. It is also generally a requirement that the employment period will be for the duration specified in the nomination, or a minimum of two years after the visa grant for the 186 ENS. Lastly, employers must ensure that workers are paid the market salary rate for the occupation, which must meet the minimum income threshold of $70,000 plus super.

The second major consideration is which visa pathway would be most suitable to achieve your goals. Some visa options will provide PR pathways, while others may not. The duration and cost of the visa, as well as the occupations that would be eligible to be sponsored, also vary between different visa subclasses.

Lastly, when preparing to nominate skilled foreign workers, Australian employers must first take a number of steps, which may include applying to become an approved employer, engaging in mandatory advertising for the role to demonstrate the labour shortages and ensuring that their workplaces are compliant with workplace laws and eligible for a sponsorship.

Which employers can become a sponsor

The criteria to become a Standard Business Sponsor, which is a requirement for the subclass 482 Temporary Skill Shortage visa, as well as the 494 SESR, is a relatively straightforward process. The main criteria can be summarised as follows. The applicant business:

  • Is lawfully running a business
  • Is committed to hiring local labour where possible
  • Will not engage in discriminatory recruitment practices

In general, businesses that have been operating for 12 months or more will have little difficulty in meeting the criteria, however newly established businesses can meet the requirements by providing additional information.

Once approved, the sponsorship will last for a period of five years, and can be renewed on expiry. A business does not have to have a current sponsorship to employ workers on a TSS or SESR visa, however they must be an approved sponsor when lodging nominations for positions.

Where an employer has applied for a labour agreement, or already has an agreement in place, they are not required to have an approved sponsorship before lodging nominations. This means that, in effect, negotiating a labour agreement with the Department of Home Affairs is equivalent to becoming a Sponsor if you are intending to apply for visas under the labour agreement stream. This is suited to businesses that would require concessions to the general isa criteria.

In addition to the standard sponsorship, it is possible for businesses to apply to become an accredited sponsor subject to fitting into one of five categories, briefly:

  • A commonwealth, State or Territory government agency
  • An Australian Trusted Trader
  • A low volume sponsor with a high percentage of Australian workers (85%+)
  • A high volume sponsor with a medium percentage of Australian workers (75%+)
  • A business that has made a major investment in Australia ($50M)

This option will generally become available after two years. There is no additional fee to apply to become accredited, and, if you fit into one of the categories, there are a number of benefits. These include priority processing, fewer evidentiary requirements particularly regarding the proposed salary, and a simplified renewal process when it comes time to renew the sponsorship.

Who you can sponsor

The occupations that are eligible for employer sponsored visas are contained in legislative instruments that outline Skilled Occupation Lists. For example, legislative instrument LIN 19/048 outlines the occupations that are eligible for a subclass 482 visa. The short-term list occupations are eligible for the short term stream, while the regional and medium to long-term lists can apply for a medium-term stream 482 visa. The 186 ENS visa is available to occupations contained on any of the 482 occupation lists.

The occupations eligible under a labour agreement will vary depending on the agreement, as an agreement can and will often include occupations not ordinarily available on the list.

Each occupation is given an ANZSCO code, which outlines the criteria to prove that the position would fall under a relevant occupation. The position should match the qualification and work experience requirements in ANZSCO, as well as including a substantial number of the associated tasks. If the position would be more likely to align with a different occupation, the Department may refuse the nomination on the basis that the position does not align with the nominated occupation.

As outlined above, the three employer-sponsored visas are the 482, 494 and 186.

The 482 and 494 are very similar, both being a temporary visa that leads to permanent residency. The key difference is the occupations available for the visas, as they are dictated by different lists, as well as the fact that the 494 is a regional only visa, meaning that the worker must live and work in a designated regional area in Australia. The 482 can be granted for a maximum of two years under the short-term stream, or up to four years under the medium-term stream, whereas the 494 is valid for a period of five years.

In general, a 482 visa holder will then look to apply for permanent residence under the subclass 186 Employer Nomination Scheme. While the Direct Entry stream for the 186 allows a higher skilled applicant to apply for the visa directly, the Temporary Residence Transition stream and Labour Agreement stream both require the primary visa applicant to have worked for the sponsor for a minimum of two years while holding the subclass 482 visa. Once granted, the 186 is a permanent visa, which means that the applicant can live and work in Australia indefinitely, and may apply for Australian citizenship subject to meeting the residency requirements.

It is worth noting that the 494 and the 482 come with conditions that require a visa holder to continue working exclusively for their sponsoring employer throughout the duration of the visa, while the 186, as a permanent visa, does not have this condition. As such, the temporary options can be better for the purposes of retaining skilled workers, with the caveat that you will need to continuously renew the visa, and the applicant may seek to find a sponsor who is willing to assist them with permanent residence.

The visa nomination process will generally require a variety of evidence relating to the position within the business and the employment terms and conditions that the overseas skilled worker will be employed under. To lodge a nomination, you must be an approved sponsor or hold a current labour agreement.

Each nomination will come with relevant fees, and in most cases, a Skilling Australians Fund levy. The fees will vary depending on the visa period and subclass. More information related to sponsorship and nomination fees can be found on our web page.


Claim your consultation

If you are interested in getting more information about a work or skilled visa, get in touch with Australian Migration Lawyers for a free consultation.


The sponsorship application process for employers

The first step to sponsoring skilled overseas workers is to apply to become a Standard Business Sponsor. This will involve an application that outlines the business details, as well as their financial capacity to support sponsored employees.

The evidence required for the sponsorship application can include:

  • ABN registration certificates or ASIC extracts
  • Profit and loss statements
  • Annual financial reports
  • BAS statements
  • Lease agreements
  • Contracts
  • Organization charts
  • Support letters from accountants

Alternatively, if you require concessions to the standard skilled visa program, you can lodge a request to enter into a labour agreement. This process can involve a significant amount of work, and is generally rarely applied for in relation to businesses with special circumstances.

Once you have been approved as a sponsor, or lodged a labour agreement, you can make a nomination for the position. Each worker will need to have an approved nomination to work in an occupation listed on the skilled occupation lists.

We recommend waiting until the business has been approved as a sponsor before lodging a nomination, as the nomination will be refused if the sponsorship application is unsuccessful, however it is possible to lodge nomination and visa applications while the sponsorship application is still pending.

Most nominations will require evidence that the employer has been unable to find a suitably skilled worker in the Australian labour market to fill vacant positions, and that they will employ all foreign workers on the same terms as an equivalent Australian worker. The nomination will also specify the stream of the visa you are applying for.

If applying for a 186 visa under the TRT stream, you will need to provide evidence that the employee has worked for you on a full-time basis for a minimum of two years.

The nomination can be the most complex part of the process, so it is important to seek advice to ensure that you have addressed all relevant criteria. In general, the nomination must include the following evidence:

  • Signed employment contract
  • Position details, including organisation chart and position description
  • Evidence of Labour Market Testing to show that thereare no suitably skilled Australian workers (494 and 482)
  • Salary details and comparison with rates in the Australian labour market

Expert advice from Australian Migration Lawyers

The sponsorship process can be difficult to navigate, with a number of legal and regulatory factors to consider. To ensure that you use the process effectively, we highly recommend seeking advice from an immigration lawyer or registered migration agent. This will allow you to access the full range of benefits available under the immigration program, while minimizing the chances of unforeseen consequences of a failure to meet criteria or comply with your obligations. It will also give you the chance to compare visa options to determine the best pathway for your sponsorship in order to source overseas workers.

Australian Migration Lawyers Team

At Australian Migration Lawyers, we provide valuable guidance and support to make the entire process as seamless as possible. We have a high success rate with our applications, and have dealt with a wide array of complex occupations and situations. Our goal is to ensure that we help you optimise the application to avoid unnecessary costs, including the costs associated with a delay if your application is incomplete or insufficient.

  • Our team of qualified Australian lawyers draw on their knowledge of legislation, case law, and policy, to give clear and accurate advice on all requirements and strategies relevant to your matter
  • As lawyers, we have an obligation to ensure that your application meets all legislative requirements, which greatly improves your chance of success
  • We assist in all stages of the process, including the preparation of all necessary applications all the way through to the grant of the visa, including working with you to action any additional requests from the Department of Home Affairs

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