457 Visa Program – addressing Australia’s skilled labour force needs

01 January 2017

Maria Jockel , Legal Principal and National Leader, Migration Services |

Australia’s Migration Program is skill-focused and aims to meet Australia’s economic needs.

The Temporary Work (Skilled) visa (457) enables Australian and overseas businesses to sponsor skilled overseas workers to fill prescribed positions on a temporary basis for up to four years.

There are three steps in the approval process under the 457 visa:

  • Sponsorship application, which is lodged by the company, and:
    • the company is actively and lawfully operating the business;
    • the employment of the nominee will benefit Australia;
    • it is able to comply with sponsorship obligations;
    • it will be the direct employer or ‘related to’ the direct employer of the nominee;
    • there is no adverse information regarding the sponsor;
    • it has a strong record of, or commitment to, employing local labour and non-discriminatory employment practices; and
    • it meets the training benchmark as part of its commitment to the ongoing training of their Australian citizen and permanent resi­dent staff.
  • Nomination application, which is lodged by the company and meets the following requirements:
    • the position is on the consolidated sponsored occupation list (CSOL);
    • the position meets the minimum skills threshold for that occupation;
    • the base salary meets or exceeds the temporary skilled migration income threshold (TSMIT) (currently A$53,900 gross per annum) in addition to superannuation for a 38-hour week;
    • the terms and conditions of employment are no less favourable than those provided to Australian staff in the same position in the workplace’s regional locality (‘the market salary rate’);
    • the details of the nominee are provided; and
    • includes labour market testing if required.
  • Visa application, which is lodged by the person nominated to fill the position, who must:
    • demonstrate they have the requisite skills and experience for that position;
    • be offered employment at the relevant market salary rate (which cannot be below the TSMIT);
    • if necessary, provide evidence that they have vocational English;
    • if necessary, provide a skill assessment;
    • if necessary, undertake a health check; and
    • if necessary, provide a police check.

Only specified occupations on the CSOL are specified to be sponsored under the 457 visa program.

Prescribed occupations are subject to LMT of the Australian labour market to demonstrate whether a suitably qualified and experienced Australian citizen or permanent resident is readily available to fill the prescribed temporary position.

LMT does not apply if it would be inconsistent with Australia’s international legal obligations.

Terms and conditions

The terms and conditions of employment must meet Australian standards and cannot be less favourable than those provided to Australian staff in the same position and at that business’s regional location.

With the increased focus on the 457 visa program as a means to help ameliorate labour shortages affecting the economy, the program has become increasingly controversial.  This has resulted in various reviews of the regulatory framework and increasing monitoring and compliance measures aimed at limiting abuses and ensuring compliance with the regulatory scheme.

The nominated position cannot be created solely so that the overseas worker can obtain a visa.  This requires the business to evidence that the scope, scale and nature of the business requires it to recruit to the position even in respect of occupations which do not require LMT.
The visa applicant must demonstrate they have the suitable personal attributes including educational qualifications and work experience relevant to the nominated position and in some instances provide evidence of vocational English and that a skills assessment has been undertaken.  Health and character checks may also be required in some instances.
The Department of Immigration and Border Protection (the Department) with the Australian Border Force as its operational enforcement arm has significant powers and reach including to verify the claims made in an application and the documentary evidence used to support it.
This can include claims as to the nature of the business and the visa applicant, including as to identity, work history, educational level, health, character and such like.
Companies that are approved as sponsors under the 457 visa program must meet sponsorship obligations.  These include obligations to:

  • Cooperate with inspectors
  • Ensure equivalent terms and conditions of employment (namely to pay the market salary rate however described) to the primary 457 visa holder
  • Pay travel costs to enable sponsored persons to leave Australia
  • Pay costs incurred by the Commonwealth to locate and remove unlawful non-citizens
  • Keep records
  • Provide records and information to the Minister
  • Provide information to Immigration when certain events occur
  • Ensure primary sponsored person does not work in an occupation other than an approved occupation
  • Not recover certain costs from a primary sponsored person or a secondary sponsored person
  • Meet prescribed training requirements of Australian citizen and permanent resident staff
  • Not to engage in discriminatory recruitment practices.

The Department, together with the Australian Border Force, has a broad range of powers to monitor and investigate possible non-compliance with sponsorship obligations and a range of measures to address identified breaches of obligation.

These include taking administrative action to bar or cancel the sponsorship approval, or to issue civil pecuniary penalties by way of infringement notices.

The Migration Act 1958 (the Act) contains various powers in the event of breach including a number of criminal offences in respect of persons who commit offences relating to visas, false papers and in relation to persons who are unlawfully in Australia or working unlawfully in Australia. These offences may result in civil and criminal prosecution, penalties of imprisonment and/or substantial pecuniary penalty.

A person’s (and their accompanying family member/s) visa/s may be cancelled as a consequence of the cancellation of the business’s sponsorship approval or as a result of a breach of the visa conditions by the sponsored person.

While the 457 visa program recognises the importance of skilled workers to meet Australia’s economic needs, the current emphasis of the program is to ensure that it is responsive to local and national needs, and that the recruitment of overseas workers is not to the detriment of the Australian workforce.

The Employer Nomination Scheme (186 and 187) (ENS) enables businesses operating in Australia to recruit skilled workers on permanent visas to fill specified highly skilled positions that cannot be filled from the Australian labour force.

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