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Proposed Changes to Sponsorship Obligations of Employers of 457 visa holders

The contents of this article are correct as at 20 Ocober 2008 

Employers who sponsor foreign employees are likely to be affected by a Bill currently before the Federal Parliament. The Migration Legislation Amendment (Worker Protection) Bill 2008 will allow changes to the Migration Regulations in order to redefine employers’ sponsorship obligations under the temporary work classes of visas. 

Employers should be aware that sponsorship obligations are likely to change in the near future, and of the implication of these changes on their business. Current sponsorship obligations found in the Migration Regulations include the requirement to meet the costs of workers’ repatriation and medical treatment in public hospitals, and only apply to employers who have agreed to them in writing. The Bill paves the way for the Minister for Immigration to redefine and possibly expand the obligations of sponsoring employers, and for the new obligations to be an automatic consequence of temporary work sponsorship. 

As much as possible, employers should try and introduce risk minimization strategies that will have the effect of reducing the circumstances which could lead to a breach of sponsorship obligations and limit their liabilities in the event that the sponsorship obligations are breached.

Under the new Bill, employers will face the following sanctions if found to be breaching their sponsorship obligations: 

  • Cancellation of sponsorship in relation to one or more particular classes of visa, or for all classes
  • Cancellation of sponsorship in relation to all classes of visa
  • Prohibition from sponsoring for a certain period
  • Prohibition from applying for sponsorship for a certain period
  • Criminal indictments
  • Civil penalty orders (up to $6600 for an individual and $33000 for a corporate body)
  • Infringement notices to the employer
  • Security bond orders (for an amount to be specified in the regulations)

Proactive advice about the implications of new changes will assist employers in negotiating a safe pathway through these new obligations. 

One benefit to employers in the proposed changes is a provision allowing for ‘rolling’ sponsorship agreements. Currently, sponsorship is granted for a finite length of time. The new provisions will facilitate ongoing sponsorship of foreign employees by Australian businesses that have previously been approved as sponsors. However, sponsorship when approved will be limited to a particular class of temporary work visa, necessitating applications for each distinct class. 

Another potential area of benefit to employers is the ability to vary sponsorship obligations through employment agreements, allowing for concessions to sponsorship obligations in certain circumstances. The employment agreements to which variation of obligations may be permitted will likely include Invest Australia Supported Skills Agreements; Religious Worker Agreements; and Labour Agreements, negotiated between an employer and the Department of Immigration to recruit overseas workers for particular short-term projects, to industries in which there are emerging labour or skills shortages in Australia, or to work in temping agencies. 

We have assisted many sponsoring employers, in all types of industries, by guiding them through the application and monitoring process and giving presentations to companies about practical and effective risk management strategies that minimise the impact of sponsorship obligations on their business.  

If you would like advice or assistance with understanding how sponsorship obligations may impact on your business or the potential benefits of the proposed changes, please contact Visa Lawyers Australia.