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Courts open door to MRT review of Labour Agreement 457 visa refusals

The contents of this article are correct as at 19 December 2011.

In a recent case run by Visa Lawyers Australia, the Federal Magistrates Court has confirmed that the Migration Review Tribunal (MRT) can review DIAC decisions to refuse 457 visa applications that are based on a Labour Agreement. This is the case even where there is no Labour Agreement in place.

The relevant case is that of: Islam & Anor v Minister for Immigration & Anor [2011] FMCA 991.

The section of the Migration Act dealing with the MRT’s review powers states that, where it is a criterion for the visa that the applicant is ‘sponsored by an approved sponsor’, the MRT can only review the visa application if:

  • the employer has already been approved as a sponsor; or

  • refusal of the sponsorship application is also being reviewed at the MRT.

Labour Agreements are arrangements negotiated between employers and the Minister for the employer to nominate a certain number of non-Australian workers in specified occupations within a certain time frame. There is no ‘sponsorship application’ as for standard 457 applications, and the Minister’s decision is final and cannot be reviewed.

One of the criteria for a 457 visa in the Labour Agreement stream is that the applicant is ‘nominated by a party to a Labour Agreement’. There must also be ‘an [approved] nomination of an occupation in relation to the visa applicant’ for one of the occupations specified in the Labour Agreement.

This raised a question as to whether 457 visa applications lodged on the basis of a Labour Agreement must be ‘sponsored by an approved sponsor’ and so cannot be reviewed in the following circumstances:

  • Employer 'appplies' for a Labour Agreement'

  • Applicant lodges a 457 visa application under the pending Labour Agreement

  • Labour Agreement ‘refused’
  • Applicant's 457 visa refused on the basis that there is no Labour Agreement
  • Aplicant applies to the MRT for review of the visa refusal
  • Employer applies again for a Labour Agreement, which is still pending

In the above circumstances, the MRT decided that it had no power to review the visa refusal, because:

  • at the time of the review application the employer did not have a Labour Agreement in place; and

  • Labour Agreement decisions cannot be reviewed.  

On 13 December 2011, the Federal Magistrates Court decided to overturn the MRT decision. The Court found that while ‘an [approved] nomination of an occupation in relation to the visa applicant’ and ‘a nomination by a party to a Labour Agreement’ are criteria for the grant of a 457 visa in the Labour Agreement stream, this is not the same as a criterion that the applicant be ‘sponsored by an approved sponsor’.  As a decision to refuse a 457 visa application under the Labour Agreement stream is not a decision where it is a criterion for grant that the applicant is ‘sponsored by an approved sponsor’, the restriction on the MRT’s power does not apply to such visa applications.

In reaching its decision, the Court also found:

  • The reason for the restriction on the MRT’s power was to prevent visa applicants from lodging review applications that could not possibly lead to a visa because there was no sponsor. This was not the case with 457 visa applications lodged on the basis of Labour Agreement negotiations that were still pending at the time of the application to the MRT.

  • Since amendments to the Migration Regulations in September 2009, the definition of ‘sponsored’ used in relation to the MRT’s review powers has included ‘being identified in a nomination under s. 140GB of the Act’. The same amendments replaced the phrase ‘sponsored by an approved sponsor’ with ‘identified in a nomination…under s. 140GB of the Act’ in the criteria for all sponsored temporary non-business visa subclasses. This ensured that the limit on the MRT’s power remained in place in the case of sponsored temporary non-business visa subclasses, despite the change in visa criteria. The same amendments could have introduced the requirements to the 457 visa Labour Agreement stream, but did not do so. Nomination under a Labour Agreement therefore does not come within the definition of ‘sponsored’ used to limit the MRT’s review powers.

  • There is a well-established principle of statutory construction that clear words of intent are required to remove rights, including the right of review of a DIAC decision. If Parliament had intended to remove the review rights of Labour Agreement 457 visa applicants, it would have been relatively easy to introduce explicit regulations that did so. As there is doubt as to whether Parliament had such an intention, the law should be interpreted to preserve the right of review.

At this stage, it is unclear whether the Minister for Immigration will appeal the Court’s decision to the Federal Court. Such an application may affect the legal standing of the decision described above. For this reason, it is important that people involved in 457 visa applicants under the Labour Agreement stream seek up-to-date and personalized legal advice.

If you are involved in a case where a 457 visa application has been refused and the Labour Agreement is still pending, please click this link to contact Visa Lawyers Australia for assistance with your application for review or an appeal.