Labour Market Testing for 457 Visas

webster By Mark Webster
Friday, 07 June 2013

The Minister for Immigration has announced a new labour market testing requirement for 457 sponsorship as part of the Migration Amendment (Temporary Sponsored Visas) Bill 2013.

Note that the Bill has not yet been passed by Parliament, and it is not yet clear when the legislation will come into effect, if ever.

Labour Market Testing was previously a requirement for 457 sponsorship, but was abolished in 2003. Currently, Employers do not need to show that they have tried to hire an Australian permanent resident or citizen for a position to be filled by a 457 visa holder.

Evidence of Attempts to Fill the Position Locally

Under the proposed legislation, employers may need to provide evidence that they have made attempts to fill the position locally before looking to sponsor.

Evidence that can be provided would include:

  • Advertising of the position by the employer
  • Participation in career expos
  • Fees paid for recruitment
  • Results of recruitment attempts

It is expected that the employer would need to show that they have made such attempts within the 6 months prior to making the nomination for a 457 visa. The legislation allows for the change to be introduced some time after the Bill comes into effect, so employers may not be impacted immediately.

Alternatives to Providing Evidence of Recruitment Efforts

Instead of providing evidence of recruitment efforts, employers would also be able to provide:
  • Research into labour market trends
  • Letters of support from government agencies
For occupations known to be in short supply in Australia or in a particular region, this may well be the best way to meet the new requirement.

Exemptions to Labour Market Testing

Where there has been a recent major disaster, employers can be exempted from the labour market testing requirement.

Apart from this, the legislation allows for most occupations to be exempted from labour market testing. In particular, the following types of occupations can be exempted by being listed on a legislative instrument:

  • Professionals and Managers: Occupations requiring a bachelor degree or 5 years of work experience would be exempt by default
  • Associate Professionals: Occupations requiring a diploma or 3 years of work experience would be exempt by default

The Minister has indicated that most professional and management positions will be exempted. The Bill also helpfully mentions that the legislative instrument can be disallowed by Parliament - the result of this is that no occupations would be exempt and so all occupations would require labour market testing!

There is no capacity to exempt trade and technician occupations from labour market testing, even by legislative instrument. These occupations require completion of an apprenticeship or Certificate IV, and would require labour market evidence, except for instances of major disasters.


If the Migration Amendment (Temporary Sponsored Visas) Bill 2013 is enacted, the new labour market testing requirements will have a significant impact on employers using the 457 program. In particular:
  • Employers sponsoring trade and technician occupations will need to provide labour market evidence in most cases
  • Most professional and management occupations should be exempt, but will require them to be explicitly listed in a legislative instrument as being exempt.
  • Where labour market testing is required, this could add weeks or months to the time taken to obtain the necessary 457 visa. It may also require additional recruitment expense and administrative overhead for the process

Perhaps the best way to deal with the new requirement would be to ensure that solid evidence of labour market conditions can be shown to avoid the need for advertising positions.

Acacia would be happy to discuss how the new Bill could affect your 457 program. If you would like to do so, please contact us to discuss further.

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