Top 10 Changes to 457 Employer Sponsorship from 1 July 2013
By Mark Webster
Wednesday, 03 July 2013
1. Increases to Application FeesSignificant increases to application fees apply from 1 July. Some areas of particular note:
- Additional charges apply for each dependent family member - $900 for a spouse or dependent over 18, and $225 for any children under 18
- Where applying onshore, a surcharge of $700 may apply for each applicant. Whether this applies depends on which visa is held and whether that visa was applied for onshore
A summary of the new charges is below:
|Item||Old Fee||New Fee||Increase|
|457 Dependent (Over 18)||$0||$900||$900|
|457 Dependent (Under 18)||$0||$255||$255|
|Onshore Extension (per applicant)||$0||$700||$700|
2. English Language TestingPreviously, English language testing for 457s was only required in the case of trade and technician occupations.
From 1 July, all 457 applicants will require English language testing, unless covered by one of the exemptions below:
- Holders of passports from the UK, Ireland, USA, Canada or NZ
- Where the salary level is at least $96,400
- Where the applicant has completed 5 consecutive years of study in English medium at the secondary or higher education level
3. Caps on Numbers of Sponsored EmployeesPreviously, Standard Business Sponsors had no limit on the number of employees they could sponsor for 457 visas. From 1 July, sponsors will need to justify the number of workers to be sponsored for 457 visas as part of the sponsorship approval process, and a certain number of possible 457 sponsorships will be approved. Once this cap is reached, the employer could apply to have the terms of the sponsorship altered to allow sponsoring of further employees.
4. Limitations on Recently Established BusinessesThe usual period of validity of a Standard Business Sponsorship is 3 years. From 1 July, a "recently established business" - ie one which has been in operation for less than 12 months - will be approved as a sponsor for only 12 months. In addition, the 457 visa granted to a startup business will be valid for only 12 months versus the usual 4 years.
5. Skills Assessments Required for More OccupationsPreviously, skills assessments were required only for certain trade occupations. From 1 July, skills assessments are required for two occupations of concern to the Department:
- Program and Project Administrator
- Specialist Manager Not Elsewhere Classified
6. Limitations on Hospitality OccupationsSome concern has been expressed about the rise in the number of positions sponsored in the hospitality industry. As a result, there are now limitations on sponsorship of Cooks, Chefs and Cafe/Restaurant managers. Such employees cannot be sponsored to fill positions in fast food or takeaway restaurants.
7. Training RequirementThe training obligation for sponsors will now apply for each 12 month period from the approval of sponsorship. Previously, the obligation was to meet the obligation for each financial year. Employers need to keep records of training activities to meet the obligation. If an employer does not meet the training benchmark, they may not be approved for an extension or variation of their sponsorship and could face fines or cancellation of their approval. The training benchmarks remain the same - either 1% of payroll spent on training of Australians in the business, or contribution of 2% of payroll to a training fund.
8. Work Condition 8107There are a number of changes to the work condition 8107 which applies to 457 visa holders:
- They must commence work within 90 days of arrival in Australia
- If they leave employment with the current sponsor, they have 90 days to be sponsored by a new employer before they will be considered in breach of the 8107 condition (increased from the previous 28 days)
- If required by their occupation, the 457 holder must have the necessary licensing professional membership or registration in Australia
9. Salary Level IncreasesThreshold salary levels have increased as of 1 July as follows:
|TSMIT (Minimum Salary)||$51,400||$53,900||5%|
|English Language Waiver||$92,000||$96,400||5%|
|Market Rate Salary Waiver||$180,000||$250,000||39%|
10. Other ChangesThere are a host of other changes, including:
- All 457 applications must now be lodged online, with no paper applications possible
- Greater powers for Fair Work Australia to inspect workplaces for compliance with immigration laws
- Possibility of refusal of a nomination on the basis that it is "not genuine"
- In determining market rate salary, reference can be made to employees working in similar businesses in the locality, rather than just the sponsor's workplace
- Requiring employers to retain employment contracts to demonstrate that they are not engaging in defacto labour hire arrangements
- Requiring sponsors to pay for the cost of obtaining approval as a business sponsor, rather than having these be paid by the 457 applicant or another person