New obligation for 457 employers: Training Australian workers
July 10, 2014
Significant changes to the 457 visa were made on 1 July 2013. One of these changes included strengthening the requirement for businesses that employ 457 visa holders to actively contribute to the training of Australian workers.
As it stood prior to the changes on 1 July 2013, businesses have always needed to show they actively contribute to the training of Australian workers. Businesses demonstrated they had spent, in the 12 months prior to applying to be a sponsor:
specific amounts on either training their own Australian employees, or
provided funds to an industry training fund in the industry they operate in.
Since 1 July 2013, the training obligation takes this a step further by requiring businesses in the programme to continue contributing to the training of Australians for the entire time they are approved as a sponsor and employ 457 visa holders.
What is the training commitment?
Australian businesses sponsoring 457 visa holders must meet at least one of the following training benchmarks:
expenditure of at least 2 per cent of the payroll of the business, in payments allocated to an industry training fund that operates in the same industry as the business, or
expenditure of at least 1 per cent of the payroll of the business, in the provision of training to Australian employees of the business.
Businesses are required to continue to meet one of these benchmarks for as long as they employ a 457 visa holder and are approved as a sponsor.
What happens if a business doesn’t meet the benchmarks?
The Department undertakes regular checks of businesses that sponsor 457 visa holders to make sure they are complying with all of the sponsorship obligations, including meeting one of the training benchmarks. If during these checks they become aware that the business has not fully met the training requirement, they have a range of options available, including:
issuing a formal warning
barring the business for up to five years from sponsoring overseas workers
cancelling the business’ sponsorship
issuing an infringement notice to a maximum value of $10 200
entering into an enforceable undertaking (a court-enforceable undertaking between the minister and sponsor) applying for a civil penalty order with a maximum penalty of