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Simplifying the 457 Visa for Business Owners

Binfeng Zhang
Written by Binfeng Zhang

The Subclass 457 Visa is commonly known as the 457 Visa. Its purpose is to allow Australian businesses to employ overseas workers on a visa for a set period of time, due to a skills shortage in that particular occupation. It is a complex visa, but it does not have to be confusing. Continue reading and you’ll see how simple it can be. can be.

The Unthinkable

In April 2017, the unthinkable happened. The Department of Immigration and Border Protection (DIBP) announced a raft of changes to the 457 visa without consulting anyone, with even the migration agents/lawyers who have been practising for over 20 years being caught by surprise. Occupations were removed from the occupation lists, and new occupation lists were created, resulting in large numbers of applications being rejected.

Reason? Protect Australian jobs and give Australians priority to apply for those jobs.

Result? Lengthier processing times and more stringent requirements.

The whole process became even more complex, but it does not have to be confusing.

Does my business qualify?

Employer-sponsored visas are made up of two parties – the employee and the employing business. This article will focus on the business sponsor and a future article will focus on the employee being sponsored.

The business needs to become an approved Sponsor (known as the Standard Business Sponsorship) and also needs to be approved as a Nominator before being able to sponsor an employee on the 457 visa.

The Sponsorship approval is more about the financial health of the business, whereas the Nomination approval is about the genuine need of that occupation in the business.

The main requirements the business must meet are:

12-month operations

Ideally the business must have been operating for 12 months. This is not a strict requirement, although it does assist in proving financial health.

Revenue

There is no set minimum revenue requirement, however, some occupations will stipulate minimum requirements.

Minimum salary

The employee being sponsored must be paid at least AUD 53,900. This is somewhat misleading because you are still expected to pay the sponsored employee at the market rate for their experience and position.

Advertising the Position

Advertise the position for at least one month to allow Australian Permanent Residents and Citizens an equal opportunity to fulfil the role. The job advertisement does not have to be paid.

Training

The business must demonstrate it is providing ongoing training for staff who are Australian Permanent Residents or Citizens. The total monetary value of this training must be equal to at least 1% of your total payroll. There are other options to satisfy this requirement.

Occupation Lists

For someone to be sponsored, the occupation needs to be available on the Occupation Lists published by the Immigration Department. If the occupation is not on the list, then there is either no option to sponsor or you can try to sponsor the employee under a closely related occupation. For example, Sales and Marketing Manager may be closely related to Marketing Specialist in terms of overlapping of similar tasks and duties.

There are different occupation lists for different visa subclasses under the Employer Sponsored Visa Programme and the relevant one for the 457 Visa can be found here.

There are two subcategories within each list – the Short Term Skilled Occupation List (STSOL) and the Medium to Long Term Strategic Skilled List (MLTSSL). The subcategory that your occupation falls under makes a big difference to the conditions on your 457 visa. For example:

STSOL MLTSSL
Sample Occupation Marketing Specialist Civil Engineer
Duration of visa 2 years + a single 2-year extension 4 years + unlimited extensions
Pathway to Permanent Residency None Apply for PR after holding the 457 visa for 3 years

Additionally, there are things called CAVEATS for certain occupations, which are additional requirements imposed on either the sponsor or employee. For example, a Marketing Specialist has the following additional requirements:

  • Salary of AUD 65,000
  • Business turnover of at least AUD 1 million
  • Must not be a front line retail position

Tips & Hacks

Here are some tips and hacks we have picked up along the way:

  1. What expenses can I claim for Training?
    • It must be provided to Australian citizens or permanent residents only
    • Formal course of study at college, TAFE or university
    • Training delivered by a Qualified trainer
    • Purchasing an eLearning platform
    • Salary of apprentices or trainees
  2. Do contractors count towards my payroll?
    • Yes, if the work is related to the service/provide provided by your business
  3. How do I determine Market Salary?
    • Payscale, Glassdoor, Live Salary
    • Job Outlook – Government website
    • Compare similar job advertisements on Seek or Indeed

Next Steps

It’s as simple as 3 steps:

  1. Apply to become an approved Business Sponsor (SBS)
  2. Have your Contract for Employment approved (Nomination)
  3. Employee applies for the 457 visa

If you would like information specific to your situation, please feel free to contact us on [email protected] or (02) 8880 0210.

“The opinions expressed by BizWitty Contributors are their own, not those of BizCover and should not be relied upon in place of appropriate professional advice. Please read our full disclaimer."

About the author

Binfeng Zhang

Binfeng Zhang

Binfeng Zhang is a Director of Affinity Migration Group and a Registered Migration Agent. His strength is in helping SME with employer sponsored visas, skilled migration visas, business investor visas and overcoming challenges in small businesses.