Australia has two ways for businesses to becoming an approved sponsor of 457 visa applicants. Becoming a standard business sponsor is the most common approach for.

Australia has 2 ways for businesses to becoming approved sponsor for 457 visa applicants:

  1. Standard business sponsor
  2. Negotiating a labour agreement

Here, we’ll be looking at how businesses can become a standard business sponsor which then enables them to sponsor employees for 457 visas. We’ll look at labour agreements separately.

How long is the standard business sponsor status valid for?

Your standard business sponsor status is valid for 5 years on approval.

The steps to becoming a standard business sponsor vary depending on the nature of your business.

If your business has traded in Australia for 12 months or more

In your application to become a standard business sponsor, you will need to show your business is:

lawfully operating

(a business that exists on paper only is not applicable)

You will need to provide:

general business registration information relating to your business, such as your ABN, company and trading name if you operate as a company, or if it operates as a franchisee, Trust or joint venture agreement, relevant information such as signature pages of contracts or deeds.

You will also need to provide details of the principals of your business, such as its Owners, Partners, Directors and major Shareholders.

financial statements and bank statements covering the past 12 months, tax returns and BAS statements.

have no relevant adverse information against your business.

meeting training benchmarks

You can show your business meets one of two training benchmarks set out by the government. Either:

Training benchmark A: your business can show a spend within the past 12 months of at least 2% of the payroll of the business to an industry training fund that operates in the same or a related industry as your business.

Training benchmark B: your business can show a spend within the past 12 months of at least 1% of the payroll of the business towards the training of your employees who are Australian employees. Australian employees is defined as employees who are Australian citizens or Australian permanent residents.

What counts as training?

Expenditure that can be counted towards meeting the training benchmarks include:

payments for Australian employees to undertake a formal course of study,

costs of travelling to training venues or accessing online training programmes,

payments to Registered Training Organisations to provide face to face training to Australian employees that will contribute to an Australian qualification,

purchasing of an eLearning platform or training software,

salaries of Australian employees who are apprentices or trainees under a formal training contract,

salaries of Australian employees who have completed a university degree in the past 2 years and are participating in a formal graduate program for up to 2 years,

salaries of Australian employees whose sole job is to provide training to Australian employees,

expenditure to attend conferences for continuing professional development.

Evidence of training includes a receipt of payment from the relevant training fund or receipts for relevant training programmes or employment contracts for relevant employees, such as apprentices.

Expenditure that does not count as training spend

Expenditure that is inapplicable towards the training benchmark include: inductions, membership fees, purchase of subscriptions, staff salaries apportioned to time spent undertaking online courses, training carried out by principals of the business.

 

showing a commitment to employing local labour

You must confirm in writing your strong record or commitment to employing local Australian labour.

not engaging in discriminatory recruitment practices

You must declare that your business does not and will not engage in any discriminatory recruitment practices.

If your business does not operate in Australia

If your business is not currently operating in Australia, you will need to show your intention to set up a business entity in Australia or that you have a contractual obligation in Australia. You can do this by providing:

A company or business expansion plan

An agreement to enter into a joint venture

A contract between you and an Australian party.

If your business is not registered in Australia, you must show that it is:

lawfully operating

You can do this by provide evidence of registration in the country you operate in.

If your business does not operate in Australia, you must be able to show that you need a skilled worker to:

come to Australia to establish, or help to establish, a business operation with connections with a business located outside of Australia

fullfil, or help fulfil, a contractual obligation.

What about training benchmarks?

Businesses that do not yet have an operating base in Australia do not need to meet the training benchmarks.

If your business is new

You can still become a standard business sponsor if you can provide evidence that your business is:

lawfully operating

You can do this by providing:

a detailed business plan, ideally with contracts to provide services.

business bank statements

a lease agreement

evidence of employing staff

BAS statements from the start of operations

positioned to meet training benchmarks

A new business should have an auditable plan to meet the training benchmarks. The plan must:

relate to the immediate future (within the next 12 months)

clearly articulate the forecast payroll for the next 12 months

show the intended expenditure towards training benchmark A or training benchmark B. If your plan relates to meeting training benchmark B, it should clearly show the type, duration and estimated cost of delivering the training.

show a clear intent to implement the plan.