If you wish to sponsor a foreign worker, you will need to meet certain requirements. While there are a number of different types of visa sponsorship arrangements, becoming a standard business sponsor is a common option. Here, the Department of Home Affairs (the Department) has set out a number of key requirements that you must adhere to when acting as a standard business sponsor (SBS). If you fail to meet these requirements, you could face penalties. This article outlines the key obligations of standard business sponsors and the consequences if you do not comply with them.

Purpose of Sponsorship Obligations

The purpose of imposing obligations on businesses that sponsor foreign workers is to protect the sponsored worker from exploitation. These obligations are important tools which the Department uses to ensure that sponsored workers and sponsoring businesses act fairly to each other.

The purpose of these obligations is to:

  • maintain the working conditions of sponsored people to meet Australian standards;
  • ensure that sponsored people are not exploited by sponsoring employers;
  • ensure visa programs are used for their intended purpose, and not exploited for immigration purposes; and
  • guarantee that requirements for sponsoring business are standardised nationwide, to ensure fairness among employers.

Obligations a Standard Business Sponsor

To become a standard business sponsor in the first place, your business must be legally established and currently operating. Your business can be inside or outside Australia. 

Once your business is granted SBS status, the following obligations will apply.

1. Cooperate With Inspectors

The key role of inspectors is to ensure that you are compliant with your responsibilities has a sponsor. Inspectors have the authority to investigate approved sponsor employers and have the right to:

  • enter your premises;
  • inspect any work, process or object;
  • interview persons while on premises;
  • require a person to tell the inspector who has custody of, or access to, a record or document;
  • require a person to produce a record or document;
  • inspect and make copies of records or documents; and
  • require a person to tell the inspector the person’s name and address if the inspector reasonably believes that the person has contravened a civil penalty provision.

As a sponsoring employer, you must cooperate with the inspector and not engage in any conduct that may:

  • hinder or obstruct their investigation;
  • conceal or hide persons, documents or information;
  • prevent a third party from providing assistance; or
  • be assaulting, threatening or intimidating behaviour.

Failing to comply with this obligation is considered a serious breach of your obligations.

2. Ensure Equivalent Terms and Conditions of Employment

When employing a visa holder, you must not vary from the employment terms and conditions you advertised to the applicants. These terms can include:

  • performing certain work;
  • guaranteed annual earnings;
  • market salary rate; and
  • minimum employment conditions.

The terms and conditions governing the visa holder’s employment also must not contradict those enjoyed by an equivalent Australian worker. 

However, this rule does not apply if the annual salary of the visa holder is greater than $250,000.

3. Pay Travel Costs

You must pay reasonable and necessary travel costs to let the employee and their sponsored family members leave the country.

‘Reasonable and necessary’ costs will include:

  • travel from the employee’s usual place of residence in Australia to their departure point from Australia;
  • travel from Australia to the country for which the employee holds a passport and intends to travel to; and
  • economy class air travel or a reasonable equivalent.

The employee (or the Department) must write to you to make a request for payment of travel costs. You will then need to pay these costs within 30 days of the request. You only need to pay this cost once. If the employee then re-enters the country on a different visa, you will have no such obligation.

4. Pay Costs Incurred by the Commonwealth to Remove Unlawful Non-Citizens

You may be required to pay for the costs the government incurs when removing a visa holder who becomes an unlawful non-citizen, or their family. 

If this occurs, you will pay the difference between the actual costs, minus the costs you have already paid for travel costs for them to leave Australia. These costs are capped at a maximum of $10,000.

5. Keep Records

Keeping records of all activities regarding the recruitment of TSS visa holders is a requirement of all sponsoring businesses. These records must be:

  • in a reproducible format;
  • kept in accordance with federal, state or territory laws; and
  • able to be accessed or presented to the Department if requested.

The Department has the ability to compel a standard business sponsor to provide documents, including those which:

  • the sponsor is obliged to keep; and 
  • are standard under state or federal law.

Providing records to the Department will be used to determine whether you are complying with your obligations.

6. Provide Records and Information to the Minister

You must provide records or information to the Immigration Minister if they request it by written notice. You must provide these within the timeframe that the Minister requests.

7. Provide Information to the Department When Certain Events Occur

It is vital for you to maintain records for your business, not only for yourself, but in order to notify the Department of potential changes in your business. The circumstances in which you must notify the Department, within 28 days, include any changes to your business’:

  • legal name;
  • trading name;
  • registration details;
  • business structure;
  • ongoing communication contact;
  • owners, directors, principals or partners; or
  • business address.

You must also communicate any changes to your business’ financial or legal situation, including if the business:

  • becomes insolvent or is bankrupt;
  • goes into receivership, liquidation or administration; or
  • ceases to exist as a legal entity.

As the sponsor, you also must notify the Department regarding changes with the status of the sponsored employee, including:

  • cessation of their employment;
  • changes in their work duties; or
  • if they never commenced working with your business.

Other general instances in which you are obliged to notify the Department (in writing) include:

  • changes to how you meet your training obligations; and
  • when you have paid return travel costs of a sponsored visa holder and their family in accordance with the obligation to pay travel costs.

The Department has made the act of notification very simple. You can complete it either by:

  • direct notification, by sending an email addressing the changes to sponsor.notifications@abf.gov.au; or
  • instructing your lawyers to notify the Department by completing a nomination of sponsor changes form through an online ‘Immi’ Account. 

One way to ensure that notification occurs when it needs to is to appoint a key person in the business with the responsibility of monitoring any changes, and letting the Department know if any occur. This would guard against the above changes to go unnoticed which may lead to an inadvertent breach of your obligations as a standard business sponsor.

8. Monitor What Kind of Work the Sponsored Person Completes

With the success of a visa application being often dependent on the type of work the applicant can perform in Australia, it is important that the scope of the employee’s actual work is consistent with the terms of their employment. You can ensure this through monitoring and consistently checking-in with the employee. When doing so, you should ask them to outline the type of work they have completed over a period.

In practice, this means that:

  • the visa holder can only work in the occupation for which you nominated them;
  • if you want the visa holder to work in a new occupation, you must submit an entirely new nomination;
  • you must employ the sponsored person under a written contract of employment;
  • you must not be involved in the recruiting of that sponsored person to another business unless the other business is an associated entity of your business.

Restrictions regarding the scope of work will end when the employee is granted a visa that is not a: 

  • TSS visa;
  • bridging visa;
  • criminal justice visa; or 
  • enforcement visa.

This obligation continues if the Department grants your employee another TSS visa to continue to work for you.

9. Paying All Relevant Costs

There are multiple associated costs with sponsoring a TSS visa for an employee, including the: 

  • cost of becoming a sponsor;
  • cost of nomination charges; and 
  • fees of migration agents associated with the sponsorship and nomination applications.

All of these costs must be paid by your business itself.

Your business must also pay for all costs associated with recruitment, including:

  • recruitment agent fees;
  • advertising;
  • screening;
  • shortlisting;
  • interviewing; and
  • reference checks.

Any of the costs regarding recruiting must not be transferred to another person, such as the visa holder or the family.

10. Do Not Engage in Discriminatory Recruitment Practices

During any stage of recruitment, your business must not engage in discriminatory practices which negatively affect individuals based on their visa or citizenship status. You must keep records during the employment of a TSS visa holder which demonstrate that decisions have not been made as a result of visa or citizenship status.

This requires sponsors to use the subclass 457 or 482 visa program only to fill skill shortages where a suitable Australian worker cannot be found. This, in turn, means that the recruitment process to find such a suitable Australian worker must be genuine, and cannot discriminate against this section of the population. 

For example, discriminatory practices could include advertising a position via foreign language websites to discriminate against candidates who are Australian citizens.

Monitoring of Sponsored Employee

Your compliance with obligations regarding a visa holder is monitored for as long as five years after the conclusion of the sponsorship. Visa holders are also monitored to ensure they comply with their visa conditions. If a visa holder fails to comply with their visa conditions, this may result in visa cancellation and other sanctions. 

Therefore, it is in your best interest to closely monitor the employee you are sponsoring, to ensure that they are meeting their conditions and are not prohibited from working for you. You can monitor your employees via the online platform ‘VEVO’, which you register to used through the Department of Home Affairs website.

Monitoring may result in the Department:

  • writing to you, requesting records and information;
  • carrying out site visits, usually to your premises, with or without notice; and
  • obligating you to exchange information with other government agencies.

Sanctions

Failing to meet any of your obligations as a standard business sponsor will result in sanctions or penalties. Some sanctions include:

1. Administrative Sanctions 

These types of sanctions include:

  • cancellation of your sponsorship approval;
  • barring you from sponsoring more people; or
  • barring you from making future applications for approval as a sponsor.

2. Enforceable Undertaking

This is where you would need to make a legally binding promise to undertake actions to demonstrate that the failures have been fixed, and will not happen again.

3. Civil Action From the Department

Here, the Department can choose to:

  • issue an infringement notice of up to $12,600 for a body corporate and $2,520 for an individual for each failure; or
  • apply to a court for a civil penalty order of up to $63,000 for a corporation and $12,600 for an individual for each failure.

Other Reasons For Sanctions

Other reasons that you could face sanctions include that:

  • you provided false or misleading information to the Department or to the Administrative Appeals Tribunal;
  • you no longer satisfy the criteria for approval as a sponsor;
  • a court found that you have contravened a Commonwealth, state or territory law, whether it be related or unrelated to sponsorship; or
  • the sponsored employee breaks a law relating to the licensing, registration or membership needed to work in the nominated position.

How Will the Department Determine the Sanction?

In making its determination, the Department will consider:

  • whether your failure is minor, significant or serious;
  • whether your failure was intentional, reckless or inadvertent;
  • the effect the sanction will have on you, the sponsored persons and the relevant work program; and
  • the effect the sanction will have on Australia’s national interest.

Key Takeaways

If you wish to sponsor a foreign worker, you must be prepared to meet different sponsorship obligations. These obligations ensure that you treat your employees in a fair way, and in accordance with the law. If you fail to comply with these obligations, you could face various sanctions. If you have any questions about being a standard business sponsor, contact LegalVision’s corporate immigration lawyers on 1300 544 755 or fill out the form on this page.

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Lindsay Zeloof
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