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Enables Australian employers to recruit, on a permanent basis, highly skilled staff from overseas or temporary residents currently in Australia when they have been unable to fill a vacancy from within the Australian labour market or through their own training programs.

Click here for more information on skilled workers visas

The Subclass 457 visa program is primarily designed to support the Australian economy by providing a mechanism for the temporary entry to Australia of skilled persons to top-up the available domestic workforce and prolong growth in the Australian economy. A key feature of the program is a fast processing outcome when complete applications are submitted and all requirements are met.

A key element that relates to the purpose of the 457 program is that processing of applications under the program should remain cognisant of the prevailing economic conditions. In relation to sponsorship applications, decision makers need to ensure they are satisfied that the Benefit to Australia requirement is met. In relation to nominations and particularly visa applications, a key focus should be given to the nominated salary and its proximity to the average remuneration for that occupation.

Benefit to Australia

For regulation 1.20D(2)(a), decision-makers need to carefully consider the prevailing economic conditions, both globally and locally. A key factor would be that of the relevant Australian employment rate.

Australian employment rate

The prevailing Australian rate of participation in the workforce is an extremely important element when assessing all four elements. During times of growing unemployment, decision-makers should satisfy themselves that there is a benefit to Australia as opposed to a benefit to the business.

If there is information available to the department that suggests the business has been reducing its workforce, a decision-maker should ensure that they are satisfied that any sponsorship application to hire overseas skilled workers is justifiable and that the business has demonstrated a benefit to Australia should the application be approved.

A decision-maker would need to be satisfied that the approval of:

• a sponsorship application, or
• a visa application sponsored by a previously approved Standard Business Sponsor would directly lead to at least one of the four elements of the Benefit to Australia requirement being met (457.111(2) refers).

When the economy is buoyant with low unemployment, a vigorous assessment of the benefit to Australia requirement should be limited to applications where there are very clear inconsistencies. However, during periods where economic conditions are deteriorating and levels of unemployment rising, the need for the importation of overseas workers to fill positions in the trades and semi skilled areas diminishes. Even during periods of economic turbulence, there will remain shortages in some areas of the Australian workforce, although this is more likely in the higher skilled, professional groupings. In relation to the individual components:

(i) the creation or maintenance of employment for Australian citizens or Australian permanent residents
For regulation 1.20D(2)(a)(i), decision-makers need to be satisfied, based on submissions by the employer, that there will be net job creation or the maintenance of employment for Australian citizens or permanent residents. This would include circumstances where employment may otherwise be lost without the skills provided by the nominated employee. Employment opportunities created overseas for Australians by businesses operating internationally may also be taken into account when assessing this criterion. In situations where the sponsor (or sponsor applicant) is claiming this as a benefit to Australia and the department is aware that the sponsor has recently reduced its workforce, decision-makers would need to be satisfied that the business has demonstrated they meet this requirement.

(ii) expansion of Australian trade in goods or services
First note that, as regulation 1.20D(2)(a)(ii) is framed in terms of ‘trade’, it includes imports and exports. The contribution here should be to Australian trade. ‘Services’ includes the provision of intangible goods eg the provision of information, assistance or expertise in the form of work undertaken by a business in Australia. Examples include:

• research and development
• professional services (for example, financial, engineering, legal, information and communications technology, management, marketing etc.)
• education
• transportation
• strategic personnel service.

The sponsor applicant would need to demonstrate how the sponsorship approval and the sponsorship of individuals under the approval would contribute to an expansion of Australian trade in goods and services. In times of growing unemployment, decision-makers would need to be satisfied that the skills and attributes required for this role could not be found locally. Decision makers would also need to be satisfied that there is potential for expansion of Australian trade in goods and services in the context of the global economic downturn.

(iii)  the improvement of Australian business links with international markets

The prevailing economic environment is a significant factor in this as positive business confidence tends to lead to rapid economic growth and global expansion.  However during periods of economic turbulence, the sponsor applicant would need to demonstrate how the sponsorship approval and the sponsorship of individuals under the approval would contribute to the improvement of business links with international markets. 

The regulation 1.20D(2)(a)(iii) criterion includes those situations where the employer requires an individual with a particular knowledge or understanding of a foreign market or supplies that will contribute to the creation or enhancement of international trade links. Examples include knowledge of its customers, competitors, industries, commercial practices or law, marketing of products, growth strategies.  There would generally be very few occupations that sponsors could rely on to claim this benefit, mainly limited to specialist professional occupations.

(iv) competitiveness within sectors of the Australian economy

The sponsor applicant would need to demonstrate how the sponsorship approval and the sponsorship of individuals under the approval would contribute to greater competitiveness within their sector. 

For regulation 1.20D(2)(a)(iv), decision-makers should consider how each position to be nominated by the employer will contribute to the business by:

• improving its operating efficiency and effectiveness
• enhancing its competitiveness, either domestically or internationally
• increasing its turnover, profit or efficiency and
• adding new or improved products or services in the market.

In times of growing unemployment, decision-makers would need to be satisfied that the skills and attributes required for this role could not be found locally and that the individuals proposed to be sponsored demonstrably have a higher level of skill than can be sourced within Australia.

Subclass 457 – market salary rates

From 14 September 2009, all sponsors of Subclass 457 visa holders (457 sponsors) will be required to adhere to a new series of Sponsorship Obligations. For 457 sponsors, the obligation to ensure equivalent terms and conditions of employment will mean that they pay market salary rates to their overseas workers. For people who were already Subclass 457 visa holders on 14 September 2009, transitional arrangements will apply.

More information on market salary rates (including transitional arrangements) is available. http://www.immi.gov.au/skilled/457-market-salary-rates.htm