The recent Visa Solutions Australia webinar hosted by Senior registered migration agent Richard Marriott & Lyndon Engles, registered migration agent discussed a range of topics relevant to keeping Australian businesses compliant when it comes to sponsoring overseas workers.
The Essential Migration Compliance and Risk Mitigation Strategies webinar, targeted at HR leaders and business owners covered:
- Sponsorship Obligations
- The Severe Cost of Non-Compliance
- Managing Regulatory Audits and Inspections
- The Ultimate Sanction: Protecting Sponsor Status
As legislation and rising enforcement evolves, the penalties for not complying with sponsorship obligations have never been more serious. Understanding sponsorship obligation compliance is crucial when it comes to hiring high quality international talent to fill skills shortages. It’s essential that business owners and their human resources department understand the obligations of being a business sponsor as well as the penalties for failing to comply with their sponsorship obligations.
The number of overseas workers sponsored by Australian businesses has continued to increase over the last few years. As the number of sponsored employees increases, the need for the Department of Home Affairs to ensure compliance by business owners has grown. This increased focus on compliance ensures that businesses are abiding by the rules of business sponsorship and foreign workers are not being exploited.
It’s important that businesses understand that sponsorship obligations are not something the Department of Home Affairs and the Australian Government recommends, these are regulations which are the law. These regulations apply to all sponsors of nominated workers so all obligations must be complied with.
Sponsorship Obligations
When a business applies for a standard business sponsorship, as part of the application process, they are signing up and agreeing to comply with sponsorship obligations. Once the sponsorship is approved and the business receives their approval letter, they are directed to the Department of Home Affairs website which specifies what these obligations are.
As a business sponsor, an employer must provide a safe workplace as well as legal pay rates, leave conditions and shift arrangements. They must provide payslips, superannuation and taxation documents to their employees. In addition, they must also:
Advise the Department of Home Affairs when certain events occur
Any changes to business names, partnerships, financials or changes related to the employee’s job must be communicated in writing.
Ensure employees only work in their nominated occupation
Sponsored employees must only work in the occupation they were nominated for. A change in occupation requires a new nomination to be lodged.
Ensure equivalent terms and conditions of employment
The annual earnings of the employee must be at least the same as those stated on the nomination application. (N.B. This condition applies if the annual earnings of the employee are less that AUD$250,000.) The employment conditions should also be the same as those of an equivalent Australian worker.
Not engage in discriminatory recruitment practices
When recruiting, employers must not engage in discriminatory recruitment practices that adversely affect Australian citizens or any other person based on their visa or citizenship status.
Keep records
Employers must keep all records that show compliance with the sponsorship obligations. They must be kept in a format that can be reproduced with some documents able to be independently verified. A full list of required records can be found on the Department of Home Affairs website.
Provide records and information
If requested, employers must supply departmental officers with records relating to the sponsorship.
Assume all costs
All costs associated with becoming a sponsor, nomination charges and migration agents are the responsibility of the employer. This also applies to costs related to the recruitment process.
Pay travel costs
Employers are required to pay reasonable and necessary travel costs for the sponsored employee and their sponsored family members to leave Australia for the last time.
Pay costs to locate and remove an unlawful citizen
If the sponsored employee or any of their sponsored family members becomes an unlawful citizen, employers may be required to repay the costs incurred by the Commonwealth to locate or remove them from Australia.
Cooperate with inspectors
If a business is investigated in relation to sponsorship obligation compliance, the business owner must provide access to the premises and supply any requested documentation to the inspectors.
A detailed list of business sponsorship obligations can be found on the Department of Home Affairs website.
Managing Regulatory Audits and Inspections
Regulatory audits and inspections are a function of the Australian Border Force (ABF). The Australian Border Force may conduct audits of standard business sponsors and conduct workplace inspections. These audits can be:
- Randomly selected as part of standard monitoring activities
- Triggered by intelligence such as a complaint, anonymous tip or a change in business operations
- Conducted pre-approval during a sponsorship or nomination application
Audits can involve written requests for documents, phone interviews or unannounced on-site inspections.
Penalties for Being Non-Compliance
If a business fails to comply with their sponsorship obligations, they could face a number of penalties. There are four types of sanctions that may be enforced.
Administrative
The Department may:
- Bar employers from sponsoring additional visa holders for a specified time
- Not approve an employer’s application for sponsorship of visas
- Cancel all of an employer’s existing sponsorship approvals
- Issue a compliance notice
Enforceable Undertaking
Employers may be asked to enter into an enforceable undertaking which would require the employer to promise in writing to complete certain actions to show that the non-compliance issues have been rectified and won’t happen again.
Civil
The Department may:
- Issue an infringement notice of up to AUD$15,840 for individuals and AUD$79,200 for body corporates per obligation breach
- Apply to a court for a civil penalty order of up to AUD$396,000 for a corporation and AUD$76,200 for an individual for each obligation breach
Employer Prohibition
Employers who seriously, deliberately or repeatedly break the law may be prevented from employing overseas workers for a period of time.
The Ultimate Sanction: Protecting Sponsor Status
The penalties for not complying with sponsorship obligations are quite serious. The severity of the breach will determine the appropriate penalty with serious and repeated non-compliance most likely resulting in heavy fines; however, the worst cases can potentially result in the loss of sponsor status.
A loss of sponsor status not only affects the business but also any employees who are sponsored by the business. Visas holders working within the business can potentially lose their visa if they are unable to find another sponsor within 180 days of no longer being sponsored by their current employer. In addition, the business stands to lose any employees who are working within the business on a visa which can affect productivity. The consequences of a business losing their sponsor status can be quite significant.
Ensuring compliance with sponsor obligations is the best way for a business to avoid being under the scrutiny of the Australian Border Force. Sponsorship compliance ensures that the interests of the business and sponsored overseas workers are protected.
Richard Marriott is a senior migration agent at Visa Solutions Australia and has worked in immigration for over 30 years. He spent 19 years as an officer with the Department of Home Affairs. He holds a Graduate Diploma in Migration Law from the Australian National University and a Certificate IV in Statutory Compliance from Australian Forensic Services. He has a wealth of experience managing the risks related to business sponsorship and is happy to assist businesses who may have questions relating to business sponsorship and compliance.
To learn more about any aspect of migration, Richard and the team at Visa Solutions Australia are happy to help. Book a consultation.
Disclaimer: The above content is not advice for any particular matter and is for general information only. It is recommended you consult with a registered migration agent to discuss your specific case.
