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457 visa explained

Temporary working visa, 457 visa           

The subclass 457 visa is the most commonly used program for employers to sponsor overseas workers to work in Australia on a temporary basis. The visa allows businesses to employ overseas workers for up to 4 years in skilled occupations. The skilled occupations are listed in both SOL and CSOL. The overseas worker needs to be sponsored by an Australian employer. The most common sponsorship is Standard Business Sponsorship (SBS).

Three stages of application

There are 3 processing stages in sponsoring an employee from overseas under the subclass 457 visa program:

Sponsorship: The employer applies for approval as a standard business sponsor. This is required to nominate an occupation for a subclass 457 visa.

Nomination: The employer nominates an occupation for a prospective or existing subclass 457 visa holder.

Visa application: The person nominated to work in the nominated occupation applies for the subclass 457 visa.

Training requirement

An Australian employer must meet a number of criteria in order to qualify for a SBS. One of the important criteria is meeting the training benchmark. If your business has been operating in Australia for 12 months or more, you must be able to demonstrate that you meet the prescribed benchmark for the training of Australian citizens or permanent residents. If your business has been operating for less than 12 months, you must be able to demonstrate that you have an auditable plan to meet this training benchmark.

The training benchmarks for an established business are:

A) Recent expenditure to the equivalent of at least 2% of the payroll of the business, in payments allocated to an industry training fund that operates in the same industry as the business. or

B) Recent expenditure to the equivalent of at least 1% of the payroll of the business, in the provision of training to employees of the business.

Expenditure that can count towards this benchmark includes:

·  Paying for a formal course of study for the business’s employees who are Australian citizens and Australian permanent residents or for TAFE or University students, as part of the organisational training strategy

·  Funding a scholarship in a formal course of study approved under the Australian Qualifications Framework for the business’s employees who are Australian citizens and Australian permanent residents or, for TAFE or University students, as part of the organisational training strategy

·   Employment of apprentices, trainees or recent graduates on an ongoing basis in numbers proportionate to the size of the business

·   Employment of a person who trains the business’s Australian employees who are Australian citizens and Australian permanent residents as a key part of their job

·  Evidence of payment of external providers to deliver training for Australian employees

·  On-the-job training that is structured with a timeframe and clearly identified increase in the skills at each stage, and demonstrating:

§  the learning outcomes of the employee at each stage;

§  how the progress of the employee will be monitored and assessed;

§  how the program will provide additional and enhanced skills;

§  the use of qualified trainers to develop the program and set assessments; and

§  the number of people participating and their skill/occupation

Expenditure that cannot count towards this benchmark includes training that is:

·  Confined to only one or a few aspects of the businesses broader operations, unless the training is in the primary business activity

· Only undertaken by persons who are not Australian citizens or permanent residents

· Only undertaken by persons who are principals in the business or their family members

· Only relating to a very low skill level having regard to the characteristic and size of the business.

Note: Businesses operate outside Australia but not in Australia, are not required to satisfy this requirement in relation to training of Australians.

Pathway to Permanent Residency

The 457 visa is an important pathway for overseas temporary workers to gain permanent residency. Under subclass 186 and 187 visas, a Temporary Residence Transition steam is available for 457 visa holders who has worked for the employer for 2 year, and the employer wants to offer them a permanent position.

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