Australia: State of play on 457 visas in Aussie trucking

Last Updated: 10 August 2014
Article by Paul Hardman (formerly with Holding Redlich) and Christopher Rowe

Most Read Contributor in Australia, January 2019

There has been a debate raging for some time as to whether businesses should be able to sponsor overseas workers on subclass 457 (Temporary Work (Skilled)) visas to operate heavy vehicles. This piece will explain the process for applying for a subclass 457 visa, and will examine the positions adopted by the primary agitators of the debate, namely: the Transport Workers Union (TWU) and the Australian Trucking Association (ATA).

How the Subclass 457 Visa Operates

The first step for any business that wishes to sponsor an overseas worker is to apply to the Department of Immigration and Border Protection (DIBP) to be approved as a Standard Business Sponsor (SBS). To be approved, the business must demonstrate that it is lawfully operating a business in Australia and that there is no relevant adverse information known about the business or its senior managers (including prior non-compliance with Australia's immigration law). Importantly, approved SBS' agree to be subject to a number of sponsorship obligations, including an obligation to dedicate a percentage of payroll to training Australian citizen or permanent residents in skills relevant to their current occupations.

The second step is for the approved business to nominate a vacant position in its business to be filled by a worker on a subclass 457 visa. For a nomination to be approved by the DIBP, the approved business needs to undertake that it will pay the prospective employee at the 'market salary rate', that is, the remuneration paid to Australian citizens working in the same position. The approved business might also be required to demonstrate that it has undertaken 'labour market testing' (i.e. demonstrating that it hasn't been able to fill the position using local labour).

Importantly to the debate, an approved business can only nominate a position in its business, if that position is an occupation listed on the Consolidated Sponsored Occupation List (CSOL). The CSOL is a list of approved occupations compiled by the DIBP. The occupation of "Truck Driver (General)" is not currently listed on the CSOL. Accordingly, businesses cannot currently sponsor overseas workers on a subclass 457 visa to drive heavy vehicles.

The final step is for the prospective employee to apply to fill the position nominated by the approved business. In doing so, they need to demonstrate that they have the appropriate skills and experience to perform the position, have a satisfactory level of English, hold private health insurance, and are of good health and character.

The TWU and ATA's Contentions

In summary the two sides of the debate are as follows:

The ATA's submissions argue that the occupation of Truck Drivers be added to the CSOL by reason of: employers struggling to fill positions in rural and remote areas; increased competition for skilled drivers from the mining industry; and reduced supply of drivers due to low levels of young drivers entering the ageing sector.

The Transport Workers Union's submissions (including its more recent submissions to the Independent Review of Integrity in the Subclass 457 Programme) argue that the occupation of Truck Drivers not be added to the CSOL by reason of concerns that: the use of 457 visas will increase the danger risk in the industry; the industry already suffers from significant underemployment; potential exploitation of 457 holders; and underpayment of 'market salary rate'.

Misunderstanding of mechanisms in subclass 457 scheme

The question of whether the occupation of truck drivers should be added to the CSOL is clearly an important matter to the industry. Unfortunately, due to the complex nature of Australia's immigration laws and policy, there has been a degree of misunderstanding of the subclass 457 scheme by the two peak industry bodies.

This is apparent when considering the TWU and ATA's responses to Skills Australia's (before changing to Australian Workforce and Productivity Agency, and then again to the Department of Industry) request for stakeholder input into the 2014 update of the Skilled Occupation List (SOL). The SOL (not to be confused with the CSOL) is a list relevant to applications for a range of visas which do not require sponsorship by an Australian business. Despite this, the responses by the TWU and ATA placed significant emphasis on whether the subclass 457 visa should be opened up to include the occupation of "Truck Driver (General)". After setting out their case in detail, the ATA concluded their submissions by making the following recommendation: "Heavy vehicle drivers...should be included on the skilled occupation list, in order for overseas drivers to apply for 457 visas..." [sic].

For the avoidance of doubt, we note that amending the SOL will not affect eligibility for a subclass 457 visa.

For those responsible for hiring drivers, this will certainly be an issue to watch closely.

This publication does not deal with every important topic or change in law and is not intended to be relied upon as a substitute for legal or other advice that may be relevant to the reader's specific circumstances. If you have found this publication of interest and would like to know more or wish to obtain legal advice relevant to your circumstances please contact one of the named individuals listed.

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