What are your obligations as an employer of foreign workers?

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Outlines your obligations in relation to hiring foreign workers, as well as some steps you can take to make sure you fulfil them.
Australia Immigration
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Employing foreign workers may be necessary to address labour shortages and skills gaps within your business. However, as an employer, you should conduct appropriate checks to ensure your workers have the right to commence employment at your business. You will have additional obligations if you are also a standard business sponsor.

This article will outline your obligations as an employer and approved business sponsor in relation to hiring foreign workers, as well as some steps you can take to make sure you fulfil your obligations.

1. Check the Applicant's Right to Work in Australia

It is your responsibility as an employer to make sure that your foreign workers have legal working rights in Australia that also match your specific business requirements. This applies even if you have engaged the employees from a labour-hire working arrangement. Australian citizens, permanent residents, and New Zealand citizens have full working rights in Australia, but everyone else requires a visa and only some visas allow for working rights.

You can check your employee's visa type and what conditions apply to them via the VEVO feature on your immigration account. In addition, you can ask them to provide you with the details of their visa.

You should conduct checks:

  • before your employee commences work;
  • within two days of visa expiry; and
  • every time there is a material change in your employee's circumstances.

However, you should check these requirements every three months or develop a system where you conduct frequent monitoring.

If you knowingly employ illegal workers it can result in penalties against your business. That is, you may face a maximum penalty of up to $315,000 depending on the specific sanction applied.

Types of Visas

Below are some examples of the main types of visas and their working rights in Australia:

Visa Type Work Rights
Employer-sponsored visas (subclasses 482 and 494) Full-time working rights restricted to the nominated occupation and the approved sponsor or employer.
Employer-sponsored visas (subclasses 186 and 187) Full-time working rights.
Skilled occupations visas (subclasses 189, 190, and 489) Full-time working rights.
Student visas (subclasses 500 and 485) 500: The typical limited hours for subclass 500 are currently relaxed until further notice. Students can currently work full time per the Australian Government's announcement. 485: Full-time working rights.
Working holiday visas (subclass 417) From 19 January 2022 to 31 December 2022, the typical 6 month work limitation has been temporarily relaxed.
Training visas (subclass 407) Workplace-based occupational training for at least 30 hours per week. No more than 30% of this can be classroom-based.
Partner visas (subclasses 801 and 820) Full-time working rights.
Bridging visas A and B Some working rights as previous visa or the work conditions imposed.
Visitor Visas No working rights.

2. Comply With the National Employment Standards

In addition to complying with immigration laws, you must also comply with the National Employment Standards (NES). This applies to all employees working in Australia regardless of their immigration status.

3. Meet Relevant Sponsorship Obligations

Once you become an approved business sponsor and are able to hire foreign workers, there are a number of obligations you must satisfy. These obligations start when your sponsorship is approved and generally finish between two to five years after the sponsorship ends. They apply to all sponsoring businesses. Some obligations that may apply to you as an approved business sponsor are outlined below.

Cooperate With Inspectors

You may have to cooperate with inspectors if they have a reasonable suspicion surrounding your foreign workers and their working rights. That is, an inspector may develop a reasonable suspicion based on a random check of your employees. Inspectors are authorised to conduct random checks, especially when you have a large number of employees from overseas.

Generally, an inspector may:

  • enter your business premises;
  • inspect any work or processes;
  • interview people;
  • inspect and make copies of documents; and
  • seek information about a person's name and address if they believe a breach has occurred.

Ensure There Are Equivalent Terms and Conditions of Employment

As an employer, you must ensure that your foreign employees are on the same employment terms and conditions as your Australian workers. For example, you should ensure consistency of their:

  • salary;
  • job position's duties and responsibilities; and
  • other working conditions in accordance with the NES.

The Department of Home Affairs ('the Department') will consider circumstances where foreign employees are in a 'less favourable' or 'more favourable' position than an Australian worker in the same or a similar role. This can consequently affect the success of their visa application.

Keep Records

As an approved business sponsor, you must also keep records of any relevant information relating to the sponsorship of a foreign worker, for example:

  • any correspondence with the Department; and
  • employment records for sponsored employees.

In addition, you will be required to keep records of the recruitment process that show you have not discriminated in any way during the process. This will be reviewed by the Department during labour market testing for the nomination application.

Readily Provide Information

In some circumstances, you may need to provide information concerning your foreign worker's employment to the Australian Border Force (ABF). For instance, these circumstances include:

  • cessation of employment;
  • change of work duties;
  • change of contact details and address;
  • change of business structure or legal entity; or
  • bankruptcy and insolvency.

If these circumstances arise, you must provide information to the Department within 28 days.

Ensure That the Sponsored Employee Works in the Nominated Position

You must also ensure the employee works in the position, program or activity that you have nominated them for. The employee is not allowed to work for another business unless it is an associated entity. You are restricted from supplying them to work for another business unless a legitimate labour agreement is in place.

Pay the Associated Costs

When employing foreign workers, you are responsible for covering the costs of recruiting, sponsoring, and nominating the foreign worker. You also cannot transfer or recover any part of these costs from the employee or their family.

Discrimination

You also must not engage in any discriminatory recruitment practices. If you do, you may incur liability for discrimination because of their:

  • sex;
  • race;
  • age;
  • disability;
  • or other factors.

Further, adverse action can also constitute discrimination. This includes discriminatorily:

  • dismissing an employee;
  • altering their work environment; or
  • treating employees differently.

Additional Obligations: SAF Levy

In addition, you will need to pay a government tax levy for workers you nominate under temporary and permanent employer-sponsored visas. This is known as the Skilling Australian Funds (SAF) levy. The money raised will go into the Skilling Australians Fund (SAF), a new government initiative to grow the number of apprenticeships and traineeships in Australia.

From 12 August 2018, this affects all nomination applications made under subclasses:

  • 482;
  • 494;
  • 186;
  • 187; and
  • 457, where applicable.

The amount you pay will consequently depend on your business's annual turnover. This will be provided through your Australian tax return with your nomination application.

Consequences for Breach of Obligations

As a result of a breach of any of the above obligations, the Australian Border Force may:

  • issue an informal or formal warning;
  • serve an infringement notice;
  • bar or cancel the sponsor from engaging in the program; or
  • pursue a civil penalty.

Unlawful Workers

If your employee becomes or is an unlawful worker, the government may request the following payments from you if they are satisfied that you were aware that the employee has become unlawful or you were complicit or negligent:

  • costs for them and their family to leave Australia including reasonable travel costs such as an economy flight and taxi costs to the airport; and
  • costs incurred by the government to locate and remove any unlawful non-citizen workers.

You may therefore be liable to pay up to $10,000 with any excess being charged to the unlawful citizen.

Key Takeaways

Overall, there is more to sponsoring foreign workers than just obtaining the required visa. Therefore, you have an ongoing obligation to make sure that you and your employees comply with immigration laws and National Employment Standards in Australia. For example, as a sponsoring business, you must pay the Skilling Australians Fund (SAF) levy. You must also keep up-to-date on Covid-19 requirements.

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