Sponsoring someone on a TSS visa – all you need to know about the hiring and the firing
In March 2018, the Temporary Skill Shortage (subclass 482) visa (“TSS visa”) replaced the popular 457 visa. Since then, the Morrison government has attempted to encourage migrants to settle in regional Australia in order to ease congestion in the capital cities and encourage economic activity in regional areas. New regional visas have been introduced in the past month, as well as incentives for migrants, especially students and skilled workers, to work or study in regional Australia. A list of postcodes of regional areas can be found on the Department’s website – with essentially most locations outside of the major cities Sydney, Melbourne and Brisbane.
Migrants looking to work, study or invest in regional Australia are said to have access to priority processing, as well as a broader range of occupations, compared to migrants seeking to settle in capital cities.
But while this may appear to be a sound strategy in national terms, what does it mean for employers looking to sponsor or retain skilled workers in the capital cities? Since the more stringent requirements for the TSS visa were introduced, sponsoring a skilled migrant on a visa has become increasingly difficult. However, having a basic understanding of the process can make the option of sponsoring an employee on a TSS visa more attractive, and easier to navigate.
What is the process involved in hiring someone on a TSS visa?
To hire or “sponsor” an individual on a TSS visa requires the lodgement of 3 separate applications:
- Standard business sponsorship application
This application is all about the sponsoring employer – what the business does, how profitable the business is (and hence whether they can afford to sponsor a skilled migrant worker), whether the business is genuine and operating in Australia et cetera. This application is usually fairly straightforward, and businesses established and operating in Australia won’t usually run into any problems in having their sponsorship application approved. Once approved, status as a standard business sponsor is generally valid for 5 years, which means employers only need to lodge this application once every 5 years. Employers can also apply to be an accredited sponsor, which generally involves, amongst other things, turnover of at least $4m for the last 2 years and having had a TSS visa approved in the past. Accredited sponsorship status has the benefit of faster processing times.
- Nomination application
Once an employer is approved as a standard business sponsor, it is able to lodge a nomination application for a particular nominated occupation to be filled by a skilled migrant worker. The nomination application is all about convincing the Department of Home Affairs that the business needs that particular nominated occupation to be filled, as attempts to fill the role with an Australian worker have been unsuccessful. This application is the one where most employers run into issues. Getting it right requires an understanding of all the requirements that need to be met under the TSS nomination regulations, including:
- the proposed salary reflecting what an equivalent Australian worker performing equivalent work in the same location would receive (and having an understanding of “equivalent work”), or in the absence of an Australian worker performing equivalent work, showing the proposed salary reflects the Australian market salary (and having an understanding of what is meant by “market salary” and what evidence the Department requires to prove “market salary”);
- proof of labour market testing i.e. proof that the employer tried to find an Australian worker for the role first (and understanding when labour market testing is not required, and if it is, what is acceptable evidence of labour market testing);
- proving the nominated occupation is a genuine position and providing information to prove “genuineness” such as an explanation as to why the position is required (if it is a new position), how the position fits in with the current organisational structure, and the duties of that nominated occupation; and,
- ensuring the nominated occupation is an occupation eligible for nomination under the TSS scheme, by ensuring it is on a list of occupations eligible for nomination.
- Visa application
Once the nomination application is approved, the final application is the employee’s visa application. This application is all about the proposed employee’s skills and qualifications and must convince the Department that the employee is suitably skilled to perform the nominated occupation. Generally, this requires having at least 2 years of experience in the nominated occupation, or 2 years of equivalent work experience, in addition to any qualifications, licensing or registration requirements. If the employee, or anyone in their family that is migrating with them, has significant health or character issues, the visa could be refused.
The whole process, including all 3 applications, can take 2-6 months or more, depending on how long the employer/employee takes to collate the required information prior to lodgement of the applications, and current Department processing times.
Given that sponsoring someone on a TSS visa is a significant investment of time and money, it is important to consider the proposed employee’s suitability for the TSS visa before any applications are lodged. There is no point in having the employer approved as a standard business sponsor, and having the nomination application approved, only to find out at the last stage of application, that there is a health or character issue associated with the employee or a member of their migrating family that will result in refusal.
Having an understanding of the process and requirements, and a realistic expectation of the time involved, and approaching the priority issues methodically, will make the process an easier and far less frustrating one.
What happens when you need to fire someone on a TSS visa?
When a nomination application is lodged, there is a requirement that the employer and employee both intend the employment relationship to last for at least 2 years. This does not mean that an employer is required to employ the TSS worker for at least 2 years, only that at the time of lodging the relevant applications, there was an intention that the relationship will be ongoing for the duration of the visa. If there are performance issues with the employee, or if there are company restructures rendering the position redundant, it is still lawful to terminate the employment of an employee on a TSS visa. However, there are some additional risks to consider.
If the employment of a TSS visa holder is terminated by their sponsoring employer, the impact on that employee is often greater than the impact on an employee who is an Australian citizen or permanent resident. If the TSS visa holder is unable to make suitable visa arrangements to stay in Australia (which generally means finding another employer to sponsor them, and quickly), they will need to leave Australia, which involves expense and dislocation. This harsh reality for a TSS visa holder is something the Fair Work Commission consider when determining whether the termination of an employee was harsh, unjust or unreasonable. Therefore, employers should take care to consider this before terminating employment.
If the employee requests in writing that the employer pay their costs of returning home, the employer must also pay their reasonable travel costs, which ordinarily would include economy tickets home for the employee and their migrating family.
If you require assistance or advice in relation to sponsoring a skilled migrant worker or the termination of employment of a skilled migrant worker, please do not hesitate to contact Employment Lawyer, Lisa Qiu.