Published On: Wed, Feb 4th, 2015

Australia cracking down on 457 sponsorship violations

What is the change? A popular restaurant in Melbourne has lost its right to recruit foreign workers for five years after being cited for a number of Subclass 457 sponsorship violations. The incident is one in a string of cases where employers have landed themselves in trouble for 457 sponsorship violations – and the Australian Government has signalled it is getting more serious about 457 sponsorship infractions.

What does the change mean? Employers should be vigilant to ensure that they are in compliance with all 457 sponsorship requirements.

  • Implementation timeframe: Immediate and ongoing.
  • Visas/permits affected: Subclass 457 visas.
  • Who is affected: Employers sponsoring 457 visa holders.
  • Impact on processing times: No impact.
  • Business impact: Businesses sponsoring 457 employees should take notice of the recent enforcement efforts.
  • Next steps: Employers should make sure that they are following all 457 sponsorship requirements in order to avoid penalties for noncompliance.

Background: Australia’s Subclass 457 visa allows skilled workers to enter and work in Australia for up to four years. Employers participating in the 457 programme must meet a number of requirements, including minimum salary and labour market testing, and satisfy industrial relations regulations.

On 27 January, Australian officials announced that an Indian restaurant in Melbourne had lost its right to sponsor Subclass 457 visas and would be ineligible to recruit foreign workers under the programme for five years. Over time, the restaurant had underpaid employees, failed to keep proper records and provided false or misleading information, according to a statement from Assistant Minister for Immigration and Border Protection Michaelia Cash.

The statement said the number of employers sanctioned for 457 violations rose 68 per cent in the 2013-14 fiscal year, which ended 30 June 2014. The Department of Immigration and Border Protection “is constantly monitoring 457 sponsors to ensure they are operating appropriately,” Cash said in the statement. “Businesses acting in good faith have nothing to fear, but we want to send a strong message that if you breach your obligations, you can expect to face the consequences, including fines and cancellation of your sponsorship.”

The Melbourne case is not the only one of its kind. A Sydney restaurant was recently found to have underpaid a South Korean cook by more than A$50 000. The restaurant agreed to pay all outstanding wages, provide a written apology, publicize its “sincere regret” in a local newspaper, and donate A$1000 to the NSW Working Women’s Centre toward education of workplace obligations and rights.

In another case, work at Manildra Group’s Ethanol Plant in Bomaderry was stopped last week after labour union leaders alleged incidents of Subclass 457 visa abuse. Another employer is facing legal action over allegations that he paid an employee on a 417 visa less than A$2 an hour for her work in Tasmania.

 The Australian Government’s recent focus on Subclass 457 and other visa violations is a reminder of the importance of complying with all visa guidelines. Penalties can be harsh and may include fines and sanctions.



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