There have been significant legislative changes affecting visa holders and applicants of both the permanent Skilled Migration Program and the Temporary Skilled Migration Program (often known as the 457 visa program) and these continue throughout 2018.  However there are also changes forecasted for employers who participate in these programs, specifically in terms of an increased economic contribution into a newly formed fund designed to increase the skills, training and vocational education of Australians.

A Commitment to Training – The Existing Requirements

At present, in order to be an approved sponsor for the purposes of the 457 visa program (or support an application for permanent residency through the employer sponsored program), an organisation has two ways in which they can demonstrate their commitment to training. 

The first option is to demonstrate that they are spending at least 1% of their annual payroll on activities for the benefit of their employees that can be appropriately characterised as having a learning outcome.  These requirements come with a few caveats including:

  • The training outcomes must fit the size, scope and nature of the business;
  • The training must be for the benefit of Australian employees; and
  • The expenditure must not be for family members of the principals of the business. 

This leaves some discretion in the hands of employers as to how they want to engage and develop the skills of their existing employees.  For example, one of the most direct and obvious ways in which it is possible to meet the training obligations is for an employer to take on an apprentice or trainee.  The wages paged to that individual are then directly attributable to the employer’s commitment to training.

In the event a particular employer cannot meet this requirement there is an alternative option whereby a contribution to the value of 2% of the organisation’s annual payroll can be made into an Industry Training Fund (such as TAFE organisations). 

Skilling Australians Fund – The New Requirements

Commencing in March 2018, a new fund will be set up to assist with vocational education and training for Australians – the Skilling Australians Fund.  While the details of the funding model are currently being finalised, it will in part be funded by organisations who are participating in the temporary and permanent employer sponsored programs.

Organisations who have a need to source labour from abroad will be categorised as either small or large organisations depending on whether their turnover is below or above $10 Million.  From there they will be required to pay a levy per applicant into the Skilling Australians Fund.  From the information that has been announced, the levy will be payable in full at the time of the nomination, that is before a decision has been made on the nomination or the visa applications. 

The details of the levy payable are as follows: 

Table One:  Overview of Skilling Australian Levy of Organisations participating in Economic Migration Programs

Migration Program     

Temporary (457 / TSS) Visa Program
- Small Organisation: $1,200 per year per visa applicant
- Large Organisation: $1,800 per year per visa applicant

Permanent Visa Program
- Small Organisation: $3,000 per year per visa applicant
- Large Organisation: $5,000 per year per visa applicant

Should you have any questions about the above information or if you want to discuss how your business can access these arrangements in more detail please do not hesitate to contact us for a confidential discussion on (03) 9614 7111 on send us an on-line enquiry.