Some businesses may not know that there are slight differences in requirements a business or organisation need to meet to sponsor overseas workers on a 457 Temporary Work (Skilled) visa. This is dependent on the circumstances of the business or organisation applying, of course. Standard Business Sponsors (the necessary sponsorship approval required to nominate overseas workers for 457 visa) generally fall within two groups: Standard Business Sponsors, for Australian businesses and organisations; and what is commonly referred to as Overseas Business Sponsors, for overseas businesses and organisations without an Australian subsidiary. There is another, outside of the Standard Business Sponsor application process called a Labour Agreement, which is a separately negotiated agreement between that Australian organisation and either the Immigration or Employment Minister.

A further distinction is made for Standard Business Sponsors between start-up businesses, which are businesses trading for less than 12 months, and established businesses, which are those trading for over 12 months. For Overseas Business Sponsors a distinction is made between those wishing to establish an Australian subsidiary, and those fulfilling contracts with an Australian party. These differences are important as they determine not only the evidentiary requirements, but also the length of approval of the sponsorship, and, very importantly, the length of approval of any 457 visa that the sponsor nominates.

Start-up businesses in Australia and overseas businesses wishing to establish a subsidiary in Australia have, according to policy, an approval period of 18 months for the sponsorship and up to 18 months for any corresponding 457 visa. Established Australian businesses and established overseas businesses fulfilling contracts with Australians are granted a sponsorship period of 5 years with up to 4 years for any corresponding 457 visa.

For established Australian Standard Business Sponsors, there is also one extra category that has greater evidentiary requirements to meet, but has equally greater benefits attached. That category is a Standard Business Sponsor with Accredited Status, commonly referred to as Accredited Business Sponsors. Essentially, these are for Standard Business Sponsors with a good history of compliance, use of the programme, and decision-ready applications processed by the Department of Immigration and Border Protection.

Accredited Business Sponsors currently enjoy a period of approval for 6 years, and while any 457 visa can only be approved for up to 4 years, any nomination and 457 visa application lodged under the sponsorship is afforded priority processing that includes being processed faster than applications lodged from non-accredited sponsors. From experience, it has been as fast as 48 hours from the time of lodgement.

Registered migration agents would have received an email from the Department of Immigration and Border Protection (DIBP) yesterday with a flyer detailing changes to accredited sponsorship arrangements that will begin on 1 July 2016. The new requirements will be that any application for accredited status must:

Be a government agency or a company (public or private) with a minimum annual turnover of at least AUD 4 million over the last 3 years
Have been an active sponsor of 457 visas for the last three years with a maximum break of no less than six months
Sponsored at least 10 primary 457 visa holders in the previous 2 years
Not have any adverse information against it based on monitoring
Lodged an agreed number of decision-ready applications in the previous 2 years
Have a refusal rate of less than 3% in the last 3 years
Have an Australian workforce of at least 75%
Engage all 457 visa holders as employees and under a written employment contract that includes the minimum employment entitlements under the National Employment Standard
Have all Australian employees paid under either an Enterprise Agreement or under a common law contract and according to an internal salary table that reflects current market salary rates
Provides all related business activities they undertake
Provides details of all principals and directors

So what will be the benefit of meeting these requirements? In addition to continued priority processing, there will also be streamlined processing of nominations for certain occupations with base salaries greater than AUD 75,000, or salaries that are greater than the Fair Work High Income Threshold (FWHIT), which is currently set at $136,700, but will increase to $138,900 from 1 July 2016 according to the Fair Work website.

On that note, the FWHIT is a very important benchmark for many primary 457 visa holders approaching 50 or who are 50 or older. When a primary 457 visa holder turns 50, the requirements for a permanent visa for either the Employer Nomination Scheme (subclass 186) or Regional Sponsored Migration Scheme (subclass 187) visas under the Temporary Residence Transition stream become much more difficult, with very few exceptions. For any primary applicant 50 years or older, their earning must be equivalent to the FWHIT for each of the four years they are sponsored by the one Australian business.

Current Accredited Business Sponsors will be notified of their options to ‘upgrade’ to the new Accredited Status, while the DIBP website will be amended to reflect the new requirements shortly.

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