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Sponsorship Obligations

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byJen Cork
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  1. Sponsorship Obligations
  2. Immigration Penalties

1. Standard Business Sponsorship (SBS) Obligations

Standard Business Sponsorship (SBS) Obligations A Business Sponsor must agree to meet certain obligations in relation to its sponsored 482/494 visa holders. This sponsorship compliance framework sets out the obligations which sponsors must meet, the prescribed circumstances under which action may be taken, the range of penalties that can be considered for breaches and the powers of delegated inspectors who administer the framework. The framework is designed to protect sponsored persons from exploitation and to maintain the integrity of the sponsored visa program by ensuring it is being used for its intended purpose.

In addition, a Business Sponsor that has ‘Accredited Status’ must, under policy, ensure that it maintains the relevant characteristics upon which this status is based.
Please note that the below is a summary and we ask that your contact us in relation to these obligations so that clarification can be provided.

The obligations are as follows:

Obligation Explanation When obligation starts When obligation ends
Ensure your employee works only in the nominated occupation

 

You must also ensure the person is employed under a written contract of employment

 You must ensure the sponsored person works only in the occupation for which they were nominated.

If you want to engage a sponsored person for a different occupation, you may lodge a new nomination and visa application.

You must employ the person under a written contract of employment and they cannot work for another business, unless that business is an associated entity of an Australian Standard Business Sponsor.

 On the day the visa is granted or on the day the nomination is approved to transfer the employee Ends on the day (whichever is the earliest), that employee

  • Ceases working for you; or
  • your employee has a nomination approved for a different approved sponsor; or
  • is granted a different type of visa
Ensure equivalent terms and conditions of employment
  • The annual earnings of the employee must be at least the same as those stated on the nomination
  • The employment conditions of the employee must not be less favourable than those of an equivalent Australian worker

This obligation does not apply if the annual earnings of the employee more than $250,000.

 On the day the visa is granted or on the day the nomination is approved to transfer the employee

 
Not engage in discriminatory recruitment practices You must not engage in, or have not engaged in, discriminatory recruitment practices that adversely affect Australian citizens, or any other person, based on their visa or citizenship status. Ongoing Ongoing
Notify the Department when certain events occur
You must notify the Department of Home Affairs within 28 calendar days if:
  • The sponsored person does not commence employment within the time frame agreed with the sponsor;
  • The sponsored person’s employment ends, or is expected to end;
  • Return travel costs of a sponsored person and any sponsored family members have been paid in accordance with this obligation (see below);
  • There are changes to the work duties carried out by the sponsored person;
  • Your business address or contact details have changed;
  • A new director is appointed to the company, a partner joins the partnership or a new member is appointment to the management committee of an unincorporated association;
  • An insolvency/bankruptcy/receivership/liquidation/administration event occurs;
  • Your business ceases to exist as a legal entity.
Please let us know ASAP if/when any of these events occur and we can notify the Department on your behalf.
 On the day approved as a sponsor. Two years after the sponsorship ends and you are no longer sponsoring anyone.
Pay travel costs to enable sponsored persons to leave Australia You must pay reasonable and necessary travel costs to enable the sponsored person (and any sponsored family members) to leave Australia to a country for which that they hold a passport. The cost is for economy air travel (or a reasonable equivalent if economy not available), airport taxes, and includes internal travel within Australia (e.g. to get from Newcastle to Sydney International airport).
The costs must be requested in writing by the Department of Home Affairs or the sponsored person and specify the country of return (country for which they hold a passport). The costs must be paid within 30 days of receiving the request in writing and notified to the Department within 28 days of payment. You will only be required to pay return travel costs once per sponsored person (unless you re-nominate the same person).		 If the person holds a 482 visa, from the time the nomination is approved.
If the person does not hold a 482 visa, from the time the visa is granted.		 On the day the person is nominated by another employer; granted a further visa (other than another 482 or Bridging visa), or the person leaves Australia and their 482 visa is no longer in effect.
Pay costs to locate and remove an unlawful citizen If a sponsored person (or any sponsored family members) becomes an unlawful non-citizen, you may be obliged to pay the costs incurred by the Commonwealth in locating and/or removing the sponsored person(s) from Australia if the Minister requests payment by written notice.

These costs will be capped at $10,000 per person (less any amount paid under the return travel costs obligation set out above).

 On the day the sponsored person becomes an unlawful non-citizen. Five years after the sponsored person leaves Australia. That is, the Department might require payment up to five years after your sponsored employee left Australia.
Keep records / Provide records and information to the Minister
The following records must be kept in a reproducible format and capable of verification by an independent person:
  • Written request for the payment of return travel costs including when the request was received, how the sponsor complied with the request including how much was paid, who the costs were paid for, and date of payment;
  • Notification to the Department of certain reportable events (see above) including the date and method of the notification and where it was sent;
  • Tasks performed by the sponsored person in their nominated occupation and location where the tasks were performed;
  • Earnings paid to the sponsored visa holder (unless the sponsored visa holder earns over $250,000)
  • Money applied or dealt with in any way on behalf of, or as directed by, the employee (unless the sponsored visa holder earns over $250,000)
  • Non-monetary benefits provided to the sponsored person, including the agreed value and the time and period those benefits were provided (unless the sponsored visa holder earns over $250,000)
  • If there is an equivalent worker, a record of the terms and conditions that apply (or did apply), and the period they applied unless the sponsored visa holder earns over $250,000);
  • Written contract of employment under which each sponsored person is employed;
  • Annual turnover in relation to calculation of the nomination training contribution charge.
You must provide such records or information relating if requested by the Department in the manner and timeframe requested.
Under policy, ”Accredited” Business Sponsors may be requested to provide evidence that they continue to meet the characteristics of their “Accredited” status (eg ratio of overseas workers to Australians, turnover etc)
 On the day you are approved as a sponsor or the nominee starts working with you. Two years after the sponsorship ends AND you are no longer sponsoring anyone.
Cooperate with inspectors
Inspectors can investigate whether your sponsorship obligations are being, or have been, complied with, you have hired an illegal worker or there are other circumstances in which the Department could take administrative action
The obligation includes:
  • Providing access to premises for inspection of any work, process or object;
  • Providing inspectors with access to interview any person on the premises;
  • Producing and providing documents within the requested timeframe;
  • Not preventing or attempting to prevent, access to a person who has custody of, or access to, a record or documents.
 On the day you are approved as a sponsor or the visa applicant starts work in the nominated position. Ends five years after the day the approved sponsorship ends or the applicant stops working for you.
Not recover, transfer or charge certain costs to another person
You must not seek to recover or transfer costs from you  or to another person, including the sponsored person, that relate to:
  • cost of becoming a sponsor
  • nomination charges
  • professional fees associated with sponsorship and nomination applications
  • recruitment agent fees
  • professional legal fees
  • advertising
  • screening, short listing, interviewing and conducting reference checks of candidates
  • salaries of recruitment or human resource staff
  • outsourcing background checks, police checks and psychological testing
  • responding to queries from potential candidates and advising unsuccessful applicants
  • travelling nationally or internationally to interview and/or meet applicants
 On the day you are approved as a sponsor. Two years after
your sponsorship ends and you no longer employ a sponsored visa holder.
Possible sanctions for failing to comply with sponsorship obligations
  • You could be barred from sponsoring more people for a specified time;
  • You could be barred from applying for approval to be a sponsor;
  • All of your existing approvals as a sponsor could be cancelled;
  • You could be required to enter an enforceable undertaking to promise, in writing, to complete certain actions to demonstrate that the failures have been rectified and will not happen again;
  • You could be issued an infringement notice for each failure;
  • You could be issued a civil penalty for each failure.
You could also have sanctions imposed if:
  • You provide false or misleading information;
  • You no longer satisfy the criteria for approval as a sponsor;
  • You have been found to have contravened a Commonwealth, state or territory law;
  • A sponsored person breaks a law relating to the licensing, registration or membership needed to work in the nominated position

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2. Immigration Penalties

Employer/Sponsor Breaches – Immigration.

There are criminal, civil penalty and administrative sanctions in the Migration Act.

1. Criminal Offences & Civil Penalties

  • allowing an unlawful non-citizen to work (s245AB)
  • allowing a lawful non-citizen to work in breach of a work-related condition (s245AC)
  • referring an unlawful non-citizen for work (s245AE)
  • referring a lawful non-citizen for work in breach of a work-related condition (s245AEA).
  • asking for, or receiving, a benefit from another person in return for the occurrence of a sponsorship-related event (s245AR)
  • offering to provide, or providing, a benefit to another person in return for the occurrence of a sponsorship-related event.​

Apply to:
These offences/civil penalties apply to the company, office holders, employees and contractors who are involved in the offence and have knowledge or are reckless.
Some offences/civil penalties apply whether the employee is sponsored or not.
They could apply to the employees of sub-contractors depending on who has knowledge of any wrongdoing.

Possible Outcomes

  • Formal Warning – this may be considered as adverse information for visa applications which must be declared
  • Fines
  • Adverse information which case officers will take into account when deciding whether to approve applications by the business
  • Barring from sponsoring visa applicants which can range from months to years
  • Cancellation of Sponsorship Licence and thereby cancellation of visas
  • Publication on Australian Border Force website: ABF Sanctions
  • Media/public relations: negative press coverage
  • Proceedings for Civil Penalty Order: The ABF can initiate civil proceedings
  • Referral for criminal prosecution

All business nominations and visa applications sponsored by the business are put on hold pending outcomes or during the sanctioned period. In some instances, it may be open to them to refuse the applications on the basis of the investigation itself being adverse information but this is less common.

2. Sponsorship Obligations – Civil Sanctions & Administrative Penalties

  • breach of sponsorship obligations (s140Q) (see below summary)
  • failing to provide name and address to an Inspector when required (s140XE)
  • failing to provide records or documents to an Inspector when required (s140XF)
Migration Regulation Sponsorship obligation
2.78 to cooperate with inspectors
2.79 to ensure equivalent terms and conditions of employment
2.80 to pay travel costs to enable sponsored persons to leave Australia
2.80A to pay travel costs of domestic workers (executive)
2.81 to pay costs incurred by the Commonwealth to locate and remove unlawful non-citizen
2.82 to keep records
2.83 to provide records and information to the Minister
2.84 to provide information to Immigration when certain events occur
2.85 to secure an offer of a reasonable standard of accommodation
2.86 to ensure primary sponsored person works or participates in nominated occupation, program or activity
2.86A to ensure primary sponsored person works or participates in activity in relation to which the visa was granted
2.87 not to recover, transfer or take actions that would result in another person paying for certain costs
2.87B* to provide training
2.87C to not engage in discriminatory recruitment practices

Employers/Sponsors can be issued with Infringement Notices if found to be in contravention of civil penalty provisions or failed to satisfy the obligations contained in the sponsorship compliance framework under the Migration Act 1958.

3. Penalties

Below are a summary of the penalties that can be issued under the Migration Act to businesses and sponsors.

Sanction Category Possible Penalty (Company) Possible Penalty (Individual) Details
Illegal Worker Warning Notice (IWWN) Administrative 
warning Administrative warning Issued for first-time or minor breaches; serves as a formal warning without financial penalty. Can affect sponsorship as is considered adverse information
Infringement Notice Monetary fine Monetary fine For allowing unlawful non-citizens to work or lawful non-citizens to work in breach of visa conditions. These are strict liability offences, meaning no intent is required.
Civil Penalty Monetary fine Monetary fine Imposed when an employer allows unlawful non-citizens to work or lawful non-citizens to work in breach of visa conditions. These penalties apply per worker and can be pursued through civil court proceedings.
Criminal Offense Monetary fine of up to hundreds of thousands and/or 2 years imprisonment Monetary fine of up to hundreds of thousands and/or 2 years imprisonment For knowingly or recklessly allowing unlawful non-citizens to work or lawful non-citizens to work in breach of visa conditions. Criminal charges can lead to significant fines and imprisonment.
Aggravated Criminal Offense Monetary fine of over $1M and/or 5 years imprisonment Monetary fine of up to hundreds of thousands and/or 5 years imprisonment Applies when there is exploitation or coercion of workers, such as through forced labour or human trafficking. These are the most severe offences with the highest penalty

4. Process

The Australian Border Force (ABF) is the government department responsible for immigration audits although Fair Work Officers also have delegated powers.

Monitoring audits can occur by:

  • ABF Unannounced site/office visits
  • by written request – usually 14 days’ notice are given
  • by request for a visit – usually 24 hours’ notice are given

Officers can issue

  • ‘Illegal Worker Warning Notice’ (IWWN) – where the ABF suspects there have been breaches of s245AB, s245AC, s245AE and s245EA above giving someone or a business an opportunity to provide records and respond to alleged breaches
  • ‘Notices of Intention to Take Action’ giving sponsors an opportunity to provide records and respond to breaches of obligations
  • Referrals for criminal prosecution

5. Steps to protect the business

Employers must therefore be vigilant in checking work rights of all employees. Some of the steps employers may include:

  1. Requesting all new hires to provide evidence of their status
    • A foreign passport with Visa Entitlement Verification Online (VEVO) checks
    • an Australian passport; or
    • a New Zealand passport; or
    • an Australian certificate of citizenship, along with photo ID; or
    • a Certificate of Evidence of Resident Status along with photo ID; or
    • a Certificate of Status for New Zealand Citizens in Australia along with photo ID

Using the Department’s VEVO system to check foreign passports allows an employer to check if they have a visa with the relevant permission to work.

Periodically checking using VEVO on employees who hold a foreign passport (and where permanent residency has not been achieved) every 3 months is the recommended practice.

  1. Ensuring compliance with sponsorship obligations at all times in relation to sponsored workers.
  2. Ensuring care is taken if hiring workers through subcontracting or on-hire arrangements. Do not assume the subcontractor or on-hire company has taken steps to ensure the worker has the relevant permission to work. Ajuria can advise on this in more detail if required.
  3. Maintaining a record of the checks made. This will be helpful in the event of any future audit or monitoring.

In the event of a breach, taking the above steps may not necessarily prevent prosecution, a fine or pursuance of a civil penalty by the Australian Border Force against the business but will be considered a very strong mitigating factor in any investigation or penalty applied.
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DISCLAIMER
The information contained in this publication is of a general nature only and may be subject to change. It should not be used as legal advice. To the extent permissible by law, Ajuria Lawyers and its associated entities shall not be liable for any errors, omissions, defects or misrepresentations in the information or for any loss or damage suffered by persons who use or rely on such information. Liability limited by a scheme approved under Professional
 Standards Legislation.
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