457 visa

As a news flash, the previous Skilled Occupation List ( SOL) has been replaced by the new Medium to Long Term Strategic Skills List ( MLTSSL) and the previous secondary Consolidated Sponsored Occupation List ( CSOL) has been replaced by the Short Term Skilled Occupation List ( STSOL).

Some occupations have been removed from the MLTSSL but the greatest impact is in relation to 457 visas . The 457 visa program been split into 2 streams , viz occupations on the MLTSSL – up to 4 years + a pathway to permanent residence and occupations on the STSOL only, which are restricted to 2 year visas + 2 years extension only with no PR pathway.

New 457 list for 4 year visas with PR pathway and 2 years + 2 year ext only

The sub class 457 temporary work visa program (457 visa program) enables Australian businesses (and in some cases overseas companies with local offices,) the opportunity as a Standard Business Sponsor to source and engage overseas skilled staff (from outside Australia or at times inside Australia if on a qualifying visa), on a sponsored visa to work in their businesses where there are existing and increasing skill shortages in occupations.

This page is currently being revised for more significant changes and the comments to date are interim only to the changes foreshadowed on the 1 July 2017. The 457 temporary visa program will undergo more dramatic change in March 2018 when the visa will be re-named the Temporary Skill Shortage (TSS) visa. Sponsorship aspects will continue largely the same until March 2018 when a series of additional levies will be imposed upon employees wishing to sponsor overseas workers. More on this will be advised when the nature of the changes become clearer.


457 visa applicants are experiencing longer-than-usual processing times.

Employers without accredited sponsorship status are experiencing an increase in average processing times for 457 visa applications. According to DIBP figures, the department is finalising its assessment of 75 per cent of Subclass 457 applications within five months from the date an application is lodged. Some 90 per cent are being finalised within 10 months. It is currently not uncommon for Subclass 457 applicants to wait at least three months before their application is assigned to a case officer for assessment.

Employers may need to adjust start dates and timelines based on current processing times and are encouraged to take the processing times into consideration, especially for positions that need to be filled before March 2018.

The 457 visa program is a 3 stage procedure for new employer sponsors;
  • First stage: the employer must be approved as a Standard Business Sponsor (SBS) by showing that it is lawfully operating, has the capacity to sponsor and that it meets critical criteria including an obligation to train local staff including meeting 1% (Training Benchmark B -with local employees) or 2% (Training Benchmark A- if they have no local workers) of their payroll spend, (including super)  per year from the anniversary of the sponsorship grant (see training benchmarks below);
  • Second stage: the employer must nominate the ANZSCO position from either the MLTSSL or the STSOL , they must pay the nominee ‘market’ salary (which can be no less than the TSMIT -see below), and must identify skills and responsibilities of the position; and
  • Third (final) stage: the 457 visa applicant’s skills must be matched with the nominated ANZSCO occupation.

*The job title is often different from the nominated occupation.

After SBS approval

Once a an employer has been approved to sponsor, it must now confirm the number of new 457 temporary nomination for the life of its sponsorship depending on the approval given:

  • 6 years (for accredited sponsors),
  • 3 years for SBS or
  • 18 months in cases of start up companies (less than 12 months operating)

The ability to sponsor will last the length of the sponsorship approval or until the number of nominated positions runs out – whichever comes first.

After approval of the sponsorship, the usual procedure is; nomination of position and visa approval for visa periods up to 4 years, unless the nominee already has a 457 visa. If so, only a nomination will be required for the balance of the existing 457 visa.

‘Self Sponsorship’ for a 457 visa

We often receive queries from persons wishing to know about ‘self sponsorship’ for a 457 visa. There is however no such thing as ‘self sponsorship’. The sponsorship regulations require an employer- employee relationship, so a sole trader cannot sponsor himself as there will be no separate legal relationship between them. What is required is that a separate legal relationship must be established between themselves and the sponsor. A company and a partnership can be a sponsor as they are both a separate legal entity and a sole trader can sponsor other workers if the employer- employee relationship exists.

ALERT: Recent change of policy

The Department of Immigration and Border Protection (DIBP) has recently made changes to its 457 (Temporary Work) visa policy (457 policy) that effectively means that self-sponsorship applications under the 457 temporary work visa program are likely to be refused on “genuineness” grounds by the Department.

The DIBP’s 457 policy now states that “The [457] program is not intended to be used for non-citizens to establish a business in Australia and self-sponsor themselves; there are other visa pathways available for such purposes.”

Additionally, as part of the nomination application for a 457 visa, the nominating business is now required to submit information to the DIBP such as information about the identity of the shareholders and directors of the business.

Accordingly, it is likely that if a 457 visa applicant (or a related party e.g. spouse) owns or controls an Australian business (e.g. is a shareholder or director) that is the nominating business for that 457 visa applicant, their 457 nomination application and/or 457 visa application will come under much closer examination and may well be refused.

However,it is important to note that this change concerns policy, not law and the DIBP does not explicitly prohibit self-sponsorship, but questions whether the position is genuinely required, or whether it was created for the purpose of securing a visa for the applicant. If applicants and sponsors can provide substantial and compelling evidence, as well as comprehensive written submissions to show why the business needs the particular role within the company, this may prove the position is indeed genuine.

In the past self-sponsorship cases have been approved on appeal at Tribunal level.These cases may still succeed at Administrative Appeals Tribunal (AAT) and in the courts  subsequent to this policy change, however a case would have to be very strong and well prepared to do so.

Post March 2018 proposed changes

Signet has assisted self sponsored applicants to a successful outcome largely prior to this policy shift and up-coming changes, but since labour market testing (LMT) will be required for all such visas (Temporary Skill Shortage -TSS after March 2018) it appears there will be little room for this technique given the clear personal connection evident in self-sponsorship..

For more information on Employer sponsors, Temporary visa applicants or Labour agreements please click on the text to take you to the appropriate page.