Businesses who want to sponsor overseas workers must provide evidence of training Australian citizens and permanent residents. Since 12 August 2018 the method has changed from providing evedence of training, to paying a training contribution charge (TCC) on top of the employer nomination charges.
After 12 August 2018
The Training Contribution Charge must be paid by any sponsoring employer who lodged their application after 12 August 2018. The amount to be paid by each employer is determined by the 'turnover' figure of the sponsoring business. The below table highlights the new fees, which include the subclass 482 (TSS), subclass 186 (ENS) and subclass 187 (RSMS) nominations.
- The Training benchmarks no longer need to be met, however records of prior compliance should be kept for at least 7 years;
- The Training Contribution Charge does not need to be paid in full for each year of the second 482 sponsorship, if the nomination is for a 482 transition to new employer
|Anual Turnover||482 Application||186 Application||187 Application|
|0 to 9.9 Million||$1,300 | per year||$3,000 | one off||$3,000 | one off|
|10 Million +||$1,800 | per year||$5,000 | one off||$5,000 | one off|
Payment Of TCC
Employers often do not want to pay the SAF Leavy Training Contribution Charge and would prefer to pass this on to their new employee. Unfortunately, the Department may see this as "paying for visa sponsorship" which is unlawful. If you would like to understand how this works you should ask your migration agent before requiring your employer to pay the fee, or pay you back. There may be significant criminal penalties if employers attempt to recover this money.
if a visa applicant leaves their existing 457 or 482 sponsor for any reason, they may apply to be nominated by another standard business sponsor. The visa holder cannot begin work for the other sponsor until that new employer becomes a standard business sponsor and nominates the employer. This process takes less than the 60 day period within which the sponsored employee has to secure a new sponsor, however the Skilling Australians Fund - Training Contribution Charge - must be paid in advance and is generally not recoverable if the nomination is refused.
In the September 2018 Skilled E News, the Department have confirmed this second 482 business sponsor may only pay 1 year of the training contribution charge and it would be considered sufficient to meet the criteria for the remaining length of the 457 visa holders time in Australia.
Is a visa holder prevented from working past the period SAF levy has been paid for?
No – as long as their visa remains valid and they continue to work in the nominated occupation for the nominated employer
Before 12 August 2018
The old training benchmarks must be met by employers lodging an application prior to 12 August 2018. As has allways been the case, the employer is responsible for complying with these obligations and may not recover the payments from the visa applicant.
Relevant training benchmark requirements for employer sponsors include either training benchmark A or B as listed below.
Current employers of overseas workers must ensure they have records they previously met the traning benchmarks for the relevant sponsorship period up to 12 August 2018. If you are unsure, you should contact your agent to establish the periods you must retain records for.
Recent expenditure, by the business, to the equivalent of at least 2% of the payroll of the business, in payments allocated to a training fund that operates in the same or a related industry of the business.
Acceptable training funds include:
- An industry training fund - that is, a statutory authority responsible for providing funding for training of eligible workers in certain industries;
- Funds managed by a recognised industry body that provides training opportunities in their industry and quarantines contributions to the fund for training purposes only;
- Recognised scholarship funds operated by an Australian university or TAFE college only.
Unacceptable training funds include:
- Training funds operated by Registered Training Organisations (RTOs) or private individuals; or
- Funds that allocate a percentage or part of the contributions received to commissions or offer refunds for failed immigration applications.
Recent expenditure for Training Benchmark A is defined as expenditure made in the previous financial year or the previous 12 months, as evidenced by a receipt for the payment or a letter from the relevant fund.
Recent expenditure, by the business, to the equivalent of at least 1% of the payroll of the business, in the provision of training of employees of the business who are Australian citizens and Australian permanent residents.
Acceptable expenditure includes:
- Payments for Australian employees to undertake a formal course of study, including any reasonable and necessary associated costs (e.g. costs of travelling to the training venue or access an online training programme);
- Payments to Registered Training Organisations (RTOs) to deliver face-to-face training to Australian employees that will contribute to an Australian Qualifications Framework qualification;
- Purchase of an eLearning platform or standalone training software;
- Salary of a person whose sole role is to provide training to Australian employee;
- Expenditure to attend conferences for continuing professional development;
- Payments to cover the salary of Australian employees engaged by the business as:
- apprentices or trainees under a formal training contract, or
- an employee who has completed an undergraduate or higher degree in a university within the last 2 years, and is participating in a formal, structured graduate program for up to 2 years, or completing a professional year following their graduation.
Unacceptable expenditure includes:
- On the job training that is not otherwise identified above as applicable expenditure for Training Benchmark B;
- Training that is not relevant to the industry in which the business operates;
- Training undertaken by persons who are principals in the business or their family members;
- Training that has a very low skill level having regard to the characteristics and size of the business;
- Induction training;
- Staff salaries apportioned to time spent undertaking online or other training courses;
- Purchase of software for use in normal duties;
- Membership fees;
- Purchase of books, journals or magazine subscriptions;
- Attending conferences for purposes other than continuing professional development;
- Hiring a booth at a trade show, conference or expo.
- Recent expenditure for Training Benchmark B is defined as expenditure made in the previous financial year or the previous 12 months, as evidenced by a receipt for the payment(s) or a contract for employment of the relevant individual for whom salary payments are being included within expenditure that can count towards the benchmark.
- Australian employee is defined as an Australian citizen or Australian permanent resident.
- The business is also required to show that the provision of training is related to the purpose of the business.
The definition of payroll for the purposes of the training benchmarks is the total amount of:
- any wages, remuneration, salary, commission, bonuses, allowances, superannuation contributions or eligible termination payments, defined as wages in payroll tax legislation for the relevant state/territory, that the applicant has paid to their employees during the same period; and
- payments made to contractors or subcontractors during the same period if work provided by the contractor is related to the service/product provided by the applicant, regardless of whether such payments are included for payroll tax purposes or not
if the applicant does not pay either of the types of payments specified above:
- the total monetary values of the director’s salaries, fees and drawn payments; or
- the actual profit of the business
Law source: IMMI 17/045
If you have previously been required to submit an auditable training plan you should ensure you meet the criteria before the 12 months period has expired.
The auditable plan must clearly identify how you intend to meet one of the prescribed training benchmarks (A or B). The auditable plan must:
- Relate to the immediate future (within the next 12 months);
- Clearly articulate the forecast payroll for the next 12 months;
- Clearly set out the intended expenditure towards the training benchmark, and
- Show a clear intent to implement the plan and be accompanied by clear evidence of the type of training, the duration of the training and the anticipated costs associated with delivering the training.