Introduction
Australia’s skilled migration program allows businesses to fill labour shortages by sponsoring qualified overseas workers under visas like the TSS 482, ENS 186, and 494 regional visa. While this presents an excellent opportunity for small businesses to access global talent, it also comes with a range of compliance obligations that must be met.
Unfortunately, many small businesses unintentionally breach sponsorship conditions—often due to a lack of awareness—putting their business, the visa holder, and their future sponsorship eligibility at risk.
In this post, we outline the most common mistakes small businesses make when sponsoring employees, and how to avoid them.
- Not Paying the Correct Market or Award Salary
Mistake: Offering the salary stated in the initial contract without keeping up with Fair Work Award increases or changes in market rates.
Why it matters: Sponsors must ensure the salary is:
- Above the Temporary Skilled Migration Income Threshold (TSMIT)
- At least equivalent to an Australian worker in the same role
- In line with Award or Enterprise Agreement minimums
Tip: Review salaries annually or whenever Fair Work rates change.
- Failing to Notify the Department of Changes
Mistake: Not informing the Department of Home Affairs of:
- Change in business ownership, structure, or directors
- Change in employee duties, location, salary, or cessation of employment
Why it matters: Sponsors are legally required to report changes within 28 days.
Tip: Create an internal checklist and assign a compliance officer to handle sponsorship notifications.
- Incorrect or Incomplete Labour Market Testing (LMT)
Mistake: Skipping or improperly conducting the Labour Market Testing process before nominating an overseas worker.
Why it matters: Inadequate evidence of local recruitment efforts can result in nomination refusal or visa cancellation.
Tip: Advertise in the correct format, for at least 28 days, on two valid platforms, and retain evidence for at least 5 years.
- Offering Duties Not Matching the Nominated Occupation
Mistake: Hiring a visa holder under one occupation but assigning unrelated tasks or drastically different responsibilities.
Why it matters: Visa holders must only work in the nominated occupation; deviations may lead to non-compliance and sponsorship bans.
Tip: Ensure actual job duties align with ANZSCO descriptions for the nominated role.
- Failing to Keep Proper Employment Records
Mistake: Not maintaining required records such as:
- Payslips
- Contracts
- Timesheets
- Communication with the Department
Why it matters: Sponsors must retain all relevant documents for at least 5 years and produce them during audits.
Tip: Use digital HR and payroll systems to automate and store compliance records.
- Underestimating Visa Processing and Planning Time
Mistake: Leaving visa applications to the last minute or assuming approval will be automatic.
Why it matters: Delays can lead to operational disruptions, missed hiring timelines, or unlawful employment.
Tip: Start the process early and consult a registered migration agent to ensure eligibility and timely submission.
- Not Understanding Ongoing Sponsorship Obligations
Mistake: Thinking that obligations end once the visa is granted.
Why it matters: SBS holders must comply throughout the visa period, including:
- Paying for return travel (if required)
- Not passing on immigration costs to the employee
- Cooperating with compliance inspections
Tip: Review the full list of sponsorship obligations regularly and conduct internal audits.
Final Thoughts
Sponsoring overseas workers can transform your small business by filling skill gaps and bringing in fresh expertise. But without the right compliance framework, it can quickly turn into a legal and financial burden.
Avoiding these common mistakes will help your business:
- Stay compliant
- Protect your sponsored staff
- Maintain eligibility for future sponsorship
Need help navigating the complexities of sponsorship compliance? Contact VALID VISAS for expert guidance and tailored support for small businesses. Contact VALID VISAS for expert advice and support. Contact us on admin@validvisas.com.au or employment law professional today.
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