Labour Market Testing for S/C457 nominees - necessary or not?

After more than 25 years as an Immigration lawyer I have become more than fully aware that governments are generally exceptionally good at making complex processes out of something which could and should be simple.

 

Labour market testing (LMT) in the 457 visa space is a classic example.

 

LMT was required many years ago and was eventually abandoned after an enquiry determined that it was useless and that it would be more appropriate for the government to publish a list of occupations that were acknowledged to be in demand and that could be updated from time to time as demand changed. This straightforward concept was adopted and was a positive step towards smooth processing of visa applications. If there can be any criticism of the process it would be that the list of occupations was rarely updated -  a government responsibility -  and so possibly failed to properly reflect labour market shortages.

 Earlier this year, in an apparent attempt to appease the unions, the labour government said LMT would be reintroduced. The Liberals, whilst in opposition, were critical of this proposal and at one point after winning government, announced that they were ‘open for business’. Notwithstanding this, LMT was introduced on 23^rd of November this year.

 The rationale behind LMT is that standard business sponsors must test the local labour market prior to lodging the nomination and, must provide information with their nomination about their attempts to recruit Australian workers and how they have determined on the basis of these attempts that there is no suitably qualified and experienced Australian citizen, Australian permanent resident or eligible temporary visa holder available to fill the position.

 While this sounds straightforward enough, certain occupations are exempt. There are also exemptions as a result of international trade obligations our government has with other countries so that workers from certain countries such as Chile or Thailand are not affected by the LMT requirement.

Exemptions may also apply if the nominated employee is a current employee of an associated business that has its operations in certain nominate countries.

One obvious consequence of these exemptions is that LMT may or may not be required depending upon the nationality or business background of the proposed nominee. If the real purpose of LMT is to demonstrate that labour market shortages exist, this does not make sense at all.

What all this means is that employers wishing to nominate employees under the S/C457 visa class need to first determine whether LMT is required and unfortunately, the answer to that question will not always be obvious. This inevitably adds another layer of complexity to a process which in turn adds to the cost of making applications thereby making it harder for employers with a need for skilled staff to remain competitive.

David Stratton LIV Accredited Specialist Immigration Law