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Benefits outweigh costs of sponsoring Employees

Some employers baulk at the costs of sponsoring an employee. For a permanent residence visa for an employer with turnover of more than $10 million, the employer will need to pay a one-off charge of $5,000 for each employee sponsored. For employers with turnover below the threshold the one-off training contribution charge is $3,000 for each employee sponsored.

The employee must agree to work for the employer for a period of at least two years under the direct entry stream of the 186 and 187 permanent residence employer-sponsored visas. With processing times for these visas up two years, this means the employee would have worked for a period of about four years in the business. For employers with lower turnover levels, this means a cost of only about $750 per sponsored employee each year.

The remoteness of some regional employers means that the partner of a sponsored employee often also works in the business. Here the costs fall to only $375 a year for each sponsored employee.

The costs to sponsor an employee on a visa or a temporary visa like the 482 visa, is $1,200 each year. This increases to $1,800 per year for employers with a turnover of more than $10 million. Employees on the medium-term stream occupation list have an eye on permanent residence in Australia. This avenue becomes available after the employee has worked in the position with the same employer for a period of three years. To apply for permanent residence the employee would need to agree to work for a further two years in the role. The processing time for this stream for the 186 and 187 visas is around a year to a year and a half. This brings the total employment period to around 6 and half years.

Recruiting and training new staff brings high costs, delays and can increase uncertainty in business processes. Retaining talented and highly-skilled staff in hard-to-fill roles is a key win for employers. It brings greater certainty in staffing challenges as well allowing for longer-term business planning. This business confidence and longer-term planning assurance certainly offsets the cost of $1,200 a year for most employers.

The federal government introduced the training contribution charge to be fed into the skilling Australians fund. This fund is ear-marked to boost the employability and skills of Australians, which further benefits employers that struggle to find key skills in the Australian job market.

For large employers the costs of the training contribution charge is less than the scheme it replaced around two years ago. Under the old scheme, employers needed to prove they had paid at least 1% of their turnover every year on training their Australian employees. For businesses with turnover of more than $10 million, the annual training cost was more than $10,000 each year.

Employers can also obtain a refund of the training contribution charge where the sponsored employee does not begin work with the sponsor. A refund is also available for the employer where the visa is refused on health or character grounds.

Finding, training and retaining skilled staff is the key challenge that almost all businesses in Australia face. Sponsoring talented employees on a visa can be a key tool to reduce staff turnover and lengthen business planning cycles.

For more information on the cost of sponsoring employees, or any migration queries, contact Sed Crest, principal of Crest Migration (07 5592 0164) and lawyer with McLaughlins Lawyers – your Gold Coast Lawyers. We Stand Beside You.