How to employ from overseas

In order to come to work in Australia, overseas tradesmen require a working visa. Visas can provide workers with either temporary residency (typically three to four years) or permanent residency.

Temporary residents must show evidence of private health insurance, pay international student rates to put their children through school, and have no access to safety nets such as unemployment benefits and other social security payments.

Permanent residency, on the other hand, provides access to Medicare, free public schooling, and social security payments.
 
Skilled Occupation Lists

The federal government will only let in overseas workers where there is an identified need for those workers. The lists have been in use for over 160 years.

In 1848, Australia was applying criteria to prospective emigrants leaving London for Moreton Bay, limiting passage to 'agricultural labourers, shepherds, female domestic and farm servants, dairy maids, blacksmiths, wheelwrights, carpenters and other country mechanics'. They were required to be in good health and of good character (both tests remain to this day).

The difficulty facing Australia (and every other developed country in the world) is creating barriers which appear on their face to be fair to all, while at the same time limiting the numbers of people who are eligible from entering the country.
There are three main categories of work visas: independent skilled, employer-sponsored and state/territory-sponsored.
 
Independent skilled visas

These visas offer permanent residency and have the advantage of freedom of movement once the worker gets here.  Unfortunately, vehicle painters and panel beaters have recently been removed from Schedule 1, meaning that the independent path is no longer available to them. But there are other options.
 
Employer-sponsored visas

There has been a move away from the independent skilled migration visa (supply-driven) and more focus on employer-sponsored (demand-driven) visas.

The 457 visa is a four-year temporary residency visa. This has the disadvantages listed above, such as no access to social security. There is one major benefit however – 457 visa applicants generally receive their visa within eight to 12 weeks.
 
Approved sponsors

Employers wishing to hire overseas workers must be approved sponsors. This requires that you show you are lawfully operating in Australia and have a strong commitment to employing local labour and non-discriminatory employment practices. Generally DIAC will require proof that you are a viable company.

Training benchmarks

The sting in the tail for most employers is the new training benchmark regime.

If you have been operating for more than 12 months, you must show that you are committed to training your Australian (permanent resident and citizen) staff. To do this you must have spent one per cent of your gross payroll on formal training in the 12 months prior to applying for the sponsorship. This is easy to achieve if you have apprentices or trainees. If you can’t show this level of training expenditure, you have the option of investing two per cent of your gross payroll into a recognised industry training fund for the next three years.

Once you are an approved, you must show that you have been unable to find a person locally.

At this time, you are now ready to hire an overseas qualified worker, providing that the nominated occupation is on the list of approved occupations for the 457 visa.
 
Minimum wage

Another sting in the tail for some industries is the requirement to pay employees a minimum wage known as the Temporary Skilled Migration Income Threshold (TSMIT). The TSMIT is indexed to inflation and is currently set at $49,330 (excluding superannuation) for most occupations.

For many employers in regional areas this is not sustainable. If the employer hires other workers performing the same job, the overseas worker must be paid the same wage.

One of the key advantages of this visa from the employer’s perspective is that the employee only holds a valid visa while they are employed by you.

The good news for the paint and panel industry is that, as of 14 July 2011, the following trades are still on the 457 list: Panelbeater; Vehicle Body Builder; Vehicle Trimmer; Vehicle Painter.
 
Employer sponsored visas

There is also a permanent visa option for employer-sponsored workers. The typical pathway is that the worker (who must be under 45 years of age and have vocational level English) will have worked full-time in Australia in the nominated occupation on a 457 visa for the last two years, or they have had their skills formally assessed by TRA or VETASSESS and have at least three years’ full-time work experience in the occupation.

In this case, an employer may agree to sponsor their worker for a permanent residency visa.

The downside from the employer’s perspective is that the employer no longer has any control over the employee at that time, and they are free to work for whoever they like.

State/territory-sponsored temporary residence visas

The majority of interested workers, and particularly those over 40 – who learnt on the job and have no formal qualifications, and/or those where English is their second language – will find it difficult to meet the new points test regime. For these people, the independent path is not an option.

It is also difficult for workers overseas to find an interested employer prepared to go through the somewhat complex and bureaucratic task of becoming an approved business sponsor.

The states and territories have recognised this dilemma. They are keen to attract skilled workers, particularly in Western Australia with the mining industry absorbing many local workers, and in Queensland.

The states and territories will sponsor qualified workers and the sponsorship is worth points – these extra points are often enough to enable workers to qualify for a permanent residency visa.

It is also easier to obtain a visa for those willing to work in regional areas. As of 14 July 2011, Panelbeaters, Vehicle Body Builders, Trimmers and Painters are still on the states/territories pick list.

Presently, the states/territories are sponsoring the following automotive trades:

ACT
Motor mechanic, motorcycle mechanic, auto electrician, panel beater, vehicle painter

nORTHERN tERRITOry
Motor mechanic, motorcycle mechanic,
auto electrician, panel beater, vehicle painter

NSW
Panel beater, Murray region
Vehicle painter, auto electrician,
Murray and Northern inland region

Queensland
No motor trades

south australia
Motor mechanic, motorcycle mechanic,
 auto electrician, panel beater, vehicle painter

Tasmania
Motor mechanic, motorcycle mechanic,
auto electrician, panel beater, vehicle painter

Victoria
Motor mechanic, auto electrician,
panel beater, vehicle painter

Western Australia
Auto electrician, motor mechanic

IELTS is the International English test. Most native English-speaking workers can score sixes in each of the four categories (reading, speaking, writing and listening).

The test is not easy however, and it is advisable for applicants to brush up on their writing skills before attempting the test.

The state/territory-sponsored path provides all the benefits of a permanent residence visa as well as allowing the worker to choose which employer they work for.

The drawback with this option is that the workers are required to sign an undertaking (which currently is not legally enforceable) that they will live in the state/territory for two years. This is a small price to pay for a permanent residency visa.
 
1 July 2012 changes

On July 1, 2012, a completely new system will be introduced for general skilled migration. It should not impact negatively on the 457 system but will significantly impact the state/territory sponsored visas and independent general skilled visas.

Under the proposed system, prospective employees must submit their details. The cream of the crop (based on their points score) will then be invited to apply for a visa on a quarterly basis.

This will allow DIAC to better control who they let in the door. Under the proposed regime, there will be a discretionary element. This system has been used in NZ for some time with great success.