Labour Market Testing (LMT) ensures that Australian citizens and permanent residents have the first opportunity to apply for job openings or nominated positions before they are offered to overseas workers. To read more about LMT, click here.
There are three LMT exemptions wherein job applicants do not need to undergo the process. In this article, we will explore three exemptions to LMT in Australia. Generally, these include:
- Intra-Company Transfers
- High Income Earners ($250,000)
- International Trade Obligation
Exemption 1: Intra-Company Transfers
One of the most common LMT exemptions applies in situations where an employer transfers an employee from their overseas branch to their Australian branch. The exemption is known as the intra-company transfer exemption.
Intra-company transfers refer to the transfer of an employee from a foreign branch of a company to its Australian branch. This is a common practice for multinational companies that must move employees around to manage their operations. The Australian government allows intra-company transfers as an exemption to the labour market testing (LMT) requirement for employers seeking to sponsor foreign workers.
Qualifications for Exemption
In order to qualify for this exemption, the employee must have been employed by the overseas branch of the company for at least 12 months and must be transferred to Australia to work in a similar role for the Australian branch. Moreover, the employer or an associated entity of that sponsor must also provide evidence that the transfer is necessary to support the company’s operations in Australia.
Intra-company transfers significantly benefit multinational companies operating in Australia by allowing them to transfer skilled employees with exceptional and outstanding achievement from their overseas branches to their Australian operations. This exemption to the LMT requirement helps streamline the visa application process and reduces the administrative burden on employers. It also enables companies to leverage the skills and expertise of their existing employees to support their Australian operations without having to search for talent locally.
Exemption 2: High-Income Earners
Workers who have an annual income of $250,000 may not need their employers to complete LMT. In other words, this exempts employers from the responsibility of conducting Labour Market Testing (LMT) when hiring foreign workers for certain skilled positions. This exemption allows employers to bypass LMT requirements if they offer a salary of $250,000
Foreign employees should receive a pay package equal to or more than AU$250,000 to be eligible for this exemption. This exemption applies to various visa subclasses, including Temporary Skill Shortage (TSS) visa (subclass 482), Employer Nomination Scheme (ENS) visa (subclass 186), and Regional Sponsored Migration Scheme (RSMS) visa (subclass 187).
The 250K Annual Income exemption aims to reduce the administrative burden on employers while ensuring that Australian workers are not disadvantaged. It also recognises that these workers will likely have unique skills and experience that may not be readily available within the Australian labour market.
It is important to note that this exemption does not apply to all skilled positions. Employers must still meet other visa requirements, such as providing evidence of the genuine need for the foreign worker and demonstrating attempts to recruit Australian workers before resorting to overseas recruitment.
Exemption 3: International Trade Obligation
Another inclusion to the LMT exemptions in Australia is related to international trade obligations. Australia has a strong commitment to international trade and investment liberalisation. It has entered into several international trade agreements, including the World Trade Organisation (WTO) and various bilateral and regional trade agreements.
As a signatory to international trade obligations and the World Trade Organisation agreements (just like with other South East Asian nations such as Malaysia, Philippines, Singapore, Thailand, etc.), Australia has certain obligations and commitments that it must fulfil.
An example of Australia’s international trade agreement is to eliminate or reduce barriers to trade in goods and services. This includes the elimination of discriminatory measures that affect imports and exports.
However, in order to meet its international trade obligations, this WTO member country may need to implement certain measures that would otherwise be inconsistent with its domestic laws, including its labour market testing (LMT) requirements.
Trade Agreements
Under the WTO General Agreement on Trade in Services (GATS), Australia has committed to temporarily allowing foreign workers to enter certain service sectors. This includes sectors such as legal services, financial services, and telecommunications services. To fulfil this commitment, Australia may need to exempt certain occupations in these sectors from the LMT requirement.
Similarly, under various bilateral and regional trade agreements, Australia has committed to temporarily allowing foreign workers to enter certain sectors. For example, the Australia-United States Free Trade Agreement (AUSFTA) provides for the temporary entry of business persons. This includes executive or senior manager, executives, and professionals. In order to fulfil this commitment, Australia may need to exempt certain occupations in these sectors from the LMT requirement.
LMT is important to ensure that Australian citizens and permanent residents have the first opportunity to make job applications. The three exemptions discussed in this article – intra-company transfers, high-income threshold, and international trade obligations – are just a few examples of situations where LMT may not be required. Employers need to understand these exemptions and ensure they comply with all relevant legislation when hiring overseas workers.
Seeking Legal Help for LMT Exemptions Process
Under the current regulations, LMT exemptions are available for certain types of jobs, industries and regions. For example, this includes highly skilled positions, senior manager occupation, and certain regional areas. Additionally, LMT exemptions may also be available for certain visa holders. This may include those with a 457 or TSS visa.
Lawyers can assist both employers and visa holders navigate the complex LMT exemptions process. For employers, lawyers can provide guidance on which exemptions may be applicable to their specific situation. They can also assist in preparing and submitting the necessary documentation to the Department of Home Affairs.
JB Solicitors has a team of lawyers who can provide expert advice and assistance. We can also assist you in challenging or appealing decisions that the Department of Home Affairs made regarding LMT exemptions. This may include appealing a decision to refuse an exemption or challenging a decision to revoke an exemption previously granted.
Contact us today.
