As a business with an On-Hire agreement we constantly see confusion regarding the features, benefits and differences between the two ways of obtaining 457 visa sponsorship in Australia. These two avenues are; Standard Business Sponsorship and the agreement Pendragon hold, which is a Labour On-Hire Sponsorship.
The main difference between both is that the visa holder is either sponsored directly by a company they are providing the services for (Standard Business Sponsor) or via a third party (Labour On-Hire Sponsorship). There are advantages and disadvantages with both, which may influence your decision to chose one avenue of sponsorship over another.
Through securing and maintaining a Labour Hire Agreement with the Department of Immigration and Citizenship Australian, on-hire firms seek to attract and contract overseas workers to on-hire out to unrelated businesses. The labour agreement provides the on-hire industry with a clear pathway for the recruitment and contracting of skilled overseas workers.
When applying for a 457 visa, the on-hire company must meet the same requirements as a Standard Business Sponsor. If you maintain sponsorship through an on-hire company, although on-hire companies are a surrogate employer, you can only be paid directly by the sponsoring (on-hire) company.
Advantage and Disadvantage of a Standard Business Sponsorship:
Advantage: With Standard Business Sponsorship, you have access to opportunities for Employer Nominated Sponsorship (ENS) for Permanent Residency.
Disadvantage: While sponsored through Standard Business Sponsorship you remain restricted to one employer/ role and need to find a new company to sponsor you if you want to move – essentially, you may need to go through the whole visa process again.
Advantage and Disadvantage of a Labour On-Hire Sponsorship:
Advantage: Labour On-Hire Sponsorship provides flexibility with options for permanent or contract based work. You can work on various projects at different sites within your sponsored classification while maintaining sponsorship through an On-hire Firm. On-hire agreements give you flexibility to change jobs without having to apply for/renew your 457 visa.
(A lot of Labour On-Hire’s also provide salary packaging options – that allows a visa holder to maximise their take home pay through deductable expenses and allowances.)
Disadvantage: At present, although this is being challenged, you cannot apply for Permanent Residency under the Employee Nomination Scheme (ENS).
Whether an individual elects to secure visa sponsorship through Standard Business Sponsorship or visa a Labour On-Hire is entirely up to them and their individual circumstances. It is important for individuals to consider all options before making a decision when it comes to what route of sponsorship that they want to take. There are other facets to consider when making this decision, if you have any further questions please contact us at [email protected]