Introducing Labour Agreements

First things first, hello from the Labour Agreement team. 

There’s no denying Labour Agreements can be complicated but I hope that after reading today’s blog they will seem less daunting.  

The first question that must be answered, “What is a Labour Agreement”?

A Labour Agreement is a flexible product that enables a business to employ specialised overseas workers when no other visa program meets the employer’s needs.  Labour Agreements are most commonly used by companies seeking semi-skilled labour or by companies in the on-hire and meat industries.  In short, they are a form of negotiated contract to employ overseas workers when you just can’t find locals to do the work. This is often the case in remote areas, in niche occupations that few Australians are qualified in, and where there aren’t domestic workers available.  

Typically, these are also the kind of occupations that are not covered by the standard Subclass 457 program which is only for skilled workers.  Under a Labour Agreement, we can help Australian businesses meet unique labour needs, while imposing a strong integrity framework that ensures workers are not exploited and Australian wages are not undermined. 

In negotiating a Labour Agreement, a number of requirements have to be met and thorough evidence provided. The most significant of these is the need to demonstrate what we call “labour market need”.

To meet this requirement, the employer needs to show us that they have made extensive, genuine attempts to fill their vacant positions with local labour.  We expect that before coming to us, the business would have tried to fill the required positions by regularly advertising online or in print, or by using a government job program or a recruitment agency.  Further to this, we examine company retention strategies and training programs aimed at retaining and up-skilling the existing workforce.

Once we are satisfied that the employer has made a genuine attempt to recruit, we will examine other evidence of labour market need such as local unemployment rates, nearby competing industries or projects and remoteness of location.  The key message is – before you come to us for help you must demonstrate that you have tried to help yourself.

In addition, there is an expectation that the occupation the employer is seeking is specialised and at least semi-skilled.  The Labour Agreement program does not cater for unskilled occupations, regardless of the labour market need.

We do understand that times are tough at the moment for businesses in certain areas seeking skilled or specialised workers.  We understand that mines and large construction projects may be drawing skilled and semi-skilled workers away from other jobs, making it difficult to find local recruits.    

It’s important though, in considering requesting access to a Labour Agreement, to have realistic expectations about the process.

To begin with, there is a cost.  To reiterate what Henry said in his 11 July post, hiring overseas workers is more expensive than hiring an equivalent Australian worker.  In addition to this, the Labour Agreement process requires a lot of information to be provided to the Department which in turn requires a lot of time to prepare. 

This in turn leads to the issue of time.  The volume of information we require means that a lot of time has to go in to analysis and assessment.  Although we at the Labour Agreements Section endeavour to finalise all requests for Labour Agreements within six months, our ability to do so is largely dependent on what the employer is asking for and the quality of the information sent to us.

For example, if an employer is seeking substantial concessions from the standard Subclass 457 visa program, negotiations will probably take longer than six months.  How much longer than six months is highly dependent on the scenario and how much work we will have to do with the employer to ensure that overseas workers will receive every entitlement, protection and opportunity they should, while also ensuring that Australian workers are not disadvantaged.

If successful, a Labour Agreement will give your business access to the global labour market.  I will leave it for you to decide what this could mean for your business. 

In the hope of not making this blog too longwinded, I have only touched on some of the many nuances and requirements of the Labour Agreement program.  I have attached our information pack below which sets out these requirements.  If you have any questions after reading this blog or information pack please feel free to email us @ labour.agreement.section@immi.gov.au

On a closing note, there is no guarantee that a request for a Labour Agreement will be approved, even if you believe that your proposal ticks all the right boxes.

The attachment referred to in the above post is now outdated and has been removed.