The Labour Agreement is a fascinating topic in the world of immigration. As Australian businesses continue to experience fierce competition for global talent, they are exploring more bespoke, out-of-the-box solutions.
Labour Agreements have grown in popularity to hire occupations not clearly defined in the ANZSCO occupation dictionary or listed on the Skilled Migration Occupation Lists, or as a permanent residency pathway to Australia for foreign workers.
However, Labour Agreement submissions require a significant amount of work and must follow certain criteria in order to have the best chance of acceptance.
Last year, we understood some Industry Labour Agreement requests were declined because organisations had not sufficiently demonstrated a genuine need for the agreement.
Given the COVID-19 pandemic and the loss of jobs related to it, the Australian government shifted its policy in relation to Labour Agreements and would not negotiate with organisations that had not satisfactorily demonstrated that the positions could not be filled by Australians in the labour market. This resulted in more scrutiny regarding the “genuine need” aspect of many types of Labour Agreements.
Our team at The Migration Agency has an excellent track record of success in having Labour Agreements accepted, with varied experience in the different industries and types of Labour Agreements. In response to the changes in policy, we iterated our process and submissions to ensure our clients had the maximum chance of success, which has been reflected in the recent approvals of Labour Agreements.
In this blog, we answer your questions about Labour Agreements and why they are relevant to your business.
What is a Labour Agreement?
Unlike sponsoring someone through a standard program where there’s a clear pathway to sponsor certain occupations, or as an individual visa applicant where your application is either approved or refused, the Labour Agreement process is different because it’s not an application process.
It must be requested of the Australian Government, supported with a strong business case as to why the Government should agree to negotiate a bespoke immigration program between you as an employer and Minister for Immigration.
Effectively, the Labour Agreement framework allows you to request certain concessions compared to the standard employer sponsored visa program. For example, a client might need a particular role filled that is not listed on the Short Term Skilled Occupation List, the Medium to Long Term Skills Shortage List or the Regional Occupation List, or an applicant cannot meet standard parameters of the subclass 482 visa, and hence, they enter into a contract with the government to secure concessions, by way of a Labour Agreement.
The Department of Home Affairs, on its website says: “Labour Agreements enable approved businesses to sponsor skilled overseas workers when there is a demonstrated need that cannot be met in the Australian labour market and where standard temporary or permanent visa programs are not available.”
How long does it take to get a Labour Agreement?
A Labour Agreement is a substantial undertaking and can take some time to compile the evidence and prepare the submission. At The Migration Agency, it usually takes around three months to prepare a Labour Agreement request and submit it for our clients. There is a lot of necessary research and submission-writing that our immigration professionals put into each case.
Once it is lodged, Departmental processing times are around 6-12 months.
What’s involved in a Labour Agreement?
Due to the fact that it’s a request to the Minister to consider your circumstances and how they warrant a Labour Agreement (it is not an application), it’s very heavily dependent upon a strong business case – and so we put together an extremely detailed submission.
For example, one recent case entailed a 60-page submission to justify the need for the Labour Agreement and the need to access workers in the occupations the organisation needed (on the particular terms they were seeking).
It’s important and necessary to include independently verifiable evidence, market research and data to substantiate the claims that you’re making about the shortage of skill sets and the conditions of the labour market in your industry.
That includes the genuine need for the positions an employer needs now and also the need for these skill sets in Australia in the future as well.
Does COVID play a part in Labour Agreement submissions?
At TMA, we go into significant detail about how COVID has and still is affecting our clients’ organisation. It is important to show that the organisation still has a genuine need for the position despite any COVID disruptions, and that there are no unemployed Australians who could perform the positions.
We also look at the impact COVID has had on the organisation, the organisation’s ability to find talent, the ability to finance the positions in the organisation, and the impact of COVID on the client’s customers or community members they serve.
What happens if the Labour Agreement is not accepted?
If the government is not satisfied that a sufficient need has been demonstrated for a Labour Agreement, it will be declined; employers may not be provided a reason why, and the government won’t negotiate with you.
If you have submitted a Labour Agreement previously and it has not been accepted, TMA can help you with a re-lodgement strategy, ensuring that we present new and relevant information and a good-quality submission on your behalf, so the government entertains your request.
A Labour Agreement is not like applying for a visa, where if you meet the criteria you are approved. For a Labour Agreement, even if you think you meet the criteria, you may not necessarily be accepted.
CASE STUDIES: If you are considering doing a Labour Agreement yourself…reconsider!
Recently, a business in the textiles manufacturing industry was considering doing a Labour Agreement themselves, so we asked them to send us their submission to do a gap analysis and determine if they met the requirements for a Labour Agreement.
What we discovered was that this business hadn’t addressed some critical aspects to the submission to prove a genuine need to hire global talent in the specific roles the business needed to fill. So we stepped in to support them with their Labour Agreement negotiation to give it every chance of success.
Another religious organisation client had tried to do their Labour Agreement themselves. They sent us a business case template borrowed from another organisation, for us to review. When we reviewed the submission, we prepared a gap analysis and helped the organisation build up their business case to address the key criteria for a Labour Agreement.
Unfortunately, it’s not just a simple form and application process. There are no review rights if a request for a Labour Agreement is declined.
The government has moved the Labour Agreement request process online. Previously, you would submit your request to the Labour Agreement Section via email, and you would attach all of your documents and create your business case. It was really clear that it was a substantial project. However, since it was moved online, it became a form that looks simple and deceptively easy and some organisations are missing out due to a lack of detail and relevant submissions.
There are risks if you try to do it yourself
Labour Agreements take around 6 – 12 months to be assessed by the Department and during that time an organisation can lodge nominations and visa applications under it, however, the applications won’t be finalised until the Labour Agreement is finalised.
Once the negotiation is finalised, the Government issues the Labour Agreement, and a contract is produced. Sometimes, there will be some negotiation of the terms of the agreement. The agreement is then signed by the employer and the Minister’s delegate. Once you have a fully signed agreement with the government, it is registered.
After an organisation’s Labour Agreement is approved, then the visa applications are processed.
One of the risks involved with doing a Labour Agreement yourself is that if an organisation has employees whose visas are expiring and an employer is trying to get those employees on to a bridging visa by merging it with the greement request, it can leave employees in a precarious situation.
If the agreement is not accepted, those visa applications would need to be withdrawn and that leaves employees with expiring visas with very little time to secure a different type of visa.
What is “genuine need” and what else does the department look at?
“Genuine need” when it comes to an agreement is showing that there is a genuine skills or labour shortage in your industry.
However, the department also looks at your case for permanent residency, so you must build a strong case for a permanent residency pathway.
At TMA, we delve into finite details including why that person’s skill set is not able to be readily trained and the lead time to get a person sufficiently skilled for the position. For example, one of our clients is a Minister of Religion, working for a religious organisation.
Some religious workers must fund their own missions, plus they need to complete specialist qualifications and gain on-the-job experience that would take many years to obtain. Therefore, there’s a long lead time to deploy someone new into his role due to the skills and preparation required.
When TMA drilled into how long it would take for the organisation to fill that position in Australia, we uncovered that the lead time to replace that particular skill set was significant. We might also look at the impact on the Australian community if he is not able to continue his service to the community.
Hence the impact of not having this minister in Australia could mean a loss of knowledge, or community or social support.
Read more: Learn more about Labour Agreements here.
Could your business utilise a Labour Agreement?
To discover if a Labour Agreement is relevant for your business, please contact us on (02) 8896 6056 or email info @ themigrationagency.com.au to have a discussion about whether your business could utilise the Labour Agreement program to access global talent.