482/TSS visas: Labour market testing ITO exemptions set to expand to Peru, Indonesian, and Hong Kong

The list of international trade obligations (ITOs) that exempt standard business sponsors from labour market testing to nominate an overseas worker from certain countries is set to expand to Peru, Indonesia, and the Special Administrative Region of Hong Kong. A new legislative instrument has been prepared for when the free trade agreements between Australia and these nations and territories come into effect.

Labour market testing is the requirement for standard business sponsors to have advertised a position to see if a suitably qualified Australian citizen or permanent resident or eligible temporary visa holder can readily fill the position before nominating an overseas national. It is a critical part of a nomination for a Subclass 482 – Temporary Skill Shortage visa, however, where an ITO applies labour market testing is exempt. ITOs are different from select occupations and select positions as although these may have a similar effect of being excluded from the strict requirements of acceptable advertising, select occupations and position require a submission to provide reasons why a suitably qualified and experienced Australian citizen or Australian permanent resident, or suitably qualified and experienced eligible temporary visa holder is not readily available to fill the nominated position.

Importantly, even though the Subclass 494 – Skilled Employer Sponsored Regional (Provisional) visa under the Employer Sponsored stream comes under the standard business sponsor regime and therefore the same labour market testing provisions as 482/TSS visas, ITO exemptions do not apply to these nominations, but select occupations and select positions may apply. This is because current policy suggests that Australia’s ITO are already discharged under the 482/TSS visa program.

There is also a major disaster exemption, however, ever since labour market testing came into effect on 1 July 2013, this has never been utilised.

According to the contingent legislation, the Peru ITO will come into effect on 11 February 2020 as the Peru‑Australia Free Trade Agreement comes into force in Australia on this date, and the Hong Kong ITO came into effect on 17 January 2020. The holdout is Indonesia, which according to media reports has seen some delay on the Indonesian side to enact local legislation.

With Brexit occurring over the weekend and a Brexit transition period that will last until the end of the year, Australia is poised to add a free trade agreement with the United Kingdom and therefore add to the list of ITO exemptions from labour market testing in the future. There are also other agreements that are under negotiation listed on the Department of Foreign Affairs and Trade’s website, including free trade agreements with the European Union, India and some regional cooperatives.

Whether the Australia-UK free trade agreement is in force at the end of the year is debateable as the UK have their hands full with negotiating other trade agreements during the Brexit transition period. It would not be surprising that in the future labour market testing is modified or even scrapped due to being significantly blunted by the proliferation of ITOs.