Temporary company-specific labour agreement arrangements for the Hotel & Accommodation Industry

In response to widespread critical skill shortages in the hotel & accommodation industry, the Department has recently introduced changes to policy settings to a temporary Labour Agreement for the Hotel & Accommodation Industry that will enable businesses to sponsor employees in short-term occupations and provide them with a pathway to permanent residence.

Short Term Occupations Receiving Pathway to Permanent Residency

The policy changes under these concessions provide businesses with the opportunity to sponsor skilled foreign nationals in seven occupations directly related to hotel, accommodation, and in-house food services to alleviate critical skill shortages in the industry:

  1. Café or Restaurant Manager (ANZSCO Code: 141111)
  2. Hotel or Motel Manager (ANZSCO Code: 141311)
  3. Hotel Service Manager (ANZSCO Code: 431411)
  4. Accommodation and Hospitality Manager nec. (ANZSCO Code: 141999)
  5. Cook (ANZSCO Code: 351411)
  6. Chef (ANZSCO Code: 351311)
  7. Pastry Cook (ANZSCO Code: 351112)

Approved businesses under this labour agreement may sponsor applicants in the above occupations on the following visas:

  1. Subclass 482 visa (for a maximum period of 4 years, regardless of occupation)
  2. Subclass 186 visa;
  3. Subclass 494 visa (for regional applications)

This Labour Agreement enables full-time employees in these occupations who have held a 457 or 482 visa for at least three years to apply for permanent residency under the Employer Nomination Scheme (186), provided they have continued to directly work for the same employer.

Since Labour Agreements generally subsist for a term of 5 years, businesses will additionally be able to sponsor new foreign workers on temporary 482 visas, and subsequently sponsor those workers for permanent residence following continued employment in the nominated position for at least 3 years.

Under the standard business sponsorship, these occupations were either not on the skilled occupation list or did not have access to a permanent residency pathway unless the short-term visa holder had remained in Australia throughout the COVID-19 pandemic.  This Agreement provides an alternative permanent residency pathway for new foreign workers and encourages businesses to sponsor overseas staff to undertake continual employment in Australia in one of the listed occupations.

The Department has indicated that the Hotel and Accommodation Industry Labour Agreement will be reviewed in 12 months, and we would urge all interested businesses to apply as soon as possible to take advantage of this permanent residence pathway.  Since there are extremely limited pathways to permanent residence for the listed occupations outside of the Labour Agreement, employers that pursue this pathway will be able to attract and retain critical hospitality and accommodation staff to overcome the current talent shortages.

Age Concessions for Specific Occupations

The Hotel and Accommodation Industry Labour Agreement also contains an age concession for applicants for the subclass 186 and subclass 494 visa.  Nominees in the following four occupations are permitted to apply for these visas while under the age of 55:

  • Café or Restaurant Manager (ANZSCO Code: 141111)
  • Hotel or Motel Manager (ANZSCO Code: 141311)
  • Hotel Service Manager (ANZSCO Code: 431411)
  • Accommodation or Hospitality Manager nec. (ANZSCO Code: 141999)

Traditionally, applicants for subclass 186 and 494 visas were required to be under the age of 45 at the time of application.  However, since the listed occupations are managerial roles and more senior positions in the business, the Department has implemented this age concession to allow more of the managers listed above to obtain permanent residency in Australia and contribute to the alleviation of the critical skill shortages.

Nomination Ceilings

The Labour Agreement is a 5-year agreement with the Government where a sponsor is able to nominate a ceiling for the number of overseas workers they intend to sponsor in certain occupations for each sponsorship year.  As this Agreement has been introduced to fill a short-term skill shortage, the Department holds the expectation that businesses decrease their reliance on overseas employees throughout the 5-year period.

Who can be a party to the Agreement?

Employers will need to ensure that:

  • Nomination ceiling for any one year does not comprise of more than a third of their workforce; and
  • Their reliance on overseas employees decreases as 482 visa holders transition to permanent residence under the Agreement.

To be eligible for this Labour Agreement, the sponsoring business will need to ensure that the number of overseas workers in their workforce does not exceed one-third of their total staffing population.  An overseas worker is defined by the Department as an applicant or proposed applicant for a subclass 482, subclass 186 or subclass 494 visa.

Additionally, it is important to note that each employing entity must have its own labour agreement.  Traditionally, associated entities of an approved business sponsor are allowed to nominate applicants under the associated business sponsorship license. Unfortunately, by operation of the terms and conditions under a labour agreement, there must be a direct employer/employee relationship between the overseas worker and the party identified in the labour agreement.  As such, if the restaurant or tourism operates as a group, each entity must attain its own separate agreement in order to sponsor foreign workers.

Final Thoughts & Summary

  • The newly introduced Labour Agreement will provide a permanent residence pathway for foreign workers in short-term occupations related to the hotel & accommodation industry.
  • The Department continues to utilise the incentive of permanent residence to compel Australian businesses in critically pressured sectors to consider sponsoring overseas workers where the Australian labour market cannot fulfil their business needs.
  • The policy settings contained in the Labour Agreement will be reviewed by the Department in 12 months, and all eligible/interested businesses should strongly consider applying prior to any potential removal or significant alteration to the permanent residence pathway.

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