Paying For Sponsorship – Part I

Read: Paying For Sponsorship – Part I (You are here)

Read: Paying For Sponsorship – Part II 

Sadly the media has been full of stories where our international visitors, primarily international students, have robed of tens of thousands of dollars by fraudsters promising visa sponsorship that never eventuates. If you aren’t aware of these events then be very very careful when someone offers you a job in return for a large some of money for in nearly all cases your money will disappear and the job will never eventuate.

Overwhelming public complaints caused the Immigration Department come up with these laws which prohibit paying for sponsorship. They have been in effect for more than a couple of years now and are quite complicated. Unfortunately I have not heard of one case where the department has bothered to prosecute anyone despite being informed daily of multiple unlawful acts taking place.

Despite this non enforcement policy from the Department of Home Affairs, the laws are still there and you should be aware of them as they have heavy penalties.

Visas affected by the ‘no payment for sponsorship’ requirement:

• Training (subclass 407)
• Temporary Activity (subclass 408)
• Temporary Work (Skilled) (subclass 457) (closed for applications)
• Temporary Skill Shortage (subclass 482)
• Employer Nomination Scheme (ENS) visa (subclass 186)
• Regional Sponsored Migration Scheme (RSMS) visa (subclass 187)

There should be no ‘asking for or receiving a benefit in return for the occurrence of a sponsorship related event’.

‘Benefit’ includes but is not limited to:

• One off lump sum payment
• Ongoing regular payments
• Underpayment of a visa holder’s wages or salary
• Repayment of a visa holder’s wage or salary
• Unpaid work
• Hours of work paid below the visa holder’s hourly wage or enterprise agreement arrangements
• Payment for goods or services above market value
• Gifts

Penalties and when is the lined crossed?

Why is this essential to understand? The consequences of not meeting this requirement is more than an unsuccessful visa application. It is illegal if one has been involved in the payment of sponsorship. This includes any third party who is included in asking for or receiving, or offered a benefit such as an intermediary. It is also still an offence whether or not the sponsor or third party actually received the promised benefit.

The consequences may include a fine, being charged of a criminal offence, civil penalty, receipt of an infringement notice, administrative action, the barring or cancellation of sponsorship, visa cancellation and so forth. Such an act would constitute as adverse information which would affect other visa applications as well.

The consequences are dependent very much on the situation which is further detailed as followed. Generally the two broad situations are:

• A person asking for or receiving benefit in return for the occurence of a sponsorship related event
• A person offering to provide benefit in return for the occurence of a sponsorship related event

Asking for or receiving a benefit

Examples of situations in which it would considered that an offence has been committed include but is not limited to:

• A standard business sponsor advises a job applicant that they will nominate them for a TSS 482 visa only if the job applicant pays the sponsor a lump sum upfront
• An employer advises their sponsored RSMS 187 visa holder employee that they will terminate their employment unless the sponsored employee returns part of their salary every month
• A sponsor agrees to sponsor a visa holder for an ENS 186 visa only if they agree to work for a salary less than the award rate and undertake unpaid overtime
• A business agrees to continue sponsoring a visa holder only if the visa holder’s partner works for them for salary less than the award rate.
• A business indicates they will make a submission for a labour agreement (under which the visa applicant would be nominated) only if the proposed sponsored visa applicant agrees to a deduction from their pay every week

Examples of situations where it would not be considered an offence include but is not limited to:

• An ENS 186 visa sponsor advises a job applicant that they will nominate them for the ENS 186 visa only if the person pays all migration agent and statutory government charges
• A TSS 482 visa holder generates a profit for the business by increasing sales by 30 per cent. The business retains the profit and continues to employ the TSS 482 visa holder
• A migration agent charges a higher than average fee for a service around a RSMS 187 visa but the case has significant complexities that warrant a higher fee.

When deciding on the degree of penalty for someone who has committed the offence of paying for sponsorship, the DOHA will consider the following factors:

• Number of payments or benefits received
• Type of benefit received
• Number of instances where the behaviour has occurred
• Time period over which the behaviour occurred
• Level of benefit received by the sponsor
• If the sponsorship related event occurred
• If false and misleading information has been provided to the Department
• If the benefit was received, or just requested
• the intent and state of mind of the person requesting and/or receiving the benefit
• If exploitation, extortion, coercion, deception, unauthorised retention of personal items, trafficking, slavery, or threats are involved
• Threats regarding the person’s visa or employment are involved
• If there have been prior warnings (either formal or informal) about paying for visa sponsorship conduct or breaches of the sponsorship obligations
• if previous action has been taken against the sponsor by either the Department or another Government agency
• Whether the person came forward voluntarily before potential paying for visa sponsorship activity was discovered by the Department, and their intent in coming forward
• The level of cooperation received from the person in relation to the investigation

 Offering to provide a benefit

Examples of situations in which it would considered that an offence has been committed include but is not limited to:

• A visa applicant responds to genuine job advertisements by offering a lump sum payment to the business owner if they hire them and sponsor them for a TSS 482 visa
• The family member of a visa holder offers the sponsor a car, in return for sponsoring the visa holder for a RSMS 187 visa
• A person contacts a range of businesses offering them a payment if they hire them in a particular occupation. In hiring this person, it requires the employer to also sponsor them for a visa
• A person claiming to be a recruitment agent, offers a business a payment in return for hiring specific persons in particular occupations that require visa sponsorship
• A person offers to pay their sponsor a portion of their weekly salary every week, in return for the sponsor continuing to sponsor them

Examples of situations where it would not be considered an offence include but is not limited to:

• A visa holder gives their boss (sponsor) a bunch of flowers as a ‘thank you’ gift for their assistance in settling into Australia.
• A prospective visa applicant offers to work the less desirable night shifts if the employer sponsors them for a visa—provided the visa applicant gets the appropriate salary, works reasonable hours and the sponsor is compliant with the Fair Work Act 2009
• A visa holder repaying a loan between them and their sponsor, to help the visa holder establish themselves in Australia. Both parties are able to provide conclusive evidence that the repayments are for a legitimate loan

When deciding on the degree of penalty for someone who has committed the offence of paying for sponsorship, the DOHA will consider the following factors:

• The amount or value of the benefit
• Number of payments or benefits provided
• Type of benefit offered or provided
• Number of instances of sponsorship related events occurred
• Level of benefit provided to the person
• Whether the sponsorship related event occurred and the type of sponsorship related event
• Whether the benefit was actually provided, or just offered
• The intent and state of mind of the person providing and/or offering to provide the benefit
• If exploitation, extortion, coercion, deception, unauthorised retention of personal items, threats of force, trafficking, slavery, violence or similar are involved
• If there have been prior warnings (either formal or informal) about paying for visa sponsorship conduct
• If previous action has been taken against the person either by the Department or another Government agency
• Whether the person came forward voluntarily before potential paying for visa sponsorship activity was discovered by the Department, and their intent in coming forward
• The level of cooperation received from the person in relation to the investigation.

In our next article we will continue to to discuss:

• The possible action against visa holders
• The possible defences for paying for visa sponsorship offences
• Liability of executive officers of bodies corporate and other partnerships and unincorporated associations

Are you navigating a sponsored work visa arrangement? We highly recommend that you call +61 2 8054 2537, 0434 890 199 or book online today to speak to our migration specialists. We will be able to help you understand how best to apply and meet requirements to save time and costs.