How Employers Become Approved Sponsors: A Complete Business Guide for 2026

What is Standard Business Sponsorship (SBS)?

Standard Business Sponsorship is the foundational "corporate gateway" that allows Australian businesses to sponsor overseas workers for employer-sponsored visas. Consider it a licence to participate in the migration program-distinct from nominating workers or visa applications themselves.

Once approved, your business can nominate skilled positions and sponsor workers for visas including:

• Skills in Demand (Subclass 482) - the new three-tiered temporary skilled worker visa
• Skilled Employer Sponsored Regional (Subclass 494) - regional visa with PR pathway
• Employer Nomination Scheme (Subclass 186) - direct permanent residency

SBS approval is valid for five years and allows you to sponsor multiple workers during this period.

Eligibility Requirements for Approved Sponsors

The Department of Home Affairs assesses SBS applications against a matrix of corporate integrity and operational legitimacy. The primary requirements include:

Special Considerations for Complex Structures

Trusts: The Trustee (not the Trust itself) must apply for sponsorship. The Trust Deed is critical evidence proving the Trustee's authority.

Franchises: The specific franchisee entity that pays the salary and directs daily work must be the sponsor-not the master franchisor.

Overseas Businesses: International entities can apply if they're establishing Australian operations or fulfilling contractual obligations (e.g., sending technicians to install machinery for an Australian client).

The "Adverse Information" Test: The Department conducts rigorous background checks across immigration law, workplace relations (Fair Work compliance), taxation, and corporate law. Any history of visa fraud, worker exploitation, or regulatory breaches can result in refusal.

The Three-Step Sponsorship Process

Sponsoring an overseas worker involves three separate applications:

Step 1: Sponsorship Application

Your business applies to become an approved sponsor. Required documents include:

Processing time: Typically 4-8 weeks for decision-ready applications. Fee: $420

Step 2: Nomination Application

Once approved as a sponsor, you nominate a specific position. This critical stage includes:

• Labour Market Testing (LMT) evidence
• Salary verification against the "double lock" mechanism (see below)
• Payment of the Skilling Australians Fund (SAF) levy
• "Genuine position" assessment

Fee: $330 per nomination

Step 3: Visa Application

The nominated worker applies for their visa with skills assessment (if required), English test results, and health/character checks.

Fee: ~$3,210 per main applicant

Accredited Sponsorship: The Priority Tier

For high-volume sponsors, government entities, and businesses with strong compliance records, Accredited Sponsorship offers a premium tier of service with significant strategic advantages.

Accredited Sponsor Categories

Key Benefits of Accreditation

• Priority Processing: Most applications processed within 5 business days
• Auto-Approval: Low-risk nominations bypass manual "genuine position" assessment
• LMT Flexibility: Can use company website for job advertising (not just third-party platforms)
• Police Check Exemptions: Written sponsor reference may replace police certificates

Strategic Tip: Businesses approaching 10 nominations in 2 years should actively pursue Accredited Sponsorship to transform migration from a compliance burden into an agile recruitment tool.

Understanding Labour Market Testing (LMT)

Before sponsoring an overseas worker, most businesses must prove they couldn't find a suitable Australian worker through a strict "tick-box" compliance exercise.

2025 LMT Advertising Standards

Mandatory Content Requirements

Every advertisement must include:

• Position title and description of duties
• Required skills and experience
• Sponsor name (or recruitment agency name)
• Salary or salary range - mandatory if annual earnings are below $96,400

⚠️ Fatal Error: Failing to include salary for roles under $96,400 = nomination refusal

International Trade Obligation (ITO) Exemptions

LMT is not required if the nominee is:

The "Double Lock" Salary Mechanism

A common misconception is that employers simply need to pay the visa threshold. In reality, the salary requirement is a "double lock" mechanism:

Lock 1: Income Threshold Floor

The guaranteed annual earnings must be at least equal to:

Lock 2: Annual Market Salary Rate (AMSR)

You must also pay at least the market rate for that occupation in that location.

How to determine AMSR:

• If you have an Australian equivalent worker → provide their payroll data/contract
• If no equivalent worker → use remuneration surveys, job advertisements, or union advice

⚠️ The Trap: If the market rate is $70,000 but the CSIT is $76,515, you cannot simply offer $77,000. Paying a foreign worker more than the market rate for Australians is prohibited. That role is ineligible for the Core Skills stream.

The Skilling Australians Fund (SAF) Levy

The SAF levy is a mandatory, largely non-refundable payment that funds Australian vocational training. It's tax-deductible but cannot be recovered from employees.

SAF Levy Rates (2025-26)

Critical: Limited Refund Scenarios

The SAF levy is notoriously difficult to recover:

Strategic Consideration: Consider nominating for 2 years initially ($2,400-$3,600 levy) rather than 4 years, allowing a review point before committing to extension or PR sponsorship.

The 180-Day Worker Mobility Rule

A major 2024/25 reform significantly shifted the employer-employee power dynamic:

The Rule

If a SID visa holder ceases employment (resignation or termination), they now have:

• 180-day grace period to find a new sponsor, apply for a different visa, or leave Australia
• Full work rights during this period (can work for any employer in any occupation)
• Maximum of 365 days total across the entire visa validity

Implications for Employers

Strategic Focus: The 180-day window makes retention strategies as critical as recruitment compliance. Focus on employee engagement to protect your SAF levy investment.

Ongoing Sponsor Obligations

Becoming an approved sponsor triggers ongoing legal obligations monitored by the Department and Australian Border Force. Penalties range from administrative fines to sponsorship cancellation and public naming.

Employment Obligations

• ✅ Pay equivalent terms and conditions to Australian workers
• ✅ Provide superannuation and all legal entitlements
• ✅ Ensure the worker performs only the nominated occupation
• ✅ Cannot recover sponsorship/nomination fees or SAF levy from employees

⚠️ Promotion Trap: If you promote a "Civil Engineer" to "Engineering Manager," the duties change significantly. This requires a new nomination and potentially new visa before the role changes-or both worker and sponsor face compliance action.

Notification Obligations (28-Day Rule)

Notify the Department within 28 calendar days of:

• Sponsored worker's employment cessation
• Changes to business structure, ownership, or directors
• Changes to sponsored worker's duties or salary
• Business insolvency events
• Awareness of worker's visa breaches

Record-Keeping Obligations

Maintain records for 5 years (note: updated from 2 years), including:

• Employment contracts and payslips
• Labour market testing evidence
• SAF levy payment receipts
• Recruitment documentation

Return Travel Costs

If requested in writing by the sponsored employee or their family, you must pay reasonable travel costs to enable them to leave Australia-even if the employee resigned or was terminated for cause.

The Path to Permanent Residency (PR)

The Skills in Demand visa is increasingly viewed as a pathway to PR, with 2024/25 reforms streamlining this transition.

Subclass 186 TRT (Temporary Residence Transition) Stream

Strategic "Rent vs Buy" Decision

Common Mistakes to Avoid

Comprehensive Cost Summary (2025-26)

Fees are current as of December 2025 and are subject to change, typically on 1 July each year.

How First Migration Can Help

At First Migration Service Centre, we specialise in assisting Australian businesses with the complete employer sponsorship lifecycle. Our registered migration agents help businesses of all sizes-from growing startups to established enterprises-navigate the complex compliance landscape.

Our employer services include:

• Standard Business Sponsorship applications
• Accredited Sponsor applications for high-volume users
• Compliant nomination applications with salary benchmarking
• Labour Market Testing strategy and documentation
• Ongoing compliance monitoring and staff training
• Transition from temporary to permanent residency (186 TRT)
• SAF levy optimisation strategies

Ready to sponsor skilled workers? We invite you to submit a free visa assessment so we can understand your business needs and provide tailored advice.