Subclass 457 - Labour Market Testing requirement

Labour market testing (LMT) requirements for the subclass 457 program commenced on 23 November 2013.

Standard business sponsors are required to test the local labour market prior to lodging a nomination and provide evidence of this as outlined below, unless the occupation is exempt from LMT or an international trade obligation applies.

The LMT requirement does not apply to nominations lodged by parties to a labour agreement.

International trade obligations

LMT will not need to occur where it would conflict with Australia’s international trade obligations, in any of the following circumstances:

  • The worker you nominate is a citizen/national of China, Japan or Thailand, or is a citizen/national/permanent resident of Chile, Korea or New Zealand.
  • The worker you nominate is a current employee of a business that is an associated entity of your business that is located in an Association of South-East Asian Nations (ASEAN) country (Brunei, Myanmar, Cambodia, Indonesia, Laos, Malaysia, Philippines, Singapore, Thailand and Vietnam), Chile, China,​ Japan, Korea or New Zealand.
  • The worker you nominate is a current employee of an associated entity of your business who operates in a country that is a member of the World Trade Organisation (WTO), where the nominated occupation is listed below as an “Executive or Senior Manager” and the nominee will be responsible for the entire or a substantial part of your company's operations in Australia.
  • Your business currently operates in a WTO member country and is seeking to establish a business in Australia, where the nominated occupation is listed below as an “Executive or Senior Manager”.
  • The worker you nominate is a citizen of a WTO member country and has worked for you in the nominated position in Australia on a full-time basis for the last two years.

Important: if you are not required to undertake LMT because an international trade obligation applies or an exemption applies, you are requested to upload a document or provide comments within your application explaining why you believe LMT is not required.

Executive or senior manager occupations: For the purposes of international trade obligations, the occupations which are considered to be Executives or Senior Managers are listed in Executive or Senior Manager occupations for the purposes of international trade obligations. Also see instruments at Subclass 457 Visa Legislative Instruments.

WTO member countries: Countries who are currently members are listed on the WTO website.

Occupation based exemptions from LMT

If international trade obligations do not apply to the nomination, there could still be an exemption from the requirement to provide evidence of LMT depending on the occupation that is being nominated.

A number of occupations cannot however be exempted from LMT - see General Guide to 457 Programme occupations which are not exempt from labour market testing. Also see instruments at Subclass 457 Visa Legislative Instruments.

Period in which LMT must have been undertaken

LMT must have been undertaken:

  • within the previous twelve months prior to lodging a nomination; or
  • within four months prior to lodging a nomination - if the sponsor or an associated entity has made any Australian citizen or Australian permanent resident workers redundant or retrenched from positions in the nominated occupation. Note: when this occurs, information about these redundancies or retrenchments must be provided.

Evidence of LMT

If you are not exempt from the LMT requirement, you must provide evidence of your attempts to recruit Australians, including the details and expenses of any advertising you conducted. If this evidence does not accompany your nomination application, it will be refused. The type of evidence you must provide will depend on the nomination application lodgement date.

For nomination applications lodged before 1 October 2017: You can complete the domestic recruitment table as evidence of your recruitment activities and attach it to your nomination, see Domestic recruitment summary table (72KB PDF). You can also provide other information and evidence about your attempts to recruit Australians, such as job advertisements, labour market research, expressions of support from government employment agencies or information about your participation in job and career expositions.

For nomination applications lodged on or after 1 October 2017: the Department will no longer accept the Domestic recruitment summary table (72KB PDF) as acceptable evidence of advertising. Applications must instead include:

  • copies of advertisement(s) referenced in the nomination form. Note: If a similar ad was placed in multiple media formats, only one copy of the advertisement is required to satisfy this requirement; and
  • if fees were paid, receipt of any fees paid.

You are also encouraged to ensure that the advertising undertaken is for the nominated position and includes the same terms and conditions as those being offered to the nominee.

Advertising may have been undertaken by a third party if authorised to do so by the sponsor (for example, an associated entity or a contracted party) - there is no requirement that the sponsor placed the advertisement themselves.