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Labour Market Testing - Implementation

Written By Will Aldous
Mon, Dec 2, 2013
Will Aldous

Labour Market Testing:


The Labour Market Testing (‘LMT’) requirement for the 457 visa program was introduced by the Department of Immigration and Border Protection (‘DIBP’) on the 23rd November. The requirement obliges employers to demonstrate that they have tested the local labour market to verify if there are suitable Australians, or other individuals with work rights such as New Zealand citizens, before hiring foreign staff on a 457 visa.

The legislation was passed by the previous Labour government and was subject to extensive negotiation prior to passing into law. As a result the legislation contains numerous exemptions and some mandatory testing, such as for Engineering and Nursing roles.


DIBP have adopted a mix of ‘soft touch’ requirements and seemingly strict enforcement. Meeting the LMT requirement is relatively straightforward and supplying evidence of a job advertisement for the relevant occupation within the past 12 months is deemed sufficient. However Immigration have advised that they will apply a strict approach to the requirement and failure to provide evidence at the time of application will result in refusal.

Somewhat ironically, it appears that determining whether LMT applies is more complex than meeting the requirement


When is LMT required?

Where LMT applies employers must provide evidence that they have tested the market in the past 12 months. Numerous exemptions apply, principally for Managerial and Professional occupations as below:

• Exemptions

A. Occupation

All occupations which require a skill level 1 or 2 under the Australia and New Zealand Standard Classification of Occupations (‘ANZSCO’) publication are exempt with the exception of engineering and nursing occupations. This includes managerial, professional and associate professional occupations. A full list of occupations which require LMT can be found here:

<a href=”/downloads/LMT_exempt_occupations.pdf"style="color:#7197b4;font-weight:bold;text-decoration:none;“>LMT Exempt Occupations | TSS Immigration

B. International Trade Agreements

International Trade Agreements which prevent limitation of restrictions on free trade mean that exemptions exist for Executives, Senior Managers, Specialists and some Service Suppliers from certain countries. TSS can advise on the full details of these exemptions.

C. Natural Disasters

The Federal Government can dispense with the LMT requirement in the case of natural disasters.

D. Existing ‘eligible temporary visa holders’ applicants

LMT is not required in the agricultural sector where a Working Holiday (Subclass 417) or Work and Holiday (Subclass 462) visa holder is already employed in the role.

• Where LMT is a Requirement

A. ‘Protected Occupations’ – Nursing and Engineering

Nursing and Engineering occupations must show LMT.

B. Redundancies

Where redundancies have occurred in the same or similar occupations in the past 4 months LMT must be shown in addition to evidence of the retrenchments.

What constitutes sufficient evidence?

Employers must show that they have advertised in the 12 months prior to the application being made.

Evidence can include advertisements, including free advertisements or advertisements on a company website, advertising the positions, or evidence of engaging a third party such as a recruitment consultant.

To demonstrate that the business has met the requirements DIBP have created a template document which may be filled out to show what LMT has been conducted by the employer. Employers can choose to complete this or provide evidence they prepare themselves.

Assistance with LMT

TSS Immigration can assist employers to determine whether Labour Market Testing is required and if so what documentation should be compiled to demonstrate the necessary steps have been taken. For further information please contact the registered migration agents at TSS Immigration.

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