Standard Business Sponsorship (SBS): Employer Approval Process

Standard Business Sponsorship (SBS): Employer Approval Process

Standard Business Sponsorship is the first step for any Australian employer wanting to sponsor overseas workers. Before nominating and hiring a foreign worker, the business must be approved as a sponsor by the Department of Home Affairs. The sponsorship application costs $420, takes 1-3 months to process, and once approved, lasts for 5 years. The business must demonstrate it's lawfully operating, has no adverse information, and will meet all sponsor obligations including paying market salary rates and maintaining employment records.

Quick Facts

What Is Standard Business Sponsorship?

Standard Business Sponsorship is the government's approval mechanism for employers who want to hire overseas workers on sponsored visas. Think of it as a licence to sponsor — without it, a business cannot nominate or bring in foreign workers.

The sponsorship covers the Skills in Demand (SID) visa, the Subclass 494 regional visa, and other employer-sponsored visa categories. One sponsorship approval allows the business to sponsor multiple workers across different visa types.

Requirements for Approval

Lawfully Operating Business

The business must be:

• Registered in Australia (ABN required)
• Actively trading or operating
• Compliant with Australian laws (tax, workplace, immigration)
• Not involved in fraudulent or illegal activities

New businesses can apply, but they may face additional scrutiny regarding their financial viability and genuine need for overseas workers.

No Adverse Information

The Department checks for "adverse information" about the business and its key personnel. This includes:

• Previous immigration law breaches
• Fair Work Act violations
• Workplace health and safety breaches
• Environmental law breaches
• Tax compliance issues
• Fraud or dishonesty convictions of directors or key personnel

A single past infringement doesn't necessarily disqualify a business, but serious or repeated breaches will result in refusal.

Training Requirements

The business must commit to training Australian workers. This can be demonstrated through:

• Spending at least 2% of payroll on training Australian employees, OR
• Contributing at least 2% of payroll to an industry training fund

This requirement ensures that employer sponsorship supplements rather than replaces investment in the Australian workforce.

Genuine Need

The Department assesses whether the business has a genuine operational need for overseas workers. Factors considered include:

• The size and nature of the business
• The number of employees
• Previous sponsorship history
• Industry and occupation context

Application Process

Step 1: Prepare Documentation

Gather the following:

• Business registration documents (ABN, company registration)
• Financial statements (latest year)
• Evidence of training expenditure or contribution
• Details of the business structure and operations
• Information about key personnel (directors, partners)
• Previous sponsorship history (if applicable)

Step 2: Lodge Online

Submit the sponsorship application through ImmiAccount. The application involves completing the online form and uploading supporting documents.

Step 3: Processing

The Department assesses the application against all criteria. They may request additional information if anything is unclear. Processing typically takes 1-3 months.

Step 4: Approval

Once approved, the business receives a sponsorship approval that lasts for 5 years. The business can then proceed to nominate specific workers.

Costs

The Skilling Australians Fund (SAF) levy is a per-worker, per-year charge that funds Australian training programs. Small businesses (turnover under $10 million) pay $1,200 per year per sponsored worker. Larger businesses pay $1,800.

Sponsor Obligations

Being an approved sponsor carries significant ongoing obligations. These include:

• Pay market salary rates — no less than an equivalent Australian worker
• Only employ the worker in the nominated occupation at the nominated location
• Maintain records — employment contracts, payslips, working conditions documentation
• Notify the Department of changes to the business or the worker's employment
• Pay travel costs for sponsored workers to leave Australia if their visa is cancelled
• Cooperate with Department monitoring — allow inspections and provide information when requested
• Not recover sponsorship costs from the worker — the employer cannot charge the worker for sponsorship or nomination fees

Renewal

Sponsorship approval lasts 5 years. To continue sponsoring, the business must apply for renewal before the current approval expires. The renewal assessment considers:

• Compliance history during the sponsorship period
• Current business status
• Continuing need for overseas workers
• Training commitment

Businesses with a clean compliance record generally have straightforward renewals. Those with breaches or monitoring issues may face enhanced scrutiny or refusal.

Common Issues

Processing Delays

Delays commonly occur due to:

• Incomplete documentation (most common)
• Adverse information requiring investigation
• Additional information requests from the Department
• High application volumes

Submit complete applications with all documents to minimise delays.

Refusal

Sponsorship applications are refused when:

• The business is not genuinely operating
• Adverse information is found
• Training requirements aren't met
• Key personnel have concerning backgrounds
• The business can't demonstrate a genuine need

Refused applicants can seek review through the Administrative Appeals Tribunal.

Cancellation

The Department can cancel an existing sponsorship if:

• The business ceases to operate
• Obligations are breached
• False information was provided
• The business is found to be exploiting workers

Cancellation affects all current and future nominations under that sponsorship.

Frequently Asked Questions

Can a sole trader be an approved sponsor?

Yes. Sole traders, partnerships, companies, and other business structures can all apply for sponsorship, provided they meet the requirements.

How many workers can a sponsor nominate?

There's no fixed limit. The number of nominations should be proportionate to the business's size and genuine needs. A 5-person company nominating 50 workers would raise concerns.

Can a new business apply for sponsorship?

Yes, but new businesses may face additional scrutiny. Providing a business plan, financial projections, and evidence of genuine operations helps.

Does the sponsored worker need to be in Australia?

No. The sponsorship and nomination process can occur while the worker is overseas. They apply for their visa and travel to Australia once it's granted.

What if the business changes ownership?

A change of ownership may require a new sponsorship application. The new owners must meet all requirements independently. If the business structure remains the same (e.g., share transfer), the existing sponsorship may continue.