What is Labour Market Testing?

Implemented in November 2013, the Labour Market Testing requirement tasks standard business sponsors to test the local labour market before hiring an overseas worker for nominated position.

The purpose of the Labour Market Testing is to ensure that available job opportunities are provided to the local workforce first before looking to sponsor an overseas individual to fill the role required.

What do you need to do to meet the Labour Market Testing Requirement?

Standard business sponsors need to record efforts and attempts to hire local Australian citizens or permanent residents.

The recruitment activities need to be sufficient to justify that the local workforce cannot fulfil the requirements of the nominated position due to the lack of skills, qualifications or relevant work experience.

The Labour market testing must have been undertaken within twelve months prior to lodging a nomination.

Such recruitment efforts may include:

  • The posting of job advertisements.
  • The details of dates, contents and expenses of the advertising.
  • Conducting interviews and tabulating the outcome of all applications for the advertised position.

Are there any exemptions to the Labour Market Testing requirement?

There are avenues for exemption from the Labour Market Testing. You can be exempt from Labour Market Testing for the following reasons:

Occupation Level

Occupations described by the Australian and New Zealand Standard Classification of Occupations (ANZSCO) as skill level 1 or 2

Skill level 1 occupations are occupations that require an Australia degree level qualification or at least five years relevant experience, which may substitute for the formal qualification.

Some examples of skill level 1 occupations include General Managers, Marketing and Advertising Managers, IT Managers, Farmers and Agricultural Managers, etc.

Skill level 2 occupations require an Australia Qualifications Framework (AQF) Associate Degree, Advanced Diploma or Diploma qualification or at least three years of relevant experience as a possible substitute for the formal qualification.

Some examples of skill level 2 occupations include ICT professionals such as Developer Programmers, Software Engineers, Business Professionals and Teachers.

However some skill level 1 and 2 occupations still require Labour Market Testing to be done. These occupations include positions in the engineering and nursing profession. You can refer to the list here. If you are nominating an occupation in these professions, you will need to provide evidence of Labour Market Testing.

International Trade Obligations

  1. 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.
  2. 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.
  3. 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, 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.
  4. Your business currently operates in a World Trade Organisation member country and is seeking to establish a business in Australia, where the nominated occupation is listed below as an “Executive or Senior Manager”.
  5. The worker you nominate is a citizen of a World Trade Organisation member country and has worked for you in the nominated position in Australia on a full-time basis for the last two years.

When should I conduct the Labour Market Testing?

Labour Market Testing must have been conducted within 12 months before the lodgement of a 457 visa nomination. Evidence of Labour Market Testing must be presented at the time of nomination lodgement.


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