Labour Agreement to Overcome Worker Shortages

The pandemic has undoubtedly strained supply chains across the globe. I have noticed a strong demand from my clients, who are represented by various companies in Australia, and abroad, to use immigration to minimise labour shortages post covid-19.


There are limitations on which occupations a company may nominate an overseas worker under an Australian visa. Normally, a company would only be able to nominate an overseas worker under the current Australian immigration occupation list. However, to overcome this occupation limitation, some of my clients have used a labour Agreement (LA) to meet labour shortages where they require access to an occupation that is not on the current immigration occupation list.


I will briefly summarise the LA process in this publication.


What is a LA?

A LA is a formal agreement entered into between the Minister, or the Employment Minister and a person or organisation in Australia under which an employer is authorised to recruit overseas workers to be employed by that employer in Australia.


The LA program is designed to provide a flexible solution to support Australian business’ where standard temporary or permanent skilled visa programs are not available, and the employer’s recruitment needs cannot be met through the Australian labour market.


When are LA’s Granted?

LA’s are assessed by the Department on a case-by-case basis.

For a LA request to be considered, organisations must demonstrate a compelling case supported by strong, relevant and current evidence for the employment of an overseas worker based on:


  1. exceptional or niche skills of the applicant; or
  2. evidence of a labour market shortage (demonstrated by the LA request applicant).


LA’s can only be accessed where it is evidenced that:


  1. there is a genuine labour market need for an overseas skilled worker to fill a position in Australia;
  2. there is no standard skilled visa pathway available, unless exceptional circumstances exist; and the request is consistent with Australia’s national interest.


Lawfully and actively operating in Australia for the previous 12 months

LAs will generally only be granted where the requesting organisation can demonstrate that their business has been lawfully and actively operating in Australia for the previous 12 months. To demonstrate this, requesting organisations are expected to provide their key business details and a statement from a chartered or certified practicing accountant that they are actively operating and able to financially support the proposed number of overseas workers requested under the LA.



LAs are generally in effect for five years and often include additional terms and conditions, with agreements negotiated to ensure that where standard requirements are waived or concessions agreed, additional requirements are implemented where practicable to manage risks effectively.



In my opinion, the World is yet to see the worst of the labour market shortages and resultant supply chain issues caused by the pandemic. Companies can mitigate labour shortages by considering to negotiate a LA with the Department where the current occupation list does not cater for the business needs and or where more flexibility is required.


Written by Farhan Rehman
Principal Partner at RSG Lawyers and Associates
Ph: (03) 9350 4440

The information contained in this publication is of a general nature only. It should not be used as legal advice. To the extent permissible by law, RSG Lawyers and Associates and its associated entities shall not be liable for any errors, omissions, defects or misrepresentations in the information or for any loss or damage suffered by persons who use or rely on such information. Liability limited by a scheme approved under Professional Standards Legislation. Please refer to our website’s terms of use.

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