Labour Agreements For Australian Businesses: Options Beyond Standard Sponsorship

Many Australian employers are still struggling to fill skilled roles, even with access to the standard employer sponsored visas. For some occupations, locations or business models, the usual Skills in Demand visa (subclass 482), Employer Nomination Scheme visa (subclass 186) and Skilled Employer Sponsored Regional (Provisional) visa (subclass 494) rules do not fit neatly.

In those situations, a labour agreement might be the right strategic option. Labour agreements sit within the Australian employer sponsorship framework and give a structured way to address skill gaps while staying compliant.

Information current as at December 2025 based on Department of Home Affairs guidance.

What is a labour agreement?

A labour agreement is a formal, binding agreement between an Australian employer (or industry body or regional authority) and the Commonwealth.

Under Home Affairs policy, labour agreements enable approved businesses to sponsor skilled overseas workers:

• where there is a demonstrated need that the Australian labour market does not fill, and
• where standard temporary or permanent visa programs are not available or suitable.

Labour agreements sit alongside, not outside, the mainstream employer sponsored program. Once an agreement is approved, the Department is allowed to grant visas under one or more of these programs, where the agreement provides for it:

• Skills in Demand (SID) visa (subclass 482)
• Employer Nomination Scheme visa (subclass 186)
• Skilled Employer Sponsored Regional (Provisional) visa (subclass 494).

Most agreements run for five years and include detailed terms about:

• which occupations are covered
• how many positions are available each year
• what concessions apply to standard criteria such as English, work experience, salary or age thresholds.

There is no fee to request a labour agreement, although nomination and visa application fees, including the Skilling Australians Fund (SAF) levy, still apply.

Key types of labour agreements

The labour agreement framework includes several main categories, each with different policy settings.

Industry labour agreements

Industry labour agreements (ILAs) set fixed terms and concessions for a defined sector, negotiated with peak industry bodies. They respond to ongoing, sector wide shortages and are intended to create a level playing field across that industry.

Examples include:

• Aged Care Industry Labour Agreement, for direct care roles such as Nursing Support Worker, Personal Care Assistant and Aged or Disabled Carer.
• Dairy, Meat, Pork, Fishing and Horticulture industry agreements.
• Minister of Religion and Restaurant (Fine Dining) agreements.
• Advertising and On-hire labour agreements.

These templates specify the visa pathways (usually SID 482, 494 and sometimes 186), available occupations and any concessions that differ from the standard employer sponsored rules.

Designated Area Migration Agreements (DAMAs)

A Designated Area Migration Agreement is an overarching agreement between the Commonwealth and a state, territory or regional authority. It allows additional occupations and concessions for employers in that region, reflecting local labour market conditions.

Employers in a DAMA region usually need endorsement from the Designated Area Representative before requesting an individual labour agreement. Once endorsed and approved, those employers are allowed to sponsor workers under the labour agreement streams of:

• SID visa (subclass 482)
• Skilled Employer Sponsored Regional (Provisional) visa (subclass 494)
• in some cases Employer Nomination Scheme (subclass 186).

Company specific labour agreements

Company specific labour agreements are negotiated directly with a single employer. They are intended for situations where:

• the occupation is not available under standard skilled visa lists or existing ILAs, or
• the employer needs specific concessions that are not covered elsewhere.

The employer must provide a detailed business case, evidence of strong local recruitment efforts and justification for any concessions to standard criteria.

Project agreements and GTES

The labour agreement framework also includes:

• project agreements for large resource or infrastructure projects with multiple subcontractors, and
• Global Talent Employer Sponsored (GTES) arrangements for highly skilled niche roles in innovation focused businesses.

These are more specialised tools and suit only a limited group of sponsors.

When is a labour agreement appropriate

A labour agreement is not a shortcut for ordinary sponsorship. Policy treats these arrangements as an option only in limited or exceptional circumstances.

Typical scenarios include:

• The required occupation is not on the standard skilled occupation lists, or the role blends duties across multiple ANZSCO codes.
• The business faces chronic shortages in an occupation where an ILA or DAMA gives broader access or concessions.
• The role is in regional Australia and standard program settings do not reflect local wage levels or skill mix.
• The employer needs structured access to a cohort of workers over several years, rather than isolated nominations.

Benefits for employers:

• access to a wider set of occupations and skill levels
• potential concessions to English, work experience, age or income thresholds, subject to policy and negotiation.
• a multi year framework for workforce planning.

Trade offs:

• more complex preparation and negotiation
• stricter scrutiny of business practices and labour market evidence
• closer monitoring once the agreement is in place.

Overview of the labour agreement process

While each agreement type has its own detail, most employers follow a similar pathway:

1. Assess options
   • Confirm that standard SID 482, 186 or 494 sponsorship does not meet the workforce need.
   • Check whether an industry agreement or DAMA already covers the occupation and region.
2. Prepare the business case
   • Outline the business, its financial position and compliance history.
   • Provide labour market evidence: genuine recent recruitment efforts in Australia, workforce data and any external labour market research.
   • Identify proposed occupations, numbers, locations and any requested concessions.
3. Consultation where required
   • For some agreement types, such as the Aged Care Industry Labour Agreement, employers must negotiate a memorandum of understanding with relevant unions before lodging a request.
4. Lodge labour agreement request
   • Submit an online request through ImmiAccount with supporting documents.
   • The Department assesses the request against program policy and overall skilled visa priorities.
5. Agreement approval and execution
   • If approved, the employer signs the agreement, which sets ceilings for nominations and the terms that apply.
6. Sponsorship, nomination and visa stages
   • The employer lodges nominations under the agreement.
   • Individual workers lodge visa applications under the relevant stream of SID 482, 494 or 186.

Key risks and employer obligations

Holding a labour agreement does not reduce compliance obligations. In many respects, expectations are higher. Program guidance stresses that:

• businesses must meet sponsorship obligations, including equivalent pay and conditions, and must not undercut Australian workers
• agreement holders face monitoring and information sharing across agencies
• adverse information, such as workplace law breaches or migration non compliance, can affect the agreement and future nominations.

For HR and in house legal teams, integrating migration, workplace relations and WHS settings is critical before scaling up hiring under a labour agreement.

How Roam Migration Law supports labour agreement strategies

Labour agreements are more time consuming and complex than standard employer sponsorship. The pay off is targeted access to skills and tailored concessions, if the agreement is designed well and the business case is solid.

Roam Migration Law supports employers through the full lifecycle of a labour agreement, including:

• Assessing if a labour agreement is suitable or if standard employer sponsorship is enough
• Choosing the right pathway, including industry agreements, DAMAs or a company specific agreement
• Building the business case and explaining why standard 482, 186 or 494 settings do not work
• Preparing labour market and business evidence to meet Department requirements
• Managing negotiations with the Department of Home Affairs
• Aligning agreement terms with workplace obligations and HR processes
• Running nominations and visa applications and advising on ongoing compliance

For a broader overview of how we work with employers on labour agreements, see our Labour Agreements service page.

Next steps

For some organisations, a labour agreement becomes a central part of long term workforce planning. For others, standard sponsorship remains the better fit, with targeted use of DAMAs or industry agreements in specific locations or roles.

If your organisation is exploring labour agreements or wants a second view on whether this pathway is appropriate, Roam Migration Law is available to assist with a structured assessment and strategy.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.