Author: Yen Wong – Team Lead / Senior Immigration Lawyer
Hiring overseas workers under Australia’s employer-sponsored visa programs such as the Subclass 482, 494 or 186 can offer strategic workforce solutions. However, these programs come with legal obligations that must be met at all times.
Employers who sponsor visa holders must be prepared for government audits that assess whether these obligations are being met. The Department of Home Affairs and Australian Border Force (ABF) routinely monitor employers through audits, including site visits and formal investigations.
Being selected for an audit doesn’t always mean something is wrong. But being unprepared can expose your business to serious consequences, including fines, suspension of sponsorship approval, or reputational harm. This guide outlines what government auditors look for, how to prepare, common compliance mistakes, and the consequences of getting it wrong.
What is a government audit?
A government audit is an official compliance check to confirm whether a business sponsoring overseas workers is meeting its legal responsibilities under the Migration Act 1958 and Migration Regulations 1994.
Audits may be:
- Randomly selected as part of standard monitoring activities
- Triggered by intelligence such as a complaint, anonymous tip, or a change in business operations
- Conducted pre-approval during a sponsorship or nomination application
Audits are carried out by Home Affairs officers or ABF inspectors. They may involve written requests for documents, phone interviews, or unannounced on-site inspections.
What areas will inspectors assess?
Government officers assess whether you are complying with all sponsorship obligations, which can vary slightly depending on the visa subclass and the terms of the approval.
Key inspection areas include:
- Employment conditions: sponsored employees must receive the same pay and conditions as equivalent Australian employees. Inspectors will examine employment contracts, salary records, and rosters to verify this.
- Nominated role compliance: sponsored workers must only perform duties within their approved ANZSCO-coded occupation, and only at the business location and employer specified in the nomination. Misalignment is a breach.
- Recordkeeping obligations: sponsors must keep thorough, accessible records for at least five years for immigration purposes. Some employment and tax laws require records to be kept for up to seven years, and these may be reviewed during audits. This includes:
- Copies of employment contracts
- Payslips and payment evidence
- Time and attendance records
- Superannuation and tax details
- Visa documents and VEVO checks
- Notification requirements: sponsors must inform Home Affairs within 28 calendar days of specific events, such as:
- Early termination of employment
- Change in business address or structure
- Business insolvency
- Change in work duties or hours
- Travel cost obligations: if requested in writing by a departing sponsored employee, you must pay reasonable travel costs to return them to their home country.
- Cooperation during inspection: failure to provide requested documents, delaying interviews, or obstructing access during site visits can itself be treated as a breach.
How to prepare for a government audit
Sponsors should treat compliance as a daily operational priority, not a one-off event. To prepare for an audit:
- Set up compliance systems: use HR systems that integrate visa expiry alerts, contract storage, and condition tracking.
- Verify visa conditions regularly: use VEVO to check each sponsored worker’s visa status, expiry date, and work conditions. Keep a record of every VEVO check.
- Train internal teams: make sure payroll, HR, and management understand the visa obligations, the importance of timely reporting, and how to handle visa-related tasks correctly.
- Keep reporting logs: maintain written evidence of any reports made to the Department of Home Affairs, this protects your business during audits.
- Review nomination accuracy: ensure the sponsored role matches the duties being performed. Job creep (where tasks change over time) is a common issue. A formal Job Change request may be required.
Common issues that lead to non-compliance
Many sponsors unintentionally breach their obligations due to misunderstandings or poor internal systems. Common problems include:
- Letting a worker take on different duties or hours without updating the Department
- Failing to report termination, unpaid leave, or resignation within 28 days
- Not paying market salary rates or underpaying overtime
- Hiring before sponsorship is approved, or after visa expiry
- Inadequate or missing recordkeeping systems
- Failure to conduct regular visa checks or keep copies of VEVO results
- Using the worker outside the approved work location or for a different business entity
Some of these issues may seem minor, but they are all considered breaches of the sponsorship framework.
What sanctions can apply?
The consequences of non-compliance depend on the severity of the breach, past performance, and whether there is a pattern of failure. Sanctions include:
- Warnings: formal letters outlining the breach and requiring corrective action.
- Infringement notices: penalties can include:
- Infringement notices of up to $15,840 (individuals) and $79,200 (corporations)
- Civil penalty orders issued by a court of up to $76,200 (individuals) and $396,000 (corporations)
- Enforceable undertakings: legally binding agreements to take specific actions (such as training or systems upgrades) within a set period.
- Sponsorship bar: temporary or permanent ban on sponsoring new visa holders.
- Sponsorship cancellation: revocation of approved sponsorship status. This impacts current employees and can trigger visa cancellations.
- Public listing: businesses that breach obligations may be listed on the Register of Sanctioned Sponsors, affecting their reputation and credibility.
In very serious cases, criminal charges may apply, especially if there is fraud, false documentation, or worker exploitation.
Best practices to stay compliant
To reduce the risk of sanctions, implement these best practices:
- Assign responsibility to a compliance manager or HR lead
- Automate alerts for visa expiry and document deadlines
- Use standardised employment contracts with visa clauses
- Conduct annual internal audits
- Train managers and recruiters on immigration laws
- Seek advice from lawyers on complex cases
At Absolute Immigration Legal, we support employers with strategic immigration advice to meet their sponsorship obligations. From managing visa compliance to responding to government audits, our experienced team is here to guide you through every step of the process.
For tailored guidance, contact us at admin@absoluteimmigrationlegal.com.