global executive mobility more than just a people issue · global executive mobility – more than...

Global Executive Mobility –

more than just a people issue

Andrew Ball, Partner, Workplace Relations, Employment & Safety

Jock McCormack, Partner, Tax

Chris Headon, Senior Associate, Intellectual Property & Technology

Date of presentation 1

Increasing trend of Global Executive Mobility

21 February 2013 2


21 February 2013 3

Source: http://www.immi.gov.au/media/statistics/statistical-info/visa-grants/migrant.htm

0

5

10

15

20

25

30

35

40

45

50

2007/2008 2008/2009 2009/2010 2010/2011 2011/2012

Th

ou

san

ds

Migration Program Statistics

Employer Sponsored

http://www.immi.gov.au/media/statistics/statistical-info/visa-grants/migrant.htm










Number of 457 visas granted in 2011/12 by Major Group of the nominated occupation

Source: Department of Immigration and Citizenship 457 State/Territory summary report 2011-12, pg 8

21 February 2013 4

Increasing trend of Global Executive

Mobility

More than just a skills shortage

Developing leaders of the business

Attracting and retaining talent

Transferring knowledge

Dealing with emerging markets

Date of presentation Insert filename here 5

Planning for Global Executive Mobility

21 February 2013 6

Employment

Law

Local,

National,

International

Regulation

Immigration Employee

Safety &

Security

Taxation

Global Executive Mobility

When do Australian employment laws apply?

Long Service Leave

Documentation

21 February 2013 7

Compliance with employment laws –

Australian assignment

Scenario

Foreign corporation – home country employer

Foreign citizen – employee

Australian corporation – host company

Fair Work Act 2009 (Cth)

National system employer

Constitutional corporation

Foreign corporation

Foreign corporation will be required to comply with the Fair

Work Act 2009

21 February 2013 8



Implications?

National Employment Standards eg minimum wages, annual

leave, personal leave, parental leave, requests of flexible

working arrangements

Modern award coverage

Provisions relating to termination eg unfair dismissal and

adverse action




Gardner v Milka–Ware International Limited

Gardner commenced working for Milka in New Zealand

Gardner split his time 50/50 in Australia and New Zealand

At time of termination Mr Gardner was working in Australia

Milka objected to the unfair dismissal application

New Zealand "registered, directed and owned" company

Traded in New Zealand only

Employed Mr Gardner in New Zealand

Paid Mr Gardner in New Zealand dollars into Mr Gardner’s New

Zealand bank account

21 February 2013 10



Fair Work Australia

‘The fact that Milka was incorporated in New Zealand means that it

is a foreign corporation within the meaning of s51(xx) and

therefore, to the extent that it employs employees to perform work

in Australia, it is a national system employer as defined in s14 of

the Fair Work Act’

21 February 2013 11


Overseas assignment

Scenario

Australian corporation – home country employer

Australian citizen – employee

Foreign corporation – host company

Can the Fair Work Act 2009 (Cth) apply in this scenario?

Fair Work Act 2009 (Cth)

Australian employer

Australian based employee

Significant Fair Work Act 2009 (Cth) application

21 February 2013 12


Overseas assignment

Implications?

National Employment Standard eg minimum wages, annual

leave, personal leave, parental leave, requests of flexible

working arrangements

Modern award coverage

Provisions relating to termination eg unfair dismissal and

adverse action

21 February 2013 13

Long Service Leave

Scenario

Significant service within a group of companies

Assignment to Australia

Assignment and employment ends in Australia

Long service leave principles

Service with one group company is considered service with

another group company

Service is deemed to be continuous

Foreign corporations are included

Overseas service will be considered

21 February 2013 14

Long Service Leave

International Computers (Australia) Pty Limited v Weaving

Weaving commenced with 3 years of service in Victoria

Followed by 1 year of service in Sydney

Followed by 2 years of service in South Africa

Followed by 6 years of service in the UK

Followed by 3 years of service in Sydney

Full Bench of the Industrial Relations Commission of NSW

‘We consider that it is not necessary that all service should be

substantially connected with NSW, but that it is essential that, at

the time the relevant event occurred, the worker’s service may be

fairly said to be NSW service. There is no doubt that at the

relevant time in this case the worker’s service had a substantial

connection with NSW’

21 February 2013 15

Long Service Leave

Rogers v Taubmans Pty Limited

Rogers was employed by various wholly owned subsidiaries of

Barlow Ltd which was incorporated in South Africa since 1984

In 1996, Barlow acquired Taubmans, an Australian company

Rogers was assigned to work for Taubmans in Sydney from 1997

to 2000, after which he returned home

Court

Not a substantial connection with NSW

Clear intention of temporary service

Rogers considered himself an ‘expat’

Job offers back in South Africa

21 February 2013 16

Documentation

Parties

The employee;

The home country employer; and

The host company

Options

Tripartite agreements

Assignment letter and inter company agreement

21 February 2013 17

Documentation

Conditions precedent

Immigration related obligations

Duration of assignment

Compensation

Relocation assistance

Repatriation assistance

Tax assistance

Termination of the assignment

Position the employee will return to after repatriation

Governing law

21 February 2013 18

QUESTIONS


Global employee mobility -

tax issues

Global employee mobility – tax issues

Balancing Employer & Employee advantages and risks

PE risks / Treaty benefits; Residence

Withholding tax, Superannuation, FBT, Payroll tax, GST

Employee Share/Option Plans (ESOP)

LAFHA

Pre-arrival planning, bonuses, ESOP

Recent rulings, ATO activities

International competitiveness for Financial Centres/Executives,

e.g. France, Netherlands

21 February 2013 21

Tax issues relating to global

employee mobility

Relevant for cross border employment arrangements

Very common occurrence as employees are globally mobile

e.g. where either:

employees leave Aust to work for related entity outside Aust;

or

employees come to Aust to work for related Australian entity

Mindful of tax consequences for employer and employee in

Australia and the other country

21 February 2013 22


employee mobility Con't

Tax issues for employer:

Does the employer have an obligation to pay tax in the

country of employment?

Is there a permanent establishment (PE) for the employer in

the country in which the employee is based?

e.g. pursuant to the Aust/NZ DTA there may be PE where:

fixed place of business may be satisfied where foreign

employees are present at a customer's premises or home

office

place of management, branch, an office, a factory or a

workshop

21 February 2013 23



Building site or a construction, installation or assembly project

which lasts for more than 6 months

PE deemed where services performed by an individual present

for more than 183 days in any 12 month period and more than

50% of gross revenues attributable to active business activities

PE deemed where substantial equipment is operated for a

period exceeding 183 days in any 12 month period

PE not include maintenance of stock for the purpose of

storage, display or delivery provided that it is of a preparatory

or auxiliary character, etc

PE deemed where a person (other than independent person)

acts on behalf of the company to substantially negotiate or

conclude contracts

21 February 2013 24



May be possible to mitigate this PE risk – secondment to local

subsidiary?

What are the employers' tax obligations in respect of the

employee in the country of employment?

May require registrations for:

withholding tax

superannuation obligations

fringe benefits

payroll tax

workers compensation

GST implications

21 February 2013 25



Tax issues for foreign employees working in Australia:

What are the employees' tax obligations in the new country

of employment?

Generally, foreign employees will only be taxed in Australia

on the remuneration received in respect of services

performed in Aust

However, relief may be available if there is an applicable

double tax agreements

Residence status

21 February 2013 26



e.g. Aust/NZ DTA

remuneration received by a NZ employee in respect of

services performed in Aust shall only be taxed in NZ (ie not

in Aust) if:

NZ employee is present in Aust for a period not exceeding

183 days in any 12 month period;

remuneration is paid by or on behalf of NZ company; and

remuneration is neither borne by nor deductible in

determining the profits attributable to a PE which NZ

company has in Aust

May apply if employee is seconded to Aust company

21 February 2013 27

Employee share schemes

General rule – discount given (value of the share/right less the

consideration paid) will be taxed at the time the share/right is

granted

Deferral of taxing point – where:

genuine risk of forfeiture of the shares/rights at the time they

are granted

employee is employed by the company/subsidiary at the

time shares/rights are acquired

shares to be acquired must be ordinary shares in the

employer/holding company

predominant business of the company is not the acquisition,

sale or holding of shares, securities or other investments

21 February 2013 28

Employee share schemes Con't

immediately after employee acquires share/right – employee

must not hold a beneficial interest in more than 5% of the

shares in the company or be in a position to cast or to

control the casting of more than 5% of the maximum number

of votes that might be cast at a general meeting

for share schemes (not rights), at least 75% of long term

permanent employees must be able to acquire shares

If deferral conditions are satisfied, tax is deferred until the

earlier of:

ceasing of employment

7 years from the granting of shares/rights

when forfeiture conditions and restrictions on sale are lifted

21 February 2013 29

Employee share schemes Con't

Genuine risk of forfeiture

eg genuine performance hurdles or where the shares/rights

are subject to forfeiture on termination of employment

usually no risk of forfeiture once shares/rights have vested

Reporting requirements

Employers required to provide reports to ATO by 14 August

and employee by 14 July, following relevant year end

21 February 2013 30

Living Away From Home Allowance

(LAFHA) – Recent Changes

Substantial reforms to the LAFHA rules effective from 1

October 2012

Concessional treatment for LAFHA will be limited to

employees (other than those working on a fly-in or fly-out

basis) who:

maintain a home in Australia (at which they usually reside) for their

immediate use and enjoyment at all times while required to live

away from home for work;

incur expenses for accommodation and food or drink for a

maximum period of 12 months while living away from home; and

have provided their employer with a declaration about living away

from home.

21 February 2013 31

Living Away From Home Allowance

(LAFHA) – Recent Changes

If concession available - taxable value of the LAFHA benefit

provided to the employee will be calculated as the amount of

the fringe benefit reduced by any exempt accommodation

component and any exempt food component.

There are transitional rules which may apply to employees

employed prior to the announcement of these changes on 8

May 2012 at 7.30 pm (AEST).

21 February 2013 32

Recent ATO Rulings – ATO ID 2013/8

Background

Employee is promoted but is required to work over 3,000 km

away from their residence

Under their agreement, employer can't require employee to

move

Employee can't perform new role from their current residence

as the employee is on call and must be there within 2 hours

Employee changes their residence to move near their new role

Employer reimburses employee for removal costs

Section 58B exempts removal costs from FBT where the

employee is 'required' to change their residence to perform

their duties

21 February 2013 33

Recent ATO Rulings – ATO ID 2013/8

Issue – if an employee changes their residence to be closer to

where they work (even though it is not required by their

employee), is the employee still 'required' to change their

residence in order to perform their duties for section

58(1)(B)(iii) FBT Act?

Decision - Yes. Even though the employer does not require the

employee to change their residence, it is considered that the

duties of the employee's employment are such that the

employee is 'required' to change their residence

21 February 2013 34

Recent ATO Rulings – TR 2013/1

TR 2013/1 Income tax: the identification of 'employer' for the

purposes of the short-term visit exception under the Income from

Employment Article, or its equivalent, of Australia's tax treaties.

The 'substance over form' approach

The written contract is essential for the existence of an

employment relationship, however the parties cannot deem their

relationship to be something it is not.

The written terms of an employment contract must be consistent

with the actual behaviour of the parties for the purposes of:

establishing whether the relationship is properly one of

employment; and

identifying the employer in respect of the short-term visit

exception.

21 February 2013 35

Recent ATO Rulings – TR 2013/1

The key indicators for identifying the employer:

who has ultimate, or day-to-day, control over the worker?

are the services rendered by the worker an integral part of the

business activities carried on by the enterprise?

the terms of engagement – Does the employee have

entitlements to leave? Who has obligations to deduct PAYG

instalments, pay superannuation contributions and workers'

compensation insurance?

who bears the responsibility or risk for the services of the

worker?

The identity of the employer is critical to second condition of the

short-term visit exception - the employer must not be a resident

of the State in which the employment is exercised.

21 February 2013 36

QUESTIONS


Immigration

21 February 2013

Do you have a Visa? - Laws of the

Land

Immigration laws vary from country to country but the common

theme is the balance between global trade and commerce with

the protection of national security and the local labour market.

In general all foreign nationals need a Visa to enter another

country's territory. Many countries have bi-lateral agreements

affording privilege, reciprocal waivers or special access rights to

citizens from particular countries. Australia grants special

streamlined application procedures, relaxed eligibility criteria and

fast track processing to particular nations - mostly APEC, english

speaking nations and parts of the EU.

Make sure you check the reciprocal arrangements first. They can

help you choose the best option for transfer/secondment.


Choose Wisely

In light of recent national security incidents and terrorist acts, as well as the

GFC and the pressure on local labour markets, nations are now applying

must stricter entry criteria and are more aggressively auditing and

prosecuting unlawful employment.

Don’t risk your company's reputation by getting it wrong on Visas. You can

face fines, blacklisting for future applications and damage to your company's

relationship with government. In some jurisdictions there are strong criminal

penalties for breaches of Visa conditions and false information.

It is often easy to find a quick Visa solution to but if the Visa is not right for

the circumstances your company will pay dearly. Use of tourist visas, student

visas and work and holiday visas are not a substitute for the appropriate

corporate or business Visa.

Short term Visas are often the only way to get a person quickly in country. An

urgent negotiation, a major deal, a desperate client. In Australia the types of

Visas available for quick trips are not appropriate for long term projects or

assignment. Make sure you talk to us first.


The Department of Immigration and

Citizenship

In Australia the Department of Immigration and Citizenship is

responsible for the assessment and granting of Visas. They

process about 13,000 Visa applications per day. Getting in early

and ensuring your documentation is accurate and complete on is

the key.

DIAC also monitors compliance, especially Visa sponsors (your

company) every 6 to 12 months to make sure foreign nationals are

complying with their Visa conditions. Employees who breach their

conditions can face severe civil and criminal penalties.

Many Visas can be applied for online (this speeds things up) but

the ability to apply online depends on the citizenship of the

applicant. In addition Visas granting the same rights often have

different names depending on the country the applicant is from so it

is vital to make sure you are applying for the right type of Visa and

that you (and your family) satisfy all of the criteria.


Skills Shortage and a one way trip

Australia is facing massive skills shortages especially in the

technical and trade occupations. There is great demand by

business for skilled workers especially for large-scale infrastructure

projects.

Managers and Executives are highly sought after, especially in

marketing, public relations, ICT and engineering roles.

Multinationals continue to transfer skilled managers and executives

to Australia to investigate new opportunities and to grow existing

business in the relatively stable Australian economy.

The good news is that only about 10% of Secondees to Australia

leave the company upon returning home. This is one of the lowest

levels of secondee attrition for in the world……..however, many

choose to stay and become Permanent Residents, even Australian

Citizens. (This seems to happen more for my clients with offices in

sunny Queensland).


The Visas

Business Travel

There are up to 100 different types of Visas available in Australia but

for business people there is a limited selection. (Less than 5).

1. Electronic Travel Authority (ETA) subclass 977

A fully electronic visa (no stamp or label in your passport) to facilitate

travel by citizens of countries who have been assessed (statistically)

as most likely to be 'genuine business visitors' and unlikely to

overstay.

An ETA is for short term business purposes only:

attending educational or business related meetings, seminars,

conventions, conferences and networking;

informal studies or training.

Date of presentation Insert

filename here

43

Conditions

Valid for 12 months (or expiry of Passport if earlier)

May enter Australia and stay for a maximum of 3 months at a

time.

No limit on number of entries.

Does not allow work except in exceptional circumstances, if

urgent or highly skilled or specialised and no more than 6

weeks.

The criteria for permission to work is extremely tough and just

because you or your business provides a very specialised

service or unique product offering this is not enough. The

threshold is high - Think Astronaut, nobel prize winning,

surgeon, super model.


Eligible Nationals


Andorra Hong Kong Norway

Austria Ireland Portugal

Belgium Italy Republic of

San Marino

Brunei Japan Singapore

Canada Liechtenstein South Korea

Denmark Luxemburg Sweden

Finland Malaysia Switzerland

France Malta Taiwan

Germany Monaco United

Kingdom

Greece Netherlands United States

Vatican City

*Online Application Available

Something longer term?

Character and security check (criminal background), health

criteria and intention of visit.

If you want a longer term ETA there is a type available for the

life of the passport (same conditions 3 months at a time) and

same conditions.

Back to Back ETA's – Not good. Must spend some time

outside of Australia.

Who is eligible?

What is the cost?

How long does it take to apply and obtain?

What about my Family?

Dual Nationals? (This is especially important for permanent

Visas)


Cost

Service Charge of $20 AUD

Time – Less than an hour for online.

Same or next day for airline or travel agent.

The Visa is recorded electronically on the Department of

Immigrations' Visa database so all you need to do is

present your passport to Immigration upon arrival.

(Always worth bringing a print out as well just in case).


Example ETA

>>>>>>>>> ETA APPROVAL 17FEB13/1754

FAMILY NAME Johnson................... AUSTRALIAN GOVT

GIVEN NAMES Joseph James

PASSPORT 45809234.....ISSUED GBR

EXPIRY DATE 17JAN2016

DATE OF BIRTH 12OCT1947 SEX M COB GBR

TYPE OF TRAVEL BUSINESS ETA...............................

ENTRY STATUS 977 ETA BUSINESS (SHORT)...................

AUTHORITY TO ENTER AUSTRALIA VALID TO........

17FEB2014. ..................................

PERIOD OF STAY 03 MTHS.......................

MULTIPLE ENTRY.........EMPLOYMENT PROHIBITED.

ETA APPROVED.


Not on the ETA list - eVisitor

An ETA (Visitor) (subclass 976) visa is designed for people who

are outside Australia and want to visit Australia for holidays,

tourism, recreation or for informal study.

Not on the ETA List or…..

Subclass 651 eVisitor

Also an electronic Visa, same conditions and criteria as the

ETA – 3 months on each occasion over 12 month period.

Generally for Europeans.

No application fee and no need for a travel agent or airline.

Individual or their company can apply online themselves.


eVisitor – Eligible Nationals

Andorra Ireland Republic of San

Marina

Austria Iceland

Romania

Belgium Italy

Slovakia

Bulgaria Latvia

Slovenia

Cyprus Lichenstein

Spain

Czech Republic Lithuania

Sweden


Subclass 456 Business Short and

Long Stay

Subclass 456 Business Short and Long Stay

Not eligible for ETA or eVisitor (Higher risk country)

India, South Africa, People's Republic of China.

Written application, same conditions and criteria. (Cost $110)

The Stats:

1. 3.5 million visitors annually.

2. 2 million ETAs and 500,000 eVisitors.

3. 250,000 Business visits.


457 Visa

The 457 is the most well known or perhaps 'infamous' (and

poorly understand) Visa.

The most common and suitable longer term Visa for

secondments and transfers (1 day to 4 years).

The 457 is about allowing foreign nationals to work in areas of

genuine need (skills shortage) without adversely affecting

opportunities for Australians for gainful employment. It is

designed to enable employers to address labour shortages by

bringing in genuinely skilled workers where they cannot find an

appropriately skilled Australian.

The subclass 457 visa is a temporary Visa that allows

businesses to employ overseas workers for up to 4 years in

skilled occupations only.

Date of presentation Inser filename here 52

Allows

Subclass 457 visa holders can:

work in Australia for a period of between one day and 4 years

bring any eligible dependants with them to Australia —

dependants can work and study

enter and exit Australia as many times as they like over the

Visa period.


Criteria

English

Most primary applicants who are sponsored by a standard business sponsor must

demonstrate that their level of English proficiency is equivalent to an IELTS test score

of at least 5 in each of the 4 test components of speaking, reading, writing and

listening.

Exemptions:

Passport holders from Canada, New Zealand, the Republic of Ireland, the United

Kingdom or the United States of America.

The nominated occupation is a highly skilled occupation that is on the gazetted list of

English language exempt occupations available on the department’s website:

www.immi.gov.au/skilled/skilled-workers/legislative-instruments/

A salary that exceeds the English language requirement exempt amount and the grant

of the visa is in the interests of Australia. This amount is currently set a gross base

salary of AUD $92,000.

The nominated occupation does not need a level of English language proficiency for

grant of registration, licence or membership, and the applicant has completed at least

5 years of continuous full time study in a secondary and/or higher education institution

where instruction was conducted in English.

21 February 2013

Health

High or low risk country.

Tuberculosis screening and x-rays, blood tests.

Conducted by authorised provider.

Age

No age limit but be wary of the 50 year limit for ENS

Permanent Residency Pathway.

Character and Travel History – Lived in for

more than 3 months over past 5 years.

Insurance – Private Health Insurance.


457 Stages

Application stages

1. Sponsorship – Approval as a standard business sponsor.

2. Position Nomination – Approval of the eligible occupation and position (conditions)

3. Visa Application – Individual applicant meets health, security, language, character requirements.

21 February 2013 56

Sponsorship

Position

Nomination

Visa

Application

DIAC 21 Day

target for

processing

and decision.

– My fastest

2 days,

longest 3.5

months.

Step 1 - Sponsorship

The purpose of the sponsorship stage is to:

identify the details of the business applying for standard business

sponsorship

gain attestation from the employer, where the employer is operating a

business in Australia, that the business has a strong record of, or a

demonstrated commitment to:

– employing local labour

– non-discriminatory employment practices

assess the employers’ training practices where they are an Australian based

business.

to ensure the employer has a strong record of and commitment to training

Australians. (Training Benchmark A and B) – The hidden cost.

Sponsorship is valid for 3 years and you can sponsor an unlimited number of

workers – no quota.


Sponsorship

Requirements for approval

To be approved as a standard business sponsor your business must meet the following requirements.

These requirements apply to all applicants whether they are individuals ,businesses, in or outside

Australia with one exception. The exception is that overseas standard business sponsors are not

subject to training requirements and attestation.

you must be lawfully operating a business in or outside Australia

if you are lawfully operating a business in Australia and you have traded for 12 months or more you

must meet the prescribed training benchmark

if you are lawfully operating a business in Australia and you have been trading for less than 12 months,

you must have an auditable plan to meet the prescribed training benchmark

if you are lawfully operating a business in Australia, you must attest, in writing, that you have a strong

record of, or a demonstrated commitment to both of the following:

– employing local labour

– non-discriminatory work practices

if you are lawfully operating a business overseas but not in Australia, you must be seeking to be

approved as a standard business sponsor with the intention of sponsoring a person under the subclass

457 visa program to either: establish, or assist in establishing, on your behalf, a business operation in

Australia with overseas connections, or fulfil, or assist in fulfilling, your contractual obligation.

there is no adverse information known to the department


Obligations of Sponsors

Co-operate with inspectors

Equivalent terms and conditions of employment (except where

salary in excess of $180,000 AUD). Comply with Fair Work

Act.

Travel Costs to leave Australia.

Records.

Costs incurred by Commonwealth to remove unlawful non-

citizen.

Notifying and keeping Department informed of prescribed

events.


Step 2 - Nominating the Position

Employer nominates a position

The approved sponsor nominates a skilled worker to fill the

position. The skilled worker must be paid the appropriate

market salary for the position in Australia. The position must

be an eligible occupation (CSOL).

A nomination is valid for up to 12 months unless the

sponsorship ceases beforehand.

Demonstrating Market Salary – Salary survey, existing

employee contracts.

Compliance with Fair Work Act.


Step 3 – Visa Application

Who can apply for a subclass 457 visa?

You can apply for a subclass 457 visa if you:

have been nominated by an employer to work in Australia under standard business sponsorship and you

have been advised by that employer to apply for your visa; or

have been nominated to work in Australia on the basis of a transfer within you company and have been

advised by your employer to apply for your visa; or

are a member of the family unit of a primary visa applicant who is seeking to be granted a subclass 457

visa on the basis that they meet the primary visa requirements.

Condition 8107

Condition 8107 requires that as a primary holder of a subclass 457 visa you must:

work in the occupation for which you were nominated

work for the sponsor, or an associated entity of the sponsor, who nominated the

position you are working in, and

not cease employment for a period of more than 28 consecutive days.

A Visa holder is considered to have ceased employment when either they or their employer gives notice of

intention to cease employment and the date of the notice of intention to cease employment has passed. (28

days to find another Sponsor).

Condition 8501

Condition 8501 requires subclass 457 visa holders to maintain adequate arrangements for health

insurance while in Australia.


Example Visa Grant – Extract

Visa Transaction Reference Number (TRN): EG23568791

Visa Application ID: 0760454319

Client ID: 75804275026

Name of Approved Visa Holder: James Johnson

Passport Number: 4157833464

Visa validity period: 07 February 2013 - 07 February 2017

Name of Sponsor: ACME INDUSTRIES PTY LTD

Sponsorship/Agreement Application ID: 130951745

This email refers to your application for a Temporary Business Entry (Class UC) visa. You have

indicated on your application that you wish to be considered for the grant of a Temporary Work

(Skilled) (Subclass 457) visa

DECISION

I am pleased to advise that James Johnson has been granted a Temporary Business Entry

(Class UC) Work (Skilled) (Subclass 457) visa. This visa allows you to travel to, enter and

remain in Australia and is valid until the date specified above

VISA GRANT NUMBER

The visa grant number is 70545826586176. This is the unique number assigned to the visa.

Please keep this visa grant number with you for the life of your visa, as you may be asked for it.


457 Time and Cost

1% gross payroll on Training (demonstrated investment in

training for Australians) or 2% paid to Industry training Fund

(each and every year for the 4 years).

Sponsorship Application Charge $420

Nomination Charge $85

Visa Application Charge $455

Return Travel.

ENS – $$$

Documents – Financial statements, training plans, contracts,

Annual Reports, employment contracts, CV's, Qualifications,

Marriage Certificates, Passports……..Extensive material

required, takes time to obtain – translation and certification.


Intra-company transfers

Streamlined processing arrangements are in place to help executives, managers and

specialists on intra-company transfer (employees of an international business

transferred to Australia to work in a branch or subsidiary of the business). These

arrangements also assist intra-company transfers between Asia Pacific Economic Co-

operation (APEC) economies.


Brunei India Papua New Guinea

United States

Canada Japan Peru

Vietnam

Chile Korea Philippines

Indonesia

China Malaysia Russia

Chinese Tapei Mexico Singapore

Hong Kong New Zealand Thailand

ENS – Permanent Transfer and

Residency

For this visa, you should already have:

an Australian employer

a highly skilled employee

an eligible occupation. (These are different occupations from

the CSOL – higher skills and more limited).

Same process – Sponsorship, Nomination and Visa.

Offer of 3 years, age limit 50.

Can apply for ENS after holding 457 for 2 years or can offer

ENS initially.


The Tricky Bit – Setting it Up

Method 1: Secondment

Continues to be employed by home country except where modified by terms and duties in host

country. (Intra-company transfer letter).

Host pays Parent/Home company. (Be careful re permanent establishment issues)

Most common arrangement.


Home Company

or Parent

Local Company

(Subsidiary/Host)

Secondee

Method 2: Transfer

Home company terminates employment.

Host company employs individual on a new contract – host jurisdiction only.

Be wary of entitlements and termination requirements vs benefits of fresh start and a

clearer employment relationship.


Home Company

or Parent

Local Company

(Subsidiary/Host)

Transfer

through

termination

and rehire

Method 3: Dual Employment

Employee of both Companies .Executive with multiple titles and reporting

responsibilities.

Services benefit both entities. Tax challenges. Clear duties and time allocation

required.

Less common. Possibility of some favourable tax outcomes.


Home Company

or Parent

Local Company

(Subsidiary/Host)

Employee

Method 4: Use of Global Employment Companies

Expatriate GEC.

GEC as employer – seconds to Host. Uniformity of conditions for pool of expatriates.

Often used to address permanent establishment. Set up in employer friendly jurisdictions.


Home Company

or Parent

Local Company

(Subsidiary/Host)

Global

Employment

Company

Secondment

Transfer and rehire

Case Study 1 – Regional Manager

Regional Asia Pacific Manager responsible for operations

in multiple countries. Australian subsidiary based in

Sydney.

Long Stay ETA for meetings, networking and

negotiations. (Remember strict no work condition)

457 Visa if going to live and work in Australia - 38 hour

week. Must have valid leave to depart. Remember

'genuine intention'.

ENS if permanently based, or back to back 457 Visa.


Case Study 2 – Project Work

Project Work – 2 month project in Perth for new customer

– specialist project manager. Company/provider has no

presence in Australia.

457 Visa only.

Cannot use a 457 Visa for fly in fly out.


Checklist

The best laid plans………….

Use our Checklist to make sure your company is prepared.

No one wants to receive a call from the Airport……."I'm stuck at

Immigration."


QUESTIONS
