Training Benchmarks for Renewing Business Sponsorships

by External31 Jul 2014
Maintaining Business Sponsorship status is crucial to businesses wanting to preserve their visa program under the Department of Immigration and Border Protection (DIBP). However, sustaining the DIBP’s set training benchmarks and retaining supporting documentation for each year of recent sponsorship approval can be challenging. 
What are the training benchmarks?

Businesses operating for 12 months or more must meet Training Benchmark A or B to be granted sponsorship status by the DIBP. Businesses operating for less than 12 months must show their plan to meet benchmarks.

Benchmark A

Calculated by reviewing 2% of payroll expenditure where a business makes a contribution to a training fund.

Benchmark B

Calculated by reviewing 1% of payroll expenditure to demonstrate direct training of staff who are Australian citizens or permanent residents.

If no Australian workers are employed, the business must show contributions to a training fund operating in the same industry as itself.

Currently, an approved business sponsor must continue to meet their benchmark for three years post-approval (or six years if they have Accredited Status). They must keep records of training expenditure for monitoring purposes by the DIBP or for renewing or varying the terms of sponsorship or nominating a subclass 457 visa holder under the Temporary Residence Transition Stream of the Permanent Employer Sponsored program. 

To become a business sponsor, a business must have operated for more than 12 months and have a payroll (i.e. wages, remuneration, salary, commission, bonus, allowances, superannuation, termination payments). The payroll amount must be used to determine the figure required to meet a training benchmark.  

What can be included within the 1%?
A variety of training and expenditure can be included, such as:
  • Funding a scholarship in a formal course of study approved under the Australian Qualifications Framework 
  • Funding study relevant to the business 
  • Total salaries of apprentices or trainees
  • Graduate salaries for a formal, structured graduate program for up to two years, or a professional year post-graduation
  • On the job training as part of a formal, structured course
  • Purchasing of on-line learning and self development material
  • Journal and magazine subscriptions related to the business
  • Reasonable costs associated with training, e.g. travel and logistics representing a minor proportion of the training expenditure

What’s not included?

Excluded items encompass:
  • Wages of staff attending training
  • Third party training from within the same business
  • Membership of professional associations unless a specific percentage of the fee entitles attendance at professional development seminars 
  • Registration or licensing fees
  • Networking opportunities or costs associated with attendance at a trade show or conference

Tips to keep track 

It’s important for Business Sponsors to keep records of when training was held, who attended and what skills were mastered.

Consider introducing a recording system to collate and maintain this information quickly and easily. 

Ideally, set training budgets in accordance with the budgeted payroll amount each financial year and conduct quarterly reviews to ensure it’s on track to 1% of payroll. 

Contact Fragomen on for further assistance with your training spend.