Labour Market Testing Exemptions: When Advertising Is Not Required

What Labour Market Testing is and when it is exempt

Labour Market Testing (LMT) is a requirement that a sponsor demonstrate it has made an effort to find an Australian worker or permanent resident before sponsoring an overseas worker through the 482 visa. In practice, this usually means advertising the role for a set period, keeping the evidence, and explaining why a local worker could not be hired.

However, Australian migration law provides for certain cases that are fully exempt or partly exempt from the LMT requirement. Identifying the correct exemption ground can save a business considerable time and cost.

Exemptions under trade and investment agreements

This is the most important exemption group and the one most often applied in practice.

Free trade agreements (FTAs)

Australia has signed a number of free trade agreements with provisions relating to labour mobility. Under these, citizens of the signatory countries are exempt from LMT when sponsored by a company of the signatory country, or under certain specific conditions:

• TAFTA (Australia – Thailand): Thai citizens working for a Thai company, or in certain sectors, are exempt from LMT.
• AUSFTA (Australia – United States): the exemption applies to specialists within the framework of bilateral investment or trade.
• ChAFTA (Australia – China): includes provisions exempting LMT for certain types of project contracts.
• KAFTA (Australia – Korea), MAFTA (Australia – Malaysia): have similar provisions but a narrower scope.
• CPTPP: the Comprehensive and Progressive Agreement for Trans-Pacific Partnership covers many countries, but the scope of any LMT exemption needs to be assessed case by case.

An important note: an FTA exemption usually comes with conditions about the type of business activity, the standing of the sponsor (whether it is a business from a signatory country), and the nature of the role. Not every citizen of an FTA signatory country is automatically exempt from LMT.

Intra-company transfer

A person transferred internally from an overseas office to Australia, where:

• The overseas company and the Australian company belong to the same corporate group (related by ownership)
• The role is a senior specialist position (senior manager, specialist)
• The worker has worked for the group for at least 12 months

This case is usually exempt from LMT because it is by nature an internal transfer, not a new hire from the market.

Exemptions based on the nature of the role and the circumstances

Roles on an exemption list

Certain roles under particular ANZSCO codes may be considered by DHA for an LMT exemption in the context of a specific industry skill shortage. This list changes over time and should be checked at the time of lodging.

Emergency and disaster situations

When there is a natural disaster, a health crisis, or a national emergency, the Minister may issue a decision temporarily exempting LMT for certain industries or geographic regions. A clear example was the COVID-19 period, when many exemptions were issued for the healthcare sector.

Roles in rural and local areas with labour shortages

In some cases, a role in a remote rural area, or an area with a low unemployment rate, may be considered for a partial exemption from the LMT requirement; however, this is not an automatic exemption and requires a supporting submission.

How to declare an exemption in the nomination

When lodging the nomination, the sponsor must:

1. Select the correct exemption ground in ImmiAccount — the system will ask the reason LMT was not carried out
2. Provide supporting documents: for example, if relying on an FTA exemption, evidence of the nominee’s nationality, the legal standing of the sponsor, and the role itself meeting the FTA conditions
3. Not skip LMT without a clear basis: DHA may refuse the nomination and require LMT to be carried out

Where there is no exemption: the standard LMT requirement

If none of the exemption grounds applies, the sponsor must:

• Advertise the role on at least one suitable channel (for example, SEEK, LinkedIn)
• Keep the advertisement running for at least 28 consecutive days within the 4 months before lodging the nomination
• Keep the evidence: screenshots, posting confirmation, the number of applicants, the reasons for rejection
• Explain why no suitably qualified Australian could be hired

Any LMT carried out before the business attains SBS status does not count. The advertising must therefore be planned for after the SBS is approved.

Common mistakes when applying an exemption

• Confusing FTA nationality with an automatic exemption: not every citizen of an FTA signatory country is exempt; read the specific provisions carefully.
• Missing the documents that establish the exemption ground: declaring an exemption without attaching the evidence leads to an RFI.
• Relying on an expired exemption: some temporary exemptions have ceased to apply; check the dates they were in force.

Consulting an experienced migration agent before deciding to skip LMT is an important step to avoid the risk of the nomination being refused.