What Happens if You Underpay a Sponsored Employee?
For many Australian businesses, the ability to sponsor skilled workers via the Skills in Demand (SID) (Subclass 482) visa or Employer Nomination Scheme (ENS) (Subclass 186) visa programs is a competitive advantage. However, this advantage comes with legal sponsorship obligations, including paying the nominated salary. There is zero tolerance if the government discovers that underpayment is happening.
What are the Two Standards: CSIT & AMSR?
When you nominate a worker, you are not just agreeing to pay a minimum wage. You are legally bound by two different financial benchmarks:
As of 1 July 2026, the minimum salary of the Core Skills Income Threshold (CSIT) and the Temporary Skilled Migration Income Threshold (TSMIT) has increased to $79,423. You cannot pay a cent below this for most sponsored roles.
You must also pay according to the Annual Market Salary Rate (AMSR). This means if you pay an Australian citizen $90,000 for the same role, you must pay the visa holder $90,000. Underpaying the visa holder relative to their Australian colleagues is a major breach of your sponsorship obligations.
Related: What are the Key Business Sponsorship Obligations?
The Role of the Monitoring Audit
The Department of Home Affairs (DoHA) and the Australian Border Force (ABF) conduct regular audits. If your payroll records show that the taxable income of a sponsored worker is lower than the amount promised in the nomination, this usually triggers a formal request for information or an unannounced on-site visit to your business.
Related: What Happens If Your Business Is Audited by the Department of Home Affairs?
What are the Consequences for Your Business?
If your business is found to have underpaid a sponsored worker, you may face a number of these consequences from the Department:
You can be issued with Infringement Notices that carry heavy fines for every pay period the worker was underpaid.
The Department can revoke your Standard Business Sponsorship (SBS), meaning you can no longer hire overseas talent to grow your business.
If your sponsorship is cancelled, all your current SC482 visa holders will be notified. They will have 180 days to find a new sponsor, potentially leaving you without a workforce overnight.
The government maintains a public Register of Sanctioned Sponsors. Being listed here can cause permanent damage to your brand and make future recruitment nearly impossible.
Related: What happens if my sponsor loses their SBS approval while I'm on a SC482 visa?
What if the Underpayment was an Accident?
Many underpayments are not intentional; they often happen because of:
Changes in indexation that weren't updated in payroll.
Unauthorised deductions, like charging the worker for their own visa fees.
Miscalculating pro-rata pay for part-time work, as most sponsored roles have to be full-time.
Even if the mistake was honest, the Department still considers it a breach. However, proactive self-correction is always viewed more favourably than being caught during an audit.
How to Fix a Compliance Gap?
If you realise you have accidentally underpaid a worker, do not wait for the government to find out. We recommend the following steps:
Calculate the shortfall and pay the worker the full amount owed, including superannuation.
Keep clear records of why the mistake happened and how you fixed it.
Ensure all employment contracts reflect the current 2026 salary thresholds.
Seek legal advice from an immigration lawyer to help you to address the mistake to the Department.
The Australian Government’s primary goal is to ensure that migration is not used to undercut local wages. Ensuring that every sponsored worker is paid exactly what was promised is the only way to protect your business’s future.
Read our clients’ testimonials on Agape Henry Crux and Accredited Specialist in Immigration Law, Jason Ling.
Related:
Sponsoring Skilled Migrants: SBS Process, Obligations, and Main Considerations
Is Your Company at Risk of Adverse Information for a Nomination Application?
How Can a Workplace Investigation Trigger Visa Cancellation under Section 116?
Can You Still Get PR If You Change Employers? Your Guide to Subclass 186 Sponsorship
How Can Agape Henry Crux Help You?
Don't risk your SBS! Our team of immigration lawyers at Agape Henry Crux can assist businesses in conducting internal audits, managing backpay calculations, and defending against DOHA monitoring. The team works closely with two of our Accredited Specialists in Immigration Law who specialise in complex visa matters. We recommend booking a Migration Planning Session with our team by calling 02 8310 5230 or emailing us at info@ahclawyers.com to arrange a time.
We speak fluent English and Mandarin. If this isn’t your language, we can also help you arrange an interpreter.
Our founder and principal lawyer, Jason Ling, is recognised in the 2026 edition of The Best Lawyers in Australia™ and the 2027 edition of The Best Lawyers in Australia™. Agape Henry Crux is named as Best Immigration Law Firm 2025 - Sydney by APAC Insider Awards and in the 2027 edition of The Best Law Firms™ - Australia.
This article/presentation (“publication”) does not deal extensively with important topics or changes in law and is not intended to be relied upon as a substitute for legal or other advice that may be relevant to the reader's specific circumstances. If you find this publication of interest and would like to know more or wish to obtain legal advice relevant to your circumstances, please contact our office.
Client Testimonials
….we call it Support Network
As navigating through the immigration law process may be difficult, our former clients have agreed to share their experiences through telephone chats, emails and meetings in person.
These are their stories…
