Can We Fire a Sponsored Employee? Understanding Your Obligations as an Employer
One of the most common questions we receive from businesses sponsoring overseas workers is: "Can we terminate the employment of a sponsored employee, and if so, what happens to their visa?"
Yes, you can terminate a sponsored employee, make their position redundant, or cease their contract for performance or behavioural issues. Sponsoring a worker does not guarantee them employment for life. However, terminating a sponsored worker, such as those on a Skills in Demand (SID) (Subclass 482) visa, is not as simple as terminating a local employee. It triggers obligations under both Australian employment law and migration law. Today, we will go through how it affects the migration law perspective.
Does Employment Law Still Apply?
Sponsored workers have the same workplace rights as Australian citizens and permanent residents (PR). You cannot simply fire a sponsored employee without due process. The termination must comply with the Fair Work Act 2009, meaning:
You must have a valid reason for termination, such as underperformance, serious misconduct, or genuine redundancy.
You must follow a fair process, including giving warnings, an opportunity to respond, and allowing a support person to be present.
You must provide the correct notice period or payment in lieu of notice and pay out all accrued entitlements, such as annual leave.
Failing to follow these steps exposes your business to unfair dismissal or general protections claims, which can be costly and damage your reputation.
Related: What Happens If a Sponsored Employee Resigns?
Your SBS Obligations as a Sponsor
Once the employment relationship ends, you must adhere to your Standard Business Sponsor (SBS) obligations, which include:
You are legally required to notify the DoHA within 28 calendar days of the sponsored employee’s last day of work. Failing to report the cessation of employment breaches your sponsorship obligations and can lead to fines, administrative sanctions, or cancellation of your business's sponsorship approval.
If the sponsored employee or their sponsored family members request it in writing, you must pay reasonable and necessary travel costs for them to depart Australia. This obligation must be fulfilled within 30 days of receiving the written request. You cannot deduct this cost from their final paycheck.
Related: Sponsoring Skilled Migrants: SBS Process, Obligations, and Main Considerations
What Happens to the Employee’s Visa?
A common misconception is that terminating a sponsored employee automatically cancels their visa. In fact, employers cannot cancel visas; only the Department of Home Affairs (DoHA) can.
When you terminate a sponsored worker:
They do not have to leave the country immediately.
Under recent updates to visa conditions, such as condition 8607 for SID Subclass 482 visa holders, they typically have up to 180 days to find a new sponsor, apply for a different visa, or arrange their departure from Australia.
During this time, your business is no longer responsible for paying their salary, but you remain their sponsor on record until their visa expires, is cancelled, or they are transferred to a new sponsor.
How to Avoid Losing Your SBS Approval?
The best way to protect your SBS is through proactive compliance.
Conduct internal audits regularly. Consider reaching out to AHC Lawyers to do a mock internal audit to ensure you meet compliance requirements before DoHA audits you.
Ensure your HR and payroll teams understand that they have only 28 days to report changes to the Department.
You must keep records of employment, salary, and duties for at least 5 years. If DoHA audits you, you must be able to produce these files instantly.
Seeking professional assistance from an immigration lawyer can help you conduct a compliance check to find and fix mistakes before an inspector shows up.
Read our clients’ testimonials on Agape Henry Crux and Accredited Specialist in Immigration Law, Jason Ling.
Related:
Experiencing Workplace Exploitation: What to Do for Your Visa?
What Happens If Your Business Is Audited by the Department of Home Affairs?
SBS Application: Proving Your Business is Lawfully Operating
Who is Responsible for Paying Employer-Sponsored (Subclass 482 / 186) Visa Costs?
How Can Agape Henry Crux Help You?
Losing your SBS approval could severely impact your business operations and damage your reputation. Consider speaking with one of our immigration lawyers at Agape Henry Crux for a compliance check and mock audit. Our team of immigration lawyers works closely with our Accredited Specialists in Immigration Law to handle highly complex matters. We recommend booking a Migration Planning Session with our team by calling 02 8310 5230 or emailing 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.
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