A labour agreement is a formal written arrangement between the Australian Government (represented by the Department of Home Affairs) and an employer, industry body, or regional authority. It allows the employer to sponsor overseas workers in occupations or under conditions that are not available through the standard employer-sponsored visa programs.

Labour agreements are used where the standard sponsorship framework (the approved sponsor system under the Skills in Demand visa) does not meet the employer's needs — typically because the required occupation is not on the standard occupation lists, or because the employer needs to sponsor workers with lower qualifications or English proficiency than the standard program requires.

Labour agreements operate as an overlay to the standard visa framework — workers sponsored under a labour agreement still apply for a Subclass 482, 494, or 186 visa, but under the terms of the agreement rather than the standard program requirements.

Labour agreements are authorised under the Migration Regulations 1994. The Department of Home Affairs negotiates and executes the agreements with employers. Once a labour agreement is in place, the employer nominates workers under it, and those workers apply for the relevant visa subclass. The terms of the agreement (which may include concessions on salary, qualifications, English proficiency, or occupation lists) are binding on both the Department and the employer.

There are three main types of labour agreements:

1. Company-specific labour agreements: Negotiated directly between the Department and a single employer. Used where the employer has demonstrated a genuine, ongoing need for overseas workers that cannot be met through the standard program. The employer must demonstrate labour market testing, genuine labour need, and the ability to meet the sponsorship obligations.

2. Industry labour agreements: Pre-negotiated template agreements for specific industry sectors with known, systemic labour shortages. Current industry labour agreements exist for aged care, dairy, meat industry, advertising, horticulture, and other sectors. Employers in these industries can accede to the template agreement rather than negotiating a bespoke arrangement, which reduces time and cost.

3. Designated Area Migration Agreements (DAMAs): Agreements between the Commonwealth and a state/territory government or regional authority. DAMAs provide additional occupation and concession access for employers in regional areas. See the DAMA framework page for detail.

Under any labour agreement, the employer must:

• Be endorsed by the relevant DAMA authority (for DAMAs) or demonstrate genuine need (for company-specific agreements)
• Lodge a labour agreement request online through ImmiAccount with supporting evidence
• Have the agreement approved by the Department before any nominations are made
• Comply with all terms of the agreement, including employment conditions equivalent to Australian workers

There is no cost to request a labour agreement, though application charges apply at the nomination and visa stages. Agreements are generally in effect for 5 years, after which they must be renewed or renegotiated. A current list of all in-force labour agreements is maintained by the Department of Home Affairs at immi.homeaffairs.gov.au — list of current labour agreements.

Labour agreements provide concessions — for example, lower English proficiency requirements, lower minimum salary, or access to occupations not on the MLTSSL or STSOL — but they also impose additional obligations on employers, including enhanced monitoring, reporting, and return-travel obligations. Employers who breach the terms of their labour agreement face cancellation of the agreement and potential civil penalties under the sponsorship obligations framework.