Australia’s new Skills in Demand visa is a four-year temporary work permit designed to attract skilled workers to fill critical labour shortages. Replacing the former Temporary Skill Shortage (TSS) visa, it offers greater flexibility and clearer pathways to permanent residency. This visa includes three streams based on skill level and occupation. This article focuses on the Labour Agreement or Essential Skills Pathway, which targets workers in essential industries.
Overview of the Labour Agreement or Essential Skills Stream
The Labour Agreement stream allows Australian employers to sponsor overseas
workers where:
- The occupation is not on standard occupation lists, or
- There are unique workforce shortages that cannot be addressed through usual visa programs
This stream is commonly used across industries experiencing chronic or regional shortages.
Key Characteristics of the Labour Agreement or Essential Skills Stream
Access to Non-Standard Occupations
Employers can sponsor roles that are not on the Core Skills Occupation List
(CSOL), provided they are approved under a labour agreement.
Customised Visa Conditions
Labour agreements can include negotiated concessions, such as:
- Lower salary thresholds (in specific sectors)
- Adjusted English requirements
- Reduced work experience requirements
- These are assessed on a case-by-case basis and must be approved by the Department.
Employer-Led Approval Process
Before any visa can be lodged, the employer must first obtain a labour agreement by demonstrating:
- A genuine labour shortage
- Efforts to recruit Australians
- A commitment to workforce training
Pathway to Permanent Residency
Many labour agreements include a pathway to permanent residency, depending on the terms of the agreement and eligibility criteria at the time.
Common Labour Agreement Examples
Aged Care Industry Labour Agreement
This is one of the most widely used labour agreements. It allows employers in the aged care sector to sponsor roles such as:
- Personal Care Assistants
- Nursing Support Workers
- Key features:
- Concessions on English and salary thresholds
- Clear pathway to permanent residency
- Designed to address critical workforce shortages in aged care
DAMA (Designated Area Migration Agreements)
DAMA agreements are region-specific labour agreements between the Australian Government and regional authorities. Examples include:
- Northern Territory DAMA
- South Australia DAMA
- Far North Queensland DAMA
- Key features:
- Broader occupation lists (including semi-skilled roles)
- Age, salary, and English concessions in some cases
- Strong focus on supporting regional Australia
Company-Specific Labour Agreements
Some large businesses can negotiate individual labour agreements directly with the Government. These are typically used for:
- Large infrastructure or construction projects
- Hospitality groups
- Agriculture and food processing businesses
- These agreements are tailored to the specific workforce needs of the employer.
General Eligibility Requirements
To apply under this stream, you must:
- Be sponsored by an employer with an approved labour agreement
- Work in an occupation listed within that agreement
- Meet the salary, skills, and English requirements specified
- Satisfy health and character requirements
Skills in Demand Visa Cost
Visa application charges are subject to change, particularly from 1 July 2026.
Important Considerations
- Labour agreements are complex and highly regulated
- Not all employers can access this pathway
- Conditions vary significantly between agreements
- Processing involves an additional agreement approval stage
Final Note
The Labour Agreement stream is a powerful but specialised pathway, particularly for applicants whose occupations are not available under standard visa streams. Due to its complexity, professional guidance is strongly recommended.
Next Steps
If you believe you may be eligible under a labour agreement, or your employer is considering this pathway, it is recommended to consult with our registered migration professionals here at Pathway to Aus for more personalised guidance and to further help you with visa options suited for your situation.
