The income threshold is indexed on 1 July: does the sponsored worker’s salary have to rise? What moves, what does not, and the nomination that will be read at the new figure

MARN 1576536

What the threshold governs, and what it does not

The Core Skills Income Threshold is a figure set by legislative instrument and indexed on 1 July each year in line with average weekly ordinary time earnings, and the threshold guide carries the current figure and the history. It governs the approval of a nomination: a nomination for the Core Skills stream of the 482 is approved only if the annual market salary rate for the position is at or above the threshold and the nominated annual earnings are at or above both, read at the time the nomination is lodged, and the same test applies to the 186 and the 494 nominations in their own terms. It is not a wage law for workers already sponsored: nothing in the Regulations requires the earnings on an approved nomination to be lifted when the threshold is indexed, and a sponsor who is paying the earnings stated in the approved nomination is paying what the nomination requires, whatever the threshold has become since. The confusion comes from the other obligation, which does move, and from the next nomination, which is read at the new figure, and the rest of this guide separates the three.

The nominated earnings, and the obligation to keep paying them

The approved nomination states the annual earnings the sponsor undertook to pay, and the sponsorship obligations require the sponsor to ensure that the sponsored worker's annual earnings are no less than those stated in the nomination, for as long as the worker holds the visa on the sponsor's nomination; a sponsor that pays less, by a reduction, a failure to pay an increment the nomination assumed, unpaid hours, unlawful deductions or a change in the contract, breaches the obligation and is exposed to the sanctions the sanctions guide describes, with the worker entitled to the shortfall. The nominated earnings are guaranteed annual earnings: the base salary and any guaranteed amounts payable regardless of performance, excluding compulsory superannuation, non-guaranteed bonuses and commissions, overtime that is not guaranteed and reimbursements; a nomination that stated a figure including superannuation was wrong when it was lodged and the sponsor reads what was actually approved. The obligation is to the nominated figure, not to the threshold, and a sponsor whose approved nomination stated earnings above the floor is bound to that higher figure. The underpayment guide covers the breach and the remedy.

The market rate obligation, which does rise

The second obligation is the one that moves. The sponsor must ensure that the terms and conditions of employment of the sponsored worker are no less favourable than those the sponsor provides, or would provide, to an equivalent Australian worker performing equivalent work in the same workplace or location, and the obligation runs for the life of the sponsorship; where there is no equivalent Australian worker in the business, the market rate is read from the award, the enterprise agreement, remuneration surveys and job advertisements for the occupation and location. When the Australian colleagues receive an increase, through an award or agreement increase, an annual review, a promotion band or a general rise, the sponsored worker in equivalent work must receive the same, from the same date, and a sponsor that leaves the sponsored worker on the nominated figure while the colleagues move has, from the date the colleagues moved, a worker paid less favourably, which is a breach whether or not the nominated figure is still being paid. The Department finds it by comparing payroll across the equivalent positions, by the worker's complaint, and at the next nomination. The practical rule is that the sponsored worker is in the business's pay system like everyone else: the same review dates, the same increases, the same bands, with the nominated earnings as a floor beneath it rather than a ceiling above it; a sponsor that treats the nomination as the worker's permanent salary is the sponsor that is found.

The new nomination read at the new figure

Every new nomination is read against the threshold and the market rate on the day it is lodged, and sponsored workers need new nominations more often than employers expect: a change of position to a different occupation, or a change of duties substantial enough to be a different position, which the promotion guide covers; a transfer to a different employer, including a related entity with a different ABN; a further 482 when the visa ends; and the 186 nomination for permanent residence. A worker nominated at the threshold in one program year who is nominated again two years later must be paid at or above the threshold in force then, which after two indexations is several thousand dollars higher, and at or above the market rate then, which has usually moved further. A sponsor who learns this at the nomination, with the worker's salary below the figure, has the choice of raising the salary before lodging or not nominating, and the salary rise is read for genuineness if it arrives the week before the nomination; a sponsor that plans the worker's salary to the threshold expected at the next nomination date, which the Department's indexation makes predictable, avoids both. The Specialist Skills threshold rises on the same day and governs the specialist stream nominations in the same way.

The 186 nomination

The 186 nomination is the one that catches most sponsors, because it is lodged two or more years after the 482 nomination and because the worker and the business have planned permanent residence around it. The 186 nomination in the Temporary Residence Transition stream and the Direct Entry stream requires the annual market salary rate for the position to be at or above the Core Skills Income Threshold in force when the 186 nomination is lodged, and the worker to be paid at least that rate, so a worker who was nominated for the 482 at the floor and has had no increase since cannot be nominated for the 186 without a rise to the current threshold first, and the Department reads the rise. The 186 also reads the market rate afresh, with the evidence of what equivalent Australian workers are paid now, and reads the two years of employment in the nominated position on the 482 for the transition stream, which the 482 to 186 guide sets out, including the salary history across those years, so a worker paid below the nomination or below colleagues in that period has a problem in the 186 nomination that the back-pay solves only in part. A sponsor that intends to nominate a worker for the 186 budgets the salary to the threshold expected at the 186 lodgement date from the day the 482 is granted.

The Specialist Skills threshold

The Specialist Skills Income Threshold governs the Specialist Skills stream of the 482 in the same way: the nominated earnings and the market rate must be at or above it at lodgement, it is indexed on the same 1 July, and a worker nominated in the specialist stream at the threshold in one year who needs a new nomination in a later year must be paid at or above the higher figure then; a specialist-stream worker whose earnings have not kept pace with the threshold, and whose new nomination cannot meet it, is nominated in the Core Skills stream instead if the occupation is on the list, which loses the stream's priority processing but not the visa. The obligation to pay the nominated earnings and the market rate obligation apply to specialist-stream workers as to any other, with the difference that the market rate obligation is applied only where annual earnings are below the high-income figure the Department publishes, above which the Department treats the worker as able to look after their own terms.

The superannuation guarantee trap

The superannuation guarantee rate has risen in steps in recent years, and a sponsor whose employment contracts express remuneration as a total package inclusive of superannuation has, at each step, a choice the contract may have made for it: if the package stays the same and the superannuation component rises, the cash component falls. For an Australian worker that is a matter between the parties and the award; for a sponsored worker it is a reduction in guaranteed annual earnings, which exclude superannuation, and where the cash component falls below the earnings stated in the approved nomination the sponsor is in breach of the obligation to pay the nominated earnings, with no decision having been made and no one having noticed. The same effect follows from a salary-sacrifice arrangement that reduces the cash base below the nomination, and from a package that includes a car or other benefit valued so that the cash is below the figure. The fix is to express every sponsored worker's salary as a base excluding superannuation, at or above the nominated earnings, with superannuation added on top at the current rate, and to check each sponsored worker's base against the nomination after every change to the superannuation rate or the package; a sponsor that has package-inclusive contracts and has not checked since the last rate change checks now.

Hours, allowances and what counts as earnings

Annual earnings for the nomination and the obligations are read on the full-time position the nomination described: a worker moved to part-time hours at a pro-rata salary is being paid less than the nominated annual earnings, and the part-time arrangement is itself a matter for a new nomination or a question of whether the position remains the nominated one, which the part-time guide covers. Guaranteed allowances written into the contract count toward earnings; discretionary bonuses, commissions and non-guaranteed overtime do not, so a nomination that relied on a base plus a guaranteed allowance to reach the threshold is in breach if the allowance is withdrawn, and a nomination that counted expected commission to reach the floor was wrong when lodged. Non-monetary benefits can be included in earnings only where the worker agreed in writing, the value is reasonable and the Department accepts it, and most sponsors exclude them for simplicity. A period of agreed unpaid leave does not reduce the annual earnings for the obligation in the Department's practice, since the position and its rate continue, while a reduction in the rate does; the leave guide covers the difference.

The worker whose salary has fallen behind

A sponsor reviewing its sponsored workers finds three kinds of shortfall. A worker paid less than the nominated earnings, through any of the mechanisms above, is a breach of the obligation: the sponsor restores the rate, back-pays the shortfall from the date it arose with records that show it, and keeps the evidence, because a sponsor that finds and fixes its own shortfall before the Department asks is treated differently from one that is found, and the underpayment guide covers the correction. A worker paid the nominated earnings but less than equivalent Australian colleagues is a breach of the market rate obligation from the date the colleagues moved: the sponsor raises the rate to theirs and back-pays the difference. A worker paid above the nomination and in line with colleagues but below the threshold now in force is not in breach of anything on the existing nomination, and the sponsor budgets the rise for the next nomination date rather than applying it now, unless the business chooses to. In each case the worker is told what is happening and why, and no part of any correction is recovered from the worker or offset against anything; a correction that arrives as a deduction elsewhere is a new breach.

The annual review

The review that keeps a sponsor compliant is a short table, prepared each July after the indexation and again whenever the business gives a general increase: for each sponsored worker, the earnings stated in the approved nomination, the current base salary excluding superannuation, the rate paid to equivalent Australian workers or the award or market rate where there are none, the current Core Skills or Specialist Skills threshold, the date and kind of the next nomination the worker will need, a further 482, a change of position, the 186, and the salary the worker will need to be on by then. Any base below the nomination is corrected and back-paid; any base below the colleagues is raised and back-paid; any worker whose next nomination is within the planning horizon is budgeted to the threshold expected at that date; any package-inclusive contract is converted to a base-plus-super expression. The table is kept, because it is the record the Department asks for when it monitors, and the monitoring guide covers what else is kept with it. The hour it takes per worker per year is the cheapest thing a sponsor does, and the sponsor that does it never asks in July whether every salary has to rise, because it already knows which ones do.

The threshold checklist

1. Read the new threshold each 1 July from the threshold guide; it governs nominations lodged from that date, not existing nominations.
2. For each sponsored worker, confirm the base excluding superannuation is at or above the earnings in the approved nomination.
3. Confirm the sponsored worker has received every increase equivalent Australian workers received, from the same date.
4. List each worker’s next nomination and its likely date; budget the salary to the threshold and market rate expected then, especially for the 186.
5. Convert package-inclusive contracts to base-plus-super so superannuation rises cannot cut guaranteed earnings.
6. Check allowances and hours: guaranteed allowances count, discretionary payments do not, part-time pro-rata is a shortfall.
7. Correct and back-pay any shortfall now, with records, before the Department asks; recover nothing from the worker.
8. Keep the review table with the sponsorship records for monitoring.

General information only, current at October 2026; not advice on your own case. The nomination criteria in regulation 2.72 and the subclass 186 and 494 nomination criteria of the Migration Regulations 1994, the Core Skills Income Threshold and Specialist Skills Income Threshold as specified by legislative instrument and indexed on 1 July, the annual market salary rate provisions, the sponsorship obligations in Division 2.19 including regulation 2.79, the definition of annual earnings and the Department’s published policy on guaranteed earnings, superannuation and non-monetary benefits, and the Superannuation Guarantee (Administration) Act 1992 rates, all as in force at the date above; the current figures are on the threshold guide and the instrument governs. Outcomes depend on the Department’s assessment of each application; no registered migration agent can guarantee a result (Code of Conduct, Migration Agents Regulations). Keshab Chapagain, MARN 1576536.