What is the market salary rate in employer sponsorship?

Migration Economy sponsor Business migration Corporate Migration May 27, 2026

When businesses prepare a sponsorship application, most of the attention goes to the government salary threshold, the minimum annual income set by the Department of Home Affairs. But there is a second, equally important salary requirement that is often misunderstood or missed entirely. It is called the market salary rate.

Understanding the difference between these two requirements, (and why both must be met at the same time) is one of the most important things an employer can know before lodging a sponsorship application.

The two salary requirements explained simply:

Requirement 1: The migration threshold

This is the government minimum. For the 2026–27 financial year, the thresholds are:

Core Skills Income Threshold (CSIT): AUD 79,499
Specialist Skills Income Threshold (SSIT): AUD 146,717

Your offered salary must be at or above whichever threshold applies to the role.

Requirement 2: The market salary rate

This is what an Australian worker would typically earn for the same role, in the same location, with a similar level of experience and qualifications.

The Department uses this to make sure that sponsored workers are being paid comparably to their Australian counterparts, not less.

Here is the part that catches many employers off guard: meeting the threshold is not enough if the salary is below market rate.

Both requirements must be satisfied at the same time.

A real-world example

Imagine a business in Brisbane wants to sponsor a chef. The CSIT is AUD 79,499. The employer offers AUD 80,000, just above the threshold.

On paper, this looks compliant.

But if comparable head chef roles in Brisbane are typically paying AUD 88,000 to AUD 95,000, and the offered salary is AUD 80,000, the Department may question whether the salary genuinely reflects the market.

This is not just a technical issue. It raises a broader concern: is the business trying to use sponsorship to hire someone at below-market wages?

To avoid this, the salary must make sense both as a threshold figure and as a real-world reflection of what the role is worth.

Why the market rate varies by role, industry, and location

The market salary rate is not a single number. It shifts based on several factors:

Location: The same role may command a different salary depending on whether it is in Sydney, regional Queensland, or Perth. Labour markets differ, and the Department recognises this.

For example, a general manager role in Darwin may have a market rate of AUD 90,000, while the same role in Melbourne might sit closer to AUD 115,000. Both may be legitimate market salaries for their respective contexts.

Level of responsibility: A sous chef and a head chef may carry the same occupation code, but their market salaries differ significantly. The actual seniority of the role matters.

Industry norms: Each sector has its own wage expectations. What is considered a standard salary for a software developer differs enormously from the expectation for a hospitality manager, even if both roles are at a similar level of responsibility.

How does the Department determine what the market salary rate is?

The Department does not rely on a single database or a fixed schedule. They use a combination of sources to assess whether a salary is consistent with the market, including:

Industry salary surveys and benchmark data
Job advertisements for similar roles in the same location
Enterprise agreements or awards applicable to the industry
Information submitted by the employer about how similar roles in the business are compensated
Independent salary data from government and industry sources

This means that if you are nominating a role with a salary that sits at the low end for your industry, it is worth being able to explain why, and to back it up with evidence.

Where can employers find market salary data?

The good news is that market salary information is not hard to find. Some useful starting points include:

Seek Salary Insights: Australian-specific data broken down by role and location
LinkedIn Salary: useful for professional and technical roles
Fair Work Commission: for award-covered positions
Industry association salary surveys: many peak bodies publish annual remuneration data for their sectors
Internal comparisons: if you have Australian employees in similar roles, their salaries are an important data point

When preparing a sponsorship application, it is worth documenting the sources you used to determine the salary. This becomes part of the evidentiary record of the nomination.

What happens if the salary does not meet market rate?

The consequences depend on how significant the gap is. In some cases, the Department may issue a Request for Further Information (RFI), essentially asking the employer to explain or justify the salary. This adds time to the process and requires additional evidence.

In more significant cases, if the salary appears to be substantially below market rate without a clear explanation, the nomination may be refused.

Even if the application is initially approved, employers have ongoing obligations to maintain the nominated salary. Significant drops in pay relative to market expectations can also trigger compliance concerns down the line.

The practical takeaway for employers

Think of salary not as a single checkbox, but as a two-part test:

Test 1: Is the salary at or above the government threshold?
Test 2: Is the salary consistent with what an Australian would typically earn for this role, in this location?

If the answer to both is yes, you are on solid ground.

If you are unsure about the second test (particularly for roles where market rates are variable or hard to pin down) it is worth reviewing the salary before lodging, not after receiving a request for information.

Frequently asked questions

Can I offer less than market rate if I provide other benefits? Generally, no. The market salary rate comparison is based on the monetary salary. Non-monetary benefits such as accommodation, bonuses, or allowances may be factored in under specific circumstances, but this needs careful consideration.

Does the market salary rate apply to the 186 permanent visa? Yes. The market salary rate requirement applies across the main employer-sponsored visa pathways, including permanent residence nominations.

What if my business genuinely cannot afford the market rate? If the market rate for a role exceeds what the business can offer, it is worth reassessing whether sponsorship is viable for that position at this time. Proceeding with a below-market salary creates risk and is unlikely to succeed.

Is the market salary rate publicly listed somewhere? No. It is assessed on a case-by-case basis using available labour market data. This is why working with an experienced migration professional is valuable — they can help you assess the salary before lodgement.

Unsure whether the salary you are planning to offer meets both requirements? Seven Corp can review the numbers before you lodge — saving time, cost, and the risk of a refused application. Book your free consultation today.