The Migration Regulations set out the sponsorship obligations in detail but they can be summarised as follows:
The Department of Immigration carries out routine monitoring of approved sponsors to determine whether they have complied with their sponsorship obligations. This normally involves the provision of records and documents and may also involve a site visit where employees and sponsors are interviewed.
There are a number of penalties that can be imposed on sponsors, depending on the nature and seriousness of the sponsorship obligation breaches.
If a minor failure is identified then the Department will normally attempt to resolve the failure informally by for example issuing a 'reminder to comply' letter. If there has been a significant or serious failure then the Department may issue a written formal warning. This is considered to be 'adverse information' and can have an effect on future sponsorship applications. In more serious cases the Department can cancel the sponsorship approval or bar the business from applying to be approved as a sponsor in the future. Infringement notices specifying financial penalties can also be issued and in extremely serious cases civil action may be taken against the business.