From 1 July 2007, overseas workers must have English language skills equivalent to an average band score of 4.5 in an International English Language Testing System (IELTS) test, unless exempted in certain special circumstances.

Applicants must have higher English language skills where this is required for licensing, registration, or membership of a professional association in their nominated occupation.

All applicants will need to detail their English language skills on their visa application form. In addition, applicants may be asked to undertake an IELTS test to demonstrate their English language skills.

Applicants will not be required to meet the English language requirement if;

* their first language is English and they are a passport holder from Canada, New Zealand, the Republic of Ireland, the United Kingdom or the United States of America; or
* their nominated occupation is within the highly skilled major groups 1-3 of the Australian Standard Classification of Occupations (ASCO), comprising managers, administrators, professionals and associate professionals; or
* they have completed at least five years of continuous full time secondary and/or tertiary education at an institution where at least 80 percent of instruction was conducted in English or
* they are to be paid at least a salary specified in a legislative instrument (initially a gross base salary of $75,000 excluding all allowances and deductions).

These exemptions will not apply to applicants who have been nominated for a position that requires English language for licensing, registration or professional association membership.

http://www.minister.immi.gov.au/media/media-releases/2007/ka07050.htm