1405700 (Migration)

1405700 (Migration) [2015] AATA 3066 (10 July 2015)
DECISION RECORD
DIVISION:Migration & Refugee Division
APPLICANT:  ZOOM AUTO SERVICES PTY LTD
CASE NUMBER:  1405700
DIBP REFERENCE(S):  OPF2013/1084
MEMBER:Nicole Burns
DATE:10 July 2015
PLACE OF DECISION:  Melbourne
DECISION:The Tribunal sets aside the decision under review to cancel the approval of the sponsor as a standard business sponsor under section 140M(1)(a) of the Act and substitutes it with a decision to bar the review applicant for 18 months from the date of the delegate’s decision from sponsoring more people for Subclass 457 Business (Long Stay) visas under s.140M(1)(c) of the Act; and
The Tribunal varies the decision under review by barring the review applicant for 18 months from the date of the delegate’s decision from making future applications for approval as a standard business sponsor under s.140M(1)(d) of the Act.

Statement made on 10 July 2015 at 12:17pm

STATEMENT OF DECISION AND REASONS
APPLICATION FOR REVIEW

This is an application for review of a decision made by a delegate of the Minister for Immigration to take an action under s.140M of the Migration Act 1958 (the Act) in relation to the applicant’s sponsorship.
The applicant was approved as a standard business sponsor on 4 May 2012. On 11 March 2014, the delegate decided to cancel the approval of the sponsor as a standard business sponsor (SBS) under section 140M(1)(a) of the Act and to bar the sponsor for 48 months from making future applications for approval as a standard business sponsor under section 140M(1)(d) of the Act.
Mr Japanjot Singh Ganda, the director of the applicant company, appeared before the Tribunal on 17 February 2015 to give evidence and present arguments.
The applicant was represented in relation to the review by its registered migration agent, who attended the Tribunal hearing.
After the hearing the representative submitted numerous supporting documents, which the Tribunal has had regard to in reaching its decision.
For the following reasons, the Tribunal has decided to set aside the decision under review to cancel the approval of the sponsor as a standard business sponsor under section 140M(1)(a) of the Act and substitutes it with a decision to bar the review applicant for 18 months from the date of the delegate’s decision from sponsoring more people for Subclass 457 Business (Long Stay) visas under s.140M(1)(c) of the Act; and to vary the decision under review by barring the review applicant for 18 months from the date of the delegate’s decision making future applications for approval as a standard business sponsor under s.140M(1)(d) of the Act.
CONSIDERATION OF CLAIMS AND EVIDENCE
Sections 140K, 140L and 140M of the Act provide for the imposition of sanctions on approved sponsors in certain circumstances.
Under s.140M, if prescribed circumstances exist, the Minister (and the tribunal on review) may take one or more of the following actions:
·cancelling the sponsorship approval in relation to a class to which the sponsor belongs;
·cancelling the sponsorship approval for all classes to which the sponsor belongs;
·barring the sponsor for a specified period from sponsoring more people under the terms of any existing approval; and
·barring the sponsor for a specified period from making future applications for sponsorship approval in relation to one or more classes of sponsor.
For these purposes, the circumstances are prescribed in r.2.89 - r.2.94B and include circumstances in which the Minister, or tribunal on review, is satisfied there has been: a failure to satisfy a sponsorship obligation; provision of false or misleading information; sponsorship application or variation criteria no longer met; a contravention of the law; unapproved changes to a program; a failure to pay additional security; a failure to comply with certain terms of an agreement; or a failure to pay medical and hospital expenses.
Where a prescribed circumstance has been found to exist, the regulations prescribe criteria that must be taken into account when determining what action, if any, to take: r.2.89 – r.2.94B. These criteria, as they relevantly apply to the circumstances of this case are set out in the attachment to this decision.
Background
By way of background and context, the applicant company – Zoom Auto Services Pty Ltd – is one of three companies owned and managed by Mr Ganda whose main premises is in a 4000 square metre site in Broadmeadows. Mr Ganda told the Tribunal at the hearing that he first established Zoom Auto Services Pty Ltd (registered in March 2012) to service and fix motor vehicles on site. He currently employs nine motor mechanics. He established and registered Zoom Hand Carwash and Café Pty Ltd around that time and registered Zoom Mechanics Pty Ltd in July 2012 as a mobile mechanics service.
On 11 March 2014 the Department made a decision to cancel the approval of the sponsor as a standard business sponsor in relation to all three companies owned and operated by Mr Ganda. The decisions to do so in relation to the other two companies are also currently the subject of review.[1]
[1] Zoom Mechanics Pty Ltd (MRT No. 1406032) and Zoom Hand Carwash & Café Pty Ltd (MRT No. 1406033)
Does a circumstance for the taking of an action exist?
Failure to satisfy a sponsorship obligation: r.2.89
The Minister may take one or more of the actions in s.140M if reasonably satisfied the sponsor has failed to satisfy a sponsorship obligation referred to in r.2.78 - r.2.87A of the Regulations in the manner or within the period prescribed: r.2.89(2).
In the present case the action was taken for failing to satisfy the obligation to cooperate with inspectors (regulation 2.78), for failing to satisfy the obligation to ensure equivalent terms and conditions of employment (regulation 2.79), and failing to ensure primary sponsored person works or participates in the nominated occupation, program or activity (regulation 2.86), discussed below.
Failure to cooperate with inspectors: r.2.78
The delegate determined that the applicant failed to satisfy the obligation to cooperate with inspectors during two site visits to the main business premises in 2013.[2] During the first visit on 14 March 2013 by officers (one of whom was a delegated inspector), it is alleged that throughout the visit the director, Mr Ganda, was generally uncooperative and had to be repeatedly cautioned about the obligation to cooperate with inspectors.
[2] At 80 Camp Road, Broadmeadows, Victoria
During the second visit on 25 October 2013, it is alleged that once again Mr Ganda was generally uncooperative and had to be repeatedly cautioned about the obligation to cooperate with inspectors (of which there were two this time). Specifically, Mr Ganda refused to provide access to his mobile phone and laptop computer.
The delegate also concluded that during the site visit in October 2013 Mr Ganda interfered in interviews with two of his employees, which the delegate determined amounts to hindering of an inspector and intimidation of a person assisting an inspector. Specifically, the delegate states in the decision record that this occurred on two occasions. First whilst accompanying Mr Lakhvir Singh to an interview location, the inspector overheard Mr Ganda advise Mr Singh that he did not have to speak to the Department, and second Mr Ganda interfered with an interview being conducted with another employee, Mr Gagandeep Singh Sekhon by approaching Mr Sekhon and telling him he was required to return to work.
In his response to the Department’s ‘Notice of Intention to Take Action’ (NOITTA) which sets out these matters, Mr Ganda states that during the visit in March 2013 the officers opened a lot of his (and other employees) “personal stuff” kept on the premises and that their attitude was rude and insulting. With respect to the visit in October 2013, Mr Ganda states that he tried to cooperate with the officers but noted that they came during a very busy time. He said that he did not want to hand over his mobile phone because, although it has a dual SIM function and diverts business calls to the fixed landline, it also contains his personal information from family and friends for example and for other business matters. With respect to his laptop, Mr Ganda states that it contained personal information, as well as other business matters and contained little information about the applicant business). Nonetheless he gave the officers access, offered them help to find where the relevant information was stored, and told them he would open anything and they could request anything. However during this time he was receiving booking calls and was busy with cashing dockets and money transfer from the same computer. Therefore, after an hour and when the officers wanted to check his personal emails he said that he was unable to help them further and that he had to continue working as he had customers waiting. He states also that he told the officers that the company’s financial documents were kept at the registered office not at the workshop, noting that he had previously provided these (and other) documents to the Department when requested.
At the Tribunal hearing Mr Ganda stated that he was very busy during the second visit, which fell on a Friday morning. He said one of the inspectors/officers started looking at documents on his desk, including his personal diary which he did not want her to see because he writes his personal thoughts and feelings in it. Mr Ganda said he uses his mobile phone for business as well as for his personal life; he added that if the inspectors had asked respectfully to see it he would have given it to them. He said that he did initially give the inspectors access to his laptop. He noted that his business also provides cash dockets for taxi drivers - they act as a commission agent for the banks - and that data was on his laptop as well as personal information, which made him reluctant to show them everything. He said that the inspectors asked to look at the laptop in the café area where a lot of taxi drivers gather to collect their money. As a result the inspectors thought he was running a taxi business from there. He said that he tried to explain to the inspectors but they would not listen.
With respect to the allegation that he interfered with the employee interviews during the site visit in October 2013, Mr Ganda said at that time Gagandeep Singh Sekhon was working on a car in the workshop when they took him aside for the interview. Mr Ganda said he spoke to him then because his hands were dirty and he wanted him to finish the job for the customer first. They were already interviewing the other mechanic (Lakhvir). Mr Ganda said the delegate and another officer became aggressive and shouted at him. He said he just kept on doing what he had been doing – i.e. handling customers - and did not give them any extra time. Mr Ganda said he also asked for the car keys from Gagandeep and Lakhvir, to return to the customers. He said he was trying to build up his business, it was busy, and the inspectors should have interviewed his staff one at a time.
It is difficult for the Tribunal to know exactly what took place during the site visits to the business’ main premises in March and October 2013. On the one hand the delegate asserts that, in addition to being generally uncooperative, Mr Ganda refused to allow the inspectors “unhindered” and “unobstructed” access to his mobile phone and laptop, which constituted failure to cooperate with inspectors. Mr Ganda disputes the level of his purported uncooperativeness, which the Tribunal will discuss in more detail in relation to specific factors set out below. Nonetheless, Mr Ganda did acknowledge that he did not provide his mobile phone or complete access to his laptop to the inspectors when requested. He also acknowledged that he prioritised customers over the inspectors, in large part as a response to their alleged rudeness. As such the Tribunal does find that the circumstances for taking of action exist in relation to r.2.78.
Failure to ensure equivalent terms and conditions of employment: r. 2.79
The delegate determined that the applicant failed to ensure equivalent terms and conditions of employment, which requires the sponsor to pay a sponsored person their guaranteed annual earnings or the market rate - whichever is greater.
Specifically, the delegate noted that the applicant had paid two employees sponsored as ‘Motor Mechanics’ $49,500 annually, based on guaranteed annual earnings approved at the nomination of the position stage, and two others $51,500 annually. However information the applicant provided to the Department in support of a separate nomination indicated that the market rate for a Motor Mechanic was $52,500 from 6 September 2012. The delegate therefore formed the view that the applicant should have been paying the four motor mechanics the market rate of $52,500 from 6 September 2012.
In response to the NOITTA on this matter, and in his oral evidence to the Tribunal, Mr Ganda said that, on advice from his lawyer and accountant, he understood that his employees would be paid the amount specified in the signed contract, which was approved by the Department, as well as the overall salary package approved by the Department as part of the nomination approval. He had no idea that this was an issue until he received the NOITTA from the Department in October 2013. Even then his lawyer advised that he was only obliged to pay the amount set out in the signed contract. Mr Ganda said that although he was still somewhat confused, he called his accountant and arranged to increase the annual salary for all four employees to $52,500 from 1 January 2014. He has submitted evidence of such to the Tribunal in the form of a letter from his accountant and the employees’ payslips.
At the hearing the representative noted that if the law is seen in such a way it exposes all businesses who engage 457 visa holders to huge debts down the line. He also queried whether the applicant could have been said to have failed to meet this obligation if he had not sponsored anyone else.
The Tribunal has had regard to these submissions, which it will discuss in more detail when considering the specific factors below. Even if the Tribunal accepts the applicant’s evidence that he made a genuine mistake in paying his four sponsored employees less than the ‘market rate’ from 2 September 2012 to 1 January 2014, a discrepancy exists and therefore the Tribunal does find that the circumstances for taking of action exist in relation to r.2.79.
Failure to ensure primary sponsored person works or participates in the nominated occupation, program or activity: r. 2.86
The delegate determined that the applicant failed to satisfy r.2.86 in two respects: that is i) failure to ensure one of the sponsored mechanics - Mr Gagandeep Singh Sekhon - worked in the nominated occupation of motor mechanic and ii) failure to ensure Mr Sekhon was employed by the sponsor or an associated entity of the sponsor, addressed in more detail below.
Specifically, the delegate concluded that one of the 457 visa holders who was sponsored as a Motor Mechanic (ANZSCO Code 321211), Mr Gagandeep Singh Sekhon actually performs a number of tasks that fall outside his nominated occupation and the motor mechanic duties that Mr Sekhon performs are not at the skill level associated with those of a motor mechanic, but are at a level associated with an apprentice mechanic. She reached this conclusion because:
·When Departmental officers visited the business premises on 14 March 2013 Mr Sekhon was working at the customer service (point-of-sale) area; he advised that he had been working there since 8 that morning; and this was confirmed by Mr Ganda, who said that Mr Sekhon was just helping out;
·During the March 2013 visit officers spoke with a person occupying the mechanic’s workshop (signage as ‘United Motor Works’) called Mr Sulimein who stated that he had sublet the garage from Mr Ganda for the past seven months and that Mr Sekhon had been working with him as an apprentice on occasion. Mr Sulimein stated that Mr Sekhon spent about 50% of his time working with him in the workshop and about 50% of his time in the customer service area of the site;
·During the October 2013 visit Departmental officers again initially located Mr Sekhon working as a service attendant in the customer service area of the site; and
·During the October 2013 visit officers spoke to the occupants of the mechanic’s workshop which was still signed as United Motor Works. The occupants named two others involved in the business, which did not match any sponsored persons employed by the sponsor or Mr Ganda.
Further, as the delegate was of the view that the business had been sublet to a business entity trading as ‘United Motor Works’ since around September 2012, the delegate determined that the persons sponsored by the applicant company were actually employed by an entity that is not the sponsor or an associated entity of the sponsor.
In response to the NOITTA on this matter, Mr Ganda said that Broadmeadows is a multiple business site and they have one customer service area for all the customers. As the most experienced staff member for the unit, Mr Sekhon helps Mr Ganda handle customers through taking payments and issuing invoices for example. He states that Mr Sekhon was at the workshop when he was called to interview (with Departmental officers) whilst he looked after the counter. He said that his businesses, which include a workshop at two locations and a mobile mechanics service, out of practical necessity require staff to shift around periodically. He also explained that ‘United’ and ‘Zoom’ are the trading names of different entities owned and operated by the same owner.
At the Tribunal hearing Mr Ganda said that during the October 2013 visit Mr Sekhon was helping out at the counter because Mr Ganda’s wife, who usually works there, was at a doctor’s appointment. Mr Ganda explained that they have one common cash point for all customers and Mr Sekhon is the person who usually escorts the customers to wherever they need to go on site for all the different businesses. He thinks that is where the officers got confused. He notes that during the March 2013 visit Mr Sekhon was at the counter but had dirty hands, which indicates that he was only there temporarily to escort customers.
With respect to the officer’s discussion with Mr Sulimein, Mr Ganda explained that Mr Sulimein is a friend and experienced mechanic who has helped him set up his businesses, including through training new staff, which is what he was referring to when he spoke with the officers. Mr Ganda was emphatic that he is the only one on the lease agreement (a copy of which he provided to the Tribunal[3]), a copy of which he provided to the Tribunal, and that he has not and does not sublet the premises to anyone. After the hearing the applicant submitted to the Tribunal a statutory declaration from Mr Suliman dated 25 February 2015 confirming that was the case.
[3] Between the owner and ZPN Group Pty Ltd., an associated company of Zoom Mechanics Pty Ltd
At the hearing Mr Ganda clarified that ‘United Motor Works’ is the applicants company’s trading name. He said that when he first established the mechanics business he leased the area next to a United petrol station and the owners wanted him to trade under the same name. The Tribunal has had regard to information on ABN Look up which confirms that ‘United Motor Works’ was registered as the business name of the Zoom Auto Services Pty Ltd from 25 March 2014. Whilst this took place after the delegate’s decision to cancel the SBS, the Tribunal is willing to accept on the basis of Mr Ganda’s oral evidence and the statutory declaration from Mr Sulimen, that United Motor Works was the business trading name for the applicant company, not the name of a separate business which the applicant sublet the premises in Camp Road.

The Tribunal, having regard to these submissions and evidence provided including the letter from Mr Suliman, as well as the lease agreement and Mr Ganda’s oral evidence on this matter which it found to be persuasive, accepts that Mr Ganda did not sublet the premises to anyone and that Mr Gagandeep Singh Sekhon worked as a motor mechanic, even if under direction of Mr Suliman informally at the start and if some of his day-to-responsibilities included customer management, for the majority of tasks of a ‘Motor Mechanic’ as set out in ANZSCO.
For these reasons the Tribunal is not satisfied that the applicant failed to ensure primary sponsored person works or participates in the nominated occupation, program or activity (r.2.86) and is therefore not satisfied that there was a breach of r.2.86 in the manner alleged by the delegate.
Provision of false or misleading information: r. 2.90(2)
The delegate found that the applicant provided false or misleading information to the Department on three occasions as follows:
(a)Provision of payslips that contained false information
(b)False information provided by Mr Ganda about the use of the mechanics workshop at the Broadmeadows site
(c)False information provided by Mr Ganda that he had another motor mechanic workshop in Thornbury where the sponsored persons also worked
(a) Provision of payslips that contained false information
The delegate states in the decision record that during the course of monitoring the applicant provided a payslip for a sponsored employee (Mr Hitesh Sojitra) which indicates that he worked eight hours on Christmas day in 2012. However, Mr Sojitra told the delegate during a phone interview on 7 August 2013 that he did not work on Christmas day (2012). As such, the delegate concluded that the applicant had provided false information in relation to Mr Sojitra’s payslip for this period.
The delegate also states in the decision record that during monitoring the applicant provided payslips of another sponsored employee (Mr Gurwinder Singh), for the fortnight ending 6 January 2013 indicating that he had worked eight hours from 31 December 2012 to 2 January 2013 inclusive as well as seven hours on 4 January 2013 and again on 5 January 2013. However, during a telephone conversation with Mr Singh on 23 September 2013, Mr Singh stated he was on unpaid leave during this period and up until 7 January 2013. As such, the delegate concluded that the applicant had provided false information in relation to Mr Singh’s payslips for this period.
In his response to the NOITTA and at the Tribunal hearing Mr Ganda stated that when he received the NOITTA he checked with his accountant about these matters. His accountant clarified that in relation to Mr Sojitra, although he did not work on the Christmas day in question (because it is a public holiday) the software that generates payslip information entered the eight hours on that day by default. At the hearing the representative explained that even though the employees are on an annual salary, they often calculate their salary on an hourly basis.
With respect to the discrepancies in Mr Gurwinder Singh’s payslips in the period in question, Mr Ganda stated at the hearing that this was a result of a genuine mistake. That is, Mr Singh had written the end date for that particular pay period in the front of the timesheet instead of in the last column (a copy of a logbook was provided to the Department to illustrate). Mr Ganda took the dates on that basis and issued a payslip accordingly. Mr Ganda said that as this was a common mistake made by his employees they have implemented changes to the timesheet and better explained the process to staff.
In response to the NOITTA on this matter Mr Ganda submitted that even though these types of errors happen now and then, their payroll software is set to rectify it later and his accountant and payroll officer handles these issues carefully and sort out any issues as soon as they are discovered. He also noted that errors of this type are very minor and did not have any effect on any of the responsibilities towards their employees or any other obligations.
Having regard to the submissions and evidence before it on this matter, the Tribunal accepts the explanations advanced by Mr Ganda that the payslip discrepancies were due to a software error in respect of Mr Sojitra and human error (i.e. recording hours worked in the wrong timesheet column) in Mr Singh’s case, and do not constitute the provision of false or misleading information to the Department.
(b) False information provided by Mr Ganda about the use of the mechanics workshop at the Broadmeadows site
The second occasion the delegate determined the applicant had provided false or misleading information to the Department was in relation to Mr Ganda's claims about his use of the mechanics workshop at the Broadmeadows site.
Specifically during the site visit in March 2013, Mr Ganda advised the Departmental officials that the workshop was located at the address and run by the sponsor and was the employment location of the sponsored persons. However, as discussed, when officers interviewed the occupant of the workshop Mr Sulimein, he advised that he had sublet the workshop from the sponsor for the last seven months; that no other mechanics worked at the site apart from Mr Gagandeep Singh Sekhon who worked as an apprentice in the mechanics workshop about 50% of the time, and the rest of the time Mr Sekhon worked in the petrol station. As such, the delegate was satisfied that Mr Ganda’s claims about the sponsor’s use of the mechanics workshop at 1/80 Camp Road Broadmeadows constituted the provision of false information to the Department.
For the same reasons set out above in relation to the Tribunal’s finding that there was not a breach of r.2.86 in the manner alleged by the delegate, the Tribunal is satisfied that the sponsor uses the premises at Camp Road for a mechanics workshop (among other businesses including a carwash and café), and has not sublet the premises in the past. Accordingly the Tribunal is satisfied that the applicant did not provide false or misleading information to the Department on this occasion.
(c) False information provided by Mr Ganda that he had another motor mechanic workshop in Thornbury where the sponsored persons also worked
The third occasion the delegate determined the applicant had provided false or misleading information to the Department was in relation to Mr Ganda’s statement to visiting officials in March 2013 that he had another garage in Thornbury where the sponsored persons also worked and that two of those persons[4] were currently working at that address. However when the officers visited the address in Thornbury later that day neither person was located there and the officers observed that the workshop area contained no equipment to indicate that the site was operating as a mechanic workshop. Further, when the officers interviewed employees present at the site and operating the café and car wash they were unable to state when they had seen anyone in the garage area working.
[4] Simarjeet Singh and Nishant Chouchan
In his response to the NOITTA on this matter, Mr Ganda submits that out of practicality his employees are shifted periodically for the performance of the business.
At the Tribunal hearing Mr Ganda explained that he took the new site in Thornbury with a genuine intention to expand the business there and to get a more reliable workforce established who could then work at both sites. However, at the time of the Mach 2013 site visit, most of the mechanical work was undertaken at the Broadmeadows site because there was only basic infrastructure at the Thornbury site and they needed to put up new signs, for example. He said the timing of the officers visit was ‘bad’ also because just prior they had been visited by ‘council guys’ who had sealed the fridges because he had not yet obtained a health certificate to run the café (which he later obtained). Mr Ganda said he intended to allocate one of them (Simarjeet Singh) to handle the Thornbury site and leave Gagandeep Singh Sekhon in charge of the Broadmeadows site.
Mr Ganda told the Tribunal that due to delays in the nomination approval he had to let the Thornbury site go and has sold the businesses located there (that is the workshop and café and carwash).
The Tribunal notes that Mr Ganda did not dispute the allegation that he told officials at the Broadmeadows site during their visit on March 2013 that he had another mechanic workshop in Thornbury and that two sponsored persons were currently working there. This was not exactly accurate, given the site was not operating as a workshop at the time and the two sponsored persons in question were not actually working at the workshop that day. This constitutes false or misleading information and therefore the Tribunal does find that the circumstances for taking of action exist in relation to r.2.90. The extent to which that information was deliberately misleading will be discussed in relation to factors discussed below.
Having regard to the above, the Tribunal is satisfied that the prescribed circumstance in r.2.89 (failing to satisfy the obligations in r.2.78 and r.2.79) and 2.90 exists for the purpose of s.140M of the Act.
Action to be taken
For these reasons, the Tribunal is satisfied that relevant circumstances for s.140L(1)(a) exists. Accordingly, it is necessary to consider whether one or more of the actions mentioned in s.140M should be taken.
In considering what action to take, the Tribunal has had regard to the prescribed criteria, as extracted in the attachment to this decision. The criteria to be considered where there is failure to comply with sponsorship obligation, are set out in r.2.89(3). For the provision of false or misleading information, the criteria are those set out in r.2.90(3). The Tribunal has also had regard to the oral evidence of Mr Ganda, his response to the NOITTA and relevant supporting documents.
Obligation to cooperate with inspectors (r.2.78) and to ensure equivalent terms and conditions (r.2.79)
The period of time over which the sponsor has been an approved sponsor
The applicant was approved as a standard business sponsor on 4 May 2012.
The past and present conduct of the sponsor in relation to Immigration
The applicant had not been previously monitored and his only dealings with the Department were in relation to the 457 programme.
With respect to the monitoring that led to the cancellation of the applicant’s standard business sponsorship, the delegate notes in the decision record that Mr Ganda had been generally uncooperative throughout the monitoring process and that he failed to cooperate with inspectors, as discussed. She states that an inspector had to exercise their powers under the Act to require the applicant to provide information because Mr Ganda failed to provide all of the documents requested in the Department’s Notice requesting records and/or information. At the Tribunal hearing Mr Ganda said that he did respond to the Department’s request for information, however his response was not sufficient. On this point the Tribunal notes that in the decision record the delegate states that on 21 March 2013 the applicant was sent a Notice requesting records and/or information and received a response with some of the required records and information on 3 April 2013. On 6 August 2013 the Department sent a Notice requiring provision of records and/or documents that was issued by an inspector requiring the provision of the missing records. The delegate states that on 22 August 2013 the Department received most of the requested records. [Tribunal emphasis]
The delegate also notes in the decision record that during the monitoring process the sponsor indicated to the sponsored persons that they should not answer phone calls from the Department; that in one conversation a sponsored person advised that he only answered his telephone as the call had come from a Departmental mobile phone number (not the blocked number he had been advised by Mr Ganda the Department would call from); that in another conversation with a different sponsored person, that person advised that Mr Ganda told him that all communication should go through him; and that this resulted in the sponsored person not providing records to the Department that he had previously agreed to.
The number of occasions on which the sponsor has failed to satisfy the sponsorship obligation
The delegate found that the applicant failed to cooperate with inspectors during three separate incidents during the site visit on 25 October 2013, and to ensure equivalent terms and conditions on four occasions (that is failing to pay four sponsored persons salary equivalent to the market rate for their positions for more than 12 months of their period of employment).
With regard to the incidences during the site visit in October 2013, the delegate does not specify what she meant exactly in this part of the decision record, however it appears when reading the decision record as a whole that she is referring to the applicant’s failure to provide access to his mobile phone and to his laptop computer. As discussed above, the applicant gave evidence at the hearing that he did initially give the inspectors access to his laptop, however after about an hour and when they started looking through personal information and/or business information unrelated to the applicant’s company business, he refused them access. As well, he refused access to his mobile phone because it contained personal information. Taking into account these considerations, the Tribunal accepts that there was a failure to satisfy a sponsorship obligation in relation to cooperating with inspectors on two occasions during the October 2013 visit.
With respect to ensuring equivalent terms and conditions of employment, the delegate found that the applicant failed to satisfy this obligation on four occasions; that is by failing to pay its four sponsored persons a salary equivalent to the market rate for their positions throughout their period of employment with the sponsor. As mentioned, when this matter was discussed at the hearing, Mr Ganda said that on advice from his lawyer and accountant, he understood that his employees would be paid the amount specified in the signed contract, which was approved by the Department, as well as the overall salary package approved by the Department as part of the nomination approval. He said that he had no idea that this was an issue until he received the NOITTA from the Department in October 2013. Taking into account these considerations, the Tribunal accepts that there was a failure to satisfy sponsorship obligations on four occasions. However, it also accepts evidence provided by Mr Ganda that there were valid reasons, and efforts to rectify the situation.
The nature and severity of the circumstances relating to the failure, including the time period over which the failure has occurred
The delegate found that the applicant’s failure to meet its sponsorship obligation in respect of failing to cooperate with inspectors during two site visits in 2013 and in particular by refusing access to his mobile phone and laptop during the second visit in October 2013 seriously undermined the Departments’ attempts to investigate significant concerns surrounding the sponsor’s compliance with its sponsorship obligations. As a result, the delegate considered these failings to be a major factor in her decision.
As mentioned, at the hearing Mr Ganda said that he tried to assist the inspectors initially, however they were disrespectful, and after a while he felt that anything he said was futile. He said that it was a very busy time during the second visit in particular. He was reticent to hand over his mobile phone because it contained personal information as well as other business information. He said that he initially gave the inspectors access to his laptop, however, given it holds other business and personal information, he tried to direct the inspectors to look at the relevant information. He said that after an hour he gave up, noting that he had to deal with customers. He said that he told the inspectors at the time that most of the information in relation to the business was not contained on that laptop, however they did not listen.
With respect to the applicant’s failure to pay four sponsored employees the ‘market salary rate’, the delegate noted that the extent of underpayments for two of the sponsored persons[5] amount to approximately 6% of the market rate while the underpayments for the other two[6] amount to approximately 2% of the market rate the sponsor should have paid. The delegate acknowledges that the magnitude of the failures is “relatively minor” however considers the period of time over which these failures to have occurred to be serious, and therefore considers this to be an important factor in her decision given the financial disadvantage to the sponsored persons.
[5] Mr Gagandeep Singh Sekhon and Mr Gurwinder Singh
[6] Mr Nikul Ashokbhai Patel and Mr Hitesh Kanjibhai Sojitra
The Tribunal notes that any underpayment is a serious matter, and has had regard to the objective of the reforms to these programs, which includes ensuring they do not permit exploitation of workers from overseas and include equitable remuneration arrangements.[7] However, the Tribunal agrees with the delegate that the magnitude of the specific failures is relatively minor and accepts that Mr Ganda was genuinely unaware that that was the case, being under the erroneous (yet not illogical) assumption that his 457 employees were to be paid the stipulated contract amount, as approved by the Department as part of the business nomination process. This was based on advice from his lawyer and his accountant. The Tribunal also notes that Mr Ganda has sought to rectify the situation, and has provided evidence of paying the four employees the market rate of $52,500 from 1 January 2014.
Whether, and the extent to which, the failure to satisfy the sponsorship obligation had a direct or indirect impact on another person
[7] Explanatory Statement to SLI 2009, No.115, p.2
The delegate found that the nine sponsored persons were directly impacted by the sponsor’s failure to cooperate with inspectors because it meant the Department was unable to address significant concerns regarding their employment. As well, the sponsor’s failure to pay the four sponsored persons the market rate had a direct financial impact on those persons. The delegate, therefore, considered these to be major factors in her decision.
Mr Ganda reiterated at the hearing that he initially cooperated with inspectors, as set out above, however he eventually gave up. Further, he reiterated that he had no knowledge of the underpayments at the time, and rectified the situation once he found out.
With respect to the failure to cooperate with inspectors, the Tribunal notes that it appears that the delegate considered the negative impact on the Department, rather than another person. It is not clear how the failure to provide information (from Mr Ganda’s mobile phone and laptop) in a timely manner had a direct or indirect impact on another person, taking into account that the sponsored persons under the 457 program in relation to the business had already been approved. This behaviour may have a future impact if the 457 visa holders have their visas cancelled, but this was not the situation when the delegate made her decision.
The Tribunal agrees with the delegate that the underpayment of the four sponsored persons did have a direct impact upon them in financial terms. However, whilst serious the magnitude of the failure was minor (as conceded by the delegate) and the Tribunal has found that it was unintentional. Further, the Tribunal accepts the evidence before it that Mr Ganda has rectified the situation by adjusting the sponsored persons salary payments upwards since 1 January 2014, which means the period of underpayment was approximately 15 months.
Whether, and the extent to which, the failure was intentional, reckless or inadvertent

The delegate found that the applicant’s failure to satisfy its relevant sponsorship obligation in terms of failing to cooperate with inspectors was intentional. In reaching that finding, the delegate placed weight on the following factors:
a.The sponsor agreed to abide by the sponsorship requirements at the approval stage and signed a declaration to that effect
b.Departmental officers explained the sponsorship obligations – including in relation to the inspector’s powers - to the director, Mr Ganda, during two visits to the premises, as well as the consequences if they were not met
c.Mr Ganda was repeatedly offered the opportunity to call on other available employees to assist him with his work, however he refused
d.Mr Ganda was asked on numerous occasions during the visits if he wished the officers to leave the business premises however he advised this would not be required
The delegate states in her decision record that she believes that the sponsor was intentionally using work to avoid cooperating with inspectors which she considers to be a major factor in her decision.
At the Tribunal hearing Mr Ganda said he understood his sponsorship obligations and had provided the requested information to the Department to the best of his ability in the past. He did not agree with the delegate’s version of events in relation to the site visits. He reiterated that he was busy, that the inspectors were aggressive, and that he was juggling customers at the time. He said he felt victimised. When the Tribunal asked why he did not get someone to cover for him to deal with customers whilst he gave the inspectors his full attention, Mr Ganda said that Gagandeep Singh Sekhon is the person whom he would usually ask to step in and help out in such a situation. However, during the March 2013 site visit Mr Ganda said that Mr Sekhon was busy working in the workshop and his hands were dirty and when the inspectors arrived for the second visit in October 2013, Mr Sekhon was busy at the counter dealing with customers, covering for Mr Ganda’s wife, who was at a doctor’s appointment.
At the hearing Mr Ganda acknowledged that his businesses are growing rapidly and he needs a good manager to help him out. He said he has started to get big a little too quickly with the resultant multitude of responsibilities and demands.
The delegate did acknowledge that the applicant’s failure to satisfy its relevant sponsorship obligation in terms of failing to ensure equivalent terms and conditions of employment was unintentional. However, she found it was reckless due to a lack of care by the sponsor to ensure it properly understood the sponsorship obligations. This was a significant factor in her decision.
As discussed, at the hearing Mr Ganda reiterated that he was not aware that he was underpaying the four 457 visa holders and that he understood his obligation in terms of what is set out in their contracts. The representative questioned whether all businesses have to adjust their salaries to 457 visa holders’ mid-contract. The Tribunal notes that this is a somewhat strange obligation in this sense, given that whilst salary as specified in a contract is usually static for the contract validity period, the market salary rate can fluctuate.
Having regard to the overall evidence in this case, including the fact that the Tribunal accepts that Mr Ganda has made efforts to rectify the situation, the Tribunal is of the view that the ‘failure’ to pay four sponsored persons was more inadvertent than intentional. Given that the Tribunal accepts Mr Ganda’s evidence that he consulted with his accountant in this regard, the Tribunal does not agree with the delegate’s view that the failure was reckless.
Whether, and the extent to which, the sponsor has cooperated with Immigration, including whether the sponsor informed Immigration of the failure
The delegate described the sponsor’s level of cooperation throughout the monitoring process as “less than satisfactory.” The fact that he failed to cooperate with inspectors when specifically requested to do so several times during a site visit and the fact that the sponsor’s failure to ensure equivalent terms and conditions was discovered during monitoring were, in the delegate’s view, significant factors in her decision.
Mr Ganda in his oral evidence to the Tribunal acknowledged that he could have been more cooperative during the site visits. However, he felt like he was not being listened to, felt despondent and gave up. He acknowledged that he did not really want them to visit, but said that up until that time he had cooperated and provided documents, for example, to the best of his ability when asked.
Having regard to the evidence before it, the Tribunal is of the view that Mr Ganda demonstrated some shortcomings in his dealings with the inspectors, particularly during the second site visit in October 2013. However, the Tribunal also appreciates that he was feeling under pressure at the time and was busy and as a result appears to have come across as somewhat defensive. This appears to have led the inspectors (and the delegate) to believe that he was hiding something. The Tribunal considers that the applicant could have handled the situation better and should have been more cooperative, despite the inconvenience.
The steps (if any) taken by the sponsor to rectify the failure, including whether the steps were taken at the request of Immigration or otherwise
The delegate stated that the failure of the sponsor to cooperate with inspectors has not been acknowledged by Mr Ganda and is not a failure that can be rectified. Before the Tribunal Mr Ganda has acknowledged his lack of cooperation to some extent, but he has qualified his behaviour and provided some explanations.
With respect to the failure to provide equivalent terms and conditions of employment the delegate notes that the sponsor advised they would rectify the issue once they had received legal advice, however they had not advised the Department of any progress at the time of the delegate’s decision. During the review stage the sponsor has provided evidence to the Tribunal of having paid the four sponsored persons $52,500 from 1 January 2014. The Tribunal notes that this does not constitute back pay from 6 September 2012. However, this action indicates that once brought to his attention, Mr Ganda was willing to address the matter.
The processes (if any) the sponsor has implemented to ensure future compliance with the sponsorship obligation
As discussed, Mr Ganda has provided evidence of having rectified the payment discrepancy for the four 457 visa holders and has indicated that he is alert to the issue in the future.
As mentioned, at the Tribunal hearing Mr Ganda said that through his accountant and lawyer he is making efforts to keep abreast of his requirements and obligations as a standard business sponsor. He acknowledged that his businesses have grown big fast, and he needs some managerial support. The Tribunal did discuss at the hearing the need for Mr Ganda to prioritise Departmental visitors and/or inspectors over customers, if such a situation arises in the future. He agreed.
The number of other sponsorship obligations the sponsor has failed to satisfy a sponsorship obligation and the number of occasions on which the sponsor has failed to satisfy other sponsorship obligations
For reasons set out above, the Tribunal finds that the review applicant has failed to satisfy two sponsorship obligations on this occasion. There is no evidence before the Tribunal to show that the applicant has failed to satisfy any other sponsorship obligations.
Any other relevant factors
In this part of the decision record the delegate addresses concerns raised by Mr Ganda in his response to the NOITTA about what he alleges was the Department’s inappropriate behaviour, including the inconvenience of the visits and attempts by the Department to contact sponsored persons directly. The delegate, having regard to Mr Ganda’s concerns, indicates that she is satisfied that they had authority to conduct the visits in the way they were conducted and she was satisfied that all processes and approaches were in line with Departmental policies and procedures. These matters are not directly relevant to the specific factors and the Tribunal has therefore not commented upon them.
Provision of false or misleading information – r.2.90(3)
The purpose for which the information was provided
According to the delegate, the information was provided by the sponsor in its representation of the use of the motor mechanic workshops in Broadmeadows and Thornbury.
The nature of the information
The delegate found the sponsor provided false and misleading information to the Department because he claimed during a visit to the main premises in March 2013 that he operated a mechanic workshop at another address in Thornbury, that sponsored persons also worked there, and that two sponsored workers were currently working there. However when officers attended that address later in the day there was no equipment to indicate that the site was operating as a motor mechanic workshop, nor were the employees present at the site able to say whether they had seen anyone in the garage working.
As mentioned, at the Tribunal hearing Mr Ganda acknowledged that in March 2013 most of the mechanic work was being undertaken at the Broadmeadows site, that the Thornbury site contained only basic infrastructure, and that the café was temporarily closed whilst they organised a health certificate. Further, he stated that his intentions to grow the business and have multiple sites (including the Thornbury site) did not reach fruition due to nomination processing delays which resulted in delays in getting the right staff, and he eventually closed down the Thornbury site.
Whether, and the extent to which, the provision of false or misleading information has had a direct or indirect impact on another person
The delegate found that the provision of false and misleading information in this respect hindered the Department’s ability to assess the genuineness of the motor mechanic positions nominated by the sponsor and therefore the ability of the sponsored persons to comply with a condition of their visa to work only for the approved sponsor and only in their nominated occupation, a failure of which can lead to visa cancellation. It appears that the delegate considered the negative impact on the Department, rather than another person. It is not clear how the provision of false information (ie that the Thornbury workshop was operational and two sponsored persons were working there on 13 March 2013) had a direct or impact on another person, taking into account that these two sponsored persons under the 457 program in relation to the business had already been approved. This behaviour may have a future impact if the 457 visa holders have their visas cancelled, but this was not the situation when the delegate made her decision.
Whether the information was provided in good faith
The delegate considered that the provision of false and misleading information in this case was a false representation of the business’ operations which undermines other claims made by the sponsor. She did not believe the information was provided to the Department in good faith and this was a significant factor in her decision.
The Tribunal acknowledges the delegate’s concerns in this regard. It appears that Mr Ganda failed to sufficiently explain to the officers during their visit to the main business premises in March 2013 that the other business site in Thornbury was largely inactive and gave the erroneous impression that some sponsored persons worked there, including two on the day, which later turned out to be false. The Tribunal is not clear where the two employees were at the time of the Thornbury site visit and it is a serious concern if Mr Ganda provided the information to explain away their absences. However, given the evidence that the business also provides mobile mechanic services, and Mr Ganda’s assertion that staff shifted depending on demand, the Tribunal is willing to give him the benefit of the doubt on this matter. Further, the Tribunal accepts that at the time Mr Ganda genuinely held plans to expand the business operations to the site at Thornbury, and envisaged that his employees would move between sites as needed. He should have been more upfront about the status of those plans to the officers, but in the context of these evolving plans, the Tribunal considers he was acting in reasonably good faith at the time.
Whether the sponsor notified Immigration immediately upon discovering that the information was false or misleading
The delegate found that the false and misleading information was discovered by the Department during its audit of the sponsor’s compliance with the sponsorship obligations. The delegate expressed concern that the sponsor did not notify the Department that it had provided information that was false or misleading.
Mr Ganda did not inform the Department (through the inspectors), as he should, at the time of the March 2013 visit that the workshop at Thornbury was largely inactive. Nonetheless, for reasons set out above, the Tribunal is of the view that that at the time Mr Ganda genuinely held plans to expand the business operations to the site at Thornbury, and envisaged that his employees would move between sites as required. The Tribunal notes that when it became clear to Mr Ganda that his plans for the Thornbury site were not to reach fruition, he informed the officers of such during the second site visit, in October 2013.
Any other relevant factors
The delegate did not rely on any additional relevant factors. Nor did Mr Ganda when asked at the hearing.
Other matters:-
Whilst not explicitly addressed in the delegate’s decision record, the site visit notes and interview plans contained on the Departmental file reveal a concern held by the delegate that the applicant’s financial plans and projections provided at the sponsorship agreement stage do not indicate that the business has the financial capacity to support so many (457) visa holders (primarily as motor mechanics). At the Tribunal hearing Mr Ganda acknowledged that apart from him and his wife, no Australian citizen or permanent resident staff work for him in this business as well as the related mobile mechanic workshop and carwash/café business. He told the Tribunal that he has tried to find suitably qualified Australian citizens/permanent residents in the past, for example by advertising on Gumtree and jobseeker. However, he said that he is dealing with mostly ‘Centrelink’ people in the area and that he gave a couple of people a chance but it did not work out, due to trust issues.
The Tribunal shares the delegate’s concerns in this respect, particularly as it appears that Mr Ganda is completely dependent on 457 visa holders to run his various businesses. Whilst these concerns are not directly relevant to the failure of specific sponsorship obligations as discussed above, the Tribunal considers these are matters that should be closely examined if the applicant applies to be a standard business sponsor in the future. Also because of the rapid growth of the business since the standard business sponsorship was first approved in 2012.
Discussion and findings
For the reasons set out above, the Tribunal finds that the applicant did fail to cooperate with inspectors, which amounts to a sponsorship failure under r.2.78. Mr Ganda for the applicant company refuted the extent of the alleged lack of cooperation, and pointed to several mitigating factors such as the fact that he initially tried to cooperate during the site visits and that he was reticent to hand over his mobile phone and laptop because they contained personal information. The Tribunal also finds that the applicant did fail to pay four sponsored 457 visa holders equivalent terms and conditions of employment, which does amount to a sponsorship failure under r.2.79. However the Tribunal considers this to be an unintentional and minor mistake on behalf of the applicant company, and there is evidence before it indicating that the situation has been rectified.
The Tribunal acknowledges that it could appear that Mr Ganda was deliberately uncooperative with inspectors, which led them to believe he was trying to hide something. Mr Ganda did not do himself any favours in his dealings with the inspectors, and should have prioritised their visits over his customers. However, the Tribunal considers that was more to do with the fact that his businesses have grown rapidly and his administrative processes (including record keeping) were not in order, primarily because he has been trying to do everything himself, more so than an attempt to deliberately mislead the Department. At the Tribunal hearing Mr Ganda realised the importance of cooperating with the Department in the future, and the need to get his administrative practices in order as well obtain management and administrative support. The Tribunal is satisfied for reasons set out above that the applicant has made steps to improve management and administrative practices and is committed to meeting its sponsorship obligations in the future.
For the reasons set out above the Tribunal also finds that the applicant did provide false or misleading information, which amounts to a sponsorship failure under r.2.90. However, only in one instant (not the three as found by the delegate) in relation to telling officials in March 2013 that the Thornbury workshop site was operational (and employing two sponsored employees), when it was not. The Tribunal considers that Mr Ganda exaggerated the strength of his businesses and misled the Department in this respect to some degree. However, in context of his plans at that stage to expand the business model to this site and have staff shifting between sites as required.
Considering the totality of the circumstances, and having regard to the prescribed criteria discussed above, the Tribunal considers that the instances of non-compliance by the applicant in this matter warrant the imposition of some sanction. However, for reasons set out above, the Tribunal consider that the action taken by the delegate was to a certain extent excessive. Therefore, the Tribunal has decided to set aside the decision to cancel the approval of the sponsor as a standard business sponsor and substitute it with a decision to bar the review applicant for 18 months (from the date of the delegate’s decision) from sponsoring more people for Subclass 457 visas. The Tribunal has also decided to vary the decision by barring the review applicant for 18 months (from the date of the delegate’s decision) from making future applications for approval as a standard business sponsor.
The Tribunal notes that 18 months from the date of the delegate’s decision on 11 March 2014 is 11 September 2015.
DECISION
The Tribunal sets aside the decision under review to cancel the approval of the sponsor as a standard business sponsor under section 140M(1)(a) of the Act and substitutes it with a decision to bar the review applicant for 18 months from the date of the delegate’s decision from sponsoring more people for Subclass 457 Business (Long Stay) visas under s.140M(1)(c) of the Act; and
The Tribunal varies the decision under review by barring the review applicant for 18 months from the date of the delegate’s decision from making future applications for approval as a standard business sponsor under s.140M(1)(d) of the Act.
Nicole Burns
Member

ATTACHMENT – EXTRACT FROM THE MIGRATION REGULATIONS 1994
2.89   Failure to satisfy sponsorship obligation
…
(3) For paragraph 140L(1)(b) of the Act, the criteria that the Minister must take into account in determining what action (if any) to take under section 140M of the Act in relation to the circumstance mentioned in subregulation (2) are:
(a)   the past and present conduct of the person in relation to Immigration; and
(b)   the number of occasions on which the person has failed to satisfy the sponsorship obligation; and
(c)   the nature and severity of the circumstances relating to the failure to satisfy the sponsorship obligation, including the period of time over which the failure has occurred; and
(d)   the period of time over which the person has been an approved sponsor; and
(e)   whether, and the extent to which, the failure to satisfy the sponsorship obligation has had a direct or indirect impact on another person; and
(f)    whether, and the extent to which, the failure to satisfy the sponsorship obligation was intentional, reckless or inadvertent; and
(g)   whether, and the extent to which, the person has cooperated with Immigration, including whether the person informed Immigration of the failure; and
(h)   the steps (if any) the person has taken to rectify the failure to satisfy the sponsorship obligation, including whether the steps were taken at the request of Immigration or otherwise; and
(i)    the processes (if any) the person has implemented to ensure future compliance with the sponsorship obligation; and
(j)    the number of other sponsorship obligations that the person has failed to satisfy, and the number of occasions on which the person has failed to satisfy other sponsorship obligations; and
(k)   any other relevant factors.
…
2.90   Provision of false or misleading information
…
(3) For paragraph 140L(1)(b) of the Act, the criteria that the Minister must take into account in determining what action (if any) to take under section 140M of the Act in relation to the circumstance mentioned in subregulation (2) are:
(a)   the purpose for which the information was provided; and
(b)   the past and present conduct of the person in relation to Immigration; and
(c)   the nature of the information; and
(d)   whether, and the extent to which, the provision of false or misleading information has had a direct or indirect impact on another person; and
(e)   whether the information was provided in good faith; and
(f)    whether the person notified Immigration immediately upon discovering that the information was false or misleading; and
(g)   any other relevant factors.
…

[2015] AATA 3066

10 July 2015

Key Legal Topics

Areas of Law

Immigration

Administrative Law

Legal Concepts

Judicial Review

Procedural Fairness

Natural Justice

Jurisdiction

Statutory Construction

Appeal