1407227 (Migration)

1407227 (Migration) [2015] AATA 3480 (13 October 2015)
DECISION RECORD
DIVISION:Migration & Refugee Division
APPLICANT:  Gencerler Pty Ltd ATF Ahmet's Licensed Turkish Restaurant
CASE NUMBER:  1407227
DIBP REFERENCE(S):  OPF2013/1004 OPF2013/5392 OPF2013/6146 OPF2013/6161 OPF2013/7282
MEMBER:Jennifer Ciantar
DATE:13 October 2015
PLACE OF DECISION:  Sydney
DECISION:The Tribunal varies the decision under review by deciding under s.140M(1)(d) to bar the sponsor from making future applications for approval as a standard business sponsor from 31 March 2014 until 13 October 2015.
Statement made on 13 October 2015 at 11:49am

STATEMENT OF DECISION AND REASONS
APPLICATION FOR REVIEW
1.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.

Background

The applicant was approved as a standard business sponsor on 18 June 2010 and the sponsorship agreement ceased on 18 June 2013.
On 25 February 2013 the department wrote to the applicant requesting records and information for the commencement of monitoring. The monitoring period was 1 January 2012 to 25 February 2013.
On 2 August 2013 the Department sent the applicant a Notice of intention To Take Action (NOITTA).
On 10 October 2013 the Department sent the applicant another NOITTA, which took into account the applicant’s response to the NOITTA sent on 2 August 2013. In regard to r.2.79(2), which requires the sponsor to provide terms and conditions of employment to the primary sponsored person, which are no less favourable than those the Minister was satisfied with when the nomination was approved, the Department identified a number of potential failures regarding terms and conditions for four 457 visa holders.
The notice indicates there is a discrepancy between the payments made to the 457 visa holder, Mr Daniel Bridge, and his Australian citizen or permanent resident equivalent, Mr Daniel Veniditti, because in the period 27 December 2011 to 25 February 2013, Mr Bridge received $9833 less in salary.
In regard to Mr Musa Akdemar, an underpayment of $10,724.98 had been identified. The applicant’s response to the earlier notice indicated that Mr Akdemir was paid $5250 gross and $3316 net on 16 August 2013 and the remaining 50% of the underpayment is be paid on 19 August 2013. A bank statement indicates that $3316 was paid on 21 September 2013 and so the balance of the remaining underpayment appears to be $224.98.
In regard to Ms Casimiro Sobreira, who was employed as a marketing specialist with an annual salary of $52,000, for a 38 hour week including reasonable overtime, the expected salary in the 21 weeks that she held a 457 visa (30/10/12 to 25/2/13) was $14,628.36 but payslips indicate she was only paid $10,955.52 (gross). There is therefore a shortfall of $3672.84.
In regard to Mr Harpreet Singh Kambo, he was employed as a cook with an annual salary of $50,000 for normal working hours of 38 hours per week including reasonable overtime. He only held a 457 visa for 33 of the 60 week monitoring period, from 10 July 2012 to 25 February 2013, and payslips indicate he was paid $31,523.19 (gross) of the expected gross salary of $32,099.38; therefore there is an underpayment of $576.19.
On 31 March 2014, under s.140M(2), the delegate decided to bar the applicant from making any future applications for approval as a standard business sponsor for four years on the basis that the applicant did not comply with sponsorship obligations as prescribed under r.2.89. Specifically, the applicant did not comply with the obligation to ensure equivalent terms and conditions of employment (r.2.79), the obligation to provide records and information to the Minister (r.2.83), the obligation to provide information to Immigration when certain events occur (r.2.84) and the applicant had also provided false and misleading information (r.2.90).
The delegate found that the sponsor had failed to satisfy the obligation to ensure equivalent terms and conditions of employment on five occasions. Between 1 January 2012 and 5 September 2012, Mr Daniel Bridge received $8500.02 less than the Australian equivalent, Mr Daniel Veniditti. This amount had been amended following the applicant’s response to the second NOITTA. The delegate also found that there was an underpayment of $4519.03 to Mr Bridge, but the Tribunal is of the view that this appears to be an error as this was the amount of the underpayment identified in the first NOITTA and it was varied in the second NOITTA and again in the final decision.
The delegate also found an underpayment of $10,724.98 to Mr Akdemir, an underpayment of $3672.84 to Ms Sobreira and an underpayment of $576.19 to Mr Kambo and therefore Mr Bridge, Mr Akdemir, Ms Sobreira and Mr Kambo were not paid in accordance with the salary approved at nomination. The delegate was of the view that as the total underpayment exceeded $5000 and involved multiple significant failures, the breach is serious. The failure to comply with r.2.79(2) occurred between 1 January 2012 and 5 September 2012. The failure to comply with r.2.79(3) occurred throughout the monitoring period. The delegate did not accept the applicant’s claim that the underpayments arose due to errors by the former general manager who was responsible for salary payments. The delegate also noted that the applicant has provided evidence that they have reimbursed the underpayments to Mr Bridge and Mr Akdemir but the latter’s underpayment was not fully reimbursed until after the issue of the second NOITTA. There is no evidence that the underpayment to Ms Sobreira has been rectified. The applicant denies that Mr Kambo has been underpaid. The applicant claims that the initial period of employment of Mr Kambo was not part of the subclass 457 arrangement but the second NOITTA clearly states the identified underpayment occurred during the time that Mr Kambo held his 457 visa.
The delegate noted that the sponsor has paid the infringement notice and has been largely cooperative in providing information as requested. The delegate noted that the sponsor has been monitored twice in the past. In 2005/06, the outcome was unsatisfactory – counselled. In 2007/08, the outcome was satisfactory.
However, in regard to the provision of false or misleading information, the applicant has not provided any comment on information which indicates that false or misleading information was provided on two occasions. As highlighted in the second NOITTA, the sponsor provided PAYG summaries for the 2011/2012 financial year for Mr Bridge and Mr Akdemir on two occasions - in response to the letter advising of the commencement of monitoring and again, in response to the NOITTA. In response to the “commencement of monitoring” letter, the PAYG, signed on 29 April 2013, indicates that Mr Bridge was paid $49,684 gross and $8,918 was withheld in tax. However, the PAYG, signed 17 July 2012, states that Mr Bridge was paid $40,753 gross and $6105 was withheld in tax. In regard to Mr Akdemir, the PAYG signed, 29 April 2013, indicates he was paid $49,500 gross and $8178 was withheld in tax. However, in the PAYG, signed 17 July 2012, Mr Akdemir was paid $38,529 gross and $5263 was withheld in tax.
In regard to r.2.90, the delegate was satisfied that the applicant provided false or misleading information because of inconsistent information on PAYGs dated 29 April 2013 and 17 July 2012 regarding payments made to Mr Daniel Bridge and Mr Musa Akdemar.
The delegate also found that on one occasion the applicant had failed to satisfy the obligation to provide records and information to the Minister because the applicant had not provided a statement regarding whether, since being approved as a sponsor, they have been found by a court or competent authority to have contravened a Commonwealth, State or Territory law. This information was requested in the letter advising of the commencement of monitoring and in the first NOITTA. The failure to provide records and information to the Minister appears to have been intentional as the applicant did not respond to the requests.
The applicant had also failed to provide information, within the required timeframe, regarding the cessation of employment of Ms Sobreira. The delegate found that Ms Sobreira had ceased employment on 9 February 2013 and the applicant had not advised the Department until 25 March 2013.
Information given to the Tribunal
In a letter, dated 15 April 2014, the applicant advised the Tribunal that Mr Daniel Bridge and Mr Daniel Veniditti were initially in equivalent roles, on equivalent pay, but Mr Daniel Veniditti was promoted on 5 September 2012 to the position of sous chef and his salary increased to $1153 per week. He left the restaurant in February 2013. Mr Bridge remained on his initial pay rate and role until 24 December 2012 when he was promoted to sous chef and his salary increased to $1153 gross per week. Employees were paid at equivalent rates when undertaking the same role.
The applicant also advised that Mr Akdemir has now received the full amount of the underpayment and the banking receipt was provided to the Department. Ms Sobreira was employed on a full-time basis as soon as the restaurant became aware that her visa had been granted. The underpayment to her is acknowledged. However, she is no longer in Australia having resigned from her role while on holidays overseas and she has not been in recent contact with the restaurant. Mr Kambo was employed full-time at the contract salary rate as soon as the restaurant was aware that the visa had been granted. As the initial period of employment was not part of the 457 program arrangement, the applicant does not agree the contract rate was necessary and does not believe an underpayment occurred. Mr Kambo did not advise the applicant when his visa was granted, as he assumed the sponsor would be automatically notified. The accountant has confirmed that the PAYG summaries for Mr Bridge and Mr Akdemir signed on 29 April 2013 are correct and aligned with the relevant Business Activity Statements.
The applicant acknowledges that some errors occurred while the former general manager, Dave Yates, was responsible for payroll matters but the errors were inadvertent. Since March 2013, the applicant has taken personal control of staffing arrangements to ensure there is no further error and copies of current payslips for affected staff will be provided as confirmation of current payroll arrangements.
It is acknowledged that the department was not notified prior to 9 February 2013 that Ms Sobreira had ceased employment but the applicant was not aware that she did not intend to resume employment after taking recreation leave. The applicant requested that the infringement notice and associated prescribed penalty relating to the cessation of employment of Ms Sobreira be withdrawn as he had notified the department when Ms Sobreira notified him that she would not be returning from overseas and he was not in a position to provide the information earlier. However, he subsequently paid the fine on 22 February 2014.
The applicant also submits that the business owner was not aware of any issues until monitoring commenced because they relied on the former general manager to operate the business efficiently. It is unlikely that directors of the company would be involved in the day-to-day running of the business but as soon as they realised what was happening, they appointed their son (who is the applicant) as general manager and he took over the running of the business to ensure that mistakes were corrected for all staff. It is submitted that to place a bar on the business will affect not just the owners but also their Australian staff. The restaurant has a seating capacity of 300 and books about 30 private functions per week. Currently it employs 46 staff including 2 457 visa holders and 2 apprentices. One of the 457 visa holders has recently applied for permanent residence, nominated by the restaurant, and the other expects to submit his application when he is eligible in July 2014. The business has sponsored many overseas employees since 2002 and ensures everyone has the capacity to communicate in English. The business also constantly seeks Australian staff but takes into account the experience rather than the nationality of employees. The sponsored Turkish chefs have provided excellent training to Australian employees.
On 25 February 2015 the applicant provided further information to the Tribunal. Since March 2013, Mr Gencerler has taken personal control of staffing arrangements. Copies of payslips for Mr Bridge and Mr Kambo since March 2013 are attached, as confirmation of current payroll arrangements. The restaurant now has 43 employees, 25 of whom are Australian citizens or permanent residents and now there are also five apprentices, all of whom are Australian citizens. An organisational chart is provided. A continuing sponsorship bar affects not only the owners but also their Australian staff as employees pass skills onto one another. Mr Bridge is the head chef and is the primary supervisor and trainer for the five Australian citizen apprentices. Due to the current sponsorship bar, the restaurant has been unable to nominate Mr Bridge under the ENS program and will be precluded from further sponsorship under the 457 program should the bar continue. This is causing Mr Bridge to look elsewhere for future work and sponsorship opportunities both on a temporary and permanent basis. Most applicants who gained their permanent residence through the temporary residence transition stream in the ENS program, nominated by the applicant’s business, stayed with the business following the grant of their permanent residence. Apart from a seating capacity of 330 and 30 private functions per week, the restaurant has 2 to 3 sittings on Friday and Saturday nights. The opening hours are 11:30 AM to 9 PM Sunday to Thursday and 11:30 AM to 10 PM Friday and Saturday. The restaurant is extremely busy and has an excellent reputation and cannot afford to be understaffed.
Hearing
The applicant, Mr Harun Gencerler, appeared before the Tribunal on 3 July 2015 to give evidence and present arguments. The Tribunal also received oral evidence from Mr Daniel Bridge and Mr Felipe Toro.
The applicant was represented in relation to the review by its registered migration agent.
The applicant stated that although he does not want to entirely blame the former general manager, Mr Dave Yates, the underpayments had occurred when Mr Yates was in charge. Mr Yates has now moved to Canada and he had not really provided much of an explanation as to how the underpayments arose. The applicant took over as general manager about two years ago. He reviewed systems and set up MYOB. He is aware that he has to pay 457 visa holders the same rate or more as their Australian counterparts. The business has contracts with each of its full-time employees and there are annual performance reviews. All salary payments are made via electronic transfers. Since the applicant took over the general manager’s role two years ago, there have been no underpayments. It was never their intention to underpay employees and the business has sponsored visa holders since 2003. This is the first time there have been under payments and the applicant believes the delegate made a very harsh decision to impose such a long bar and also impose a fine. The business relies on sponsoring staff because it offers specialised cuisine and there are few local people in Brisbane with the required skills.
The Tribunal put to the applicant that the delegate’s letter indicates that there had been an unsatisfactory monitoring outcome in 2005/06. The applicant stated that this is before the time that he was involved with the business although his parents were also the owners at that time. However, he has no information about why the outcome then was unsatisfactory.
In regard to the underpayment to Mr Bridge, the applicant stated that they had not noticed that the delegate’s letter makes reference to 2 underpayments to Mr Bridge: one of $8500.02 being the difference in pay between Mr Bridge and Mr Veniditti, and a second underpayment of $4519.03. The applicant stated that they had accepted one underpayment which they have paid to Mr Bridge. The applicant stated that perhaps Mr Yates had not realised that Mr Bridge’s pay had increased or he might have misunderstood the award payment that was required.
In regard to the underpayment to Mr Akdemir, once the underpayment was realised, Mr Akdemir was reimbursed in two instalments. The Tribunal put to the applicant that the Department had found that following the reimbursement of two underpayments there was still an outstanding amount. The applicant stated that the entire outstanding amount was paid to Mr Akdemir who left the position about 1.5 years ago, when he received permanent residence.
In regard to Ms Sobreira, she had taken leave and gone to South America from where she sent an email saying she would not be returning. The email was sent to the general manager who did not notify the applicant for about two weeks and as soon as the applicant was aware that Ms Sobreira had resigned, he notified the Department. Ms Sobreira has not been reimbursed the underpayment because the applicant does not know how to contact her and also because she resigned only a few months after commencing her employment and the employer had spent some thousands of dollars on the sponsorship and nomination. Furthermore, at the time she took leave Ms Sobreira had only accumulated one week of annual leave but the applicant paid her additional holiday pay in advance, perhaps one or two weeks. They had agreed to pay her 4 weeks leave but in the second or third week of her leave she notified the employer that she had resigned and so they stopped salary payments from that point. The applicant commented that perhaps the delay in notifying the Department about Ms Sobreira’s resignation was because she was still being paid.
In regard to the underpayment to Mr Kambo, the applicant understood that the procedure involved the employee being advised by the Department about the approval of his 457 visa and the employee then telling the applicant of the approval. However, Mr Kambo had not notified the employer for two weeks about the grant of his subclass 457 visa. Although the applicant does not agree with the Department’s position, nevertheless, they had paid Mr Kambo the alleged underpayment. Mr Kambo had worked for the applicant for about six years and had become their head baker. However, because of the sponsorship bar, the applicant was unable to sponsor Mr Kambo for permanent residence and so he left and has moved to Perth where he found another sponsor. Mr Kambo’s departure has been very difficult for the applicant as the making of Turkish pide and bread is very specialised. The applicant is trying to fill the position.
In regard to the delegate’s finding that the sponsor had not provided information about whether, since being approved as a sponsor, they have been found by a court or competent authority to have contravened a Commonwealth, State or Territory law, the applicant stated that he was not aware that this information had been requested. The representative stated that this was an oversight on her part as it had initially been requested in earlier correspondence but not in the second NOITTA. The applicant stated that the business has not contravened any State or Commonwealth laws and he would provide this information in writing.
The Tribunal put to the applicant that 2 PAYG summaries have been provided for the 2011/2012 financial year, which contained different payment information for Mr Bridge and Mr Akdemir. The applicant stated that he has no information about why the earlier PAYG was incorrect but the accountant has assured him that the PAYG with the later date matches the BAS. The applicant stated that he would provide the Tribunal with a submission on this point.

Mr Bridge stated that he is now the head chef and is eligible to apply for permanent residence. He would prefer to stay employed with the applicant but as the applicant is unable to sponsor him currently, another business nearby has offered him a position and has lodged a sponsorship application. If the applicant continues to be barred as a sponsor then Mr Bridge will have no choice but to leave. However, this will have adverse ramifications for the restaurant. Mr Bridge currently supervises three apprentices one of whom has a learning disability. The three apprentices have between 2 and 3.5 years of their apprenticeships remaining. Mr Bridge stated that he has been the head chef for nine months and he has worked at the restaurant for nearly 6 years. He was a casual for about six months and then was granted a subclass 457 visa. He applied for a subclass 186 visa on 12 March 2015 and he has been advised that the nomination application lodged by the rival restaurant was approved about two weeks ago. Mr Bridge also stated that once the employer realised there was an underpayment, he was reimbursed straightaway and given an explanation.
The applicant stated that although there are another five qualified chefs working in the business they are not at the standard of Mr Bridge and he does not believe they would be capable of supervising the apprentices. Mr Bridge not only has the right skills but he is also patient and he is a good communicator; not all chefs have the right personality to manage apprentices. The applicant stated that he would have to replace Mr Bridge as head chef and he would have to look outside the business as he does not believe that the chefs currently employed have the skills to be the head chef.
The applicant also stated that it is difficult to find chefs who are specialists in preparing Turkish cuisine. The business employs about 50 people and since 2003 it has frequently had to sponsor chefs. If Mr Bridge leaves then it is likely that they would have to let the apprentices go. The loss of Mr Kambo has also been keenly felt as it is difficult to find someone with the skills of a Turkish baker and it is likely that they would need to fill this position through the 457 program.
Mr Toro stated that he has worked in the restaurant for about 10 years. The owners sponsored him for his temporary visa and then his permanent visa and he anticipates that he will become an Australian citizen soon. He has always been treated very fairly by the owners and he wants to continue working for them. Mr Bridge is a skilled chef and he has observed the difficulties in filling this position; it will be very hard for the restaurant to replace Mr Bridge.
The representative stated that she would provide a submission by 8 July 2015 addressing the issue of the contradictory PAYG summaries, whether the applicant has ever contravened any laws and she will provide a further explanation regarding payments made to Ms Sobreira.
On 7 July 2015 the applicant wrote to the Tribunal and advised that:
·the applicant and the representative had both missed point 11 in the Department’s letter dated 25 February 2013. However, as stated at the hearing, since being approved as a sponsor there have been no findings made by any court or competent authority that a Commonwealth, State or Territory law has been contravened;
·Ms Sobreira was employed by the business in a fulltime basis from November 2012 subsequent to the grant of the 457 visa. She went on a month’s holidays in February 2013 at which time she had only accrued 5 days of holidays. The applicant agreed to her taking leave and also agreed to pay her the additional 3 weeks holidays in advance. The applicant paid Ms Sobreira one week’s leave to which she was entitled and also $1615.38 for 2 of the 3 weeks in advance but did not pay the last week as by then she had advised that she was not returning;
·the applicant acknowledges the mistakes and has ensured they do not re-occur. It is a testament to the business that the staff who have been sponsored have remained in the business for many years. The applicant has been fined and has served nearly 2 years of the bar which would seem to be sufficient punishment.
The applicant also provided a letter from Clift Pearce Accounting, dated 6 July 2015, concerning the 2 payment summaries (PAYG) for the financial year ending 30 June 2012. The accountant’s understanding is that there had been data entry errors when payroll processing occurred in MYOB software. After the end of the financial year, after payment summaries had been issued, this was brought to the accountant’s attention and on this basis the firm prepared an amended payment summary to reflect the correct amounts advised. The employees affected were Mr Bridge and Mr Akdemir.
On 15 July 2015 the Tribunal wrote to the applicant under the provisions of s.359A of the Act and the relevant part of the letter is as follows:
The Tribunal has given consideration to the information you provided at hearing and in correspondence. The relevant period is the monitoring period, 1 January 2012 to 25 February 2013. The Tribunal is of the view that there are 2 outstanding underpayments to 2 Subclass 457 visa holders who were in your employ:
·    An underpayment of $3672.84 to Ms Sobreira. You stated that you do not dispute that Ms Sobreira was underpaid but you have not attempted to reimburse Ms Sobreira because she was paid $1615.38 to which she was not entitled as she took a month’s leave at a time when she had only accumulated 1 week’s leave. While on leave she resigned after having been employed as a Subclass 457 visa holder for less than 6 months and after the business had spent a considerable amount sponsoring Ms Sobreira. Furthermore, you stated that you have no way of contacting Ms Sobreira as she did not return to Australia from overseas. However, Ms Sobreira took leave after the end of the monitoring period and the email she sent giving her resignation, dated 13 March 2013, apart from providing an email address also contains her phone number.
This information is relevant as it may lead the Tribunal to find that although you had contact details for Ms Sobreira you did not attempt to reimburse her for the underpayment.
·    An underpayment of $576.19 to Mr Kambo. Mr Kambo was granted a Subclass 457 visa on 10 July 2012. Although you told the Tribunal that the underpayment had been reimbursed, there is no evidence of this before the Tribunal and in a letter to the Tribunal, dated 15 April 2014, you stated that you disagree with the alleged underpayment and Mr Kambo was paid the contract rate from as soon as he notified you that he had been granted a Subclass 457 visa. Furthermore, the information on the Department’s file indicates that Mr Kambo was underpaid from 9 July 2012 to 5 September 2012. Between 10 July 2012 and 5 September 2012 Mr Kambo was paid $923.08 per week and from payday 12 September 212 he was paid the contract rate of $961.54 per week.
This information is relevant as it may lead the Tribunal to find that you underpaid Mr Kambo for about 2 months and you have not reimbursed him for the underpayment.
·    You also told the Tribunal at the hearing that Mr Kambo has left his employment in your business because you were unable to sponsor him for a permanent visa. However, the Department’s records indicate that Mr Kambo’s Subclass 457 visa does not cease until 9 July 2016.
This information is relevant as it may lead the Tribunal to not accept that Mr Kambo left your employ because the imposition of the bar has prevented the business from sponsoring him for a permanent visa.
If the Tribunal makes these findings it might further find that your business has failed to satisfy sponsorship obligations under r.2.89, and has failed to rectify these failures, which is a relevant consideration under r.2.89(3) which sets out criteria that must be taken into account (see attachment to letter) when considering what action should be taken and when considering the period of the bar (if any) that may be imposed from making future applications for sponsorship approval under s.140M of the Act.
On 28 July 2015 the applicant responded. The applicant stated that at the time Ms Sobreira went on holidays she was owed 5 days leave but the applicant agreed to also pay her 3 weeks holidays in advance. The applicant actually paid Ms Sobreira the one week to which she was entitled and also $1615.38 for 2 of the 3 weeks in advance but did not pay the last week as by then Ms Sobreira had advised that she was not returning. The applicant agrees he underpaid Ms Sobreira $3672.84 and as he advanced her $1615.38, the underpayment is $2057.46. The applicant has now contacted Ms Sobreira and requested her bank details. Evidence of payment will be provided.
The applicant also agrees that Mr Kambo was underpaid and evidence that the underpayment of $576.19 has been paid to Mr Kambo is provided. The applicant also advised that Mr Kambo had been eligible to apply for residence under the Subclass 186 visa program from 10 July 2014 and he had contacted the applicant’s representative to commence the application. However, Mr Kambo did not pursue the application because he was aware that Mr Bridge had lost his application fees and charges in relation to his application for a permanent visa, after the Department advised that the nomination could not be approved because of the sponsor bar imposed on the applicant. As the bar was imposed until 2018, even if Mr Kambo stayed in the applicant’s employment, as he had worked for the applicant since 2012, the applicant would not have been able to nominate Mr Kambo for a permanent visa or another Subclass 457 visa when Mr Kambo’s visa expired in 2016.
On 5 August 2015 the applicant provided evidence that a payment of $2057.46 had been made to Ms Sobreira.
On 19 August 2015 the Tribunal wrote to the applicant and the relevant part of the letter is as follows:
You told the Tribunal that when Ms Sobreira went on leave she was only entitled to 1 weeks holiday pay, but you advanced her an extra 2 weeks holiday pay and you have deducted $1615.38 from the underpayment. This equates to 2 weeks’ salary. The department's records indicate Ms Sobreira went overseas on 10 February 2013. The PAYG and payslips you provided to the department indicate Ms Sobreira was paid until 25 or 28 February 2013, which is about 2 weeks after she left Australia. It therefore appears that she received 2 weeks holiday pay in total and you gave evidence that she was only entitled to 1 weeks holiday pay.
The Tribunal now invites you to provide information to show that Ms Sobreira was paid $1615.38 more holiday pay than that to which she was entitled.
The Department’s file also indicates that Ms Sobreira advised you by email on 13 March 2015, more than a month after she departed Australia, that she was not returning to her employment.
The Tribunal invites you to provide information about when you had expected Ms Sobreira to return to work.
On 16 September 2015 the applicant provided the Tribunal with a statutory declaration in which he declares that as far as he is aware Ms Sobreira has now been paid all outstanding monies. Her contract required her to give 2 weeks’ notice and as she did not do so, she was in breach of contract. To the best of his knowledge, Ms Sobreira had been expected back at work 4 weeks after her departure on 10 February 2013. The applicant also provided evidence of a payment made to Ms Sobreira of $1028.73 on 14 September 2015 and a copy of the contract of employment.
47.For the following reasons, the Tribunal has decided to vary the decision under review.
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.
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 ensure equivalent terms and conditions of employment (regulation 2.79), failing to satisfy the obligation to provide records and information to the Minister (r.2.83), and failing to satisfy the obligation to provide information to Immigration when certain events occur (r.2.84).
Obligation to ensure equivalent terms and conditions of employment: r.2.79
In regards a breach of r.2.79(2) in the monitoring period, the law requires that the applicant must ensure that the terms and conditions of employment provided to the primary sponsored person are no less favourable than the terms and conditions of employment that the person provides, or would provide, to an Australian citizen or an Australian permanent resident who performs equivalent work in the person’s workplace, at the same location.
The applicant accepts that between 1 January 2012 and 5 September 2012, Mr Daniel Bridge, a subclass 457 visa holder, received $8500.02 less than the Australian equivalent, Mr Daniel Veniditti. In the Notice of decision dated 31 March 2014 the delegate states that the underpayment regarding Mr Bridge has been fully reimbursed. The delegate also found that there was an underpayment of $4519.03 to Mr Bridge but as there is no other information about this in the decision record or in the NOITTA, the Tribunal is of the view that this might be an erroneous statement. The delegate also found an underpayment of $10,724.98 to Mr Akdemir but also found that this was fully reimbursed although not until after the second NOITTA was issued. The applicant does not dispute that these underpayments occurred.
The delegate also found that there was an underpayment of $3672.84 to Ms Sobreira. The applicant does not dispute there was an underpayment but at the time of hearing had not attempted to reimburse Ms Sobreira. The applicant’s reasons were that Ms Sobreira was paid an additional 2 weeks holiday pay, $1615.38, to which she was not entitled as she took a month’s leave at a time when she had only accumulated 1 week’s leave. While on leave she resigned. The applicant also stated that the business had spent a considerable amount sponsoring Ms Sobreira who then left only months after commencing in the nominated position. However, in response to the Tribunal’s letters, the applicant provided evidence that payments of $2057.46 (the underpayment less 2 weeks holiday pay) and $1028.73 (1 week’s pay) have recently been made to Ms Sobreira. The Tribunal accepts that Ms Sobreira was paid an additional amount of holiday pay for leave which she had not accumulated and that the underpayment to Ms Sobreira now has been fully reimbursed.
The delegate found that there was an underpayment of $576.19 to Mr Kambo. The Tribunal notes that the applicant had asked the Department to check that correct payments had been made to Mr Kambo. The NOITTA dated 10 October 2013 indicates that Mr Kambo held a Subclass 457 visa for 33 weeks of the 60 weeks monitoring period, from 10 July 2012 to 25 February 2013. Although the applicant stated at hearing that the underpayment had been reimbursed, there is no evidence of this and the Tribunal notes that in a letter to the Tribunal dated 15 April 2014 the applicant states that Mr Kambo was paid the contract rate from as soon as he notified the applicant that he had been granted the Subclass 457 visa. However, the applicant has since provided evidence that a payment of $576.19 has been made to Mr Kambo. The Tribunal also accepts that Mr Kambo left the applicant’s employment because the applicant was barred from sponsoring Mr Kambo for a temporary or permanent visa.
In summary, the Tribunal finds that the applicant did underpay 4 subclass 457 visa holders and that the underpayments total a significant amount. Therefore the circumstances for taking action exist in relation to r.2.79.
Obligation to provide records and information to the Minister: r.2.83
59.The delegate also found that the applicant had breached r.2.83, obligation to provide records and information to the Minister because the applicant had not provided a statement regarding whether, since being approved as a sponsor, the applicant has been found by a court or competent authority to have contravened a Commonwealth, State or Territory law. The applicant has since provided a statement to the Tribunal that the applicant has not been found by a court or competent authority to have contravened a Commonwealth, State or Territory law. The applicant also stated that they had failed to give this information to the Department because it had been overlooked or not picked up, as the applicant was responding to a number of requests for information from the Department.
60.Regulation 2.83 requires that certain circumstances are satisfied including that the request for information is made by a written notice using a method specified in s.494B of the Act, the request specifies the date of compliance not earlier than 7 days after the date on which a person is taken to have received the notice under s494C of the Act, and thirdly, the person is required to keep the records under a law of the Commonwealth or a State/Territory that applies to the person, or under regulation 2.82 (obligation to keep records), and fourth, the records or information relate to the administration of Division 3A of Part 2 of the Act (sponsorship provisions) or, if the person is a party to a work agreement, to the work agreement. On the available information the Tribunal is not satisfied that the Department’s request to the applicant to provide a statement regarding whether, since being approved as a sponsor, the applicant has been found by a court or competent authority to have contravened a Commonwealth, State or Territory law complied with the requirements of r.2.83. However, as noted, the applicant has since provided the requested information. The Tribunal is not satisfied that the circumstances for taking action exist in relation to r.2.83.
Obligation to provide information to Immigration when certain events occur: r.2.84
61.The delegate also found that the applicant had breached r.2.84 because the applicant had failed to provide information to the Department when certain events occurred, namely, when Ms Sobreira resigned. The NOITTA dated 2 August 2013 states that Ms Sobreira resigned on 9 February 2013 and the applicant notified the Department on 25 March 2013. However, the email on the Department‘s file from Ms Sobreira to the applicant, which advises of her resignation, is dated 13 March 2013. There is no information before the Tribunal to indicate that prior to this date, the applicant knew that Ms Sobreira would not be returning to Australia or to her employment.
62.It may be that the Department has taken the resignation from the date that Ms Sobreira went on holidays, which the applicant states was 10 February 2013. The applicant expected Ms Sobreira to return to work 4 weeks after this date. However, the Tribunal accepts that the applicant was only notified by Ms Sobreira on 13 March 2013 that she would not be returning to Australia or to her employment with the applicant. Therefore, the applicant’s delay in notifying the department of the resignation on 25 March 2013 amounts to about 12 days. The Tribunal notes that the department’s policy states that a sponsor is considered to have satisfied r.2.84 if they notify the Department within 28 calendar days of the event occurring. The Tribunal is of the view that it is reasonable to allow an employer 28 days to notify of an event such as a resignation. The Tribunal therefore is not satisfied that there was a breach of r.2.84 as the information before the Tribunal indicates that the applicant notified of the resignation 12 days after the applicant was told of the resignation. The Tribunal is not satisfied that the circumstances for taking action exist in relation to r.2.84.
63.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). Although the applicant has reimbursed all the 457 visa holders, the Tribunal finds that the applicant failed to satisfy a sponsorship obligation being the obligation to ensure equivalent terms and conditions of employment, as required by r.2.79.
Provision of false or misleading information: r. 2.90(2)

The delegate found that the applicant had provided false and misleading information to the Department because the applicant provided 2 inconsistent PAYG summaries. As highlighted in the second NOITTA, the sponsor provided PAYG summaries for the 2011/2012 financial year for Mr Bridge and Mr Akdemir on two occasions - in response to the letter advising of the commencement of monitoring and again, in response to the NOITTA. In response to the commencement of monitoring letter, the PAYG, signed on 29 April 2013, indicates that Mr Bridge was paid $49,684 gross and $8,918 was withheld in tax. However, the PAYG, signed 17 July 2012, states that Mr Bridge was paid $40,753 gross and $6105 was withheld in tax. In regard to Mr Akdemir, the PAYG, signed 29 April 2013, indicates he was paid $49,500 gross and $8178 was withheld in tax. However, in the PAYG, signed 17 July 2012, Mr Akdemir was paid $38,529 gross and $5263 was withheld in tax.
65.The applicant acknowledges that 2 inconsistent PAYG summaries were provided and he has provided a letter from his accountant, which states that there had been a data entry error and when this was picked up, a new PAYG was issued. Having regard to the submissions and evidence before it on this matter, the Tribunal accepts the explanations advanced by the applicant that the PAYG discrepancies were due to a data entry error and that the second PAYG submitted, dated 29 April 2013, is correct. The Tribunal also accepts that the applicant did not intentionally provide false or misleading information to the Department. However, it is not disputed that the applicant provided 2 inconsistent PAYGs, one of which contained incorrect information and the Tribunal accepts that this amounts to the provision of false and misleading information.
Having regard to the above, the Tribunal is satisfied that the prescribed circumstances in r.2.89 (failing to satisfy the obligations in r.2.79) and 2.90 exist 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 applicant’s oral evidence, his response to the NOITTA and relevant supporting documents.
Obligation 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 last approved as a standard business sponsor on 18 June 2010. However, as the applicant was monitored in 2005/06, this would indicate that the applicant has been an approved sponsor since at least 2005.
The past and present conduct of the sponsor in relation to Immigration
70.The Tribunal finds that there had been a previous monitoring in 2006 – unsatisfactory outcome but in 2008 a ‘satisfactory’ outcome was recorded. There is no information before the Tribunal about the reasons for an unsatisfactory outcome in 2006. The Tribunal has taken into account that this was some 9 years ago and that there was satisfactory monitoring after this date.
71.In regard to the monitoring conducted in 2013, the delegate found that the applicant has been generally co-operative and has provided responses to the majority of requests made by the Department.
The number of occasions on which the sponsor has failed to satisfy the sponsorship obligation
The delegate found that the applicant failed to ensure equivalent terms and conditions on four occasions (that is failing to pay four sponsored persons the agreed salary for various periods during the monitoring period), and the Tribunal accepts that there was a failure to satisfy sponsorship obligations on four occasions. The Tribunal has taken into account that the applicant has since rectified the underpayments although he only did so in respect of Mr Kambo and Ms Sobreira after the Tribunal put to the applicant that it may take an adverse view of the failure to have done so.
The nature and severity of the circumstances relating to the failure, including the time period over which the failure has occurred
73.The Tribunal finds that the period of time over which the failure occurred is 14 months from 1 January 2012 to 25 February 2013. In terms of r.2.79, the Tribunal finds that there were significant underpayments to the 4 subclass 457 employees identified by the Department, and this is a serious breach. 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.[1] The Tribunal accepts that the applicant has now reimbursed all 4 employees.
[1] Explanatory Statement to SLI 2009, No.115, p.2
74.The Tribunal has also found that the applicant provided false and misleading information as he provided 2 PAYG summaries for 2 employees in the same financial year which were inconsistent. The applicant has since clarified through the business accountant, which is the correct PAYG.
Whether, and the extent to which, the failure to satisfy the sponsorship obligation had a direct or indirect impact on another person
The Tribunal finds that there was a direct impact on the 4 subclass 457 employees who were underpaid in the period. The Tribunal agrees 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 varied as it was far more significant for Mr Bridge than it was for Mr Kambo but Mr Bridge has continued to work for the applicant and gave positive evidence to the Tribunal about his experiences as an employee of the applicant. The Tribunal accepts that the applicant has rectified the situation and paid the underpayments.
Whether, and the extent to which, the failure was intentional, reckless or inadvertent
76.The delegate found that the applicant’s failure to ensure equivalent terms and conditions of employment appears to have been reckless, as the applicant claimed that the former general manager was responsible for salary payments. The Tribunal accepts that the failure to ensure equivalent terms and conditions may not have been intentional on the part of the applicant but is of the view that the fact that 4 people were underpaid what was in some cases a significant amount indicates that the failure was careless or reckless.
77.Although the applicant stated that it was not intentional, the Tribunal finds that the applicant has been at least reckless in relation to the underpayments in relation to r.2.79. The Tribunal finds that in relation to the underpayments the applicant was reckless in that he did not give proper regard to the applicable hourly rate, as might be expected by a competent manager/owner of a company. The Tribunal is also of the view that the applicant unduly delayed reimbursing 2 of the affected 457 visa holders and that the fact that 2 of these employees had resigned is not an excuse for underpayments made during the course of employment.
Whether, and the extent to which, the sponsor has cooperated with Immigration, including whether the sponsor informed Immigration of the failure
78.The delegate described the sponsor’s level of cooperation throughout the monitoring process as largely co-operative although the failures had been identified by the Department and not by the applicant.
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 Tribunal is satisfied that the applicant has rectified the breach of r.2.79 as identified in relation to the 4 subclass 457 employees who were underpaid. Although 2 of the underpayments were only reimbursed in response to the Tribunal’s letters, the Tribunal accepts that the applicant responded immediately to the Tribunal’s letters.
The processes (if any) the sponsor has implemented to ensure future compliance with the sponsorship obligation
80.The applicant has taken action by appointing the son of the owners as the general manager and he gave evidence that he has established a new system that uses MYOB to ensure no underpayments occur in the future. The applicant has provided numerous pay slips as evidence that staff are now receiving the correct rate of pay.
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 one sponsorship obligation on this occasion.
Provision of false or misleading information – r.2.90(3)
The purpose for which the information was provided
The information was provided by the sponsor as part of information requested concerning the salaries paid to Mr Bridge and Mr Akdemir, as the Department was monitoring the applicant to assess if sponsorship obligations had been met
The nature of the information
83.The sponsor provided PAYG summaries for the 2011/2012 financial year for Mr Bridge and Mr Akdemir on two occasions - in response to the letter advising of the commencement of monitoring and again, in response to the NOITTA. In response to the commencement of monitoring letter, the PAYG, signed on 29 April 2013, indicates that Mr Bridge was paid $49,684 gross and $8,918 was withheld in tax. However, the PAYG, signed 17 July 2012, states that Mr Bridge was paid $40,753 gross and $6105 was withheld in tax. In regard to Mr Akdemir, the PAYG signed, 29 April 2013, indicates he was paid $49,500 gross and $8178 was withheld in tax. However, in the PAYG, signed 17 July 2012, Mr Akdemir was paid $38,529 gross and $5263 was withheld in tax.
Whether, and the extent to which, the provision of false or misleading information has had a direct or indirect impact on another person
84.The delegate found that the provision of false and misleading information hindered the Department’s ability to assess the applicant’s compliance with sponsorship obligations. The Tribunal accepts that the provision of conflicting financial information did hinder and delay the monitoring process and may also have caused the staff affected considerable inconvenience in, for example, meeting taxation requirements.
Whether the information was provided in good faith
85.The delegate considered that it appeared that the information had not been provided in good faith. However, the Tribunal accepts that the applicant did not deliberately provide false and misleading information. The applicant did provide the correct PAYG but he had also provided an incorrect PAYG and it was some time before the correct PAYG was identified. The Tribunal is of the view that the incorrect PAYG may have been calculated on the basis of the incorrect payments made to the visa holders; thus the errors which caused the underpayments are likely to have also caused the data entry errors which then led to an incorrect PAYG being issued.
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.
Any other relevant factors
87.The delegate did not rely on any additional relevant factors or any other matters. However, the applicant has identified the effect of this sanction on his business and the uncertainty for the Subclass 457 employees who have been employed by the applicant for some years and who would like to apply for permanent residency. The Tribunal accepts that one 457 visa holder has already resigned in order to take up employment with an approved sponsor. The Tribunal accepts that the head chef who is also a 457 visa holder intends to move to an alternative employer if the applicant is unable to sponsor him for permanent residency. The Tribunal accepts that the possible resignation of the head chef could have a negative impact on the apprentices employed by the applicant as the head chef is their supervisor. The Tribunal has also taken into account the positive evidence given by 2 visa holders regarding their employment at the applicant’s business.
88.The Tribunal has also taken into account that the applicant has a long history as an approved sponsor. As the last approval for a sponsorship ceased on 18 June 2013, the applicant effectively been barred from making applications for approval as a standard business sponsor for more than 2 years as of the date of the Tribunal’s decision.
89.The Tribunal has also taken into account that the applicant paid a fine for having delayed notifying of the resignation of Ms Sobreira but the Tribunal is not satisfied that the applicant did delay in notifying.
Conclusions
For the reasons set out above, the Tribunal finds that the applicant did fail to pay four sponsored 457 visa holders equivalent terms and conditions of employment, which amounts to a sponsorship failure under r.2.79.
At the Tribunal hearing the applicant acknowledged 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 the Tribunal is of the view that the cause of the provision of inconsistent PAYGs was likely to be the same cause as that which led to the underpayments and that this cause is likely to have been the poor administrative and financial systems in place in the business at that time. The applicant has given evidence that he has taken steps to improve these practices.
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 a sanction. However, for reasons set out above, the Tribunal considers that the action taken by the delegate was, to a certain extent, excessive. Therefore, the Tribunal has decided to vary the decision by barring the review applicant from the date of the delegate’s decision, 31 March 2014, until the date of the Tribunal’s decision, 13 October , from making future applications for approval as a standard business sponsor.
DECISION
94.The Tribunal varies the decision under review by deciding under s.140M(1)(d) to bar the sponsor from making future applications for approval as a standard business sponsor from 31 March 2014 until 13 October 2015.
Jennifer Ciantar

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.
…

[2015] AATA 3480

13 October 2015

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