1420420 (Migration)

[2015] AATA 3346

1420420 (Migration) [2015] AATA 3346 (2 September 2015)

DECISION RECORD

DIVISION:Migration & Refugee Division

APPLICANT:  BISTOON CONSTRUCTION PTY LTD

CASE NUMBER:  1420420

DIBP REFERENCE(S):  OPF2014/3844

MEMBER:Bruce Henry

DATE:2 September 2015

PLACE OF DECISION:  Brisbane

DECISION:The Tribunal sets aside the decision under review and substitutes a decision not to take one or more of the actions specified in s.140M of the Migration Act 1958.

Statement made on 02 September 2015 at 3:38pm

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.

2. The applicant company was approved as a standard business sponsor on 22 February 2013. On 24 November 2014, the delegate decided to impose a sponsorship bar under s.140M of the Act on the basis that the applicant had failed to satisfy their sponsorship obligations under r.2.79, 2.84 and 2.86 of the Migration Regulations 1994 (the Regulations).

3. The director of the applicant company, Mr Kevin Zandi, appeared before the Tribunal on 26 August 2015 to give evidence and present arguments.

4. For the following reasons, the Tribunal has decided to set aside the decision under review and substitute a decision not to take one or more of the actions specified in s.140M of the Act.

   CONSIDERATION OF CLAIMS AND EVIDENCE

5. Sections 140K, 140L and 140M of the Act provide for the imposition of sanctions on approved sponsors in certain circumstances. 

6. 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 from sponsoring more people under the terms of any existing approval for a specified period; and

   ·barring the sponsor from making future applications for sponsorship approval in relation to one or more classes of sponsor for a specified period.

7. For these purposes, the circumstances are prescribed in r.2.89 - r.2.94B of the Regulations and relevantly include, in r.2.89, circumstances in which the Minister, or Tribunal on review, is satisfied there has been a failure to satisfy a sponsorship obligation.

8. 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. 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?

9. In the present case, the delegate found that the applicant failed to satisfy the sponsorship obligations identified in r.2.79, 2.84 and 2.86 of the Regulations.

   Failure to satisfy a sponsorship obligation: r.2.89

10. The Minister may take one or more of the actions in s.140M of the Act 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).

11. The delegate stated in the decision record, a copy of which was provided to the Tribunal with the application for review, that:

    On 5 November 2014 the Department wrote to the sponsor in the form of a Notice of intention to take action (NOITTA) under regulation 2.96 which stated that a delegate of the Minister was satisfied that circumstances for cancelling the approval of the sponsor in relation to the class or classes to which the sponsor belongs, or for barring the sponsor from further use of the program for a specified time, exist or existed.

    The NOITTA provided an opportunity for the sponsor to comment on the circumstances that exist for a sponsor to be barred or for their approval as a sponsor to be cancelled. The identified circumstances are:

    Regulation 2.89 Failure to satisfy sponsorship obligation

    The sponsorship obligations for a person who is or was an approved sponsor are specified in section 140H of the Act and Part 2A of the Regulations. The identified failures to satisfy the sponsorship obligations are:

    ·Regulation 2.79 Obligation to ensure equivalent terms and conditions of employment

    ·Regulation 2.84 Obligation to provide information to Immigration when certain events occur

    ·Regulation 2.86 Obligation to ensure primary sponsored person works or participates in nominated occupation, program or activity

    The Department did not receive a response to the NOITTA and the date specified for providing a response has passed.

12. Evidence on the departmental file confirms that the applicant company had taken steps to rectify the identified breach of r.2.84 in response to the notice sent to it by the Department.

13. In relation to the identified breach of r.2.86, information in the decision record indicates that the applicant was sponsored as a Building Associate, ANZSCO Code 312112. The position is described in the contract of employment signed by the applicant and the visa holder (Mr Sefat) as ‘Building Construction Supervisor’, which is listed in ANZSCO as one of the specialisations of a Building Associate. ANZSCO states that a Building Associate ‘Supervises construction sites, and organises and coordinates the material and human resources required’, and lists the duties of that position as follows:

    Tasks Include:

    oAssisting Construction Managers, Architects and Surveyors in planning and organisation

    oInterpreting plans, regulations and codes of practice

    oPreparing preliminary sketches, working drawings and specifications

    oPreparing, editing and revising plans, maps, charts and drawings

    oCoordinating works programs

    oInspecting work and materials for compliance with specifications, regulations and standards

    oCalculating costs and estimating time scales

    oCollecting data using surveying instruments and photogrammetric equipment

    oPerforming routine computations and plotting preliminary data

14. The delegate stated that the basis for the finding that the applicant was not employing Mr Sefat in the nominated position was:

    The sponsor’s failure to satisfy the obligation to ensure the primary person works or participates in the nominated occupation program or activity appears to be intentional. There is minimal evidence to support that Mr SEFAT has worked in the nominated position due to the information provided at interview regarding the duties undertaken by Mr SEFAT, the size of the company, the small number of employees and the size and type of jobs undertaken. Taking into account these factors there are concerns regarding the genuine need for the nominated position. …
    The sponsor did not acknowledge that Mr SEFAT is not working in the nominated occupation. The sponsor attempted to provide evidence to support Mr SEFAT’S duties; however this evidence was minimal and more indicative of a less skilled role. Information obtained from the interviews indicates that the business is operating as a small renovations outfit and not a large construction company; this is substantiated by the sponsor who provided invoices detailing small renovation jobs. There are concerns that whilst the sponsor has been honest in admitting its current financial and operating environment; it may not have been totally cooperative regarding the duties of Mr SEFAT.

    Evidence produced during the review and at hearing

15. With the application for review the applicant company provided evidence in the form of pay advice and copies of Mr Sefat’s bank statements to show that the underpayment of his salary that had been identified by the Department had been rectified.

16. At the hearing Mr Zandi told the Tribunal that his company had experienced a downturn in its business over the last two years, as had many other businesses in the construction industry. He said that the company’s turnover had been in the region of $700,000 per year prior to this downturn, but had fallen to $150,000 in the last financial year. He said that while the company had previously been building houses, for the last two years its work has primarily been in renovation of existing houses.

17. Mr Zandi explained that apart from himself and Mr Sefat, the applicant company had no employees, as Mr Sefat had told the Department when he was interviewed. He said that this had given rise to a misunderstanding, however, as the departmental officer had assumed that he and Mr Sefat did the building work themselves, whereas that work was carried out by subcontractors.

18. Mr Zandi said that as well as experience and qualifications in carpentry and joinery and metalwork, Mr Sefat had an MBA and qualifications as an industrial engineer from Iran. He said that Mr Sefat’s role with the business was to plan and coordinate their projects, and to organise and supervise the subcontractors needed to complete the work.

19. The Tribunal put to Mr Zandi information from the departmental file that when Mr Sefat was interviewed he had told the departmental officer that he was assisting a builder on the site of one of the company’s jobs. Mr Zandi said that this was true, but that this was by no means the extent of Mr Sefat’s work with the company. He said that Mr Sefat would assist the subcontractors if it was appropriate for him to do so, as would Mr Zandi himself, but that his most important function was to coordinate the building projects secured by Mr Zandi as explained above.

20. Mr Zandi said that in his view Mr Sefat had at all times continued to do the work of a Building Associate as outlined in the nomination for the position. He said that he was familiar with the ANZSCO definition of the tasks associated with that position, and confirmed that in his view Mr Sefat continued to perform those tasks.

21. The Tribunal asked Mr Zandi why such a position was needed in such a small company, and he responded that while the turnover of the business had declined after the approval of the sponsorship, it had been improving again over the last few months. He said that he had continued to employ Mr Sefat during the difficult times over the last two years, and it would cause serious problems for his business if he were to lose him now that the business was picking up again. He repeated that no matter what the turnover of the business, he had always worked with subcontractors to do the tradesman’s work – plumbers, builders, carpenters and electricians – on his projects, and needed Mr Sefat to supervise and coordinate these subcontractors if the business was to flourish.

22. After the hearing Mr Zandi provided the Tribunal copies of the applicant company’s tax returns from 2010 to 2014, details of invoices issued by the company since the end of the 2014 tax year, and copies of recent quotations for work that he had referred to in his evidence. The Tribunal is satisfied that the documents produced support the evidence given by him at the hearing as to the downturn in the company’s business since 2012 and also confirm that the business is once again picking up.

23. Mr Zandi did not dispute in his evidence that he had failed to notify the Department of the change of address, and acknowledged that he had underpaid Mr Sefat – albeit by $1.37 per hour – until the matter had been brought to his attention.

24. The Tribunal finds that the breaches identified by the Department of r.2.79 and 2.84 of the Regulations have occurred.

25. In relation to r.2.86, however, the Tribunal does not consider that the applicant company was in breach of this obligation. The Tribunal found Mr Zandi to be an honest and credible witness, and accepts his account of the circumstances that his business has faced over the last few years, noting that it is corroborated by the evidence submitted following the hearing. The Tribunal also accepts his evidence as to the role that Mr Sefat plays in the business, and the importance of that role to the ongoing success of the business, and on the basis of this evidence the Tribunal is satisfied that Mr Sefat has continued to perform the work of his nominated occupation, Building Associate.

26. In the circumstances, the Tribunal is satisfied on the basis of the breaches of r.2.79 and 2.84 referred to above that prescribed circumstances referred to in r.2.89 exist for the purpose of s.140M of the Act.

    Action to be taken

27. For these reasons, the Tribunal is satisfied that a relevant circumstances for s.140L(1)(a) of the Act exists, and it is necessary to consider whether one or more of the actions mentioned in s.140M should be taken.

28. The regulations require that prescribed criteria be taken into account when determining whether to impose a bar or cancel a sponsorship. Regulations 2.88-2.94B set out not only the circumstances in which the Minister may bar an approved sponsor or cancel a sponsorship approval, but also the criteria that must be considered. 

29. In considering what action to take, the Tribunal has had regard to the criteria to be considered where there is failure to comply with sponsorship obligation, which are prescribed in r.2.89(3) of the Regulations.

30. The Tribunal may also have regard to Departmental policy, which in this context states that in determining the appropriate penalty (or combination of penalties), regard should be had to a number of factors including whether the failure is minor, significant or serious, whether the failure was intentional, reckless or inadvertent and the effect the sanction will have on the sponsor, sponsored persons and the relevant sponsored worker program.[1]

    The past and present conduct of the person in relation to Immigration

    [1] PAM3: Sponsorship applicable to Division 3A Part 2 of the Act – Penalties, Sanctions and Enforcement – Introduction at [3] (compilation 23/08/14).

31. The delegate states in the decision record that the applicant was cooperative in providing documents and information as requested, and there is no information before the Tribunal to suggest that the applicant company has been other than cooperative and honest in its dealings with the Department.

    The number of occasions on which the person has failed to satisfy the sponsorship obligation

32. In relation to this issue, the delegate stated:

    The sponsor has failed to satisfy the obligation to ensure equivalent terms and conditions of employment on one occasion:

    - For the period 24/2/2014 to 6/8/2014, visa holder Saeed SEFAT was not paid in accordance with the approved terms and conditions of his employment.

    The sponsor has failed to satisfy the obligation to provide information to Immigration when certain events occur on one occasion:

    - The sponsor failed to notify Immigration of the change of address for the business within the required ten working day timeframe.

    The sponsor has failed to satisfy the obligation to ensure primary sponsored person works or participates in nominated occupation, program or activity on one occasion:

    - For the period of their employment since 24/2/2014, visa holder Saeed SEFAT has not been working in the nominated occupation of building associate.

33. The Tribunal notes that the applicant has taken steps to rectify the identified breaches of r.2.79 and 2.84 of the Regulations, and it has found above that the applicant company was not in breach of the obligation that Mr Sefat work in the nominated occupation.

    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

34. The particulars of the breaches of r.2.79 and 2.84 of the Regulations are explained above. The Tribunal does not regard either of these breaches to have been severe in the circumstances, having regard to the minor nature of the breaches and the applicant company’s action to remedy the breaches when they were brought to its attention.

    The period of time over which the person has been an approved sponsor

35. Information in the decision record of the delegate states that the applicant was approved as a sponsor on 22 February 2013 and has been an approved sponsor since that time.

    Whether, and the extent to which, the failure to satisfy the sponsorship obligation has had a direct or indirect impact on another person

36. There is no evidence before the Tribunal that any other person has been detrimentally affected by the breaches of the sponsorship obligations. Mr Sefat was being underpaid by $1.37 per hour, but that matter has been rectified.

    Whether, and the extent to which, the failure to satisfy the sponsorship obligation was intentional, reckless or inadvertent

37. The Tribunal accepts the evidence that the breaches of the applicant company’s obligations were inadvertent, and were due to the pressure on Mr Zandi as a result of the downturn in the construction industry rather than being intentional or reckless. The Tribunal accepts that he is committed to honouring his obligations to Mr Sefat notwithstanding the difficulties facing his business, and that Mr Sefat’s skills will be crucial in enabling to company to take advantage of the current improvements in the construction sector of the economy.

    Whether, and the extent to which, the person has cooperated with Immigration, including whether the person informed Immigration of the failure

38. Again the Tribunal notes that there is no suggestion that the applicant company has been other than cooperative and honest in its dealings with the Department.

    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

39. As noted above, the applicant company has provided evidence that they had remedied the underpayment of the Mr Sefat by paying him the balance between the salary proposed in the nomination and the amount actually paid. The documents also stated that the appropriate adjustment had been made to Mr Sefat’s superannuation account.

40. The Tribunal also notes that evidence on the departmental file shows that the applicant remedied the breach in relation to the company’s change of address as soon as the matter was brought to its attention by the Department.

    The processes (if any) the person has implemented to ensure future compliance with the sponsorship obligation

41. The Tribunal accepts Mr Zandi’s evidence that the applicant company will ensure that it will comply with its sponsorship obligations in the future.

    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

42. Other than the breaches referred to in the decision record as set out above, there is no evidence before the Tribunal that the applicant has breached any other sponsorship obligations.

    Other relevant factors

43. The Tribunal considers that it is relevant in this case that the applicant company has continued to employ Mr Sefat despite the downturn in its fortunes over the last few years, and accepts Mr Zandi’s evidence that he believes that the continued employment of Mr Sefat in the role identified for him in the nomination is crucial to the future success of the business.

44. In these circumstances, given that the Tribunal considers that the breaches of the sponsor’s obligations were relatively minor, the imposition of a sponsorship bar would serve only to damage the interests of the applicant company and possibly lead to serious consequences for Mr Sefat, as to whom there is no suggestion of complicity in the breaches.

45. Considering the totality of the circumstances, and having regard to the prescribed criteria the Tribunal finds that none of the actions under s.140M of the Actshould be taken.

    DECISION

46. The Tribunal sets aside the decision under review and substitutes a decision not to take one or more of the actions specified in s.140M of the Act.

    Bruce Henry
    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.

    …