1506507 (Migration)

[2016] AATA 3398

1506507 (Migration) [2016] AATA 3398 (23 February 2016)

DECISION RECORD

DIVISION:Migration & Refugee Division

APPLICANT:  YATELLE PTY LTD

CASE NUMBER:  1506507

DIBP REFERENCE(S):  OPF 2014/841 OPF2015/3447 OPF2015/3448 OPF2015/3449 OPF2015/3450

MEMBER:Kate Millar

DATE:23 February 2016

PLACE OF DECISION:  Adelaide

DECISION:The Tribunal affirms the decision under review.

Statement made on 23 February 2016 at 10:46am

STATEMENT OF DECISION AND REASONS

APPLICATION FOR REVIEW

1. Yatelle Pty Ltd (Yatelle) purchased and operated printing businesses Pace Print and Pace Design.  It was approved as a standard business sponsor on 10 October 2012 and sponsored three people for temporary business entry (subclass 457 visas), and four people for permanent residency under the regional sponsored migration scheme (subclass 119 and 857 visas). 

2. The Department of Immigration and Border Protection commenced monitoring Yatelle’s compliance with its sponsorship obligations in April 2014.  As a result of information obtained during the monitoring process a delegate of the Minister for Immigration and Border Protection found Yatelle had failed to meet its obligations as a sponsor; specifically the obligation to ensure equivalent terms and conditions of employment, the obligation to keep records and the obligation to ensure a primary sponsored person works in the nominated occupation, program or activity.  The failure to comply with these sponsorship obligations was found to come from underpaying wages of the three 457 visa holders, the failure to keep records of payments to the 457 visa holders that could be verified, and changing the occupation of the 457 visa holders or failing to employ them in the nominated occupation. 

3. On 20 April 2015 the delegate cancelled the approval of Yatelle as a standard business sponsor and barred it from sponsoring more people for subclass 457 and 187 visas for a period of five years under s.140M of the Migration Act 1958 (the Act). This is an application for review of that decision.

4. Yatelle is also aggrieved by the imposition of a civil penalty for the breach of its sponsorship obligations under s.140Q of the Act, however this tribunal does not have jurisdiction to review a decision to apply a civil penalty.  Yatelle was aware that the imposition of the penalty did not come within the jurisdiction of the tribunal, but wanted the sponsor bar and cancellation removed so as to remove the basis for the civil penalty. 

5. Miss Naini Chhabra, a director of Yatelle, appeared before the Tribunal on 21 December 2012 to give evidence and present arguments. Yatelle was represented in relation to the review by its registered migration agent.

6. For the following reasons, the Tribunal has decided to affirm the decision under review.

   CONSIDERATION OF CLAIMS AND EVIDENCE

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

8. 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.

9. The circumstances are prescribed in r.2.89 - r.2.94B and include where the Minister, or the tribunal on review, is satisfied there has been a failure to satisfy a sponsorship obligation (r.2.89).  

10. 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(3)). These criteria, as they apply to the Yatelle, are set out in the attachment to this decision.

    Does a circumstance for the taking of an action exist?

11. In the present case, the delegate found that Yatelle had failed to comply with its sponsorship obligations.

    Failure to satisfy a sponsorship obligation: r.2.89

12. 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 this case, the delegate relies on three different obligations: the obligation to ensure equivalent terms and conditions in r.2.79, the obligation to keep records in r.2.82 and the obligation to ensure the primary sponsored person works or participates in the nominated occupation, program or activity (r.2.86).

    Obligation to ensure equivalent terms and conditions (r.2.79)

13. The obligation applies to standard business sponsors if the primary sponsored person holds a subclass 457 visa (r.2.79(1)).  It requires that the sponsor must ensure 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 sponsor provides, or would provide, to an Australian citizen or an Australian permanent resident to perform equivalent work in the person’s workplace at the same location (r.2.79(2)). 

14. The delegate found each of the three 457 visa holders had not been paid the amount that was stated in their payslips.

15. In relation to Satinder Jeet Singh, the delegate found that the payslips provided by Yatelle did not match deposits to Mr Singh’s bank account, with no payments corresponding to the amount on the payslips on 26 February 2014, 14 Match 2014 and 26 March 2014.  The delegate found this resulted in an underpayment of $6,205.25.

16. The second employee, Maninder Bir Singh did not have payments into his account as stated in the payslips on 1 April 2013, 22 August 2013, 3 October 2013, 17 October 2013, 28 November 2013, 12 December 2013, 9 January 2014, 14 March 2014 and 26 March 2014.  The delegate found this resulted in an underpayment of $18,775.80.

17. The third employee, Manwinder Pal Singh did not have payments corresponding to his payslips deposited in his account for the fortnight 11 November 2013 until 24 November 2013, which the delegate found resulted in an underpayment of $27,279.29. 

18. In its written submission to the department, and provided to the tribunal, Yatelle argues that the appointment of a reputable company to manage payments of salary, the payment of superannuation of the sponsored workers, and issuing of PAYG payments summaries of the employees showed they were paid the required amount.  I am not satisfied in the circumstances of this case, where cash payments have been said to have been made by Yatelle in the place of wages reported on the paylsips, that any of these items either on their own or in combination show that the sponsored workers were paid the wages shown on the payslips.

19. Miss Chhabra provided a statement in which she says she engaged Wagelink to handle pay and allowances for the employees of Yatelle. She said her Indian employees had a habit of asking for advance cash payments and she had to comply with their requests as they were responsible for the success of the business.  She states the payslips are evidence of the employees being paid their wages. 

20. A letter from Wagelink states the payroll of 2 September 2013 to 11 November 2013 was incorrectly dated.

21. Mrs Chhabra also provided statutory declarations from each of the three affected employees stating they had received cash payments for each of the pay dates referred to be the delegate.  Mr Satinder Jeet Singh declares he needed cash for his daily use as he ran out of money, to pay rent, and gifts for his sister’s wedding, Mr Maninder Bir Singh said he needed cash for needs such as travel, gifts, moving house, purchase of household items, routine expenses, purchase of a car, repayment of loans and purchase of a computer.  Mr Manwinder Pal Singh said he was paid cash to meet urgent commitments.  The purported statutory declaration form Mr Satinder Singh is not signed by him but is signed (somewhat concerning) by a Justice of the Peace.  The statutory declaration for Ms Manwinder Pal Singh states he received a cash payment on one fortnight but does not specify the amount.  The statutory declaration from Maninder Bir Singh is also not signed by Mr Singh but is signed by a Justice of the Peace. 

22. The delegate states in the decision record that Mr Maninder Bir Singh was asked about transactions in his account including rent payments, payment of credit cards and cash deposits and that it was implausible that he would not mention cash salary.  The delegate states Mr Satinder Singh was specifically asked about his salary and method of payment and at no stage said he received cash payments.  In relation to Mr Manwinder Pal Singh, the cash payments are said to have occurred in a period when all the transactions in his account are in New South Wales and Yatelle is based in South Australia.     

23. Miss Chhabra said the visa holders did not mention cash payment at interview because they were scared and uncomfortable about the questions and were subject to harassment.  On being asked why she said they were the subject of harassment, she said this was because they were asked questions and they were not sure about the answers and this affected their performance at interview. 

24. I asked Miss Chhabra why the payslips were issued with the payment recorded as being made on a particular date and with no deductions for cash advances.  Mrs Chhabra said every Tuesday she paid money to Wagelink and Wagelink made payments to the employees accounts.  On being asked why a transfer to the bank account of the employees  had not been made in accordance with the Wagelink payslips if Wagelink were making the payments, Miss Chhabra said this was because there were cash payments.    

25. On being asked how Wagelink knew how much to put in the employees’ accounts if there were been cash payments, she said this was confirmed in an email that she sent to Wagelink telling them she had made a cash payment and to provide the payslip.  On being asked if she could produce these emails, she said she did not have copies of the emails.  She said these transactions were only recorded by Wagelink via email. She said Wagelink would send a payment summary each fortnight and on the basis of the payment summary she would make a payment. 

26. Mrs Chhabra was asked to provide the email records, and was given until 8 January 2016 to provide these records.  In response, she said the person from Wagelink was not available, but she could provide these records by 28 January 2016.  No further records have been provided to the date of this decision, and I infer from the failure to provide these documents that they either do not exist or would not assist Yatelle’s case.  This does not reflect well on Miss Chhabra’s credit.  Had these documents been emailed as she said, they should have been easy to retrieve.  I am not satisfied that the cash payments were made to employees as she stated in her oral evidence. 

27. Miss Chhabra provided a photocopy of two cheques both dated 2 June 2014 on to Maninder Bir Singh for $952.00 and one to Manwinder Pal Singh for $2,510.  This is stated to be as evidence of payment of arrears.  This is not for the amount specified and does not support their contention that they were paid the correct wages at the time. 

28. I am not satisfied that Yatelle provided terms and condition of employment to the sponsored workers that were equivalent to those it provides, or would provide, to an Australian citizen or an Australian permanent resident to perform equivalent work in the person’s workplace at the same location.  As a result I find it breached r.2.79.

Obligation to keep records (r.2.82)

1. The obligation to keep records for a standard business sponsor includes an obligation to keep a record of the money paid to the primary sponsored person.

2. The payslips provided are not a record of the money paid to the 457 visa holders, as they specify payment dates and amounts that were not paid to the employees in that amount on that date.

3. As a result, I find Yatelle had breached the obligation to keep records in r.2.82.

The obligation to ensure the primary sponsored person works or participates in the nominated occupation, program or activity

1. The delegate relies on the circumstances of employment of Satinder Jeet Singh and Manwinder Pal Singh.

2. Mr Satinder Jeet Singh was employed as a web designer.  At interview, the production manager of Pace Print, Mr Ray Smilie is reported as telling the Departmental officer that Pace Print has no web design work for Mr Singh and is primary task was to rebuild the server.  The officer reports that Mr Smilie initially said Mr Singh had done web design work for Dudley Park Cemetery, Touch of Beauty and Skintelligence, but later said he had not in fact completed work for these clients, Mr Smilie was unable to produce evidence of any current or previous work completed by Mr Singh other than a hand drawn sketch that was claimed to be a mock up of a website. 

3. Miss Chhabra said that she has never doubted Satinder’s work and he provided results shown by a significant increase in the turnover of the business

4. Mr Manwinder Pal Singh was employed as a graphic designer.  The production manager Mr Smilie is reported as saying that Manwinder “runs his business from Sydney” and that he hardly ever sees him.  Mr Smilie said he had never seen a completed job by Manwinder and that Manwinder could do a basic menu layout, but “you could teach a child to do that.”  Other Pace Print employees did not know if Manwinder lives in New South Wales or South Australia and could not state the duties he performed. 

5. Manwinder is reported as stating his role is in sales and business development, and was reportedly unable to elaborate on duties he performs as a graphic designer.  Manwinder has qualification in graphic design and pre-press. 

6. Miss Chhabra said that Manwinder’s tasks matched his job and he helped the company to grow.  She could not tell me the names of the clients he provided services to as the business had closed eight months before the hearing.  She said Manwinder was running his own business in Sydney, then that he was managing the Sydney operation.  On being asked the proportion of the income of the business was from the Sydney operations, she said 15% but then that she could she could not say in terms of the amount of dollars. 

7. Miss Chhabra said that at the time Mr Smilie was employed she had a small child and was unable to attend the office.  She said he was new when the officer interviewed him and had been employed for one month and did not yet know what the employees did.  She said he was not competent with the work and would get stressed.   Miss Chhabra had not raised any concerns about Mr Smilie’s performance before the hearing.  In the extensive written response she provided for the Department, Mr Smilie is reported to have clarified his answers, which were markedly more favourable to Yatelle than his responses at interview.  No concerns about Mr Smilie’s knowledge or performance were raised in this document.     While these submissions have Mr Smillie’s name typed at the end, they are not signed by him or any of the other people who have their names listed at the end of the submissions. On the Department file there is the final page of this written submission that was provided later with signatures that appear on it. 

8. In her submission provided after the hearing, Miss Chhabra states that the failure of the business has destroyed her and that the questions asked of her shattered her mental balance during the hearing and she could not concentrate during the hearing.  She asks that a copy of the unsigned written submissions provided to the Department  are considered which will “have answers to some unanswered/incorrectly answered questions”.  During the hearing, I did not have the impression that Miss Chhabra was having difficulty answering questions, although she did need to be reminded to listen to the entire question before answering.  She had considerable notice of the hearing, which was postponed on one occasion at her request.  I have considered the written response dated “9 December 204 (sic)” which is not signed.  This detailed response seeks to improve on answers provided by those interviewed by the Department.  While it refer to emails and statutory declarations, these have not been provided, and nor are there references to statutory declarations or emails in support of the submission in several critical aspects, such as the reported comments of Mr Smilie. 

9. I was not convinced by Miss Chhabra’s explanation of Mr Smilie’s answers.  Mr Smilie was recruited to be the production manager of the business.   I place greater weight on the information recorded by the Department from Mr Smilie than on the written submission or the evidence of Miss Chhabra about his work as she said he was not often at the business as she had a small child. 

10. Having considered the information before me, I am not satisfied that Satinder and Manwinder worked in the nominated occupation and I consider Yatelle has breached its obligation to ensure Satinder and Manwinder works in the nominated occupation. 

11. As I have found Yatelle has breached its obligations as a sponsor, I am satisfied that the prescribed circumstance in r.2.89 exists for the purpose of s.140M of the Act.

    Action to be taken

12. As I am satisfied that relevant circumstances for s.140L(1)(a) exist, it is necessary to consider whether one or more of the actions mentioned in s.140M should be taken.

13. In considering what action to take, I have 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).

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

14. Miss Chhabra said that whenever the Department has needed documents they have provided them through their agent. 

15. The employees were co-operative in being interviewed by officers of the Department n in the conduct of the site visits, and provided a detailed written response to the information put to it by the Department. 

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

16. As I am not satisfied that cash payments were made as asserted by Ms Chhabra or that records were kept of payments made to her employees, and having regard to the documents regarding the payment of wages on the Department file, I find the breaches in relation to payment of wages occurred as asserted by the Department on thirteen occasions.  The failure to keep records occurred on the same number of occasions.  The failure to employ Mr Satinder Singh and Mr Manwinder Pal Singh occurred on an ongoing basis, from at least the date the monitoring commenced. 

    (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

17. The breaches identified are over a significant period of time and involve significant amounts of money for the sponsored workers.  There has been a continuous failure to maintain adequate records relating to the employment of the sponsored workers.  Ms Chhabra has been unable to provide documentary evidence from Wagelink in relation to the purported cash payment of the workers.  As such I regard the failure to meet the sponsorship obligations falls at the more sever end of the scale.   

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

18. Ms Chhabra said that Yatelle has been an approved sponsor since 2012. 

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

1. Mrs Chhabra said that at one stage the department identified an underpayment of wages based on the award salaries, and they paid the affected employees arrears by cheque.  She provided copies of the cheques after the hearing.  She said that after the findings of the Department she became more particular in dealing with Wagelink and the records they kept.  On being asked what changes were made she said the filing system was stronger and they had weekly meetings with employees within the premises and they communicated with their migration agent. The weekly meetings with the employees was in regard to the clients of the business, any suggested improvements and other issues for the employees.  She said these meetings started in 2013.  This was before the monitoring of the business by the department commenced. 

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

2. Yatelle produced payslips from an external source that were not correct to support their claims about the payment of the employees.  The explanation of cash payments only came after it was shown that these payslips did not match deposits into the sponsored workers’ accounts.  I am not satisfied that cash payments were made.  Yatelle undertook certain obligations, including ensuring equivalent terms and conditions and keeping records when they sought approval as a sponsor, and its directors were therefore aware of these obligations. 

3. In the written submissions Ms Chhabra is reported to have been unwell prior to and following the birth of her child, and that the business moved premises.  These circumstances are said to have affected the management of the business in the period January to May 2014, and the ability of the business to respond to concerns raised by the Department.  The bulk of the payments that are reported in the payslips but not made to the sponsored workers occurred prior to these dates, and I am not satisfied this explains anomalies prior to January 2014.  After this date if Ms Chhabra was incapacitated, it was her responsibility as a director of the company to provide suitably qualified and experienced managers for the business.  I find the failure to satisfy the obligation to ensure terms and conditions equivalent to Australian citizens and permanent residents and the failure to keep records was at best reckless.   

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

4. Yatelle and its employees cooperated with interviews with the Department and during site visits. 

   (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

5. Miss Chhabra provided copies of cheques for relatively small amounts she says were paid to two of the sponsored visa holders when the Department identified an underpayment of wages, in addition to the amounts the Department found had not been paid to the sponsored visa holders.   There is no independent evidence that these cheques were received or cashed by the recipients, and in light of Yatelle having previously provided documents that were shown not to be accurate (being the payslips that do not accurately record payments made to employees) I am not satisfied these cheques were provided or cashed by those named on the cheques. 

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

6. The business is no longer operating and this does not apply.  Miss Chhabra said the business has been sold to a new operator who was referred to them by their accountant.  Maninder Bir Singh has continued to work for the new owner of the business.

7. In terms of any new processes implemented, she said the way they did cash payments she would not do again, and next time she would make cash payments through a personal loan to an employee.  As Yatelle no longer owns the business, this is now hypothetical.

   (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

8. I have found Yatelle failed to comply with three sponsorship obligations.  The failure to keep adequate records was ongoing, as was the failure to employ two sponsored visa holders in the occupation for which they were nominated.  Miss Chhabra said the company was new and she was new to running the company and it was not subject to any other monitoring by the Department.

   (k)       Any other relevant factors.

9. Miss Chhabra said that she has a management background and wanted to use her qualifications in a practical way.  She said she did not want to do anything wrong when she bought the business and realised that they could provide a one stop shop from printing cards, web design and large signs.  She says she tried to give the business a new face and succeeded in that goal because of the marketing.  She said she hired qualified people for design.  She said she did not know where she went wrong and was not given an opportunity to improve.

10. Miss Chhabra said the Department is trying to set an example for other businesses and that she had been victimised and the decision was harsh and severe. 

11. In the written submissions, her migration agent refers to Ms Chhabra’s financial losses as a result of the Department investigation, in that their clients left them and employee’s morale suffered resulting in a low income to the business. 

12. Miss Chhabra provided a written statement in which she describes the breaches as trivial procedural issues.  I do not consider the failure to pay sponsored workers the wages reported in the payslips as trivial or procedural. 

13. Considering the totality of the circumstances, and having regard to the prescribed criteria the Tribunal finds that the action mentioned in s.140M(1)(a) and (c) to cancel the approval of Yatelle as a standard business sponsor and to bar the sponsor for a period of five years from sponsoring more people for Temporary Work (Skilled)(Subclass 457) visas and Regional Sponsored Migrations Scheme (Subclass 187) visas.

14. As a result the decision under review is affirmed. 

    DECISION

15. The Tribunal affirms the decision under review.

    Kate Millar
    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.

    …