Aerotech Aviation Pty Ltd (Migration)

Aerotech Aviation Pty Ltd (Migration) [2018] AATA 5293 (22 November 2018)
DECISION RECORD
DIVISION:Migration & Refugee Division
APPLICANT:  Aerotech Aviation Pty Ltd
CASE NUMBER:  1719052
DIBP REFERENCE(S):  BCC2017/2176629
MEMBER:Peter Emmerton
DATE:22 November 2018
PLACE OF DECISION:  Adelaide
DECISION:The Tribunal sets aside the decision under review and substitutes a decision approving the nomination.
Statement made on 22 November 2018 at 1:29pm

CATCHWORDS
MIGRATION – Employer Nomination – approval of nominated position – Direct Entry Nomination – Aircraft Maintenance Engineer (Mechanical) – need for a paid employee in specified position – international tightening of aircraft industry employment market – position cannot be filled locally – first and currently the only aircraft storage and recycling facility in Australia and Asia Pacific region – financial capacity – “commercial in confidence” agreements with major industry participants – market conditions – default risk – credible evidence – decision under review set aside
LEGISLATION
Migration Regulations 1994 (Cth), r 5.19
STATEMENT OF DECISION AND REASONS
APPLICATION FOR REVIEW

This is an application for review of a decision made by a delegate of the Minister for Immigration on 9 August 2017 to reject the applicant’s application for approval of the nomination of a position in Australia under r.5.19 of the Migration Regulations 1994 (the Regulations).
The applicant applied for approval on 20 June 2017. The requirements for the approval of the nomination of a position in Australia are found in r.5.19 of the Regulations which contains two alternative streams: a Temporary Residence Transition nomination (r.5.19(3)) stream and a Direct Entry nomination (r.5.19(4)) stream. If the application is made in accordance with r.5.19(2) and meets the requirements of either stream, then the application must be approved. If any of the requirements are not met then the application must be refused: r.5.19(5).
In this case, the applicant has applied for approval of a nomination, seeking to satisfy the criteria in the Direct Entry Nomination stream.
The delegate refused the application on the basis the applicant’s nomination did not satisfy r.5.19(4)(a)(ii) or r.5.19(4)(d) of the Regulations because they were not satisfied that the nominating entity had demonstrated a need to employ a paid employee to work in the position under the applicant’s direct control. Nor were they satisfied that the nominator had provided any financial evidence that the business has the capacity to provide a permanent, full-time position to the nominee for at least two years.
The applicant represented by Mr Thomas Vincent, Managing Director, Aerotech Aviation Pty Ltd, appeared before the Tribunal on 20 November 2018 in a joint hearing with MRT file ref 1725385 to give evidence and present arguments. The Tribunal also received oral evidence from Mr Robert Raymond Cecil, the nominee AND HIS SPOUSE Ms Cecil. The Tribunal found all those presenting evidence to be credible and appeared to answer questions in an open and honest manner without obfuscation.
The applicant was represented in relation to the review by its registered migration agent, via telephone.
For the following reasons, the Tribunal has decided to set aside the decision under review and substitute a decision approving the nomination.
CONSIDERATION OF CLAIMS AND EVIDENCE
The issue in this case is whether the applicant meets the requirements for approval of the nomination under the Direct Entry nomination stream set out in r.5.19(4), which is extracted in the attachment to this decision. For the nomination to be approved, all the requirements must be met.
In determining the applicant’s claims the Tribunal must first make findings of fact on material matters in dispute. This may involve an assessment of credibility and in so doing, the Tribunal is aware of the need and importance of being sensitive to the circumstances and the difficulties applicants often face before the Tribunal in their particular circumstances.
The applicants rely on the evidence given before the Tribunal together with written submissions and supporting evidence provided to the Tribunal and previously to the department.
The nominating entity operates a long term, maintained storage and aircraft component recycling facility, adjacent to the Alice Springs Airport, Northern Territory (NT).
The nominee is a substantially credentialed, British National, Certifying Aircraft Engineer, (B1.1 License Holder), sourced from the Qatar, who has worked for the nominator since June 2016.
The employment contract signed by both parties on 16 April 2016 shows an annual salary of $120,000 exclusive of Superannuation.
The Tribunal questioned Mr Vincent in substantial detail about the need for Mr Cecil’s position and why it could not be filled by an Australian citizen. The challenges associated with hiring and subsequently retaining a senior aircraft maintenance engineer with Mr Cecil’s qualifications, experience, licences and management background, into their relatively small organisation, were clearly articulated. Evidence was provided to the Tribunal of the salary determination, recruitment process and market testing and associated multi-channel advertising, which was utilised when recruiting for this role. The Tribunal notes that an industry specialist Search Firm ultimately filled the role, earning a fee of $12,000.
The Tribunal perused popular employment web sites prior to the hearing in order to ascertain the current state of the market in this field. The Tribunal observed a very large number of related vacancies, in a wide variety of locations and organisations currently under recruitment. The Tribunal is cognisant that many of the observed positions may appear to be equally or more attractive environments to some candidates than the nominated position located in Alice Springs, which might be considered remote and climatically unattractive by some potential applicants. This may add further weight to the argument that recruitment and retention has proven challenging.
The Tribunal also notes that an RCB Certificate has been issued by the relevant certifying body, following their acceptance of the compliance measures undertaken by the nominating entity. The date of the certificate is 2 November 2017.
The application is compliant: r.5.19(4)(a)
Regulation 5.19(4)(a) requires that the application for approval must be in the approved form, must be accompanied by the prescribed fee, and, where applicable, must include the required written certification relating to conduct that contravenes s.245AR(1). The application must also identify a need for the nominator to employ a paid employee to work in the position under their direct control.
The Tribunal finds that the application was lodged electronically using the elodgement facility. The nomination was made under the RSMS Direct Entry stream (r.5.19(4)(h)(ii)) and consequently no fee is payable. The Tribunal finds the applicant meets r.5.19(2).
The Tribunal notes and discussed with the Director that the operation is operating on a lean staffing ratio. The nominee clearly carries considerable responsibility and must have a high level of skill, certification and expertise. It is noted that the nominee is not closely supervised on a daily basis, which is in line with the Tribunal’s expectation for such a senior role.
The Organisation Chart demonstrates the relative position of the nominee within the organisation, their supervisory responsibilities and the reasonable conclusion that this role is essential for the ongoing operation in regards to safety and function. This was corroborated by testimony provided at the hearing by both parties and the assertions that Mr Cecil signs off on all the work undertaken by his team, in alignment with international aviation regulatory requirements.
The Tribunal is cognisant of the international tightening of the aircraft industry employment market and the fact that highly skilled positions such as Pilots and Engineers, are recruited on a global basis. There is considerable research available, some of which was provided by the applicant, to the Tribunal, to demonstrate the looming shortages in these fields and the impact of the global recruitment market. The research published by the University of New South Wales, Business School entitled ‘Looming shortage of aircraft maintenance staff in Australia’, published 23 February 2016, clearly articulates the global issue and the associated threats and benefits for Australia.
The Tribunal has reflected upon the fact that this is the first and currently the only aircraft storage and recycling facility in Australia and the Asia Pacific region. It is also noted that the climate is the major factor when considering location of such facilities and that Alice Springs provides the extremely dry and elevated conditions appropriate for the long-term maintained storage of aircraft. The largest such facilities, located in the Mojave Desert and Tucson, in the USA, have similar geographic and climatic conditions. Both of these facts potentially give the applicant an initial competitive advantage, a factor considered by the Tribunal in its’ assessment. It is also observed that the runway being utilised is able to take any civilian or military aircraft currently operating, an important additional advantage.
The Tribunal accepts the evidence presented demonstrating the organisation’s inability to attract an appropriate employee within Australia. It is also noted that the location may not attract a large pool of talent in a highly competitive market. Spousal employment and social opportunities may make this even more difficult in some cases.
The Tribunal is satisfied that the application has identified a need for a paid employee to work in the position of Aircraft Maintenance Engineer (Mechanical), ANZSCO 323112, under direct control of the applicant. Accordingly, the requirement in r.5.19(4)(a) is met.
Nominator is actively and lawfully operating a business in Australia: r.5.19(4)(b)
Regulation 5.19(4)(b) requires that the applicant is actively, lawfully and directly operating a business in Australia.
The Tribunal was provided with a range of Business Activity and Accountant Statements and Profit and Loss Statements for 2016 and 2017. The Tribunal also checked the status of the listed ABN, the organisation’s web site and viewed the physical location of the facility. The Tribunal is satisfied that the applicant is actively, lawfully and directly, operating a business in regional Australia. Accordingly, the requirement in r.5.19(4)(b) is met.
Position is not labour-hire: r.5.19(4)(c)
Regulation 5.19(4)(c) applies to nominators whose business activities include those relating to labour hire to an unrelated business. In these cases, the nominated position must be within the business activities of the nominator. The Tribunal finds that r. 5.19(4)(c) is not relevant to the current nomination.
Term of employment of the visa holder: r.5.19(4)(d)
Regulation 5.19(4)(d) requires the nominee to be employed in the nominated position for at least 2 years full time, and the terms and conditions of that employment do not expressly exclude the possibility of an extension.
The Tribunal notes that the delegate refused the application on the basis the applicant’s nomination did not satisfy r.5.19(4)(d)(i) of the Regulations because the delegate was not satisfied that the nominating entity had demonstrated the capacity to pay the full-time salary for the nominated position for at least 2 years.
The Tribunal notes that substantial additional information was provided prior to the hearing and verified at the hearing, which had not been given to the delegate. It also notes that the business appears to be in a healthy state and is stable with Capital of approximately AUD$4m which is slightly up from FY 2017.
The Tribunal was made aware during the conduct of the hearing of a number of significant “commercial in confidence” agreements concluded with major industry participants since the delegate’s decision. It also notes that FAA certification has been obtained which is a significant development as it allows the organisation to compete with the largest global competitors based in the USA.
The Tribunal notes that the first EBITDA Profit of $90,000 was delivered in the 2016/17 financial year. This compares to a loss in the previous year of $74,000. It is also acknowledged that the market conditions associated with low fuel prices and highly liquid financial markets, has slowed down the need to take less efficient aging aircraft out of service. This has temporarily reduced the need for the nominating entity’s core services but has been in some part offset by greater efficiencies through permanent staffing and lower fly in fly out human resources, plus a focus on additional services. The Tribunal notes that there is currently a rapid uptake of new aircraft fleets in the burgeoning Asia-Pacific Market. This will likely provide expansion opportunities for the nominator as it is anticipated that 40% of the global aviation market will be concentrated in this region. Some evidence of this is provided by current vacancies advertised on their web site.
The Tribunal is also cognisant that the organisation has access to additional funds if required as evidenced by the testimony of the managing Director and the history of previously raising additional funds at the early stages of the operation. The Tribunal also acknowledges the independent Credit report provided which rates the chance of default at 1.2%, as an above average lower risk.
The Tribunal questioned the visa applicant in depth to test his knowledge of the skills required to function in the business and engage in the management activities claimed by the nominating entity. The answers showed a clear and detailed knowledge in regards to the day-to-day required activities. The Tribunal is satisfied that the business will be able to sustainably, employ the nominee for the required 2-year minimum period.
The Tribunal has had regard to the signed Employment Agreement dated 16 April 2016 and is satisfied that the nominee will be appointed for a period of at least 2 years employment from grant of visa and the terms of employment do not include an express exclusion of the possibility of extending the period of employment.
No less favourable terms and condition of employment: r.5.19(4)(e)
Regulation 5.19(4)(e) requires that the terms and conditions of employment applicable to the nominated position will be no less favourable than those that are, or would be, provided to an Australian citizen or permanent resident performing equivalent work in the same workplace at the same location.
The Tribunal has been provided with the visa applicant’s employment contract. The Tribunal accepts that the nominee’s annual salary of $120,000 exclusive of Superannuation as appropriate and is reflective of his experience relevant to the nominated position. Additionally the Tribunal researched the salaries offered for similar positions and had regard for the salary determination evidence presented by the nominating entity prior to the hearing. The Tribunal is satisfied that the terms and conditions of employment are equivalent to other employees with the same experience performing equivalent work in the same workplace. Accordingly the requirements of r.5.19(4)(e) are met.
No adverse information known to Immigration: r.5.19(4)(f)
Regulation 5.19(4)(f) requires that there is no adverse information known to Immigration about the nominator or person associated with the nominator; or it is reasonable to disregard any such information. For these purposes, ‘adverse information’ and ‘associated with’ have the meaning given in rr.1.13A and 1.13B. There is no evidence before the Tribunal that the applicant has anything but a satisfactory record of compliance with the immigration laws of Australia. Accordingly the requirements of r.5.19(4)(f) are met.
Satisfactory compliance with workplace relations laws: r.5.19(4)(g)
Regulation 5.19(4)(g) requires that the applicant has a satisfactory record of compliance with the laws of the Commonwealth, and of each State or Territory in which the applicant operates a business and employs employees in the business, relating to workplace relations. When the Tribunal questioned the parties regarding workplace conditions, it was evident that both parties were cognisant of workplace relations expectations. Furthermore, they were able to demonstrate an understanding of appropriate employee conditions as a way of retaining employees and subsequently provide quality business outcomes for their company. The Tribunal has reflected upon the fact that this industry employs a mobile workforce, which operates in a globally competitive environment. There is no evidence before the Tribunal that the applicant has anything but a satisfactory record of compliance with workplace relations law in Australia. Accordingly the requirements of r.5.19(4)(g) are met.
Tasks of the position, genuine need for the position and training requirements r.5.19(4)(h)
Regulation 5.19(4)(h) contains alternative requirements. These are set out in detail in the attachment to the decision. As stated above the nomination was made under the RSMS Direct Entry stream and the Tribunal has proceeded to assess the application against the criteria in r.5.19(4)(h)(ii) which require that:
·the position and nominator’s business are located in regional Australia;
·there is a genuine need for the paid position under the nominator’s direct control which cannot be filled by a Australian citizen or permanent resident;
·the tasks of the position correspond to those of an occupation at the ANZCO skill level 1, 2 or 3; and
·a regional certifying body has advised the Minister about certain matters relating to the position.
The Tribunal has had regard to the size and scope of the nominating entity’s business operations, the length of the visa applicant’s employment, experience and qualifications. The Tribunal is satisfied that there is a genuine need for the nominator to employ a paid employee to work in the position under the nominator’s direct control.
The Tribunal is satisfied the position cannot be filled by an Australian citizen or permanent resident. The Tribunal is satisfied that the nominator’s business is located in regional Australia.
Regulation r.5.19(4)(h)(ii)(D), requires that the tasks to be performed in the position correspond to those at ANZSCO skill level 1, 2 or 3. The position of Aircraft Maintenance Engineer (Mechanical), ANZSCO 323112, nominated by the applicant, is referred to in ANZSCO as a skill level 3 position.
The Tribunal considered the tasks found in ANZSCO for this position and compared them to the job description provided by the applicant and the evidence provided at the hearing. A clear alignment between the 2 has been demonstrated.
Detailed questioning was undertaken by the Tribunal of both the nominating entity and the visa applicant in order to arrive at a clear and comprehensive understanding of the information before it. The visa applicant was able to demonstrate to the Tribunal that he regularly undertakes the tasks of the nominated position and anticipates that he will continue to do so. The passion for his role was self-evident as was the obvious satisfaction of his performance as discussed with the Managing Director at the hearing. The Tribunal is satisfied that the position located in Alice Springs NT, can properly be classified as a position for an Aircraft Maintenance Engineer (Mechanical), ANZSCO Skill Level 3. The Tribunal therefore finds that the nomination satisfies r.5.19(4)(h)(ii)(D) of the Regulations.
The Tribunal has had regard to the satisfied Form 1404 issued by a RCB (Department of Trade Business and Innovation), dated 2 November 2017 and is satisfied that the applicant has advised the Minister about matters relating to the terms and conditions of employment, the genuine need for the position and that the position cannot be filled locally.

Based on the findings above, the Tribunal is satisfied that the applicant meets the requirements of r.5.19 for approval of the nomination of the position in Australia.
DECISION
The Tribunal sets aside the decision under review and substitutes a decision approving the nomination.
Peter Emmerton
Member

ATTACHMENT - EXTRACTS FROM THE MIGRATION REGULATIONS 1994
5.19Approval of nominated positions (employer nomination)
…
(2)The application must:
(a)be made in accordance with approved form 1395…; and
(aa) include a written certification by the nominator stating whether or not the nominator has engaged in conduct, in relation to the nomination, that constitutes a contravention of subsection 245AR(1) of the Act; and
(b)be accompanied by the fee mentioned in regulation 5.37.
…
Direct Entry nomination
(4)The Minister must, in writing, approve a nomination if:
(a)the application for approval:
(i)       is made in accordance with subregulation (2); and
(ii)      identifies a need for the nominator to employ a paid employee to work in the position under the nominator’s direct control; and
(b)the nominator:
(i)       is actively and lawfully operating a business in Australia; and
(ii)      directly operates the business; and
(c)for a nominator whose business activities include activities relating to the hiring of labour to other unrelated businesses — the position is within the business activities of the nominator and not for hire to other unrelated businesses; and
(d)both of the following apply:
(i)       the employee will be employed on a full-time basis in the position for at least 2 years;
(ii)      the terms and conditions of the employee’s employment will not include an express exclusion of the possibility of extending the period of employment; and
(e)the terms and conditions of employment applicable to the position will be no less favourable than the terms and conditions that:
(i)       are provided; or
(ii)      would be provided;
to an Australian citizen or an Australian permanent resident for performing equivalent work in the same workplace at the same location; and
(f)either:
(i)       there is no adverse information known to Immigration about the nominator or a person associated with the nominator; or
(ii)      it is reasonable to disregard any adverse information known to Immigration about the nominator or a person associated with the nominator; and
(g)the nominator has a satisfactory record of compliance with the laws of the Commonwealth, and of each State or Territory in which the applicant operates a business and employs employees in the business, relating to workplace relations; and
(h)either:
(i)       both of the following apply:
(A)the tasks to be performed in the position will be performed in Australia and correspond to the tasks of an occupation specified by the Minister in an instrument in writing for this sub-subparagraph;
(AAA)the occupation is applicable to the person identified under subparagraph (a)(ii) in accordance with the specification of the occupation;
(B)either:
(I)the nominator’s business has operated for at least 12 months, and the nominator meets the requirements for the training of Australian citizens and Australian permanent residents that are specified by the Minister in an instrument in writing for this sub-sub-subparagraph; or
(II)the nominator’s business has operated for less than 12 months, and the nominator has an auditable plan for meeting the requirements specified in the instrument mentioned in sub-sub-subparagraph (I); or
(ii)      all of the following apply:
(A)the position is located in regional Australia;
(B)there is a genuine need for the nominator to employ a paid employee to work in the position under the nominator’s direct control;
(C)the position cannot be filled by an Australian citizen or an Australian permanent resident who is living in the same local area as that place;
(D)the tasks to be performed in the position correspond to the tasks of an occupation specified by the Minister in an instrument in writing for this sub-subparagraph;
(DA)the occupation is applicable to the person identified under subparagraph (a)(ii) in accordance with the specification of the occupation;
(E)the business operated by the nominator is located at that place;
(F)a body that is:
(I)specified by the Minister in an instrument in writing for this sub-subparagraph; and
(II)located in the same State or Territory as the location of the position;
has advised the Minister about the matters mentioned in paragraph (e) and sub-subparagraphs (B) and (C).

[2018] AATA 5293

22 November 2018

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