ANRR Pty Ltd (Migration)

ANRR Pty Ltd (Migration) [2018] AATA 3816 (2 August 2018)
DECISION RECORD
DIVISION:Migration & Refugee Division
APPLICANT:  ANRR Pty Ltd
CASE NUMBER:  1618841
DIBP REFERENCE(S):  BCC2015/3253545
MEMBER:Karen McNamara
DATE:2 August 2018
PLACE OF DECISION:  Sydney
DECISION:The Tribunal affirms the decision under review to refuse the nomination.

Statement made on 02 August 2018 at 10:21am
CATCHWORDS
Migration – Nomination refusal – Direct Entry Nomination stream – Café Manager – 2 years full-time employment – Not enough evidence to demonstrate financial capacity of the business to employ the nominee for at least 2 years full time – Decision under review affirmed
LEGISLATION
Migration Act 1958, ss 359, 376
Migration Regulations 1994, 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 20 October 2016 to reject the application by ANRR Pty Ltd (the applicant) 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 5 November 2015. 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) (d)(i) of the Regulations because the delegate was not satisfied that the nominee would be employed on a full-time basis in the position for at least two years.

Information to the Tribunal

The Applicant applied to the Tribunal on 10 November 2016 for review of the delegate’s decision.
On the 14 February 2018, the Tribunal wrote to the applicant pursuant to section 359(2) of the Act (dispatched by email) requesting the applicant to provide updated and current information that would assist to determine whether the criteria in r.5.19(2) & (4) of the Regulations were met.
On the 26 February 2018, the applicant’s registered migration agent Mr Adam Khaze contacted the Tribunal advising that he was the new representative and sought an extension of time to respond to the Tribunal’s correspondence of 14 February 2018. The Tribunal advised Mr Khaze to submit his request for consideration.
The representative via email on 26 February 2018 provided the Tribunal with a change of contact details (MR6) form and sought an extension of 14 days from the 28^th February 2018. The Tribunal subsequently contacted Mr Khaze on the 27 February 2018, to advise that the incorrect form had been submitted and that the correct form (MR5) with complete details would need to be provided to the Tribunal by 28 February 2018, in order for the request for an extension to be considered.
On the 27 February 2018, the applicant’s registered migration agent submitted a request for an extension of time for the applicant to provide information as per the Tribunal’s letter of 14 February 2018. The Tribunal subsequent to this request granted an extension of time for the applicant to provide information by the 14 March 2018.
On the 14 March 2018, the applicant provided the following documents to the Tribunal:
·ASIC extract
·Appointment of Representative signed and dated 27/2/2018
·       Employment agreement for full-time employees dated 14 March 2018
·Form 1404 - Regional Development Australia Northern Inland dated 17 November 2014
·       Statement by the nominator Mr Arif Raham undated
·       Job advertisement from Seek
·       Extract from Pay snapshot
·       Position description for Restaurant Manager
·       Employees staff list
·       BAS returns:
oJan 2017 to Mar 2017
oApr 2017 to Jun 2017
oJul 2017 to Sept 2017
·Financial statements 2017
·Financial statements 2016
·Letter from Global Accounting and Financial Services dated 13 March 2018
On 23 May 2018 prior to commencement of the hearing, the applicant provided to the Tribunal;
·Interim financial statements for the year ended 15^th of May 2018, and
·Pay slips for Mr Shadman Saqif Chowdhury dated - 17 May 2018, 10 May 2018, 3 May 2018 and 5 October 2017.
On 7 June 2018, the applicant provided the following documentation to the Tribunal;
·Letter in support by Arif Rahman undated
·Letter from Faiza Bhuiyan dated 28 May 2018
·Letter from Mohammed Firoz Khan dated 28 May 2018
·Letter from Hasan Imam Emon dated 25 May 2018
·Statutory declaration by Shadam Saqif Chowdhury signed and dated 5 June 2018
·BAS returns
oJanuary 2018 - March 2018
oOctober 2017 - December 2017
oJuly 2017 -September 2017
oApril 2017 - June 2017
oJanuary 2017 - March 2007
oOctober 2016 - December 2016
oJuly 2016 - September 2016
·Interim financial statements for the year ending 15 May 2018
·Financial statements for the year ending 30^th of June 2017
The applicant was represented at hearing by Mr Abdur Rahim, General Manager of ANRR Pty Ltd. Mr Rahim appeared before the Tribunal on 23 May 2018 to give evidence and present arguments. The Tribunal also received oral evidence from the nominee Mr Shadman Saqif Chowdhury.
The applicant was represented in relation to the review by its registered migration agent. The representative attended the Tribunal hearing.
For the following reasons, the Tribunal has decided to affirm the decision under review to refuse 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.
The Tribunal notes on the Department’s file a 376 certificate. The Tribunal is of the view that this certificate is invalid. The folios identified under the certificate all contain financial information of the business. These documents being the company’s unaudited Financial Statements for 2015 and 2016 and the company’s BAS lodgements for January 2015 to March 2016. The applicant provided these documents at the time of their application to the Department. The 2016 Financial statements were also provided to the Tribunal.
In consideration of the evidence before the Tribunal, the Tribunal has placed little weighting on the company’s 2015 financial information and has founded its decision on the basis of the most current financial information before it, that being the 2017 and 2018 financial information as provided by the applicant. The information subject of the 376 certificate is known to the applicant and has not been relied upon by the Tribunal in the forming of the Tribunal’s decision.
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 nomination application dated 5 November 2015, states the proposed base salary for the nominated position is $38,000 p.a. with guaranteed annual earnings of $41,515 p.a. The Tribunal notes that Mr Chowdhury’s contract of employment signed and dated 14 March 2018 stipulates the salary is $55,000 p.a. exclusive of superannuation.
At hearing, Mr Rahim told the Tribunal the increase in salary was due to offering the nominee what the company considered the market and appropriate salary to retain an employee in the position of Café Manager at Scone NSW. The Tribunal was also told the business is actually paying the nominee a salary of $56,000 p.a. This was confirmed from Mr Chowdhury’s payslips provided to the Tribunal.
As discussed with the applicant at hearing, the Tribunal has concerns about the financial capacity of the business to employ the nominee for at least 2 years full time.
At the hearing the applicant was asked to provide information in support of the business’s financial capacity to pay the nominee a full time salary of $55,000 for two years. On the 7 June 2018, the Tribunal received the follow documentation:
·Letter in support by Mr Arif Rahman undated
·Letter from Faiza Bhuiyan dated 28 May 2018
·Letter from Mohammed Firoz Khan dated 28 May 2018
·Letter from Hasan Imam Emon dated 25^th of May 2018
·Statutory declaration by Shadam Saqif Chowdhury signed and dated 5 June 2018
·BAS returns
oJanuary 2018 - March 2018
oOctober 2017 - December 2017
oJuly 2017 -September 2017
oApril 2017 - June 2017
oJanuary 2017 - March 2007
oOctober 2016 - December 2016
oJuly 2016 - September 2016
·Interim financial statements for the year ending 15 May 2018
·Financial statements for the year ending 30^th of June 2017
The Tribunal has taken into account all of the information before it, including evidence provided at hearing by Mr Rahim and Mr Chowdhury. The evidence provided by Mr Chowdhury related to his employment and experience as a Restaurant Manager and did not relate to the financial operations of the business.
Upon review of the information provided by the applicant, the Tribunal has identified inconsistencies as to the amount of salary and wages declared in the company’s financial statements and lodged BAS returns, against the number of employees the applicant claims to employ.
The present applicant Ms Faiza Bhuiyan, purchased the business from the original applicant and business owner Mr Arif Rahman in February 2018. The business operates two Cafés in the upper Hunter and New England regions of NSW i.e. the Bits and Bites Café at Scone (at time of application known as the Cross Country Café Restaurant) and the Bits and Bites Café Tamworth. The employee list provided to the Tribunal on the 14 March 2018 shows the staffing to be in total ten employees including one Chef full time, one Cook Full time, two Cooks part time, four Waiters of which one is full time and three are casual, one Restaurant Manager full time and the Director.
At hearing the Tribunal was told the business employed six staff at the Scone location, comprising of a Café Manager (the nominated position) a Chef, two Cooks and four wait staff. Of the six staff, three are employed on a full time basis that being the Café Manager, the Chef and one Cook. The other three employees are employed on a part time basis. The Tamworth Café employs five staff i.e. three fulltime staff and two part time. The business also employs a General Manager, Mr Rahim who told the Tribunal he receives a salary of $52,000. Evidence before the Tribunal indicates the employment of 11 employees.
There is no evidence before the Tribunal to indicate the actual payroll expense for the Tamworth Café. Mr Rahim told the Tribunal that the Tamworth café employs 5 staff. The financial statements before the Tribunal are for ANRR Pty Ltd. providing no distinction between the two café’s in regard to their respective financial reporting. The Tribunal has considered the financial evidence provided by the applicant to be representative of the total operations of ANRR Pty Ltd with salary and wages expenditure stated inclusive of all employees purported by the applicant to be employed by the business.
2017 Financial records
Financial Statements provided to the Tribunal for the 2017 financial year, show a wages expense of $169,790, this is confirmed by the business’s BAS returns for the corresponding financial period showing the business recorded $169,098 as salary and wage expense for the 2017 financial year.
2018 Financial records
Interim financial statements provided by the applicant to the Tribunal show for the period July 2017 to 15 May 2018 (approximately 10.5 months) salary expenditure of $175,499, profit of $10,761 and total equity of $14,560.
A letter from the applicant’s accountant dated 13 March 2018 states “the total payroll expenditure of the business for the last 12 months is $240,576.” The letter does not specify the specific period the ‘last 12 months’ refers to. The Tribunal notes this figure approximately corresponds with the amounts shown on the business’s BAS returns for the reporting period January 2017 to March 2018 inclusive. The Tribunal is of the view that little weight can be given to the accountant’s statement as no financial documentation has been provided to support this claim and that the BAS returns are representative of a 15 month period, falling within two financial years.
Based on information provided by the applicant before the Tribunal in regard to the Company’s payroll, the following was provided for the Scone Café ( i.e. six employees):
·Chef - Full time -$55,000 p.a.
·Cook - Full time - $40,000 p.a.
·Cook - Part time - $20,000 p.a.
·Manager Full time - $56,000 p.a.
·4 positions of Waiters – Casual/part-time - $16,000 p.a. each (approx. $300 per week)
At hearing the applicant provided salary details for two waiter positions, therefore the Tribunal in determining the business’s wages expenditure has only taken into account the salary for two casual/part time waiters i.e. $32,000 p.a .
Based on this information, the total amount of wages for the six employees at the Scone café is approximately $203,000 pa. This does not include the other salaries within the business being the General Manager’s salary of $52,000 p.a. and the five employee’s at the Tamworth Café. There is no information before the Tribunal to indicate salary payments for the Tamworth employees. The Tribunal notes that the Director has not yet drawn a salary from the business.
As no BAS return for the reporting period April to June 2018 is before the Tribunal, the Tribunal has given weight to the business’s financial statement for July 2017 to 15 May 2018 which shows salary expenditure to the 15 May 2018 is $175,499.
In the absence of verifiable information including the April to June 2018 BAS return, the Tribunal estimates for the six week period from 15 May 2018 to 30 June 2018 the salary expense for the six employees at Scone would be approximately $23,424 ( $3904 per week @ 6 weeks). The total estimated 2018 salary expense therefore being $198,923 ($175,499 as per the company’s Profit and Loss statement plus $23,424.)
Whilst this is consistent with salary payable to cover the six positions at Scone, the Tribunal’s concerns lie in that this amount only covers six of the eleven employees claimed to be employed by the business.
Based on the unaudited Profit and Loss statement provided by the applicant for the period July 2017 to May 2018, the business over the ten-month period made a profit of just $10,761. There is no information to demonstrate that employment of the nominee will lead to an increase in sales and/ or income, or of any proposed activities by the business that will result in an increase in profit.
The Tribunal considers it is highly unlikely based on the business’s financial information that the total profit for 2018 will cover the shortfall in salaries the business claims to be paying specifically in covering the five positions at Tamworth and the General Manager’s salary.
At hearing the applicant and nominee were asked to provide information to the Tribunal to support payment of wages in particular to Mr Chowdhury. When asked how he received his pay, Mr Chowdhury told the Tribunal he received his pay into his bank account. The Tribunal specifically requested the provision of the business’ bank statements showing payment of wages from February 2018 (the time the current owner commenced operating the business) and Mr Chowdhury’s bank statements showing his pay deposits. The Tribunal notes this information has not been provided.
Further to this request, the Tribunal acknowledges receipt of a statutory declaration by Mr Chowdhury dated 5 June 2018, following his appearance before the Tribunal on 23 May 2018.
Mr Chowdhury states as per the following extract, that in response to the Tribunal’s question as to how he receives his pay – “at the time of my hearing, I was asked about my payment method. And due to nervousness, I said that my payment method is bank pay. The reason of my nervousness was earlier incident of our restaurant where Mr Atif Rahman, previously got banned for three months for paying cash to his employees working under subclass 457 visa. And, as my application is under processing so I wanted to avoid any situation which may the cause of banned of the restaurant. Currently my visa category is bridging visa C and application for subclass 187 is pending, therefore ANRR Pty Ltd, has been paying me cash and they have given taxes properly on my paid salary.”
The Tribunal has considered the declaration made by Mr Chowdhury and is of the view that little weight can be given to the payment of wages by cash as to evidence of regular salary payments otherwise verifiable from bank statement transactions.
In the absence of verifiable supporting evidence including the business’ bank statements to support the business is meeting its payroll commitments, the Tribunal is not satisfied, that the business has the financial capacity to pay the full time salary for the nominated position for at least two years.
The Tribunal has considered the evidence before it, as detailed above, regarding the applicant’s claim to provide the nominee Mr Shadman Chowdhury fulltime employment in the position of Café or Restaurant Manager for at least two years.
There is no evidence before the Tribunal that is concrete and persuasive to suggest the business is able to afford the fulltime salary of $55,000 p.a. for two years when the financial evidence indicates salary expenditure is covering less than the number of employees the applicant claims are employed by the business.
Having consideration of the evidence before it, the Tribunal is not satisfied that the employee will be employed on a full time basis in the position for at least 2 years. Therefore the requirements of r.5.19(4)(d)(i) are not met.
Accordingly, the requirements in r.5.19(4)(d) are not met.
As a mandatory requirement for approval of the nomination has not been met, the Tribunal has not considered whether the other requirements set out in r.19(4) have been met.
For the above reasons the Tribunal is not satisfied that the applicant meets the requirements of r.5.19(4). The applicant has not sought to satisfy the criteria in Temporary Residence Transition Nomination stream, and as such has not met the requirements in r.5.19(3). Accordingly, the nomination of the position cannot be approved. Therefore, the Tribunal must affirm the decision under review.
DECISION
The Tribunal affirms the decision under review to refuse the nomination.
Karen McNamara
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
(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 3816

2 August 2018

Key Legal Topics

Areas of Law

Immigration

Administrative Law

Legal Concepts

Judicial Review

Procedural Fairness

Statutory Construction