Ausaca Pty. Ltd (Migration)

[2022] AATA 2923

Ausaca Pty. Ltd (Migration) [2022] AATA 2923 (4 July 2022)

DECISION RECORD

DIVISION:Migration & Refugee Division

APPLICANT:  Ausaca Pty. Ltd

REPRESENTATIVE:  Ms Cheryl Wong

CASE NUMBER:  1906971

HOME AFFAIRS REFERENCE(S):          BCC2017/1418656

MEMBER:Stephen Witts

DATE:4 July 2022

PLACE OF DECISION:  Melbourne

DECISION:The Tribunal sets aside the decision under review and substitutes a decision approving the nomination.

Statement made on 04 July 2022 at 11:37am

CATCHWORDS

MIGRATION – approval of a nomination – Temporary Residence Transition nomination stream – position of Import Officer – financial capacity to employ the nominee for at least two years – updated financial information – nominee employed in the position – actively and lawfully operating a business in Australia – terms and conditions of employment no less favourable – decision under review set aside          

LEGISLATION

Migration Act 1958, ss 140, 245
Migration Regulations 1994, Schedule 2, cl 457.223; rr 1.13, 5.19, 5.37

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 Home Affairs on 6 March 2019 to reject the applicant’s application for approval of the nomination of a position in Australia under reg 5.19 of the Migration Regulations 1994 (Cth) (the Regulations).

2. The applicant applied for approval on 18 April 2017. The requirements for the approval of the nomination of a position in Australia are found in reg 5.19 of the Regulations which contains two alternative streams: a Temporary Residence Transition nomination stream (reg 5.19(3)) and a Direct Entry nomination stream (reg 5.19(4)). If the application is made in accordance with reg 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: reg 5.19(5).

3. In this case, the applicant has applied for approval of a nomination, seeking to satisfy the criteria in the Temporary Residence Transition nomination stream.

4. The delegate refused the application on the basis the applicant’s nomination did not satisfy reg 5.19(3) of the Regulations because the delegate was not satisfied that the applicant has demonstrated that it has the financial capacity to be able to pay the full-time salary for the nominated position for at least the next two years.

5. The applicant, Mr Sanyao Liu from Ausaca Pty Ltd, appeared before the Tribunal on 19 May 2022 to give evidence and present arguments.

6. The Tribunal also received oral evidence from the nominee, Mr Jun Huang.

7. The applicant was represented in relation to the review.

8. 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

9. The issue in this case is whether the applicant meets the requirements for approval of the nomination under the Temporary Residence Transition nomination stream set out in reg 5.19(3), which is extracted in the attachment to this decision. For the nomination to be approved, all the requirements must be met.

10. The Tribunal has considered all the material before it including evidence provided prior to the hearing and evidence given at the hearing.

11. The Tribunal notes that it has been provided with a copy of the delegate’s decision record dated 6 March 2019 provided by the applicant. According to the delegate it was not satisfied that the applicant has demonstrated that it has the financial capacity to be able to pay the full-time salary for the nominated position of importer and exporter for at least the next two years. According to the delegate it assessed the financial statements that had been provided and noted that this demonstrated that the business had shown net liabilities for the 2016 and 2018 financial years and that it had also made consecutive tax losses from 2011 until 2014 financial years. It was further noted by the delegate that the company had indicated that it employs five Australian citizen employees and one foreign employee and that the gross payroll expenditure of the organisation in that 12-month period was approximately $180,000 and that this figure did not match up to the company’s BAS statement material which was less than that figure. It was also stated that the nominee was employed with the business as a 457-visa holder on a salary of $56,800 since 17 December 2014 and that the total payroll was not sufficient to cover this and the other employees. It was further noted that the training cost material did also not match the financial statement material.

12. The Tribunal also notes that evidence was provided by the applicant prior to the hearing. This included a submission from the applicant’s representative dated 3 March 2022 which included details of the company’s registration as a business and its ACN number 144836340 noting that Mr Sanyao Liu, (also known as Kevin Liu) is a director and majority shareholder of the company. Also included were tax returns for the financial years from June 2015 to June 2021 and BAS statements and financial reports for the same period.

13. The Tribunal notes that also provided was an organisation structure chart indicating that the nominated position of importing officer reports to the role of managing director, Mr Liu. It was noted that all the other employees at the company are either Australian citizens or permanent residents and that the company has grown by two new positions being warehouse assistants. The Tribunal notes that also detailed on this organisation chart was an operations manager, the nominator’s wife, a sales manager and a sales representative.

14. The Tribunal notes that a job description for the nominated position of import officer was provided including a comparison with the duties and responsibilities under the ANZSCO framework. Also included were a selection of emails and other documents which were contended by the applicant’s was evidence of the nominee undertaking those duties and responsibilities, as was information about the conditions of employment for the nominated position noting that the nominee will be employed as an import officer for the company for a period of two years from the date of the approval of his visa, attached was a copy of an employment agreement dated 1 January 2022 noting that the nominee continues to work for the nominator. It was also asserted that the position is paid in accordance with a market range within Australia and that the salary was $62,800 plus superannuation and that there is no equivalent Australian citizen or permanent resident carrying out the same role employed by the company. It was stated that similar positions in Australia are paid within a scale from approximately $50,000 to up to approximately $70,000.

15. The Tribunal also notes that it was stated that the nominee has been employed by the nominator since 1 April 2015 and that he did work full-time for at least two years in the last three years immediately before the date of the nomination application on 18 April 2017. Upon his employment it was stated that he was paid $56,800 per annum.

16. It was stated by the company that it has the financial capacity to employ the nominee for at least the next two years and that the financial position of the company demonstrates this ability stating that its sales have grown from approximately $500,000 in 2015 to approximately $2 million in the most recent financial year.

17. It was further stated that the company is continuing to grow, opening more offices and warehouses to maintain its increasing client base.

18. In regard to the specific concerns raised by the delegate at the time of the decision it was stated that the BAS statements did not fully cover the full financial years since employment because the company, by mistake, added the superannuation guarantee amounts to its BAS statements. It was also stated that the alleged inconsistencies in the payroll as contended by the delegate are explained by these superannuation contribution amounts. It was also stated that the alleged inconsistencies in the sales figures occurred because the delegate calculated sales according to different definitions within the tax years including fringe benefit employee contributions which were not relevant to assessing the sales made by the company. It was further stated that the BAS statements appeared inconsistent because they included GST amounts owed to the ATO which in fact are not recognised as revenue and should not have been added when calculating the sales figures. It was also stated that the contention by the delegate that the training cost payroll material did not match the company tax returns because they were inclusive of super contributions which, according to this submission, should be included in payroll calculation for the purpose of training benchmark payments.

19. In regard to the contention by the delegate that the payroll was not sufficient to pay the five Australian employees including the nominee it was stated that this appeared to be the case because the two principal shareholders did not pay themselves a significant salary during this time as it was decided that its core staff should be paid regularly to ensure they stay with the company while the two principal shareholders did not take a regular salary during that time.

20. It was further stated that the company is not aware of being subject to any monitoring by the Department nor has it been the subject of any investigation by the Department.

21. The Tribunal also notes that the applicant’s representative provided a submission dated 11 May 2022. In this submission was provided evidence in regard to the nominee undertaking of the duties of this position including invoices, emails with suppliers, a statement regarding training requirements, and other material.

22. The Tribunal notes that a further submission was provided specifically in regard to the nominee dated 11 May 2022. In this submission it was stated that there was no registration or membership material of any professional body required for this position, that the nominee will remain in Australia and is likely to be established in Australia without imposing costs on the Australian community, that the nominee is the holder of a Chinese passport, that he is married to the dependent on his visa and that the other dependent is her daughter and that they form the same family unit and that they also hold Chinese passports.

23. At the hearing the Tribunal had a discussion with the nominator and the nominee regarding the application.

24. The nominator stated that he first arrived in Australia in 2008 and became an Australian citizen in 2010. He stated that he began a wholesale business related to the hardware, gardening and cleaning industries before starting his current business. He stated that profitability was a difficult problem for a period of time but that he moved his business from servicing customers directly to importing and exporting material for other businesses, in particular, sandpaper and sand belt products which he sourced from his home province in China. He stated that he knew the nominee prior to 2014 as he is his wife’s sister’s husband. He stated that the nominee worked as an import and export officer with a foreign trade department in China for some time and that he also worked for a sandpaper company for some years. He stated that he had been trying to employ an import officer in Australia and provided evidence that he had advertised and interviewed prospective employees at that time in Australia but that none were suitable because of a lack of specific industry experience and a knowledge of the Chinese business landscape, his principal source of his imported products to Australia.

25. The nominee stated that he first came to Australia to take up the position of import officer in April 2015 and that he remained on a 457 visa until the refusal of this application which has meant that he has been on a bridging visa.

26. The Tribunal had a detailed discussion with the parties regarding the business circumstances from 2014 until 2021 noting specifically the low wages often paid during the early days of the business, particularly from 2014 until 2017. The nominator provided evidence that during this time he and the other principal shareholder, his wife, working as the operations manager only worked part-time in the business and did not pay themselves a salary. He also provided evidence that as the business grew, from a total income of $200,000 in 2014 to a total income of $2 million by 2018 that the wages bill started to increase and that now all participants are working full-time in the business except for him and that the salary and wages component of the business is now approximately $300,000. The Tribunal also had a discussion about the other matters raised by the delegate, and reviewed the submissions provided regarding other financial aspects of the business and its growth and profitability over the last few years.

27. The Tribunal has considered the evidence provided very carefully and finds that the business does have the financial capacity to employ the nominee who is undertaking the duties and responsibilities of an import officer and that the nominee has remained employed full-time by the nominator since his employment in 2015.

    The application must be compliant: reg 5.19(3)(a)

28. Regulation 5.19(3)(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 relevant person and occupation.

29. The Tribunal finds that the application identifies the nominee who at the time held a subclass 457 visa in the standard business sponsor stream and that the notification was granted on 17 December 2014 on the basis of satisfying cl 457.223(4).

30. Given the above findings, the requirement in reg 5.19(3)(a) is met.

    Status of the nominator: reg 5.19(3)(b)

31. Regulation 5.19(3)(b) requires the nominator to be or have been the relevant standard business sponsor who is actively and lawfully operating a business in Australia. In addition, the nominator, as that standard business sponsor, must not have met certain criteria relating to the operation of a business overseas, in the most recent sponsorship approval.

32. The Tribunal finds that the nominator was a standard business sponsor and that it identified the holder of the subclass 457 visa made under s 140GB of the Act, and that it is actively and lawfully operating a business in Australia.

33. Given the above, the requirement in reg 5.19(3)(b) is met.

    Previous employment of the nominee: reg 5.19(3)(c)

34. Broadly speaking, to meet the requirement in reg 5.19(3)(c), either:

    ·     the nominee must have been employed full time in Australia in the position for which he or she holds a Subclass 457 visa for at least 2 of the 3 years preceding the nomination application; or

    ·     the nominee holds a Subclass 457 visa on the basis that s/he was identified in a nomination of a specified occupation for that visa, the nominator nominated the occupation, and the nominee has been employed in that occupation for at least 2 years in the 3 years immediately before the application.

35. The Tribunal finds that the details of the business entity which has applied for approval have been provided including details of the nominee and his visa history and the nominee’s occupation of import officer in the three years preceding the nomination application.

36. Given the above findings, the requirement in reg 5.19(3) (c) is met.

    Future employment of the visa holder: reg 5.19(3)(d)

37. Regulation 5.19(3)(d) only applies to certain nominees (those described in reg 5.19(3)(c)(i)). For this class of person, the Regulations require that the nominee will be employed on a full time basis for at least 2 years on terms that do not expressly preclude the possibility of an extension.

38. The Tribunal finds that the nominee will be employed on a full-time basis for at least two years and that the nominee’s employment will not expressly exclude the possibility of extending the period of employment.

39. Given the above findings, the requirement in reg 5.19(3)(d) is met.

    No less favourable terms and conditions of employment: reg 5.19(3)(e)

40. Regulation 5.19(3)(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.

41. The Tribunal finds that the terms and conditions of employment applicable to the position of import officer will be no less favourable than those that are provided to an Australian citizen or permanent resident performing equivalent work in the same workplace  or the same location.

42. Accordingly, the requirement in reg 5.19(3) (e) is met.

    Training commitments and obligations: reg 5.19(3)(f)

43. Regulation 5.19(3)(f) requires the applicant to have fulfilled any commitments made relating to meeting training requirements, and complied with applicable obligations relating to training  requirements, during the period of the  applicant’s most recent sponsorship approval. These requirements may be disregarded if it is reasonable to do so.

44. The Tribunal finds that there are no particular training requirements or commitments that need to be met in this applicable sponsorship.

45. Accordingly, the requirement in reg 5.19(3)(f) is met.

    No adverse information known to Immigration: reg 5.19(3)(g)

46. Regulation 5.19(3)(g) 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 regs 1.13A and 1.13B.

47. The Tribunal finds that there is no adverse information known to Immigration before it.

48. Accordingly, the requirement in reg 5.19(3)(g) is met.

    Satisfactory compliance with workplace relations laws: reg 5.19(3)(h)

49. Regulation 5.19(3)(h) requires the applicant to have 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.

50. The Tribunal finds that the nominator has a satisfactory record of compliance with workplace relations law in the locations in which it operates a business and employs staff.

51. Accordingly, the requirement in reg 5.19(3)(h) is met.

52. Based on the findings above, the Tribunal is satisfied that the applicant meets the requirements of reg 5.19 for approval of the nomination of the position in Australia.

    DECISION

53. The Tribunal sets aside the decision under review and substitutes a decision approving the nomination.

    Stephen Witts
    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.

    Temporary Residence Transition nomination

    (3)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 person who holds a Subclass 457 … visa granted on the basis that the person satisfied the criterion in subclause 457.223(4) of Schedule 2; and

    (iii)     identifies an occupation, in relation to the position, that:

    (A)is listed in ANZSCO; and

    (B)has the same 4-digit occupation unit group code as the occupation carried  out by the holder of the Subclass 457 … visa; and

    (b)the nominator:

    (i)       is, or was, the standard business sponsor who last identified the holder of the Subclass 457 … visa in a nomination made under section 140GB of the Act or under regulation 1.20G or 1.20GA as in force immediately before 14 September 2009; and

    (ii)      is actively and lawfully operating a business in Australia; and

    (iii)     did not, as that standard business sponsor, meet regulation 1.20DA, or paragraph 2.59(h) or 2.68(i), in the most recent approval as a standard business sponsor; and

    (c)either:

    (i)       both of the following apply:

    (A)in the period of 3 years immediately before the nominator made the application, the holder of the Subclass 457 …visa identified in subparagraph (a) (ii) has:    

    (I)held one or more Subclass 457 visas for a total period of at least 2 years; and

    (II)been employed in the position in respect of which the person holds the Subclass 457 … visa for a total period of at least 2 years (not including any period of unpaid leave);

    (B)the employment in the position has been full-time, and undertaken in Australia; or

    (ii)      all of the following apply:

    (A)the person holds the Subclass 457 … visa on the basis that the person was identified in a nomination of an occupation mentioned in sub-subparagraph 2.72(10)(d)(iii)(B) or sub-subparagraph 2.72(10)(e)(iii)(B);

    (B)the nominator nominated the occupation;

    (C)the person has been employed, in the occupation in respect of which the person holds the Subclass 457 … visa, for a total period of at least 2 years in the period of 3 years immediately before the nominator made the application; and

    (d)for a person to whom subparagraph (c)(i) applies:

    (i)       the person will be employed on a full-time basis in the position for at least 2 years; and

    (ii)      the terms and conditions of the person’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)       the nominator:

    (A)fulfilled any commitments the nominator made relating to meeting the nominator’s training requirements during the period of the nominator’s most recent approval as a standard business sponsor; and

    (B)complied with the applicable obligations under Division 2.19 relating to the nominator’s training requirements during the period of the nominator’s most recent approval as a standard business sponsor; or

    (ii)      it is reasonable to disregard subparagraph (i); and

    Note Different training requirements apply depending on whether the application for approval as a standard business sponsor was made before 14 September 2009 or on or after that date.

    (g)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

    (h)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.