BLUESHELL HOLDINGS PTY LTD ATF THE HILLARYS UNIT TRUST (Migration)

[2019] AATA 3684

BLUESHELL HOLDINGS PTY LTD ATF THE HILLARYS UNIT TRUST (Migration) [2019] AATA 3684 (1 July 2019)

DECISION RECORD

DIVISION:Migration & Refugee Division

APPLICANT:  BLUESHELL HOLDINGS PTY LTD ATF THE HILLARYS UNIT TRUST

CASE NUMBER:  1613512

DIBP REFERENCE(S):  BCC2015/3655443

MEMBER:Mary Sheargold

DATE:1 July 2019

PLACE OF DECISION:  Melbourne

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

Statement made on 01 July 2019 at 10:19am

CATCHWORDS
MIGRATION – nomination refusal– Temporary Residence Transition nomination stream – standard business sponsor– Cook – adverse information regarding the applicant known to the Department – applicant has the financial capacity as well as the requisite intention to employ staff on a full time basis – sponsorship bar imposed – applicant had remedied the issue – decision under review set aside

LEGISLATION
Migration Act 1958, ss 245AR, 140GB
Migration Regulations 1994, rr 1.13, 1.20, 2.59, 2.68, 5.19

STATEMENT OF DECISION AND REASONS

APPLICATION FOR REVIEW

1. This is an application for review of a decision made by a delegate of the Minister for Immigration on 5 August 2016 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).

2. The applicant applied for approval on 5 August 2016. 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).

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 r.5.19(3)(g) of the Regulations because there was adverse information regarding the applicant known to the Department, and it was not reasonable to disregard that information.

5. Mr Walter Buti, a director of Blueshell Holdings Pty Ltd, appeared before the Tribunal on 17 April 2019 to give evidence and present arguments on behalf of Blueshell Holdings Pty Ltd as trustee for The Hillarys Unit Trust. The Tribunal also received oral evidence from Mr Pardeep, the nominee.  

6. The applicant was represented in relation to the review by its registered migration agent. The representative attended the Tribunal hearing.

7. 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

8. 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 r.5.19(3), which is extracted in the attachment to this decision. For the nomination to be approved, all the requirements must be met.

9. Prior to the hearing, the applicant provided the Tribunal with copies of the nominee’s PAYG statements for the financial years ending on 30 June 2017 and 30 June 2018, a copy of the organisational chart for the applicant’s business, Business Activity Statements (BAS) for the 2018 calendar year, a recent payslip for the nominee, and a profit and loss statement for the applicant for the financial year ending on 30 June 2018.

10. After the hearing, at the request of the Tribunal, the applicant’s representative provided a letter from the City of Joondalup stating that the applicant does not have any outstanding issues in relation to food safety standards, a letter from the applicant’s accountant explaining the nature of the applicant’s finances following major renovations at the applicant’s restaurant, a detailed profit and loss statement for the financial year ending on 30 June 2017, and a detailed profit and loss statement for the first half of the 2018-19 financial year (e.g. from 1 July 2018 to 31 December 2018).  The Tribunal received an additional letter from the applicant dated 25 June 2019.

    The application must be compliant: r.5.19(3)(a)

11. 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.

12. The Tribunal has reviewed the documentation in the Department’s file, and is satisfied that the applicant’s nomination application was made on the approved internet form, and the relevant s.245AR(1) certification was also provided in the application form. The letter from the Department to the applicant dated 3 December 2015 indicates that the nomination application fee has been paid.

13. The application for approval identifies Mr Pardeep, the nominee who, according to Departmental records, held a Subclass 457 visa from 2 December 2013 that was granted on the basis of satisfying cl.457.233(4) of Schedule 2 to the Regulations.  The application for approval identifies the occupation of Cook, ANZSCO 351411.  Based on the employment documents for the nominee, the Tribunal is satisfied that the occupation identified is the same occupation as that carried out by him as the holder of a Subclass 457 visa.  Accordingly, the Tribunal is satisfied that this occupation carries the same 4 digit code (3514) as the occupation carried out by the nominee whilst he held the Subclass 457 visa.

14. Given the above findings, the requirement in r.5.19(3)(a) is met.

    Status of the nominator: r.5.19(3)(b)

15. 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.

16. Departmental records confirm that the nominator was the standard business sponsor who last identified Pardeep in a nomination made under s.140GB of the Act. The nominator was not granted the most recent business sponsorship on the basis of meeting either r.1.20DA, r.2.59(h), or r.2.68(i).

17. At the hearing, Mr Buti gave evidence that he operates a restaurant business at Hillarys Marina in Perth.  The applicant has provided the Tribunal with copies of its BAS for the 2018 calendar year, and detailed financial statements for the financial years ending on 30 June 2017 and 3o June 2018, as well as a half year statement for the 2018-19 financial year.

18. On the basis of the material before it, the Tribunal is satisfied that the nominator is actively and lawfully operating a business in Australia. Therefore, the requirement in r.5.19(3)(b) is met.

    Previous employment of the nominee: r.5.19(3)(c)

19. Broadly speaking, to meet the requirement in r.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.

20. In this case, the relevant provision is set out in r.5.19(3)(c)(i). The nomination application was made on 3 December 2015.

21. The nominee was granted his first Subclass 457 visa in the nominated occupation of Cook on 2 December 2013, sponsored by the applicant. The applicant was approved as a standard business sponsor from 18 December 2012 to 18 December 2015. The Tribunal has had regard to PAYG statements for the nominee provided by the applicant for the financial years ending on 30 June 2017 and 30 June 2018, as well as the separate evidence given by Mr Buti and Mr Pardeep at the hearing confirming that Mr Pardeep has worked for the applicant on a full time basis continuously since December 2013. Given these findings, the requirement in r.5.19(3)(c) is met.

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

22. Regulation 5.19(3)(d) only applies to certain nominees (those described in r.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.

23. The applicant has provided the Department with a copy of the employment agreement made between the applicant and Mr Pardeep dated 4 December 2015 (the employment agreement).  Clause 1.2 of the employment agreement states that Mr Pardeep will be employed full time for a minimum of two years, and clause 4.1 notes that his ordinary hours of work will be 38 hours per week.  Clause 1.1 of the employment agreement notes that the agreement comes into effect on approval of Mr Pardeep’s Subclass 186 visa.  The Tribunal is satisfied that the terms and conditions of employment do not expressly exclude the possibility of extending the period of employment beyond the initial minimum 2 year term expressed in the employment agreement.

24. The Tribunal has had regard to the detailed profit and loss statements for the applicant’s business for the financial years ending on 30 June 2017, 30 June 2018, and information regarding the applicant’s performance in the first half of the 2018-19 financial year.   The Tribunal has also considered Mr Buti’s evidence at the hearing explaining losses recorded for the financial year ending on 30 June 2018 being due to major renovations being undertaken at the applicant’s business and a one-off expenditure of $70,000 on new furniture for the new restaurant fit-out.  The Tribunal notes the applicant’s business has, based on all financial information before the Tribunal, always demonstrated a significant turnover, in excess of $1,000,000-$2,000,000.  At the hearing, Mr Buti explained that the applicant’s business is located in a prominent part of the Hillarys Marina in Perth and is very popular with both locals and tourists year-round. 

25. The Tribunal has also had regard to the evidence from both Mr Buti and Mr Pardeep that Mr Pardeep has worked for the applicant for over 8 years, and in a full time capacity since the grant of his Subclass 457 visa in December 2013.  The Tribunal notes that Mr Buti gave constant assurances to the Tribunal that he intends to employ Mr Pardeep for the long term. 

26. Based on all the evidence before the Tribunal, it is apparent that the applicant has the financial capacity as well as the requisite intention to employ Mr Pardeep on a full time basis for at least 2 years on terms that do not expressly exclude the possibility of an extension. As such, the requirement in r.5.19(3)(d) is met.

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

27. 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.

28. Item 3 of the employment agreement states that Mr Pardeep will be paid a commencement salary of $54,571, and states that he will receive all statutory entitlements such as superannuation at a rate of 9.5%.  The Tribunal has considered the recent payslips provided by the applicant for Mr Pardeep’s role, for the period 1 January 2019 to 31 March 2019, and note that his salary has now increased to $65,000 per annum.  At the hearing, Mr Buti gave evidence that he had given Mr Pardeep a significant increase in his salary to recognise his longstanding commitment to the applicant’s business and to ensure that he felt valued by the applicant.  The Tribunal accepts Mr Buti’s evidence in this respect.

29. The Tribunal notes that according to Payscale, the average salary for a Cook in Perth is $52,475 per annum and according to Indeed.com, $54,281 per annum.  Therefore, the Tribunal finds that the salary paid to Mr Pardeep is no less favourable than the salary that would be offered to an Australian citizen or permanent resident performing equivalent work in the same location.

30. Further, the Tribunal notes that the employment agreement provides for all forms of leave in accordance with the National Employment Standards, and the termination provisions mirror the requirements set out in the Fair Work Act 2009 (Cth).

31. Based on the evidence before it, the Tribunal finds 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. Accordingly, the requirement in r.5.19(3)(e) is met.

    Training commitments and obligations: r.5.19(3)(f)

32. 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.

33. The Departmental file contains records of training invoices and bank transactions made by the applicant in relation for training conducted in each year of the applicant’s most recent standard business sponsorship approval, being from 18 December 2012 to 18 December 2015.  The Tribunal notes that the applicant retained the services of Seabelle Enterprises Pty Ltd to undertake extensive 8 week courses in hospitality training for its staff commencing on 11 January 2013, 7 April 2014, and 25 March 2015.  The expenditure by the applicant for each of these respective blocks of training was $8,250 for the course commencing on 11 January 2013, $9,350 for the course commencing on 7 April 2014 and $8,250 for the course commencing on 25 March 2015.

34. The Tribunal notes that the applicant has satisfied its obligations under Training Benchmark B set out in IMMI 13/030 because it has demonstrated expenditure exceeding 1% of its total payroll expenditure for each year of its most recent standard business sponsorship approval.

35. The applicant has provided the Tribunal with a payroll activity statement for the first year of its most recent standard business sponsorship approval.  The Tribunal notes the total payroll expenses for the applicant in that first year were $724,393.69, and the training expenditure was $8,250, which exceeds 1% of the total payroll expenses for the first year of the applicant’s most recent standard business sponsorship.

36. In its application to the Department, the Tribunal notes the applicant recorded a total payroll expenditure for the second year of its most recent standard business sponsorship as $747,084, consistent with the payroll expenses recorded in the applicant’s detailed profit and loss statement for the financial year ending on 30 June 2014.  The total training expenditure for the second year of the applicant’s most recent standard business sponsorship approval was $9,350 and clearly exceeds 1% of the total payroll expenditure. 

37. Similarly, the Tribunal notes that according to payroll activity summaries provided by the applicant, the total payroll expenditure for the third year of the applicant’s most recent standard business sponsorship approval was $746,694.71, and the training expenditure was $8,250.  This exceeds 1% of the total payroll expenditure.

38. Based on the evidence before the Tribunal, the Tribunal is satisfied that the applicant met its obligations under Training Benchmark B as set out in IMMI 13/030 in each year of its most recent standard business sponsorship approval. Accordingly, the requirement in r.5.19(3)(f) is met.

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

39. 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 rr.1.13A and 1.13B.

40. The Tribunal has before it information that on 29 July 2015, Australian Border Force (ABF) sanctioned the applicant under s.140M(1)(c) of the Act to bar the applicant from sponsoring additional persons for Subclass 457 visas for a period of 6 months, as well as under s.140M(1)(d) of the Act for failure to comply with the sponsorship undertakings required of an approved business sponsor for temporary visas.  In the primary decision, the delegate noted that the sanction imposed a 36 month ban on the employer “from making future applications for approval as a sponsor for all temporary visas for which sponsorship is a criterion” and noted that the sanction was in effect from 30 July 2015 to 30 July 2018.  It was for this reason that the delegate refused to approve the nomination.

41. However, the Tribunal notes that the action taken by ABF no longer falls within the definition of adverse information in r.1.13A, which requires that the applicant has, to the satisfaction of a competent authority (e.g. ABF), acted in contravention of law mentioned in r.1.13A(1)(e), because such a contravention must have occurred within the previous 3 years: r.1.13A(3). In reaching this finding, the Tribunal has had regard to Departmental policy relating to the definition of adverse information. The Tribunal notes that the sponsorship bar was imposed due to alleged underpayment of staff wages, alleged payment of cash wages, and in relation to contraventions of food hygiene laws.

42. Specifically, the Tribunal has confirmed with the applicant that the Fair Work Ombudsman did not undertake any investigation of the applicant’s business in relation to ABF’s allegation of underpayment of wages, and has provided a written statement to that effect dated 25 June 2019. Further, the applicant has provided documentary evidence from each of the employees affected by the underpayment of wages stating that the applicant had remedied the issue in each case. As the Fair Work Ombudsman did not investigate the applicant’s business following the ABF’s allegations, the Tribunal is satisfied that, in line with Departmental policy on the interpretation of r.1.13A(3), these breaches were not sufficiently serious to constitute adverse information for the purposes of r.1.13A.

43. Further, the Tribunal is satisfied that, in line with Departmental policy on the scope of the 3 year timeframe described in r.1.13A(3), the applicant’s payment of cash wages is not sufficiently serious to constitute adverse information for the purposes of r.1.13A because the Tribunal notes it is not a breach of workplace laws to pay employees in cash. The Tribunal is also satisfied that the applicant had already paid fines in relation to breaches of food safety laws and changed its behaviour considerably after that time, and finds that the sponsorship bar being imposed in part in relation to that conduct is not adverse information within the meaning of r.1.13A.

44. Given the above, the Tribunal finds that at the time of this decision, there is no adverse information known to the Department about the nominator or a person ‘associated with’ the nominator. Accordingly, the requirements in r.5.19(3)(g) is met.

45. Accordingly, the requirement in r.5.19(3)(g) is met.

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

46. 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.

1. The Tribunal notes that as part of an investigation into the applicant by ABF, the applicant was found to have underpaid three staff members, including the nominee.  The Tribunal notes that the underpayments were rectified by the applicant without intervention from the Fair Work Ombudsman, and as such, is satisfied that the applicant has a satisfactory record of compliance with the laws of the Commonwealth relating to workplace relations.

2. There is no other information before the Tribunal to suggest that the applicant does not have a satisfactory record of compliance with workplace relations laws.

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

4. 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

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

   Mary Sheargold
   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.