Christi Contractors Pty Ltd (Migration)

[2020] AATA 334

Christi Contractors Pty Ltd (Migration) [2020] AATA 334 (7 February 2020)

DECISION RECORD

DIVISION:Migration & Refugee Division

APPLICANT:  Christi Contractors Pty Ltd

CASE NUMBER:  1801731

DIBP REFERENCE(S):  BCC2017/2043656

MEMBER:Bridget Cullen

DATE:7 February 2020

PLACE OF DECISION:  Brisbane

DECISION:The Tribunal affirms the decision under review to refuse the nomination.

Statement made on 07 February 2020 at 4:18pm

CATCHWORDS

MIGRATION – Nomination – Temporary Residence Transition nomination stream – superannuation guarantee – irregularities rectified – financial capacity – financial documents show appreciable loss – lack of improvement in finances – decision under review affirmed

LEGISLATION

Migration Act 1958 (Cth)
Migration Regulations 1994 (Cth), Schedule 2 r 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 4 January 2018 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 9 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).

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)(h) of the Regulations because the evidence provided to the Department did not support a satisfactory record of compliance with the laws of the Commonwealth. This was because no evidence of Superannuation Guarantee Contribution payments was submitted for the 2014, 2016 and 2017 financial years.

5. The applicant, by way of its director, Mr Marius Tufis, appeared before the Tribunal on 16 August 2019 to give evidence and present arguments. The hearing was held concurrently with the hearing for the nominee, Mr Andrei Gurmeza, who also provided evidence at the hearing.

6. The applicant was represented in relation to the review by its registered migration agent, Mr Adam Welch, of Welch Law (MARN 9474755). Mr Welch did not attend the hearing.

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

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

9. 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.

10. The Tribunal received evidence on the date of the hearing, 16 August 2019; which indicated that the applicant had paid superannuation to the nominee.

11. The applicant explained at the hearing that as a small business, it had relied on its accountant in order to provide advice about the correct superannuation percentage.  In view of the ANZ Bank Smart Choice Super Annual Statements provided for the nominee, Mr Gurmeza, the Tribunal is satisfied that the applicant has rectified any irregularities associated with its payment of superannuation, as at the time of hearing.

12. As there is no other evidence before the Tribunal that the applicant has anything but 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, it finds that the requirement in r.5.19(3)(h) is met.

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

13. 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.

14. As the Tribunal is required to examine all requirements under r.5.19(3), the Tribunal has examined the financial documents provided as evidence for the application. The Tribunal notes that in each year where financial documents have been provided to it, there is an appreciable loss.

15. As this was not the ground for refusal, and had not been mentioned at the hearing on 16 August 2019, the Tribunal wrote to the applicant on 23 January 2020 in the following terms:

    “In conducting the review, we are required by the Migration Act 1958 to invite Christi Contractors Pty Ltd to comment on or respond to certain information which we consider would, subject to any comments or response it makes, be the reason, or a part of the reason, for affirming the decision under review.

    Please note, however, that we have not made up our mind about the information.

    The particulars of the information are:

    -    The Tribunal has reviewed the Financial Statements you provided for the financial years ending 2019, 2018, 2017 and 2016.

    -    The information contained in the financial statements show the following results:

    o   Financial Year Ending 2015 - $47,160 loss

    o   Financial Year Ending 2016 - $84,869 loss

    o   Financial Year Ending 2017 - $94,008 loss

    o   Financial Year Ending 2018 - $76,208 loss

    o   Financial Year Ending 2019 - $59,533 loss

    This information is relevant to the review because r.5.19(3)(d) of Schedule 2 to the Migration Regulations requires the following be met:

    r.5.19(3)(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.

    If we rely on this information in making our decision, we may find that you will be unable to afford to pay the nominee’s wages on a full-time basis in the position for at least two years. If we make this finding, we will find that you are unable to meet r.5.19(3)(d)(i), and therefore r.5.19(3) will not apply to your application. As you have only made claims as to satisfy r.5.19(3), the Tribunal would therefore affirm the decision under review.

    Whilst r.5.19(3)(d) is not the subregulation that the Department refused to approve the nomination lodged on 9 June 2017, the Tribunal must be satisfied at the time of its decision, that all criterion in r.5.19(3) are met.

    Christi Contractors Pty Ltd is invited to give comments on or respond to the above information in writing.

    The comments or response should be received by 6 February 2020. If the comments or response are in a language other than English, they must be accompanied by an English translation from an accredited translator.”

16. On 5 February 2020, the Tribunal received the following in response:

    “I would like to express the following in regard to my last four financial years, where the statements show the company running at a loss, and the possible assumption of not being able to afford the wages based on a fulltime position.

    The reason Christi Contractors has been running at a loss for quite some time is a result from a combination of the following:

    1.Builders going into liquidation

    2.Builders behind in their payments

    I have found in the past that working within the Building & Construction Industry has been difficult at times as there’s no standard payment terms or guarantees and often found a lot of builders going bankrupt.

    Generally I found myself incurring an exorbitant amount of costs upfront to pay the wages and being the one responsible for the liability has proven to be difficult as there have been periods when there was no payments made to me for months on end which made it hard to run a successful and profitable business.

    These issues have made a detrimental impact on Christi Contractors which is why I feel it’s its [sic] even more crucial to continue with the application so that I can have Andrew here working alongside me enabling me to start recovering some of the losses I’ve incurred over the last few years.

    I have put a few different measurements in place that I believe will change the financial status and outcome of the financial years to come and these being;

    3.   Increase dedication to Project Management – I intend to be more proactive with the jobs and engage with the builders more regularly to ensure the payments are being kept on top of

    4.   Employ a part time accounts lady to assist me with invoicing and chasing up payments on a constant basis

    5.   Balance the intake of work – Constantly assess the workload at current and ensuring an overload doesn’t occur which will avoid rushed/not up to standard works as well as staff fatigue leading to a decline in workplace performance

    I strongly believe these measurements will improve the company and I will be in a stable financial position to pay Andrew on a consistent full-time basis”

17. The Tribunal appreciates that the applicant is aspirational and desires to improve its financial viability.  Nevertheless, the Tribunal must consider the track record that is before it, in assessing whether the applicant is in a position to be able to continue to pay the nominee’s wages for a period of at least two years, full-time. 

18. The track record indicates a loss every year for the last five financial years, of at least $47,160 and as much as $94,000.  This is significant, in the context of a small business.  The Tribunal is not confident that, if required to divert income presently used to pay wages to other company expenses if called upon, that the applicant could continue to be viable, let alone pay the wages that correspond to the nomination.

19. The Tribunal understands that the applicant relies upon the nominee, and sees value in the nominee. However, in a migration context, the applicant must be able to demonstrate that it can meet the requirements associated with the nomination. The losses carried over a 5-year period do not demonstrate a trend of improvement that would give the Tribunal comfort in thinking that business would improve significantly over the next two years. Given the above findings, the requirement in r.5.19(3)(d) is not met.

20. For the above reasons the Tribunal is not satisfied that the applicant meets the requirements of r.5.19(3). The applicant has not sought to satisfy the criteria in Direct Entry nomination stream, and as such has not met the requirements in r.5.19(4). Accordingly, the nomination of the position cannot be approved. Therefore, the Tribunal must affirm the decision under review.

    DECISION

21. The Tribunal affirms the decision under review to refuse the nomination.

    Bridget Cullen
    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.