Cyber Computer Recycling & Disposal Pty. Ltd. Atf The Cyber System Family Trust (Migration)

Cyber Computer Recycling & Disposal Pty. Ltd. Atf The Cyber System Family Trust (Migration) [2023] AATA 4066 (10 November 2023)
DECISION RECORD
DIVISION:Migration & Refugee Division
APPLICANT:  Cyber Computer Recycling & Disposal Pty. Ltd. ATF The Cyber System Family Trust
REPRESENTATIVE:  Mr Rick Gunn
CASE NUMBER:  2207164
HOME AFFAIRS REFERENCE(S):          OPF2020/14053
MEMBER:P. Maishman
DATE:10 November 2023
PLACE OF DECISION:  Perth
DECISION:The Tribunal affirms the decision under review.

Statement made on 10 November 2023 at 7:29pm
CATCHWORDS
MIGRATION – cancellation – sponsorship cancellation – applicant had failed to comply with their sponsorship obligations – provided false or misleading information – not satisfied the employment conditions that apply to Mr Varghese are not less favourable than those that apply, or would apply to an Australian citizen or Australian permanent resident performing equivalent work at the same location – failed to declare adverse information in relation to an associated person on its nomination application – decision under review affirmed
LEGISLATION
Migration Act 1958, ss 140M, 359, 375A
Migration Regulations 1994, rr 2.59, 2.84,2.91, Schedule 2
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 Home Affairs to take an action under s 140M of the Migration Act 1958 (Cth) (the Act) in relation to the applicant’s sponsorship.
The applicant was approved as a standard business sponsor on 3 September 2018. On 16 May 2022, the delegate decided to cancel the applicant’s approval as a sponsor under s 140M on the basis that it failed to satisfy its sponsorship obligations; provided false or misleading information; and no longer met the sponsorship criteria.
Mr Shibu John Lawrence John, the applicant’s Director, appeared before the Tribunal on 10 February 2023 to give evidence and present arguments. The Tribunal held a combined hearing with the applicant’s associated business Cyber Power Pty Ltd of which Mr Lawrence John described himself as the previous Director and which has an application before the Tribunal for similar issues (AAT No. 2204481). The applicant’s representative confirmed Mr Lawrence John was authorised to speak on behalf of both enterprises. The Tribunal also received oral evidence from Mr Feros Padinjakkara Pappachan, Mr Cinto Varghese and Sudhin Kuniyil.
The applicant was represented in relation to the review.
For the following reasons, the Tribunal has decided to affirm the decision under review.
CONSIDERATION OF CLAIMS AND EVIDENCE
The Tribunal had before it a copy of the Departments file. The file contains a non-disclosure certificate issued pursuant to s 375A of the Act dated 7 June 2022. Documents on the Departments file shows Australian Border Force (ABF) commenced monitoring the applicant’s compliance with its sponsorship obligations on 23 November 2020. On 18 January 2021 and 15 February 2021, the delegate required the applicant to provide records and information to which the applicant responded on 30 January 2021 and 27 February 2021. The ABF issued the applicant a notice of intention to take action (NOITTA) on 11 February 2022 and the applicant responded with written submissions and various documents on 18, 23 and 28 March 2022; and 7 April 2022.
The applicant gave the Tribunal a copy of the delegate’s decision record with its application for review. The applicant provided written submissions and documents on 17 & 27 May 2022, and 3 February 2023.
Non-Disclosure Certificates – s 375A
The Tribunal sent the applicant a copy of the non-disclosure certificate on 19 July 2023 and invited the applicant to comment on its validity. The applicant responded on 28 July 2023 and submitted the certificate contains insufficient information to engage a public interest immunity claim.
The Tribunal considered the validity of the certificate. The certificate claims release of identified documents is contrary to the public interest because it would disclose lawful methods for preventing, detecting and investigating breaches or evasions of the law which would be likely to prejudice the effectiveness of those methods. The certificates are signed and dated by a delegate.
The documents protected by the certificate relate to the Department’s methods of investigation.
The Tribunal is satisfied however that the documents identified in the certificate would, if they were released, disclose lawful methods for preventing, detecting and investigating breaches or evasions of the law which would, or be likely to, prejudice the effectiveness of those methods. The Tribunal is satisfied the certificates are valid.
The Tribunal does not have the discretion to release documents protected by a nondisclosure certificate issued pursuant to s 375A of the Act. The Tribunal does however have an obligation to ensure the applicant is aware of any adverse information the Tribunal would rely on to make its decision and to give them an opportunity to comment on that information.
The Tribunal is satisfied the adverse information in the documents protected by the nondisclosure certificate is disclosed in the delegate’s decision record which the applicant gave the Tribunal with its application for review. The Tribunal has taken into account information contained in the protected document only where that information is disclosed in the delegates decision.
Legislation
Sections 140K, 140L and 140M of the Act provide for the imposition of sanctions on approved sponsors in certain circumstances.
Under s 140M, if prescribed circumstances exist, the Minister (and the tribunal on review) may take one or more of the following actions:
·cancelling the sponsorship approval in relation to a class to which the sponsor belongs;
·cancelling the sponsorship approval for all classes to which the sponsor belongs;
·barring the sponsor for a specified period from sponsoring more people under the terms of any existing approval; and
·barring the sponsor for a specified period from making future applications for sponsorship approval in relation to one or more classes of sponsor.
For these purposes, the circumstances are prescribed in regs 2.89–2.94B and include circumstances in which the Minister, or Tribunal on review, is satisfied there has been: a failure to satisfy a sponsorship obligation; provision of false or misleading information; sponsorship application or variation criteria no longer met; a contravention of the law; unapproved changes to a program; a failure to pay additional security; a failure to comply with certain terms of an agreement; or a failure to pay medical and hospital expenses.
Where a prescribed circumstance has been found to exist, the regulations prescribe criteria that must be taken into account when determining what action, if any, to take: regs 2.89–2.94B. These criteria, as they relevantly apply to the circumstances of this case are set out in the attachment to this decision.
DOES A CIRCUMSTANCE FOR THE TAKING OF AN ACTION EXIST?
In the present case, the delegate found the applicant failed to satisfy its sponsorship obligations; provided false or misleading information; and no longer met the sponsorship criteria.
Failure to satisfy a sponsorship obligation: reg 2.89
The Minister may take one or more of the actions in s 140M if satisfied the sponsor has failed to satisfy a sponsorship obligation referred to in Division 2.19 of the Regulations: reg 2.89(2).
Obligation to ensure equivalent terms and conditions of employment: reg 2.79.
It is not disputed the applicant’s nominee, Cinto Varghese, was approved to work for the applicant in the occupation of ‘ICT Support Technician’ with a total remuneration package of $55,000 per annum from 7 February 2019.
In response to the delegates request for information on 30 January 2021 the applicant gave the Department, relevantly, a current employment contract between the applicant and its nominee, Cinto Varghese, dated 4 March 2019; payslips for the period 29 June 2020 to 29 December 2020; Payroll Employee Summaries showing the applicant paid the nominee $37,627.95 and its associated company Cyber Power Pty Ltd paid the nominee $14,028.12 in the 2020 financial year; and a written request for unpaid leave dated 3 July 2020 for the period 8 July 2020 to 24 July 2020.
Mr Varghese was contracted to work in the occupation of “Electronic Technician” with a total remuneration package of $55,000 per annum based on a 38 hour week. The contract provides the nominee may be employed with the applicant or its associated company Cyber Power Pty Ltd. The contract includes provision:
7.2. The Company expects you to work the hours required to perform your duties properly, including reasonable hours in addition to the minimum hours of work if necessary. No Overtime payment will be applicable for a Management salaried position.
The 2020 financial year remuneration received by Mr Varghese from the applicant and its associated company Cyber Power Pty Ltd was $51,656.07 according to the Payroll Employee Summaries.
In response to the Department’s NOITTA, on 10 March 2022 the applicant provided an alternative Payroll Employee Summary for the period 1 July 2019 to 1 July 2020 claiming Mr Varghese earned $39,705.03. The applicant claims the discrepancy was due to Mr Varghese’s final fortnight salary payment of $2077.08, covering the period 17 June 2020 to 30 June 2020, being made on 1 July 2020. The applicant further claimed the minor shortfall of $1267 was because of unpaid leave taken by Mr Varghese for compulsory isolation upon returning to Western Australia from Darwin.
The applicant gave the Tribunal a statutory declaration from Mr Varghese dated 23 March 2022 confirming he was paid $53,733 for the year ending June 2020 because he had to take unpaid leave for some personal reasons. The applicant has not provided any payroll information to confirm unpaid leave periods taken by the applicant in the 2020 financial year. The Tribunal is conscious that Mr Varghese relies on a positive outcome of this application as it affects his own visa. The Tribunal attributes no weight to Mr Varghese’s unsupported claim to have taken unpaid leave in the 2020 financial year.
The applicant gave the Tribunal a letter from Nandakumar Pokkatt of APTE dated 20 May 2022. APTE have been engaged as the applicant’s provider of professional accounting, taxation and payroll services according to the terms of engagement given to the Department dated 1 July 2017. Mr Pokkatt claimed the 2020 shortfall was included in Mr Varghese 2021 financial year salary of $57,916 and there was no shortfall of payment to Mr Varghese in 2020.
The Tribunal was provided a letter from Carlton and Partners Co dated 23 May 2022 signed by Mr Graeme Wovodich who describes the company has been engaged by the applicant to provide an independent review on questions raised by the delegate. Mr Wovodich addressed the comments made by Mr Pokkatt on 20 May 2022 in the following terms:
I have reviewed the supporting documents together with the response from the client and the response from the accountant and wish to confirm that the explanation of the situation is correct.
The applicant’s written submission to the Tribunal dated 3 February 2023 claim Mr Varghese was paid $2916 more than he was contracted to receive in the 2021 financial year. The applicant claims amount should be attributed to the shortfall in the 2020 financial year and the residual shortfall is due to unpaid leave taken by Mr Varghese between 8 July 2020 and 24 July 2020.
Mr Lawrence John and Mr Varghese gave oral evidence confirming Mr Varghese had received his correct entitlement when the annual amounts were correctly attributed between the 2020 and 2021 financial years.
The Tribunal attributes no weight to Mr Pokkatt’s claim in relation to there being no shortfall of Mr Varghese’s 2020 salary. Mr Pokkatt has offered no detail of how he calculated there was no shortfall. The applicant has provided no breakdown of the hours worked by Mr Varghese in the full 2021 financial year. The Tribunal observes payslips for Mr Varghese, provided by the applicant, indicate he earned $29,322.79 between 29 June 2020 and 29 December 2020 suggesting an annualised figure of close to $60,000. Similarly the Tribunal is not satisfied that the independent audit undertaken by Mr Wovodich which supports Mr Pockatt’s claims without any further reference is reliable. Accordingly the Tribunal attributes no weight to Mr Wovodich’s supporting comments.
On the basis that Mr Varghese’s first payslip from the applicant for the period 1 July 2020 to 14 July 2020 suggests his earnings for that period were $409.95 and the year-to-date figure is $2487.03, the Tribunal acknowledges that it appears an amount of $2077.08 being the difference in those amounts is likely to be attributable to earnings in the period prior to 1 July 2020.
Mr Varghese’s first payslip for the 2021 financial year for the period 1 July 2020 to 14 July 2020 indicates he earned $409.95 in that fortnight. The Tribunal accepts that the difference in the amount Mr Varghese earned in that fortnight and the year-to-date figure suggests an amount of $2077.08 was carried over from before 1 July 2020.
The Tribunal does not accept that any part of the shortfall of Mr Varghese’s 2020 annual income is due to him applying for leave without pay. Mr Varghese applied for unpaid leave on 3 July 2020 for a holiday between 8 July and 24 July 2020. The Tribunal prefers the documentary evidence that the leave was for the purposes of a holiday. The applicant’s claim that Mr Varghese was on unpaid leave while in compulsory isolation because of moving between Northern Territory and Western Australia is inconsistent with Mr Varghese’s ANZ account (*.0743) statement transactions suggesting he was making purchases at various Perth suburban locations between 25 June 2020 and 19 July 2020. In any case unpaid leave taken after 1 July 2020 is relevant to the 2021 financial year and is not attributable to the 2020 financial year.
The delegate says Mr Varghese returned a significant amount of his salary to the applicant by making cash deposits into the applicant’s ANZ business account (*1319).
The applicant’s ANZ account (*1319) transaction statement shows Mr Varghese made the following cash deposits:
a.$2310 on 15 July 2020;
b.$2000 on 25 March 2021;
c.$10,000 on 26 March 2021;
d.$15,800 on 25 August 2021; and
e.$10,310 on 10 September 2021.
The applicant and Mr Varghese deny the deposits are repayments of Mr Varghese’s salary.
The applicant submits some customers pay in cash which is held at its administrative office until it can be deposited at the bank by an available staff member. On a number of occasions Mr Varghese has been the available staff member to deposit the money. The applicant submits Mr Varghese made these deposits which represent cash payments by the applicant’s customers, or funds from TAB businesses the applicant is involved with. The applicant’s accountant APTE on 20 May 2022 provided submissions and a list of payments and corresponding invoice numbers against which the cash payments are purportedly attributed.
After the hearing, at the Tribunal’s request, the applicant provided copies of full tax invoices and full receipts for the purported accounting of the cash deposits.
It is of some surprises to the Tribunal that the applicant would contemplate using one of its regular employees, someone not employed in a security or cash handling position, to be responsible for safe keeping and transporting significant amounts of cash, up to $15,800, to a bank. The applicant has provided no documentary evidence of how the handover of such significant amounts of cash are documented, or who is responsible if money goes missing. The Tribunal has some concerns about the veracity of the tax invoices and receipts which show no clear record of cash being received from customers at the applicant’s administrative offices, or by Mr Varghese individually. One of the main cash ‘payers’ appears to be located in Victoria while the applicant runs its business in Western Australia. It is unclear how it could in any way the convenient for cash to be the method of payment when bank transfer is available. A number of the receipts also appear to predate the invoices. However, notwithstanding these concerns, it is apparent that each of the cash payments made by Mr Varghese are accounted for against invoices, and recorded receipt dates accord with the deposit dates shown in the applicant’s bank account statements. There is no evidence that indicates Mr Varghese is drawing funds from his own account. The Tribunal does not consider that the cash deposits made by Mr Varghese represent repayment of his salary.
The Tribunal finds the applicant’s employment contract with Mr Varghese provided for payment of salary of $55,000 per annum. In the financial year 2020 the applicant paid Mr Varghese salary totalling $53,733.15.
The Tribunal is not satisfied the applicant has ensured Mr Cinto Varghese’s annual earnings are not less than the annual earnings indicated when the nomination was approved as required by reg 2.79(3)(b)(i).
The delegate summarised the details of payslips provided by the applicant for Cinto Varghese in the six-month period 29 June 2020 to 29 December 2020:
The delegate says Mr Varghese’s employment conditions are less favourable than those that would apply to an Australian citizen or permanent resident performing equivalent work because he did not get paid overtime when he worked more than 38 hours per week.
The applicant submits Mr Varghese is an Award and Agreement free employee and as such has no entitlement to overtime unless it is included as a condition in the employment contract.
The terms and conditions of Mr Varghese’s employment with the applicant are contained in the contract of employment signed by the parties on 7 February 2019. The contract provides Mr Varghese will work for 38 hours per week, Monday to Friday. The location of the employment is contracted to be Darwin and, if required by the applicants associated company Cyber Power Pty Ltd in Western Australia. The conditions provide that the applicant expects Mr Varghese to work the hours required to perform his duties including reasonable hours in addition to the minimum hours of work if necessary. The contract includes that no overtime payment will be applicable for a management salaried position.
After receiving a copy of the NOITTA on 11 February 2022 the applicant gave the Department a document titled ‘Averaging Agreement’ dated 4 March 2019. The agreement signed by the applicant’s HR manager and Mr Varghese purports to require Mr Varghese to work longer hours per day paid at his regular wage rate; allow the applicant to amend Mr Varghese’s scheduled daily and weekly hours of work; give 24 hours written notice if there is a change of shift; and to allow eight hours of rest between shifts; and to entitle the employee to overtime based on an averaging arrangement if their work exceeds 44 hours a week, or an average of 44 hours a week over a multiweek period.
The applicant submits the Fair Work Ombudsman (FWO) and Fair Work Australia (FWA) have confirmed the applicant has not breached the minimum employment standards. The applicant provided a copy of an email from the FWO suggesting Mr Varghese would be covered by the Waste Management Award of 2020 which includes that the correspondent should seek legal advice and decide whether to take the matter to court if there was a breach of the employment contract, because a breach of contract does not fall within the scope of the Fair Work Act 2009. The Tribunal gives the purported opinions of the FWO and FWA no weight. It is unclear what employment details and information was given to obtain the opinions. It is not clear to the Tribunal that the FWO opinion is that there is no breach.

The applicant contends that the figures contained in the table are incorrect because 26 weeks from 29 June 2020 in fact ends on 27 December 2020, not 29 December 2020. The Tribunal agrees with applicants’ calculation. The applicant submits that Mr Varghese worked 22.8 hours after 27 December 2020 and that time should be taken out of the equation. The Tribunal notes that no evidence has been given about the hours worked by Mr Varghese on 28 and 29 of December 2020 the submission indicates he worked 11.4 hours on each of those days.
The Tribunal considered the applicant’s employment contract, averaging agreement and payslip details.
There is no information before the Tribunal that supports any contention Mr Varghese role was a management salaried position. His employment contract did not detail his role to be such, and the necessity to contemplate an ‘averaging agreement’ for the provision of overtime is inconsistent with any claim that Mr Varghese is employed in a management salaried position.
The Tribunal attributes no weight to the ‘averaging agreement’ purportedly signed by the parties on 4 March 2019, the same day the employment contract was signed. That document would form part of the terms and conditions of employment the applicant is required to establish with its nomination application. The employment contract was provided but the purported agreement was not until after the Department issued its NOITTA on 11 February 2022 itemising each of the payslips provided for the period 29 June 2020 to 29 December 2020.
For the purposes of its consideration, the Tribunal disregards the applicant’s payslip for the period 16 to 29 December 2020. The applicant argues the annual leave included on that payslip should not comprise part of the calculation because it exceeded the annual leave Mr Varghese had accrued. While the applicant has not provided any evidence or reason why it paid more annual leave than Mr Varghese had accrued, nor any evidence that Mr Varghese worked 22.4 hours on 28 and 29 of December 2020 the Tribunal is of the view that the issue is clearly and unambiguously addressed for other periods, as follows.
The Tribunal finds that the applicant’s employment agreement provides that it will pay Mr Varghese an annual salary of $55,000 per annum and requires him to work a 38 hour week. The Tribunal calculates this equates to an hourly rate of $27.83.
The Tribunal finds the terms and conditions contained in the employment contract applies to employment with the applicant and also to employment undertaken by Mr Varghese with the applicant’s associate company Cyber Power Pty Ltd because the applicant can require Mr Varghese to work for Cyber Power Pty Ltd under the terms of the employment contract.
Mr Varghese worked for the applicant for more than 76 hours in the fortnights ending 11 August 2020; 1 December 2020 and 15 December 2020 and was not paid overtime for the extra time.
Mr Varghese worked 74.63 hours for the applicant in the fortnight ending 25 August 2020, however Mr Varghese also worked for the applicant’s associated company Cyber Power for 30.40 hours within that fortnight - a total of 105.03 hours.
Mr Varghese worked 61.87 hours for the applicant in the fortnight ending 8 September 2020, however Mr Varghese also worked for the applicant’s associated company Cyber Power for 40 hours within that fortnight - a total of 101.87 hours.
Mr Varghese worked 50.08 hours for the applicant in the fortnight ending 22 September 2020, however Mr Varghese also worked for the applicant’s associated company Cyber Power for 45.6 hours within that fortnight - a total of 95.68 hours.
Mr Varghese worked 14.93 hours for the applicant in the fortnight ending 6 October 2020. Mr Varghese also worked for the applicant’s associated company Cyber Power for 60.8 hours within that fortnight - a total of 75.73 hours.
Mr Varghese worked no hours for the applicant in the fortnight ending 20 October 2020 but was paid for 7.46 hours annual leave. Mr Varghese worked for the applicant’s associated company Cyber Power for 83.6 hours within that fortnight - a total of 91.06 hours.
Mr Varghese worked 4.91 hours for the applicant in the fortnight ending 3 November 2020, however Mr Varghese also worked for the applicant’s associated company Cyber Power for 87.6 hours within that fortnight - a total of 92.51 hours.
Mr Varghese worked 52.24 hours for the applicant in the fortnight ending 17 November 2020, however Mr Varghese also worked for the applicant’s associated company Cyber Power for 38 hours within that fortnight - a total of 90.24 hours.
The Tribunal finds the hours worked by Mr Varghese above his contracted hours of 38 hours per week are excessive and beyond what are reasonable hours required to perform his role as described in his employment contract. Mr Varghese was paid an hourly rate of $27.83 for the hours that he worked despite the purported ‘averaging agreement’ suggesting that he would be paid overtime if he worked more than 44 hours in a week. Mr Varghese worked in excess of his contracted 38 hours per week and did not receive overtime payments for the excess hours he worked.
The Tribunal is not satisfied the employment conditions that apply to Mr Varghese are not less favourable than those that apply, or would apply to an Australian citizen or Australian permanent resident performing equivalent work at the same location as required by reg 2.79(3)(b)(iii).
Obligation to provide information to Immigration when certain events occur: reg 2.84.
The delegate’s decision record outlines that the applicant’s application for a Standard Business Sponsorship (SBS) was approved for five years from 3 September 2018. ASIC records show that at the time of the SBS approval Shibu John Lawrence John and Narayanaswamy Anandan were the applicant’s directors. ASIC records indicate Mr Joe Thomas was appointed director of the applicant on 12 May 2020 and ceased to be a director on 10 July 2020.
Regulations 2.84(3)(e) and 2.84(6) require that the applicant must notify Immigration within 28 days if a new director is appointed.
There is nothing before the Tribunal to suggest the applicant advised Immigration of Mr Thomas’ appointment as a director within 28 days.
The applicant does not dispute it failed to notify Immigration within 28 days from when Mr Joe Thomas was appointed director.
The Tribunal finds Mr Joe Thomas was appointed as a director of the applicant on 11 December 2020. The applicant did not meet its obligation to provide information about his appointment has director to Immigration within 28 days as required.
The delegate’s decision record further outlines that Mr Varghese’s work duties changed from those of an ICT Support Technician to those of an Electrical Technician and the applicant failed to notify Immigration.
Regulations 2.84(3)(aa) and 2.84(6) require that the applicant must notify Immigration within 28 days if there is a change to the work duties carried out by a primary sponsored person.
It is not in dispute that Mr Varghese was the holder of a Subclass 457 visa from 11 July 2017 on the basis that he was approved to work in the nominated position of ICT Support Technician (ANZSCO 313199). The applicant gave the Tribunal the visa approval letter dated 11 July 2017 confirming Mr Varghese was sponsored by ItsIT Australia Pty Ltd. The applicant sought to transfer the nominated position from ItsIT Australia Pty Ltd, an associated entity, and nominated Mr Varghese to work in the position of ICT Support Technician. The applicant and Mr Varghese signed an employment contract on 7 February 2019 confirming his employment as an ICT Support Technician.
ANZSCO 313199 describes the tasks for an ICT Support Technician to be:
Tasks Include:
·determining software and hardware requirements to provide solutions to problems
·responding to inquiries about software and hardware problems
·adapting existing programs to meet users' requirements
·installing and downloading appropriate software
·ensuring efficient use of applications and equipment
·implementing computer networks
·designing and maintaining websites
·repairing and replacing peripheral equipment such as terminals, printers and modems
·may work in a call centre
On 21 January 2021, in response to the delegates NOITTA, the applicant gave the Department a contract of employment dated 4 March 2019 showing the applicant and Mr Varghese entered into a new employment contract identifying Mr Varghese’s position to be that of Electronic Technician (ANZSCO 342314).
ANZSCO 342314 describes the tasks for the position of Electronics technician to be:
Tasks Include:
·examining and testing machines, equipment, instruments and control systems to diagnose faults
·adjusting, repairing, and replacing worn and defective parts and wiring, and maintaining machines, equipment and instruments
·reassembling, test operating and adjusting equipment
·advising users of correct operating procedures to prevent malfunctions
·receiving messages by interpreting code and converting to plain language, and writing and typing messages for transmission
·monitoring radio traffic, and transmitting and receiving voice messages
·installing electronic instruments and control systems
·applying knowledge of electrical, electronic, mechanical, hydraulic and pneumatic principles in commissioning and maintaining control systems
The applicant claims Mr Varghese received training in the role of Electrician Technician (ET) and did not consecutively work more than 60 days on an ET role. He only worked as an ET for Cyber Power Pty Ltd.
Mr Varghese told the Tribunal that he never worked as an Electronic Technician he was always employed as an ICT Support Technician but the human resources department recorded the wrong thing.
The applicant submits the Department was on constructive notice there had been a change in Mr Varghese’s duties by the lodgement of its nomination application on 29 June 2018. The applicant claims Mr Varghese reverted to his ICT Support Technician role on 4 November 2020.
The Tribunal acknowledges that on 29 June 2018 the applicant lodged an application for employer nomination seeking to fill a position of Electronic Technician (ANZSCO 342314) and nominating Mr Varghese to undertake the role. Mr Varghese lodged a visa application for a Subclass 187 visa on 29 June 2018 in respect of that nominated position. The delegate ultimately refused the applicant’s nomination application on 14 May 2019 and Mr Varghese’s visa application on 15 June 2019. The applicant and Mr Varghese have applied to this Tribunal for review of those decisions on those matters have not yet been decided.
The Tribunal does not accept that the Department was on constructive notice of Mr Varghese’s changed work duties by the existence of the nomination application from June 2018, predating the employment contract dated 7 February 2019. Mr Varghese’s oral evidence is inconsistent with other evidence that he has undertaken some work as an Electronic Technician in the Tribunal does not accept his evidence. That employment contract detailed Mr Varghese’s position to be ICT Support Technician, the position for which the nomination was approved.
The employment contract was changed on 4 March 2019 and Mr Varghese’s contracted duties changed to those of an Electronic Technician from that date. There is no plausible evidence the applicant worked contrary to his 4 March 2019 contract which provides that he would work for the applicant, and Cyber Power has required, in the position of Electronic Technician. The Tribunal prefers the evidence of the contemporaneous employment contract dated 4 March 2019 to the unsupported claim by the applicant that Mr Varghese worked as an ET only for Cyber Power and for less than 60 hours. The Tribunal notes the applicant’s evidence that Mr Varghese ceased working as an ET in November 2020 when it became apparent its nomination for an ET would be refused, when in fact the nomination was refused some 18 months earlier.
The Tribunal finds Mr Varghese, the primary sponsored person’s, work duties changed from ICT Technical Support to Electronic Technician when the parties entered into a new employment contract on 4 March 2019. The applicant did not notify Immigration within 28 days of the change to Mr Varghese’s the work duties as required by reg 2.84(3)(aa) or that a new director was appointed as required by reg 2.84(3)(e).
Obligation to ensure primary sponsored person works or participates in nominated occupation, program or activity: reg 2.86
The Delegate found the applicant failed to meet this criterion because Mr Varghese was approved to work in the nominated occupation of ICT Technician (ANZSCO 313199) but worked as an Electronics Technician (ANZSCO 342314); and that he held ABN 40430320103 since 29 September 2020 as a business owner and undertook his own business activity outside of his nominated occupation. The delegate also found that Sudhin Kuniyil was a primary sponsored person approved to work for the applicant in the nominated occupation of ICT Technician and held an ABN 96338669048 from 1 February 2018 until 7 December 2021 as a business owner and undertook his own business activity outside of his nominated occupation.
Regulation 2.86(2) requires the applicant to ensure its nominees work in the nominated occupation and not in an occupation unless it has been nominated and the nomination was approved by the Minister.
Mr Varghese was nominated and approved to work in the occupation of ICT Support Technician and was the holder of a Subclass 457 visa. The Tribunal has found (at para 77) Mr Varghese worked in the occupation of Electronics Technician from 4 March 2019. He Tribunal acknowledges the applicant nominated the occupation of Electronics Technician and identified Mr Varghese to occupy the position on 29 June 2018, however that nomination was not approved when Mr Varghese commenced working as an Electronics Technician, and ultimately the nomination was not approved by the Minister.
Accordingly the applicant did not meet its reg 2.86(2) obligation.
Regulation 2.86(2A) requires the applicant to ensure that a primary sponsored person is engaged only as an employee of the applicant and or an associated entity.
The conditions under which an individual is entitled to an ABN are contained on the website for the Australian Business Register[1]. In summary a person is entitled to an ABN if they are carrying on or starting an enterprise in Australia; making supplies connected with Australia’s indirect tax zone; or a Corporations Act company.
[1] ABN entitlement | ABR
The applicant provided a Western Australian statutory declaration signed and dated by Mr Varghese on 1 March 2022, claiming that he did not conduct any business under his personal ABN. Mr Varghese claims it was instated after the expiry of his work visa and effective from the date it was instated. Mr Varghese provided a copy of his ABN details showing his ABN was cancelled from 29 September 2020.
On the basis that Mr Varghese was able to cancel his ABN from the date it commenced the Tribunal accepts Mr Varghese was not undertaking business activities as an independent business using his ABN.
The applicant provided a Western Australia Statutory Declaration signed and dated 1 March 2022 by Mr Kuniyil claiming that he operated a business using his personal ABN prior to his visa application being approved on 6 January 2020. Mr Kuniyil claims he sought to cancel the ABN on 15 March 2019 as he did not intend to conduct a business after that date. Mr Kuniyil declares his income tax return for 2021 does not reflect any business income. His bank statements reflecting payments going into his account represent payments accrued and owed to him during the period when he was conducting a business. Because of his tax agent’s or the ATO’s error the ABN was not cancelled until 7 December 2021.
Mr Kuniyil told the Tribunal he is the ABN for his cleaning job and ceased using it when he joined Cyber. Mr Kuniyil confirmed the deposits showing into his account were outstanding from prior to 6 January 2020 when his visa was approved. Mr Kuniyil said a payment of $2000 on 4 November 2020 from Green Quest was money he borrowed from his relative.
The applicant provided an email from Darrell Theseira, Accountant, dated 11 February 2022 claiming Mr Kuniyil’s ABN was cancelled and never active from 1 July 2018 to the 2022 financial year. Mr Theseira claims the ABN was supposed to be cancelled on 1 July 2018 via an online process however due to an ATO error it was not cancelled until 7 December 2021.
Mr Theseira’s explanation of why Mr Kuniyil’s ABN remained current beyond 1 July 2018 is vague, non-specific and offers no details of what ATO system error caused the ABN to continue to be current. The Tribunal accordingly gives Mr Theseira’s explanation no weight.
The Tribunal acknowledges Mr Kuniyil’s 2021 tax return does not reflect any business income. The Tribunal however does not accept business income not appearing on Mr Kuniyil’s income tax returns as proof Mr Kuniyil did not undertake activities as an independent business owner using his ABN. Mr Kuniyil’s account statements show frequent payments to his account of various amounts totalling nearly $19,500 in the period 8 July 2020 to 23 December 2020. The Tribunal does not find it plausible that these payments represent payments outstanding from prior to when his ABN should have been cancelled on 1 July 2018, or 15 March 2019 as described by Mr Kuniyil.
Mr Kuniyil was approved to work for the applicant from 26 November 2019. The Tribunal finds Mr Kuniyil was the holder of an ABN and undertook activities as an independent business operator from 1 February 2018 until 7 December 2021.
The applicant failed to ensure that a primary sponsored person, Sudhin Kuniyil, was engaged only as an employee of the applicant and or an associated entity contractor requirement of reg 2.86(2A).
Accordingly, the Tribunal is satisfied that the prescribed circumstance in reg 2.89 exists for the purpose of s 140M of the Act.
False or misleading information: reg 2.90
One or more of the actions in s 140M may be taken if the sponsor has provided false or misleading information to Immigration or the Tribunal: reg 2.90(2).
ASIC records show Mr Lawrence John has been a director of the applicant since 6 August 2018. Mr Lawrence John’s wife, Jomol Shibu, was the director of ITS IT Australia Pty Ltd from 16 December 2014 until it was placed in liquidation on 27 March 2019 and when it was deregistered on 16 December 2021.
Jomol Shibu is the spouse or de facto partner of Mr Lawrence John and they are two persons associated with each other as described in reg 1.13B. The action of ITS IT Australia Pty Ltd going into liquidation (insolvency) is adverse information as described in reg 1.13A.
On 16 February 2021 the applicant lodged a nomination application in favour of Subramanian Kandan as an intra-corporate transfer arrangement from ITSIT Australia Pty Ltd and did not declare there was adverse information about a person associated with the applicant.
On 13 February 2022, after the applicant received the NOITTA it notified the Department of incorrect information and provided the correct information.
The applicant submits the Department was on constructive notice because as part of its application on 16 February 2021, the applicant lodged a copy of the ASIC extract which showed that ITSIT Australia was being externally administered; and on 25 February 2021 Ms Shibu sent a letter to the Sponsor Monitoring Unit WA setting out the circumstances around the liquidation of ITSIT Australia. The applicant acknowledges it gave the incorrect answer because it misunderstood the question.
The Tribunal does not accept the submission that the Department was on constructive notice by the provision of supporting evidence showing information contrary to the direct answer to a question on the application. It should not be expected that the delegate will analyse all the documents provided with an application to conclude what the correct information is, or is not false or misleading on the application form.

The Tribunal finds that the applicant provided false information when it failed to declare adverse information in relation to an associated person on its nomination application.
Accordingly, the Tribunal is satisfied that the prescribed circumstance in reg 2.90 exists for the purpose of s 140M of the Act.
Criteria no longer met: reg 2.91
The Minister may take one or more of the actions in s 140M if the sponsor no longer satisfies the prescribed criteria for approval of the sponsorship or for variation of the terms of the sponsorship: reg 2.91(2).
The prescribed criteria that must be satisfied for a standard business sponsor application to be approved is contained in reg 2.59. Relevantly, reg 2.59(g) requires that either there is no adverse information known to Immigration about the applicant or a person associated with the applicant; or it is reasonable to disregard that information. The terms ‘adverse information’ and ‘associated with’ have the meanings given in regs 1.13A and 1.13B.
The applicant was approved as a Standard Business Sponsor on 3 September 2018 for 5 years. ASIC records show Mr Shibu John Lawrence John has been a director of the applicant from 6 August 2018. Mr Lawrence John’s wife, Jomol Shibu, was the director of ITS IT Australia Pty Ltd from 16 December 2014 until it was placed in liquidation on 27 March 2019 and when it was deregistered on 16 December 2021. On 13 February 2022, the applicant notified the Department of incorrect information and provided the correct information. The Tribunal further notes Jomol Shibu is included on the applicant’s reporting structure as the ‘admin head.’
Jomol Shibu is the spouse or de facto partner of Mr Lawrence John and they are two persons associated with each other as described in reg 1.13B. The action of ITS IT Australia Pty Ltd going into liquidation (insolvency) is adverse information as described in reg 1.13A.
The applicant submits it is reasonable to disregard the adverse information involving Jomol Shibu and ITS IT Australia Pty Ltd. The applicant submits Jomol Shibu was removed as the director of ITS IT Australia Pty Ltd and Mr Shiju Mathews, as de facto director, subsequently fraudulently applied for credit on behalf of the company which was not paid back and ITS IT Australia Pty Ltd was placed in the hands of liquidators. The applicant submits that at the time of the delegate’s decision ITS IT Australia Pty Ltd was registered without any adverse information or sanctions on Jomol Shibu. Mr Lawrence John told the Tribunal Jomol Shibu was not a Director and did not cause ITS IT Australia to go into liquidation. The applicant provided documents showing Jomol Shibu commenced proceedings in the District Court of Western Australia around 24 February 2022.
The Tribunal observes Jomol Shibu is recorded as the sole Director of ITS IT Australia Pty Ltd from 20 August 2018 when Babbin Susan Mathews ceased being a Director. Notwithstanding the email purporting to dismiss her, there appears to have been no action taken to formally remove Jomol Shibu as a Director of ITS IT Australia Pty Ltd and on the applicant’s submission Jomol Shibu became aware she continued to be the Director of ITS IT Australia Pty Ltd on or about 21 September 2018. Jomol Shibu’s lawyers wrote to ASIC on 22 February 2019 claiming Jomol Shibu resigned as a director of ITS IT Australia Pty Ltd but was unable to effect that that change because she was the sole director; that the company without her knowledge had entered into credit facility agreements since July 2018; the company ceased trading on or around 8 April 2018; the company is insolvent; and a winding up application had commenced against the company on 17 January 2019 which was to be heard on 27 February 2019. The Tribunal acknowledges Jomol Shibu commenced Court action in February 2022.
The Tribunal finds that Jomol Shibu was the Director of ITS IT Australia Pty Ltd when it was insolvent. The Tribunal finds after the nomination application was lodged and before it was determined there was adverse information about a person associated with the applicant about which the Department was not notified until 13 February 2022. The Tribunal is not satisfied that it is reasonable to disregard the adverse information and finds the applicant no longer satisfies the prescribed criteria in reg 2.59(g).
Accordingly, the Tribunal is satisfied that the prescribed circumstance in reg 2.91 exists for the purpose of s 140M of the Act.
ACTION TO BE TAKEN
For these reasons, the Tribunal is satisfied that a relevant circumstance for s 140L(1)(a) exists. Accordingly, it is necessary to consider whether one or more of the actions mentioned in s 140M should be taken.
In considering what action to take, the Tribunal has had regard to the prescribed criteria, as extracted in the attachment to this decision.
Prescribed Criteria – reg 2.89(3)
The past and present conduct of the person in relation to Immigration.
The applicant has not previously been monitored. There is no information before the Tribunal which suggests that the applicant has failed to engage with the Department during the monitoring process, or that they have not previously been cooperative with the Department.
The number of occasions on which the person has failed to satisfy the sponsorship obligation.
The Tribunal has found the applicant failed to satisfy its obligations under reg 2.79; reg 2.84 and reg 2.86.
The nature and severity of the circumstances relating to the failure to satisfy the sponsorship obligation, including the period of time over which the failure has occurred.
Relative to the applicant’s failure to meet its reg 2.79 obligations, Mr Varghese’s annual earnings were less than the annual earnings indicated in the nomination application and employment contract for the 2020 financial year. For the period from June 2020 to 27 December 2020 Mr Varghese worked significantly more than his contracted full time hours and was not paid overtime. The Tribunal considers the failure to pay nominees less than their correct entitlement to be a severe failure of the sponsorship obligations because it suggests exploitation of foreign workers and provides the applicant with a competitive advantage because its costs of business are less than for businesses that pay their employees properly.
Relative to the applicant’s failure to meet its reg 2.84 obligations, sponsors receive information outlining their obligations in order to be clearly aware of their obligations. The applicant’s failure to notify the Department of the prescribed events is considered to be a severe failure because its shows a disregard by the applicant to adhere to the terms and conditions under which it can employ foreign workers and enables the applicant to employ foreign workers in positions that have not been assessed or approved as having no Australian citizen or Australian resident candidates.
Relative to the applicant’s failure to meet its reg 2.86 obligations the applicant’s failure to advise of the change of tasks for Mr Varghese is considered a severe failure because it enables the employment of foreign workers into positions for which the availability of an Australian citizen or an Australia resident has not been assessed. The applicant’s failure to ensure Mr Kuniyil is only employed with the applicant is a severe failure because it enables foreign workers to exploit the conditions of their visa while in Australia.
The period of time over which the person has been an approved sponsor
The applicant was first approved as a standard business sponsor on 3 September 2018 for five years.
Whether, and the extent to which, the failure to satisfy the sponsorship obligation has had a direct or indirect impact on another person.
The applicant submits the delegate’s decision has caused it, and it’s sponsored workers, considerable hardship. The applicant claims it relies on skilled migrant labour and is unable to conduct work in respect of a number of contracts including with government organisations. The applicant notes the decision affects visa applications for Cinto Varghese, Sudhin Kuniyil, Subramanian Kandan and Amandeep Kaur which have been or may be refused.
The Tribunal acknowledges the direct impact on those people by the refusal of their visa applications because of the actions taken in relation to the sponsorship. Those outcomes are a result of the applicant’s failure to satisfy its obligations.
The applicant’s failure to satisfy its sponsorship obligations has had a direct and significant impact on the migrant skilled workers relying on the applicant’s nominations.
Whether, and the extent to which, the failures to satisfy the sponsorship obligation was intentional, reckless or inadvertent.
The applicant submits the breaches occurred during the Covid-19 pandemic, and in a time there were Covid related changes to the requirements for temporary skilled workers which were not easy to understand or follow.
The Tribunal is not satisfied the applicant’s failures to meet its various obligations are attributable to the Covid 19 pandemic. The documents before the Tribunal suggest there was no shortage of work for Mr Varghese not to be paid in accordance with his contracted salary nor to have been paid overtime as there appears to have been opportunity for him to work well in excess of 40 hours per week. There is no evidence before the Tribunal to suggest there was such a downturn in the business that might result in the need for Mr Kuniyil to continue employment under his own ABN.
The Tribunal is of the opinion that the applicant’s failures to satisfy the sponsorship obligations were intentional.
Whether, and the extent to which, the person has cooperated with Immigration, including whether the person informed Immigration of the failure.
There is no indication that the applicant has not cooperated with Immigration during the monitoring process. The applicant’s failure to comply with its sponsorship obligations was discovered following the Department’s analysis of the applicant’s documents.
The steps (if any) the person has taken to rectify the failure to satisfy the sponsorship obligation, including whether the steps were taken at the request of Immigration or otherwise.
The applicant claims it has taken steps to resolve the issue of underpayment of staff by adjusting its policies to ensure its administrative staff are aware of all Immigration requirements. The applicant claims it has put in place a Sponsorship Obligations Procedure to ensure any sponsorship obligation is met.
The processes (if any) the person has implemented to ensure future compliance with the sponsorship obligation.
The applicant claims it has put in place process to resolve the issue of underpayment of staff by removing its flexible working policy ensuring staff work a scheduled and fixed 38 hour week. The applicant states it has instructed its administration and accounts staff to ensure any business changes lodged with ASIC are relayed to Immigration. The applicant claims it has put in place a Sponsorship Obligations Procedure to ensure any sponsorship obligation is met.
The number of other sponsorship obligations that the person has failed to satisfy, and the number of occasions on which the person has failed to satisfy other sponsorship obligations.
The Tribunal has identified two other sponsorship obligation failures: reg 2.90 and 2.91.
Any other relevant factors.
It Tribunal acknowledges the applicant’s claim to have made a payment in favour of Mr Varghese and acknowledgement of some underpaid overtime.
The applicant claims to take the matter extremely seriously seeking review because of the importance of sponsoring skilled workers to the business and the detrimental impact that the decision has had on the business. The Tribunal acknowledges that the decision would have a detrimental effect on the business and more importantly the applicant’s sponsored workers, but makes the observation that the decision arises on the basis of the actions of the applicant.
Prescribed criteria - reg 2.90(3)
The purpose for which the information was provided.
The false information was given to the Department on 16 February 2021 to support a nomination application to transfer a nominee from ITSIT Australia Pty Ltd.
The past and present conduct of the person in relation to Immigration.
The applicant has not previously been monitored. There is no information before the Tribunal which suggests that the applicant has failed to engage with the Department during the monitoring process, or that they have not previously been cooperative with the Department.
The nature of the information.
The applicant gave false information about adverse information of a person associated with it.
Whether, and the extent to which, the provision of false or misleading information has had a direct or indirect impact on another person.
The applicant’s provision of false information directly affects a number of the applicants’ nominees.
Whether the information was provided in good faith.
The Tribunal acknowledges the applicant provided copies of the ASIC registration papers for ITSIT Pty Ltd with the nomination application. The applicant was aware of ITSIT Australia’s circumstances however indicated on its nomination application that there was no adverse information. The Tribunal is not satisfied the false information was given in good faith.
Whether the person notified Immigration immediately upon discovering that the information was false or misleading.
The applicant advised the Department after it received the NOITTA identifying the applicant had provided false information.
Any other relevant factors.
The applicant claims to have implemented a Sponsorship Obligations Procedure.
Prescribed criteria – reg 2.91(3)
The nature of the applicable sponsorship criteria that the person no longer meets.
The applicant no longer meets the prescribed sponsorship criteria in reg 2.59(g) as there is adverse information in relation to an associated person known to Immigration.
Whether, and the extent to which, the failure to continue to satisfy the criteria for approval as a work sponsor or family sponsor, or to continue to satisfy the criteria for approval of a variation, has had a direct or indirect impact on another person.
The applicant submits the delegate’s decision has caused the applicant and its sponsored workers considerable hardship. The applicant submits the delegate’s decision is causing applications by the applicant to be put on hold unless they are adversely decided, thus causing hardship to the business in conducting its operations.
The Tribunal acknowledges the applicant’s claims of hardship it has incurred because of the delegate’s decision. The Tribunal finds the delegates decision is the result of the applicant’s failure to meet the sponsorship criteria. The applicant’s failure to meet the criteria has a direct impact on the visa applications of its nominees.
The reason why the person no longer satisfies the applicable sponsorship criteria, including whether the failure to satisfy the criteria is within the person’s control.
The applicant submits that the sponsorship may not have been refused even if the adverse information had been disclosed. The applicant submits it was not aware the information was required to be disclosed as part of the application. The applicant has now been advised of the requirements and understands the definitions of ‘adverse information’ and the meaning of ‘associated with’ as prescribed.
The applicant is responsible for the veracity of the information provided in their application submitted with the Department.
The steps (if any) the person has taken to ensure that the person will satisfy the applicable criteria in the future.
The applicant has put in place a sponsorship obligations procedure.
Any other relevant factors.
The Tribunal did not take into account other relevant factors.
Considering the totality of the circumstances, and having regard to the prescribed criteria the Tribunal finds that the action mentioned in s 140M(1)(a) to cancel the approval of the applicant as a work sponsor for all classes to which the sponsor belongs should be taken.
DECISION
The Tribunal affirms the decision under review.
P. Maishman
Member

ATTACHMENT – Extract from the Migration Regulations 1994
2.89   Failure to satisfy sponsorship obligation
…
(3) For paragraph 140L(1)(b) of the Act, the criteria that the Minister must take into account in determining what action (if any) to take under section 140M of the Act in relation to the circumstance mentioned in subregulation (2) are:
(a)    the past and present conduct of the person in relation to Immigration; and
(b)    the number of occasions on which the person has failed to satisfy the sponsorship obligation; and
(c)     the nature and severity of the circumstances relating to the failure to satisfy the sponsorship obligation, including the period of time over which the failure has occurred; and
(d)    the period of time over which the person has been an approved sponsor; and
(e)     whether, and the extent to which, the failure to satisfy the sponsorship obligation has had a direct or indirect impact on another person; and
(f)     whether, and the extent to which, the failure to satisfy the sponsorship obligation was intentional, reckless or inadvertent; and
(g)     whether, and the extent to which, the person has cooperated with Immigration, including whether the person informed Immigration of the failure; and
(h)    the steps (if any) the person has taken to rectify the failure to satisfy the sponsorship obligation, including whether the steps were taken at the request of Immigration or otherwise; and
(i)    the processes (if any) the person has implemented to ensure future compliance with the sponsorship obligation; and
(j)     the number of other sponsorship obligations that the person has failed to satisfy, and the number of occasions on which the person has failed to satisfy other sponsorship obligations; and
(k)    any other relevant factors.
…
2.90   Provision of false or misleading information
…
(3) For paragraph 140L(1)(b) of the Act, the criteria that the Minister must take into account in determining what action (if any) to take under section 140M of the Act in relation to the circumstance mentioned in subregulation (2) are:
(a)    the purpose for which the information was provided; and
(b)    the past and present conduct of the person in relation to Immigration; and
(c)     the nature of the information; and
(d)    whether, and the extent to which, the provision of false or misleading information has had a direct or indirect impact on another person; and
(e)     whether the information was provided in good faith; and
(f)     whether the person notified Immigration immediately upon discovering that the information was false or misleading; and
(g)     any other relevant factors.
…
2.91   Application or variation criteria no longer met
…
(3) For paragraph 140L(1)(b) of the Act, the criteria that the Minister must take into account in determining what action (if any) to take under section 140M of the Act in relation to the circumstance mentioned in subregulation (2) are:
(a)    the nature of the applicable sponsorship criteria that the person no longer meets; and
(b)    whether, and the extent to which, the failure to continue to satisfy the criteria for approval as a work sponsor or family sponsor, or to continue to satisfy the criteria for approval of a variation, has had a direct or indirect impact on another person; and
(c)     the reason why the person no longer satisfies the applicable sponsorship criteria, including whether the failure to satisfy the criteria is within the person’s control; and
(d)    the steps (if any) the person has taken to ensure that the person will satisfy the applicable criteria in the future; and
(e)     any other relevant factors.
…

[2023] AATA 4066

10 November 2023

Key Legal Topics

Areas of Law

Immigration

Administrative Law

Legal Concepts

Judicial Review

Procedural Fairness

Statutory Construction

Standing

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