DR GUZZO PTY LTD (Migration)
[2022] AATA 235
•22 January 2022
DR GUZZO PTY LTD (Migration) [2022] AATA 235 (22 January 2022)
DECISION RECORD
DIVISION:Migration & Refugee Division
APPLICANT: DR GUZZO PTY LTD
REPRESENTATIVE: Mr John Young (MARN: 9251554)
CASE NUMBER: 1901625
HOME AFFAIRS REFERENCE(S): BCC2017/1151606
MEMBER:Susan Reece Jones
DATE:22 January 2022
PLACE OF DECISION: Melbourne
DECISION:The Tribunal affirms the decision under review to refuse the nomination.
Statement made on 22 January 2022 at 1.18pm
CATCHWORDS
MIGRATION – application for approval of nomination of position – direct entry nomination stream – financial capacity to provide nominee with two years of full-time employment – nominee is director of applicant – limited current information provided out of time – latest tax return shows financial loss – substantial difference between documents – decision under review affirmedLEGISLATION
Migration Act 1958 (Cth), ss 359(2), 359C(1), 360(3), 363A, 424C(1), 425(3)
Migration Regulations 1994 (Cth), r 5.19(4)(d)
CASE
Hasran v MIAC (2010) 183 FCR 413
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 on 3 January 2019 to reject the applicant’s application for approval of the nomination of a position in Australia under reg 5.19 of the Migration Regulations 1994 (Cth) (the Regulations).
The applicant applied for approval on 24 March 2017. The requirements for the approval of the nomination of a position of Customer Service Manager (ANSZCO 149212) in Australia are found in reg 5.19 of the Regulations which contains two alternative streams: a Temporary Residence Transition nomination stream (reg 5.19(3)) and a Direct Entry nomination stream (reg 5.19(4)). If the application is made in accordance with reg 5.19(2) and meets the requirements of either stream, then the application must be approved. If any of the requirements are not met then the application must be refused: reg 5.19(5).
In this case, the applicant has applied for approval of a nomination, seeking to satisfy the criteria in the Direct Entry nomination stream.
The delegate refused the application on the basis the applicant’s nomination did not satisfy reg 5.19 (4)(d) of the Regulations because the applicant did not provide adequate evidence to demonstrate that it had sufficient financial capacity to comply with the requirement to provide the nominee with at least two years of full-time employment.
The Tribunal received a review application on 23 January 2019. It was lodged on behalf of the applicant by its director, Mr Daniel Guzzo (who is also the nominee in this case). It was accompanied by a copy of the delegate’s decision and an authority by which the applicant appointed a registered migration agent, representative Mr John Young of Immigration Agency to be the applicant’s representative and authorised recipient for correspondence.
On 8 November 2021, the Tribunal wrote via email to the agent pursuant to s.359(2) of the Act to invite Mr Guzzo to provide up to date and current information demonstrating that the applicant met all of the applicable r.5.19(4) criteria (not merely the subparagraph that the delegate had found was not met). The Tribunal provided the representative and Mr Guzzo with a copy of r.5.19(4) for reference and provided detailed examples of the kind of documentary evidence that would assist the Tribunal to assess the criteria set out in r.5.19(4).
Mr Guzzo was requested to provide the requested information by 22 November 2021, and was advised that if he failed to do so (or failed to ask for an extension of time to do so), by that date, the applicant would lose its entitlement to have someone attend a hearing to present evidence and arguments on its behalf, and the Tribunal might proceed to make its decision without requesting further information.
On 26 November 2021, the representative emailed the Tribunal stating,
Given the large number of documents required to meet the attached list of requirements in your letter can you please allow say another 20 days. I do have some documents from my client but not all is available yet.
On 29 November 2021, the Tribunal wrote to the applicant advising that in the Tribunal’s letter of 8 November 2021, the applicant was invited to provide information by 22 November 2021, and advised that any request for an extension of time to provide the information must also be received by 22 November 2021. The Tribunal did not receive a request for an extension of time until 26 November 2021.
The Tribunal also reiterated that if it did not receive the information within the period allowed or as extended, the Tribunal may make a decision on the review without taking any further action to obtain the information, and the applicant would lose any entitlement it might otherwise have had under the Migration Act 1958 to appear before the Tribunal to give evidence and present arguments. The Tribunal noted that as the applicant did not provide the information or request an extension of time to provide the information by 22 November 2021, the applicant appeared to have lost its right to a hearing, however, this ultimately be determined by the Member who is constituted the applicant’s matter. The applicant was further advised that if they wished to do so, they could provide the information and any other material in support of the review, by no later than 13 December 2021. The Tribunal further advised the applicant that it may proceed to decision at any time after 13 December 2021.
On 2 December 2021, the applicant provided the Tribunal with the following information:
- Business Details Cool Breeze Cleaning Service ASIC Connect
- ASIC Current and Historical Extract dated 12 November 2021
- BAS – Sep 2019, Sep 2021
- Applicant Accountants supportive letter - Confirmation of Status
- Financial Statement 2021
- ATO TPAR Wages lodged
- Genuine need for the position of Customer service Manager
- Form 1404 Regional body approval - certification
- Past recruitment efforts
- Re TAFE Training contribution
- ASIC Connect Business Details Cool Breeze Cleaning Service
- Print out Australian Taxation Office
- Organisational Chart
- Genuine need statement for position of Customer Service Manager
- Cleaning statement for Regis Home Care
- Emails re applicant business
- Employment Agreement for nominee (undated and unsigned2016)
If a person is given a formal invitation to provide information under s.359(2) and does not do so within the prescribed period, the Tribunal may make a decision on the review without taking any further action to obtain the information.[1] Moreover, if a person fails to respond to a written invitation within the prescribed period (or as extended), the review applicant also loses any entitlement to appear before the Tribunal to give evidence and present arguments relating to the issues in the review.[2] In the case of a review under Part 5 of the Migration Act (under which Part this review application falls), the language of s.363A operates to remove any discretion which the Tribunal may have had to allow a person to do something where a provision of Part 5 states that the person is not entitled to do so.[3] Therefore, once the applicant has lost their entitlement to a hearing, the effect of ss.359C(1), 360(3) and 363A is that the Tribunal has no power to invite the applicant to a hearing.
[1] ss 359C(1), 424C(1).
[2] ss 360(3), 425(3). In Shrestha v MIBP [2014] FCCA 34, in circumstances where there was an administrative error by the Tribunal and a s 359A letter template was used instead of a s 359(2) letter template, the Court found that s 360 did not operate with the effect that the applicant was no longer entitled to a hearing, as the Tribunal had not complied with its statutory obligation under s 359C(1) to invite the applicant under s 359 to give information.
[3] Hasran v MIAC (2010) 183 FCR 413 at [26]. This confirms the views expressed in M v MIMA (2006) 155 FCR 333 at [46], and MIMA v Sun (2005) 146 FCR 498, for example.
Given the above, the Tribunal finds that the applicant lost its entitlement to a hearing due to the failure to provide the requested information (or seek an extension of time to do so) by 22 November 2021, the due date. Accordingly, the Tribunal considers it reasonable to now proceed to make a decision on the evidence before it, noting that the Tribunal was provided with additional information from the applicant on 2 December 2021 as noted at paragraph 11 above.
For the following reasons, the Tribunal has decided to affirm the decision under review to refuse the nomination.
CONSIDERATION OF CLAIMS AND EVIDENCE
The issue in this case is whether the applicant meets the requirements for approval of the nomination under the Direct Entry nomination stream set out in reg 5.19(4), which is extracted in the attachment to this decision. For the nomination to be approved, all the requirements must be met.
The application is compliant: reg 5.19(4)(a)
Regulation 5.19(4)(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 need for the nominator to employ a paid employee to work in the position under their direct control.
From the material on the Department file, the Tribunal is satisfied that the applicant complied with the above requirements, and that the requirement in r.5.19(3)(a) is met.
Accordingly, the requirement in reg 5.19(4)(a) is met.
Nominator is actively and lawfully operating a business in Australia: reg 5.19(4)(b)
Regulation 5.19(4)(b) requires that the applicant is actively, lawfully and directly operating a business in Australia.
The Tribunal was provided with the ASIC Connect, Business details for the applicant dated 1 December 2021. The Tribunal was not provided with any other recent Financial Statements for the applicant; however, the Tribunal was provided with one Company Tax Return for the 2021 financial year.
Accordingly, the requirement in reg 5.19(4)(b) is met.
Position is not labour-hire: reg 5.19(4)(c)
Regulation 5.19(4)(c) applies to nominators whose business activities include those relating to labour hire to an unrelated business. In these cases, the nominated position must be within the business activities of the nominator.
The Tribunal has no evidence to suggest that the applicant’s business operations includes labour hire activities.
Accordingly, the requirement in reg 5.19(4)(c) is met.
Term of employment of the visa holder: reg 5.19(4)(d)
Regulation 5.19(4)(d) requires the nominee to be employed in the nominated position for at least 2 years full time, and the terms and conditions of that employment do not expressly exclude the possibility of an extension.
The Department in its decision noted that regulation 5.19(4)(d) requires the nominator to demonstrate that it is able to provide the nominee with full-time employment for at least two years. It further noted that Departmental policy provides the following advice in relation to meeting the above requirement:
Delegates need to be satisfied that the nominator has sufficient financial capacity to comply
with the requirement to provide the nominee with at least two years of full-time employment.
A simple statement that they can provide the two years of full-time employment is not
sufficient evidence of the employer’s ability to comply with this requirement.The Department assessed the financial evidence provided by the applicant in relation to the applicant’s financial capacity to provide the nominee (who is also the applicant’s sole director), with full-time employment as a customer service manager for the next two years. In addition, the Department assessed the financial position of the applicant in the context of the applicant paying all statutory obligations to the applicant’s other employees (at the time of application, one cleaner).
The applicant provided its financial statements for the year ending 30 June 2016 and subsequent Business Activity Statements (BAS) for the periods July to September 2016, January to March 2017, April to June 2017 and July to September 2017. The applicant also provided an accountant’s statement dated 18 November 2016 providing an opinion “that the nominator has the capacity to meet all of its financial obligations including the payment of wages”. The accountant did not provide any financial basis for their opinion.
The Department noted that while a Regional Certifying Body (RCB) advice had been provided, this did not advise on the financial viability of the applicant to be able to provide full-time employment to the nominee for at least two years.
As stated in the Department’s policy guidelines, the undertaking provided by the applicant in its contract of employment with the nominee is not considered sufficient evidence, in and of itself, of the nominator’s ability to provide full-time employment to the nominee for at least two years. Hence, the delegate found that the applicant did not provide adequate evidence to demonstrate that it had sufficient financial capacity to comply with the requirement to provide the nominee with at least two years of full-time employment. Therefore, the applicant did not meet subregulation 5.19(4)(d).
The Tribunal notes that it is not bound to follow Departmental policy, as it does not have the force of law. However, where that policy does not conflict or seek to impermissibly restrict the underlying legislation it purports to explain, it would generally be a relevant factor for the Tribunal to consider, particularly where it seeks to promote consistency in decision-making.
In any case, the Tribunal has received additional, more recent financial information from the applicant in response to its request, and has assessed that below to reach its conclusions regarding whether it is satisfied that the applicant will be able to employ the nominee for at least 2 years on a full time basis.
As noted above, the Tribunal was provided with the applicant’s ATO Tax return for the 2021 financial year which shows as follows:
$ 2021* Total income
147,569 Wages
Contractors
Salary & wage expenses
Payments (wages & superannuation) to “associated persons11,537
74,938
82,001Sub total 168,476 Superannuation 7,062 Total assets
15,336 Total liabilities
3,389
The applicant provided the Tribunal with the below noted BAS.
Date Sales income $ Salaries $ TOTAL July – Sept 2019 6,660 5,653 October - December 2019 5,799 4,282 TOTAL January- March 2020 6,493 4,010 April – June 2020 18,930 15,976 July – Sept 2020 31,037 17,849 October - December 2020 38,187 21,570 TOTAL 94,647 59,405 January- March 2021 32,359 15,717 April – June 2021 39,399 19,802 July – Sept 2021 39,388 23,682 TOTAL n/a n/a
The applicant provided the Tribunal with Organisation Chart showing 5 employees, 1 of whom is an Australian citizen. The applicant’s ATO Tax returns taxable payments annual report dated 2021, shows 6 Payees, excluding the nominee.
The Tribunal notes that the applicant’s income for the 2021 year was $147,569 and its salary payments were $168,476.
The Tribunal was provided with a letter from Ms Lara Grumitt of Excelsior Accounting Solutions dated 15 November 2021, which stated:
We confirm the following details regarding DR GUZZO PTY LTD:
- We act as accountant for DR GUZZO PTY LTD
- The company DR GUZZO PTY LTD has operated a business in Cairns QLD since April 2015 and has no current outstanding debts or lodgements with the ATO
- The company DR GUZZO PTY LTD is able to fulfil current obligations to suppliers and employees on time
However, the applicant’s Accountant provided no detailed explanation, supporting evidence or documentation to show that the applicant is able to fulfil its current obligations to suppliers and employees on time.
The Tribunal has been provided with a ATO taxable payments annual report which shows payments made by the applicant to the 6 payees in sums ranging from $ 3,675 to $180 (total $12,829). However, the Tribunal has not been provided with any information or evidence about the role of the payees or any information about the actual business activities of the applicant or how it plans to pay its employees or its suppliers. The Tribunal notes that the nominee was paid $51,867 in 2021 according to the ATO Tax return provided. This sum and together with the sum paid to the other 6 payees noted above, is in total $64,696, which is substantially different to the sum noted in rule 37 above, being $168,476.
The applicant did provide the Tribunal with other material including:
- a “Summary of Domestic Recruitment Efforts, Occupation of Customer Service Manager (September 2016)”. The applicant further provided a copy of a receipt for $200 for TAFE Queensland for 457 Visa Benchmark A Contributions dated 24 November 2016.
The Tribunal has been provided with no details or information or submission as to how then documents in paragraph 40 above are relevant to the issue under consideration in r.5.19(4)(d).
The applicant provided a reference in support from Bridgestone Service Centre Cairns, dated 8 November 2021, however the applicant provided the Tribunal with no other documentation or evidence to show what services were rendered by the applicant or what payments were received by the applicant from Bridgestone.
The applicant also supported its application with copies of emails from Regis Home Care dated April and May 2021, which indicates that the applicant delivers aged care services packages on its behalf in Cairns, Queensland. However, the Tribunal has not been provided with any other supporting information in relation to this business relationship with the applicant, such as contracts, invoices or the like. Nor does the Tribunal have any details as to how enduring or significant the applicant’s business relationship is with Regis Home Care.
The applicant provided an Employment Agreement for employee Daniele Guzzo, for position of Customer Service Manager with a salary of $54,000. The Tribunal notes that the nominee’s Employment Agreement is both unsigned and undated other than noting it is from 2016. The applicant’s RCB Form 1404 (Cairns Chamber of Commerce) was dated 24 March 2017 and notes the applicant’s business name, Cool Breeze Clean Service, with a salary of $60,225 for the nominee. The Tribunal was provided with the 2021 Tax return for the nominee showing gross payments of $51,867, which is lower than the salary amount designated on the RCB Form 1404 (being $60,225) and the Employment Agreement (unsigned and undated) which provides for a salary of $54,000.
Although the applicant has provided selected financial material to the Tribunal with the review application, the Tribunal notes that this information is limited. The most recent BAS for the applicant available to the Tribunal, for example (at paragraph 34 above), shows that the income of the applicant was approximately $140,000 in the period July 2020 to June 2021. However, the nominee’s salaries and superannuation obligations for the same period were $175,538. The Tribunal notes that the applicant’s Organisation Chart shows 5 employees, however the applicant’s 2021 ATO Tax payees show 6 employees excluding the applicant director. It is therefore unclear to the Tribunal as to how the applicant is able to meet these salary obligations on an ongoing basis when its salary payments appear to exceed its income.
Accordingly, the Tribunal is unable to be satisfied that the applicant has the capacity to meet all of its financial obligations including the payment of wages to all employees. Further, the Tribunal is unable to be satisfied that the nominee will be employed by the applicant on a full-time basis for at least 2 years on terms that do not expressly preclude the possibility of an extension, and it is not satisfied that r.5.19(3)(d) is met.
For the above reasons, the Tribunal is not satisfied that the applicant meets the requirements of r.5.19(4), as failure to meet any 1 of the subparagraphs is sufficient for the criteria in r.5.19(4) not to be met as a whole. The Tribunal has found that r.5.19(4)(d) is not met, and therefore it is unnecessary for it to consider the remaining r.5.19(4) criteria. The applicant has not sought to satisfy the criteria in Temporary Residence Transition Nomination, and as such has not met the requirements in r.5.19(3). Accordingly, the nomination of the position cannot be approved. Therefore, the Tribunal must affirm the decision under review.
DECISION
The Tribunal affirms the decision under review to refuse the nomination.
Susan Reece Jones
MemberATTACHMENT - 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.
…
Direct Entry nomination
(4)The Minister must, in writing, approve a nomination if:
(a)the application for approval:
(i) is made in accordance with subregulation (2); and
(ii) identifies a need for the nominator to employ a paid employee to work in the position under the nominator’s direct control; and
(b)the nominator:
(i) is actively and lawfully operating a business in Australia; and
(ii) directly operates the business; and
(c)for a nominator whose business activities include activities relating to the hiring of labour to other unrelated businesses — the position is within the business activities of the nominator and not for hire to other unrelated businesses; and
(d)both of the following apply:
(i) the employee will be employed on a full-time basis in the position for at least 2 years;
(ii) the terms and conditions of the employee’s employment will not include an express exclusion of the possibility of extending the period of employment; and
(e)the terms and conditions of employment applicable to the position will be no less favourable than the terms and conditions that:
(i) are provided; or
(ii) would be provided;
to an Australian citizen or an Australian permanent resident for performing equivalent work in the same workplace at the same location; and
(f)either:
(i) there is no adverse information known to Immigration about the nominator or a person associated with the nominator; or
(ii) it is reasonable to disregard any adverse information known to Immigration about the nominator or a person associated with the nominator; and
(g)the nominator has a satisfactory record of compliance with the laws of the Commonwealth, and of each State or Territory in which the applicant operates a business and employs employees in the business, relating to workplace relations; and
(h)either:
(i) both of the following apply:
(A)the tasks to be performed in the position will be performed in Australia and correspond to the tasks of an occupation specified by the Minister in an instrument in writing for this sub-subparagraph;
(AAA)the occupation is applicable to the person identified under subparagraph (a)(ii) in accordance with the specification of the occupation;
(B)either:
(I)the nominator’s business has operated for at least 12 months, and the nominator meets the requirements for the training of Australian citizens and Australian permanent residents that are specified by the Minister in an instrument in writing for this sub-sub-subparagraph; or
(II)the nominator’s business has operated for less than 12 months, and the nominator has an auditable plan for meeting the requirements specified in the instrument mentioned in sub-sub-subparagraph (I); or
(ii) all of the following apply:
(A)the position is located in regional Australia;
(B)there is a genuine need for the nominator to employ a paid employee to work in the position under the nominator’s direct control;
(C)the position cannot be filled by an Australian citizen or an Australian permanent resident who is living in the same local area as that place;
(D)the tasks to be performed in the position correspond to the tasks of an occupation specified by the Minister in an instrument in writing for this sub-subparagraph;
(DA)the occupation is applicable to the person identified under subparagraph (a)(ii) in accordance with the specification of the occupation;
(E)the business operated by the nominator is located at that place;
(F)a body that is:
(I)specified by the Minister in an instrument in writing for this sub-subparagraph; and
(II)located in the same State or Territory as the location of the position;
has advised the Minister about the matters mentioned in paragraph (e) and sub-subparagraphs (B) and (C).
Key Legal Topics
Areas of Law
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Immigration
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Administrative Law
Legal Concepts
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Judicial Review
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Procedural Fairness
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Statutory Construction
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Appeal
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