E Coombes & A Jha (Migration)

E Coombes & A Jha (Migration) [2017] AATA 148 (30 January 2017)
DECISION RECORD
DIVISION:Migration & Refugee Division
APPLICANT:  E Coombes & A Jha
CASE NUMBER:  1512249
DIBP REFERENCE(S):  BCC2015/1259767 BCC2015/1282596
MEMBER:Denise Connolly
DATE:30 January 2017
PLACE OF DECISION:  Sydney
DECISION:The Tribunal affirms the decision under review to refuse the nomination.
Statement made on 30 January 2017 at 1:04pm

CATCHWORDS
Migration – Employer Nomination Refusal – r 5.19 – Direct Entry Nomination stream – Nominated occupation of Retail Manager – Nominated occupation inconsistent with actual role – Provisions of franchise agreement – Franchise management training – Establishment and maintenance of franchise compliance systems – ANZSCO skill levels
LEGISLATION
Migration Regulations 1994, r 5.19
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 Immigration on 2 September 2015 to reject the applicants’ application for approval of the nomination of a position in Australia under r.5.19 of the Migration Regulations 1994 (the Regulations).
The applicants applied for approval on 30 April 2015. 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).
In this case, the applicants have applied for approval of a nomination, seeking to satisfy the criteria in Direct Entry Nomination stream. The applicants nominated a position, Retail Manager, to be employed in their Subway store at Stockland Shopping Centre, Forster, postcode 2428, NSW.
The delegate refused the application on the basis the applicants’ nomination did not satisfy r.5.19(4)(h)(ii)(D) of the Regulations because she was not satisfied that the position is a Retail Manager. She found that the occupation which best describes the duties of the nominated position is Retail Supervisor, a skill level 4 occupation.
The applicants appeared before the Tribunal on 24 January 2017 to give evidence and present arguments. The Tribunal also received oral evidence from the nominee, Mr Jagadish Subedi.
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 applicants meet the requirements for approval of the nomination under the Direct Entry nomination stream set out in r.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 applicants provided to the Tribunal a copy of the delegate’s decision record. While the applicants had nominated in their application the position Retail Manager (ANZSCO code 142111 skill level 2), the delegate formed the view that the nominated position was best described in ANZSCO by the duties of a Retail Supervisor (code 621511), at skill level 4. She was therefore not satisfied that the applicants met r.5.19(4)(h)(ii)(D) which requires that the tasks of the position correspond to those of an occupation at the ANZSCO skill level 1, 2 or 3 . Accordingly she refused to approve the nomination.
Tasks of the position must correspond to those of an occupation at the ANZSCO skill level 1, 2 or 3: r.5.19(4)(h)
Regulation 5.19(4)(h) contains a number of alternative requirements. These are set out in detail in the attachment to the decision but can be briefly summarised as requiring either:
·the tasks to be performed in the position will be performed in Australia and correspond to those of an occupation specified by the Minister and certain specified training benchmarks will be met: (r.5.19(4)(h)(i)); or
·the position and nominator’s business is located in regional Australia, there is a genuine need for the paid position under the nominator’s direct control which cannot be filled by a locally resident Australian citizen or permanent resident, the tasks of the position correspond to those of an occupation at the ANZSCO skill level 1, 2 or 3; and that a regional certifying body has advised the Minister about certain matters relating to the position: (r.5.19(4)(h)(ii)).
In the circumstances of this case r.5.19(4)(h)(ii) applies.
Tasks correspond to ANZSCO skill level 1, 2 or 3 (r.5.19(4)(h)(ii)(D))
The applicants are Subway franchisees operating two stores in regional Australia, both in Forster. The Department has approved the nomination for the position of Retail Manager for their first Subway store. They now seek approval of a nomination for their second Subway store, located in the Stockland Shopping Centre, Forster. The Tribunal is satisfied that the position and nominator’s business is located in Forster NSW, and therefore in regional Australia.
The applicants assert that the position required to manage their second Subway store is that of a Retail Manager, ANZSCO 142111, skill level 2. The delegate concluded the tasks of the position are best described in ANZSCO by the occupation Retail Supervisor, code 621511, skill level 4 and therefore the requirement in r.5.19(4)(h)(ii)(D) is not satisfied.
Prior to the hearing the applicants provided to the Tribunal various documents including evidence that the nominee has completed a Subway Manager Training course. They provided evidence regarding their attendance at meetings concerning Subway’s future plans for advertising. There are also samples of weekly inventory and sales reports, an organisational chart indicating the Stockland Retail Manager position is currently vacant, samples of advertising, customer surveys, evidence relating to the nominee’s qualifications and samples of Subway’s evaluation and compliance review.
The applicants also provided a written submission in which Ms Coombes explains that she is expecting a baby and has limited time to spend in the stores. She describes the high level of staff turnover and the difficulties in recruiting suitable staff. She asserts that sales have dropped because the Retail Manager position is currently vacant. She refers to the nominee’s diploma and his management course at Subway. She asserts that the units in Subway’s management course demonstrate what is required of a manager to effectively run a Subway store. She asserts that this course and years of experience are required to fulfil the role of Retail Manager in the Subway business. She believes the position meets the requirements of ANZSCO skill level 3 which states at least 3 years of relevant experience may substitute for formal qualifications. The applicants also provided evidence that they are lawfully operating a business, including financial statements and bank statements addressed to the applicants at their home address. They provided evidence in relation to their plans to purchase another Subway franchise store.
At the hearing the Tribunal discussed with the applicants, amongst other things, the nature of the business, the position’s duties, described in their written submissions and in their oral evidence, the ANZSCO definitions for the two relevant occupations and the provisions of the franchise agreement, provided to the Tribunal by the applicants prior to the hearing.
The Tribunal first discussed with the applicants the provisions of the franchise agreement. The applicants acknowledged that the franchisor has ‘100% control’ over the menu and the products sold in the store. Subway also advises the applicants about the certified suppliers, and they are given a few to choose from. If they do not choose a certified supplier, Subway will not provide any assistance if an issue arises. The applicants have decided to use a certified supplier. Subway advises a recommended retail price. They are not bound by this price and can vary it depending on their costs. For example if the shopping centre’s rent is high they will generally charge a higher rate than the recommended retail price, however they have to take into account the local demographics. With respect to marketing Subway has a Franchisee Advertising Fund Board which asserts national control over national marketing and advertising. The applicants are able to advertise locally but they have to go through a Subway approved agent. The agent provides them with a few templates. They are not allowed to print off their own advertisements. Any advertisement has to be professionally prepared and approved. The applicants confirmed that the customer surveys come from Subway’s website. The store manager and staff are required to encourage customers to complete surveys. The applicants are responsible for their own budgeting. They are evaluated monthly, by a Subway auditor, to ensure they are staying within budget. With respect to training, the applicants indicated training of new staff is designed by the manager. The retail manager must complete a management course designed by Subway which includes units on training staff. New staff are given basic training in customer service, safety, cleaning and using the cash register in accordance with Subway’s requirements. The applicants advertise online, in the shop window, in the local newspaper, on Facebook and Gumtree, and through local recruitment agencies. Subway dictates the Occupational Health and Safety standards. A Subway auditor visits the shop once a month to check that there is compliance. A report is produced, as required by Subway, and if there are three consecutive monthly non-compliance letters issued the applicants can lose their franchise.
The applicants confirmed that Subway issues an Operations Manual which contains rules to be implemented with respect to customer service, staff recruitment, uniforms and cleaning. It is against this operations manual that the monthly evaluations are undertaken. The cash register system used is determined by Subway. There are also particular reports, developed by Subway, that have to be provided to the franchisor on a weekly basis. The applicants acknowledged that Subway is very controlling in how the business is run.
The applicants confirmed that the auditor/field consultant meets once a month with the store manager. Ms Coombes has been meeting with the auditor, however she is seven months pregnant and will not be able to do this in the foreseeable future. In their other store the sponsored Retail Manager, granted his visa in March 2016, meets with the auditor.
The Tribunal asked if the nominee is currently working in the position and the applicants confirmed that he is not. He has been living in Sydney and as far as they are aware he is not working. It asked who has been undertaking the duties of the position. Mr Jha indicated that he is involved in both stores and sometimes meets with the Subway auditor. He last met the auditor for the Stockland store about two months ago. However he indicated that he does not want to be working in his business; he prefers to be working on his business and wants to grow it in the future. He has plans to open a third Subway store but has not exchanged contracts for that store.
The Tribunal discussed with the applicants their written evidence regarding the tasks of the required position. These are provided as follows:
a.determining adequacy of stock levels and service standards. Ordering stock accordingly. Establishment and maintenance of systems for compliance.
b.Establishment and maintenance of money control systems.
c.Organisation of staff, organising staff meetings, staff files kept, payroll, staff payslips, dealing with any kind of warning letters or complaints, rostering.
d.Organising staff training and store marketing. It is a requirement of the franchise to ensure staff have adequate training. Local marketing must be organised through local agencies (newspaper, magazine, radio, letterbox drops). The retail manager must deal with these agencies to ensure local marketing is kept up to date.
e.Prepare reports to display proper goals for business and ensure financial and budgetary goals are met. Monthly, weekly, quarterly reports must be prepared to show increase/decreases in business and percentages in relation to costs. Weekly costs must be recorded in a timely manner to ensure no mistakes. All reports must be forwarded to the franchisees.
f.Franchise head office requires a number of surveys be completed each month. Ensure these are kept up so as there are no compliance issues. Encourage customers to complete surveys as often as possible.
g.Customer complaints must be dealt with within 24 hours and a full report drawn up and submitted to franchisees about the issue.
h.Ensuring compliance with Occupational Health & Safety issues by staff, informing and educating of staff accordingly. Reporting to senior management.
The Tribunal noted the first duty is described as establishment and maintenance of systems for compliance. The Tribunal questioned whether establishment of the compliance systems was actually undertaken by the franchisor Subway. The applicants indicated that while Subway establishes the business’ processes and gives guidelines as to how the store should be run, they do not implement those policies and procedures. That needs to be done by the store manager. The operations manual indicates how many staff should be employed in the store and provides sample interview questions. However it does not establish the systems within the store; that needs to be done by the manager. The applicants acknowledged that the money control systems are designed and controlled by Subway. With respect to their third duty, the organisation of staff, the applicants acknowledge that Subway determines how many staff should be employed and gives guidelines with respect to the questions that should be asked at interview. However it is asserted that the store manager might ask different questions according to the particular business. The applicants confirmed that the store manager draws up the roster. New staff are trained on the job after an initial trial of one week.
Regarding the fifth duty, the applicants produce a report using Excel. As franchisees they are required to provide a weekly report to Subway. The reporting system has been set up by Subway. It allows such things as auditing stock levels to ensure that there are not significant anomalies. With respect to the customer surveys the manager and staff ask customers to complete the Subway survey online. The manager then has to deal with any negative comments by calling the person and apologising.
The Tribunal asked if there were any other duties required of the position. The applicant indicated that the manager will supply reports to the franchisees. The manager mainly needs to organise staff and maintain rosters, which change regularly and at short notice. There is a high staff turnover. The manager has to deal with problems with pests, invoicing issues and equipment breakdowns. The manager also has to negotiate with Stockland who can be very controlling. Ms Coombes has been undertaking this role but she is now seven months pregnant and Mr Jha is working on starting up another store. However the parties have not exchanged contracts for a third Subway store.
The Tribunal referred to the ANZSCO definitions for Retail Manager and Retail Supervisor. It explained that it may form the view that the tasks of the position are very similar to the description for the occupation Retail Supervisor. It noted that the franchisor has significant control over the product mix, service standards, purchasing and marketing policies, promoting and advertising the business, maintaining records, recruiting and controlling the supervision of staff, and ensuring compliance. The Tribunal indicated it may form the view, given the franchisor’s control of various aspects of the business, that the position’s tasks are not those of a Retail Manager but of a Retail Supervisor. The applicants indicated that while the franchisor has a lot of control the store cannot run with only a Retail Supervisor. As the applicants need to focus on their other stores, they require a Retail Manager to run their Stockland Subway store. Ms Coombes noted that the nominee has completed business courses and, included in the curriculum, are units relevant to retail management. She is of the view that not just anyone could do the job. The franchisor will meet with the manager to discuss, for example, changes to the store’s layout. This happens every five years.
The Tribunal spoke with the nominee. He confirmed that he is not currently working in the position. He claims he last worked in 2015. He said he does not want to work until the visa is granted. He had nothing further to add.
At the end of the hearing Mr Jha reiterated that he and Ms Coombes do not want to work in the business; they want to work on their business. This requires their employment of a Retail Manager for the Stockland Subway store.
Assessment of the evidence
First the Tribunal accepts that the regional certifying body (RCB), Regional Development Australia – Hunter Incorporated, has advised the Minister about certain matters relating to the position. The applicant has provided a copy of the RCB’s advice dated 25 May 2015 that, amongst other things, there is a need for a paid employee in the nominated position. The Tribunal takes into account this advice. The Tribunal has however considered all of the evidence before it to form a view about whether the tasks of the position correspond to those of an occupation at ANZSCO skill level 1, 2, 3 or 4.
The Tribunal discussed with the applicants the ANZSCO definitions for Retail Manager (ANZSCO 142111) and Retail Supervisor (ANZSCO 621511) which provide as follows:
UNIT GROUP 1421 RETAIL MANAGERS
RETAIL MANAGERS organise and control the operations of establishments which provide retail services.
Indicative Skill Level:
Most occupations in this unit group have a level of skill commensurate with the qualifications and experience outlined below.
In Australia:
AQF Associate Degree, Advanced Diploma or Diploma (ANZSCO Skill Level 2)

At least three years of relevant experience may substitute for the formal qualifications listed above. In some instances relevant experience and/or on-the-job training may be required in addition to the formal qualification.
Tasks Include:
·     determining product mix, stock levels and service standards
·     formulating and implementing purchasing and marketing policies, and setting prices
·     promoting and advertising the establishment's goods and services
·     selling goods and services to customers and advising them on product use
·     maintaining records of stock levels and financial transactions
·     undertaking budgeting for the establishment
·     controlling selection, training and supervision of staff
·     ensuring compliance with occupational health and safety regulations
…
142111 RETAIL MANAGER (GENERAL)

Organises and controls the operations of a retail trading establishment.
…
UNIT GROUP 6215 RETAIL SUPERVISORS
RETAIL SUPERVISORS supervise and coordinate the activities of retail sales workers.
Indicative Skill Level:
Most occupations in this unit group have a level of skill commensurate with the qualifications and experience outlined below.
In Australia:
AQF Certificate II or III (ANZSCO Skill Level 4)

At least one year of relevant experience may substitute for the formal qualifications listed above. In some instances relevant experience and/or on-the-job training may be required in addition to the formal qualification.
Tasks Include:
·     ensuring that customers receive prompt service and quality goods and services
·     responding to customers' inquiries and complaints about goods and services
·     planning and preparing work schedules and assigning staff to specific duties
·     interviewing, hiring, training, evaluating, dismissing and promoting staff, and resolving staff grievances
·     instructing staff on how to handle difficult and complicated sales procedures
·     examining returned goods and deciding on appropriate action
·     taking inventory of goods for sale and ordering new stock
·     ensuring that goods and services are correctly priced and displayed
·     ensuring safety and security procedures are enforced

621511 RETAIL SUPERVISOR
Supervises and coordinates the activities of retail sales workers.

The Tribunal has carefully considered all of the written and oral evidence provided by the applicants. It takes into account the RCB’s advice and the evidence indicating that the Department has approved a nomination for the equivalent position for the applicants’ first Subway store. It also takes into account the qualifications of the nominee and the evidence regarding the Subway Management course that he has completed. It focuses however on the tasks required of the position.
The Tribunal notes that there are some similarities in the tasks identified in the ANZSCO descriptions for the two occupations. These relate to tasks such as selecting, hiring and training staff, and ensuring compliance with safety. The former include elements of staff supervision. However the Tribunal notes that the Retail Manager is responsible for ‘controlling’ the process, and from the applicants’ evidence Subway as franchisor has significant control and input into the process including in the number of staff required and recommendations for interview questions. There are tasks which are found only in the Retail Manager definition. These include, for example, determining product mix and service standards, setting prices, formulating and implementing purchasing and marketing strategies, undertaking budgeting, and promoting and advertising the establishment’s goods and services. The Tribunal is of the view that, due to the nature of the franchisor’s control over a number of these areas, the store manager position has limited responsibility in relation to many of the Retail Manager duties. For example the franchisor dictates the product mix. This is not determined by the store manager. While it does not fix prices, Subway does recommend retail pricing and on the applicants’ evidence this is adopted unless for example, the applicants’ rent is high when the price would be increased. Subway gives the applicants a few options with respect to suppliers and if the applicants choose otherwise they do not have the franchisor’s support if there is an issue. Accordingly the applicants have chosen to use Subway’s recommended suppliers. The applicants’ evidence regarding advertising and marketing indicates that Subway has total control over national advertising and marketing, and while the applicants have some capacity to advertise locally this has to be done through an approved agent who provides templates. The Tribunal is of the view this indicates that the position will not be formulating purchasing and marketing policies because this is done by Subway. On the applicants’ own oral evidence Subway has significant control over the way the business operates in terms of product mix, stock purchasing, marketing and advertising, the inventory and reporting required by Subway, staff selection and numbers, and the ways in which the store complies with occupational and health standards.
The Tribunal notes that one of the significant tasks of the store manager is to maintain the staff roster and fill positions at short notice. Mrs Coombes indicated that it is often the case that a staff member will advise on the day that s/he will not be attending work. The franchisor requires a certain level of staffing so the position is often required to attend to preparing and filling the roster at short notice. The Tribunal is of the view that this is consistent with the task planning and preparing work schedules, a Retail Supervisor duty. The Tribunal also notes that another significant task for the position is responding to complaints, a duty consistent with the Retail Supervisor’s responding to customers' inquiries and complaints about goods and services. It also notes that neither of these tasks are listed in the Retail Manager definition.
The applicants emphasised the need to comply with the franchisor’s standards and the serious consequences for the business if there is repeated non-compliance. It accepts that this responsibility requires the store manager to have some skill and knowledge. It takes into account the franchisor’s expectations of the store manager and the description of the course, provided by the applicant in writing. However it is of the view these duties are included in the Retail Supervisor’s tasks, such as ensuring that customers receive prompt service and quality goods and services and ensuring safety and security procedures are enforced.
With regard to the written description of the duties regarding determining and ordering stock, the Tribunal is of the view these requirements of the position are consistent with the Retail Supervisor’s task taking inventory of goods for sale and ordering new stock. As the product mix is determined by Subway, and the franchisor requires the business to report to it on a weekly basis regarding stock and sales, in reports designed by Subway, the Tribunal is not satisfied the position determines product mix, stock levels and service standards, the similar task in the Retail Manager definition.
The Tribunal accepts that the store manager undertakes the staff training guided by the franchisor’s expectations of Subway staff. It accepts that this is essentially on the job training, teaching new staff to perform duties in accordance with the requirements set out in the Subway operations manual. The Tribunal is not satisfied the store manager controls the staff training, as described for a Retail Manager, because the franchisor has specified expectations of the staff and these dictate the training. The Tribunal is satisfied the staff training task set out in the Retail Supervisor definition best describes this duty.
The Tribunal acknowledges that the applicants will soon be in a situation where Ms Coombes will be unable to attend to the requirements of the Stockland Subway store. It also accepts Mr Jha wants to work on growing the business. It notes the applicants’ evidence that the Department approved the nomination for their first Subway store. It also takes into account the RCB’s advice and the nominee’s qualifications. It accepts the position required has responsibilities that impact on the success of the applicants’ business. However considering the evidence overall the Tribunal is of the view the ANZSCO occupation which best describes the tasks to be performed in the position is that of Retail Supervisor. The Tribunal does not accept that the ANZSCO definition for Retail Manager describes the tasks of the position needed in the applicants’ Stockland Subway store. It finds, on all the evidence before it, that the tasks to be performed in the position correspond to the tasks of a Retail Supervisor, at ANZSCO skill level 4. Therefore the requirements of r.5.19(4)(h)(ii)(D) are not met.
There is no evidence before the Tribunal to suggest that the applicants meet r.5.19(4)(h)(i)(A). Accordingly the requirements of r.5.19(4)(h) are not met.
For the above reasons the Tribunal is not satisfied that the applicants meet the requirements of r.5.19(4). The applicants have not sought to satisfy the criteria in Temporary Residence Transition Nomination stream, 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.
Denise Connolly
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
(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;
(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 at a skill level of ANZSCO skill level 1, 2 or 3;
(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).

[2017] AATA 148

30 January 2017

Key Legal Topics

Areas of Law

Immigration

Administrative Law

Legal Concepts

Judicial Review

Jurisdiction

Procedural Fairness

Statutory Construction