GHANEM MELBOURNE PTY LTD ATF GHANEM MELBOURNE TRUST (Migration)

GHANEM MELBOURNE PTY LTD ATF GHANEM MELBOURNE TRUST (Migration) [2020] AATA 6078 (22 December 2020)
DECISION RECORD
DIVISION:Migration & Refugee Division
APPLICANT:  GHANEM MELBOURNE PTY LTD ATF GHANEM MELBOURNE TRUST
CASE NUMBER:  1810663
HOME AFFAIRS REFERENCE(S):          BCC2017/1754744
MEMBER:Alan McMurran
DATE:22 December 2020
PLACE OF DECISION:  Sydney
DECISION:The Tribunal sets aside the decision under review and substitutes a decision approving the nomination.

Statement made on 22 December 2020 at 10:44am

CATCHWORDS
MIGRATION – Temporary Residence Transition nomination stream – sufficient financial capacity to pay the nominee’s full-time salary in the nominated position with full-time employment – standard business sponsor– applicant is actively and lawfully operating its business – compliance with workplace relations laws – decision under review set aside

LEGISLATION
Migration Act 1958, ss 245AR, 140GB, 359
Migration Regulations 1994, rr 1.13, 2.57, 2.72, 2.73
STATEMENT OF DECISION AND REASONS
APPLICATION FOR REVIEW

This is an application lodged 16 April 2018 for review of a decision made by a delegate of the Minister for Home Affairs on 4 April 2018 to reject the applicant’s application for approval of the nomination of a position in Australia under r.5.19 of the Migration Regulations 1994 (the Regulations).
The applicant applied for approval on 17 May 2017. The requirements for the approval of the nomination of a position in Australia are found in r.5.19 of the Regulations which contains two alternative streams: A Temporary Residence Transition nomination stream (r.5.19(3)) and a Direct Entry nomination stream (r.5.19(4)). 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 applicant has applied for approval of a nomination, seeking to satisfy the criteria in the Temporary Residence Transition nomination stream.
The delegate refused the application on the basis the applicant’s nomination did not satisfy r.5.19(3)(d)(i) of the Regulations, because the applicant failed to provide sufficient evidence addressing losses as shown in the financial statements, or sufficient evidence to demonstrate there has been any significant change in circumstances regarding the financial position of the business (as at April 2018). The delegate further found the applicant had not demonstrated sufficient financial capacity to pay the nominee’s full-time salary in the nominated position with full-time employment for at least 2 years.
The applicant appeared before the Tribunal by its duly appointed officer on Friday 18 December 2020 to give evidence and present arguments. The hearing was conducted as a combined hearing with the application [1] for review by the nominee, Gurpreet Singh Taneja (the nominee). The Tribunal also received oral evidence from the nominee and his partner, Ms Upkar Kaur, together with submissions from the applicants’ registered migration agent. All parties and the representative appeared by video in accordance with the Tribunal’s COVID-19 protocol.
[1] Tribunal case file 1816863
For the following reasons, the Tribunal has decided to set aside the decision under review and substitute a decision approving the nomination.
CONSIDERATION OF CLAIMS AND EVIDENCE
The issue in this case is whether the applicant meets the requirements for approval of the nomination under the Temporary Residence Transition nomination stream set out in r.5.19(3), which is extracted in the attachment to this decision. For the nomination to be approved, all the requirements must be met.
The Tribunal has had regard to the Department file and the Tribunal file, together with the submissions in response to the Tribunal’s 359 (2) request made 26 October 2020, made 10 November 2020, 11 December 2020 and 16 December 2020.
The application must be compliant: r.5.19(3)(a)
Regulation 5.19(3)(a) requires that the application for approval must be in the approved form, must be accompanied by the prescribed fee and, where applicable, must include the required written certification relating to conduct that contravenes s.245AR(1). The application must also identify a relevant person and occupation.
The Tribunal finds that the application was prepared by the applicant’s former representative and was made on the form 1395 (Internet) for post 23 March 2013 applications and accompanied by the fee prescribed in r.5.37.The application contains a written certification stating the nominator has not engaged in conduct in relation to the nomination that contravenes s. 245AR(1).
The Tribunal also finds that the application has identified a person who held a Subclass 457 visa (the nominee) on the basis of satisfying clause 457. 223 (4) and identifies an occupation (Cook ANZSCO 351411) as listed in ANZSCO, being the same occupation as carried out by the nominee Subclass 457 visa holder.
Given the above findings, the requirement in r.5.19(3)(a) is met.
Status of the nominator: r.5.19(3)(b)
Regulation 5.19(3)(b) requires the nominator to be or have been the relevant standard business sponsor who is actively and lawfully operating a business in Australia. In addition, the nominator, as that standard business sponsor, must not have met certain criteria relating to the operation of a business overseas, in the most recent sponsorship approval.
From the information in the Department file, the applicant was an approved standard business sponsor in respect of Subclass 457 nominations for the period from 13 November 2014 to 13 November 2017. The applicant is also an approved sponsor for Subclass GK 482 nominations approved on 23 January 2019 for 5 years until 23 January 2024.
The Tribunal finds the applicant is the standard business sponsor who first employed the nominee in 2010, and then as the holder of a Subclass 457 visa in a nomination made under s.140GB of the Act, approved 26 March 2015.
The applicant is a trustee for a family discretionary trust, which operates a large licensed restaurant premises in Melbourne.
At the hearing, the Tribunal noted that the applicant’s website indicated that the applicant’s business, trading as Byblos Bar and Restaurant from leased premises at the World Trade Centre in Melbourne, was currently closed and “only available for takeaway or delivery at this time”.
The applicant’s authorised representative, Ms Ghanem, explained that the Melbourne premises had been compulsorily closed by State Government regulation during a period of pandemic lockdown in that city. She said the applicant had since reopened the business approximately 4 weeks ago and that it was now trading. She said that during the lockdown, the applicant had temporarily relocated its kitchen to a hotel in Collingwood where it continued to function, under the same name, and providing takeaway.
The witness explained that the restaurant has been operating as a full-service restaurant since it opened in 2010, and that the nominee has worked in the applicant’s business since commencement. She said that but for the pandemic, the applicant has not ceased trading and is actively continuing to run its business from the restaurant and from the premises in Melbourne’s CBD where it has been located for the whole of that period since commencement.
The Tribunal has also had regard to the current ASIC document produced as an extract showing the company’s organisational search and recording that it is still registered and active. The applicant has also produced current financial statements and letters from its accountants confirming its current operations. The witness further indicated at the hearing and gave evidence that there is no intention to stop trading or for the business not to continue as it has for the past decade, except for the period of the pandemic.
The Tribunal finds that the applicant is actively and lawfully operating its business in Australia and was not granted the most recent business sponsorship on the basis of meeting either r.1.20DA, r.2.59(h) or r.2.68(i).
Given the above, the requirement in r.5.19(3)(b) is met.
Previous employment of the nominee: r.5.19(3)(c)
Broadly speaking, to meet the requirement in r.5.19(3)(c), either:
· the nominee must have been employed full time in Australia in the position for which he or she holds a Subclass 457 visa for at least 2 of the 3 years preceding the nomination application; or
· the nominee holds a Subclass 457 visa on the basis that s/he was identified in a nomination of a specified occupation for that visa, the nominator nominated the occupation, and the nominee has been employed in that occupation for at least 2 years in the 3 years immediately before the application.
Both the applicant’s representative and the nominee gave evidence that the nominee commenced working part-time in the business as a cook in November 2010, and then full-time from the grant of his Subclass 457 in 2015. The whole of that period, the nominee has remained employed under a contract of employment with the applicant. A copy of the employment contract has been produced, and an updated version from 2 July 2020.
The nominee confirmed in his evidence that he came to Australia originally in 2009 as a secondary applicant on his wife’s student visa. The nominee also studied in Australia obtaining hospitality qualifications, and then commenced employment with the applicant in November 2010, where he has remained working as a cook and in the nominated position since that time.
Given the above findings, the requirement in r.5.19(3)(c) is met.
Future employment of the visa holder: r.5.19(3)(d)
Regulation 5.19(3)(d) only applies to certain nominees (those described in r.5.19(3)(c)(i)). For this class of person, the Regulations require that the nominee will be employed on a full time basis for at least 2 years on terms that do not expressly preclude the possibility of an extension.
The applicant has produced in evidence an employment contract with the nominee made 2 July 2020 referring to the nominee’s start date in his full-time position as 26 January 2015. The nominee has long since completed any probationary requirement which in any event is precluded for the application for this particular nomination. The employment contract does not exclude the possibility for extending the employment, and in evidence the applicant’s witness stated they wish to retain the nominee “for as long as possible”.
The employment contract however is not the only criterion which might provide suitable evidence as regards the future employment of the nominee as the visa holder. In this instance, the delegate regarded the financial evidence, or rather the lack of substantial financial evidence, as a cause for concern. The concern being that the business may not prove viable and may not continue sufficiently so as to form a reasonable conclusion the nominee might be engaged full-time as a cook, for the minimum period of 2 years.
The Tribunal accepts that consideration of current financial statements is a relevant consideration as to the viability of the business and future employment for a visa holder. The concerns raised in respect of the financial information produced in 2017, showed a range of profitability for the business and cash flows which on their face might lead to a conclusion that the business was not performing sufficiently to provide a reasonable basis to conclude the nominee’s employment would continue.
To meet the concern, in its most recent submissions in November and December 2020, the applicant representative provided a financial summary covering the period from July 2016 to June 2020.[2]
[2] representative submission dated 8 December 2020 from AIS Immigration Solutions
The applicant further provided a statement from the current accountant[3] dated 15 December 2020. The accountant produced adjusted figures for each of the financial years 2017 to 2020, reflecting the applicant’s trading position and adjustments based on depreciation allowances added back, together with related party director fees and net profits from ordinary activities before tax. Importantly, the figures included all wages for the 20 staff engaged in the Melbourne business and which included the nominee.
[3] Viden Group Pty Ltd
The Tribunal has no reason not to accept the accountant’s evidence, corroborated by the applicant’s representative at the hearing and which demonstrates on an adjusted basis, a net profit in each financial year reported, save for the current year 2020, and in respect of which some consideration must be given, due to the downturn caused by the pandemic.
The Tribunal has had regard to Policy, which although not binding on the Tribunal, provides a reasonable basis for decision-making utilising accounting information. Policy suggests that it may be incumbent on an applicant to explain financial performance, including losses, resulting from legitimate business decisions, and which may result in increased equity in the business or a potential to result in increased profitability or competitive advantage.
The Tribunal has had regard to the financial information produced and is satisfied the financial statements reflect reasonable and legitimate business decisions for the conduct and operation of the restaurant. According to the evidence from the witnesses appearing, it is a large enterprise, seating approximately 120 patrons downstairs, and function rooms upstairs providing for similar numbers. The applicant has recently invested in upgrading materials such as crockery and cutlery, and on the balance sheet, reducing accruing GST and increasing directors’ equity.
The applicant’s witness explained the business also operates in Queensland where it conducts several large-scale restaurants with its particular Lebanese branding. The witness said the Melbourne undertaking, which is a discrete business, has also been long-established and well regarded in the hospitality business and which the applicant intends to continue.
The Tribunal has had regard to the accountant’s report which most recently indicates that “the business profitability has increased year-on-year to the peak in 2018, however 2019 reduced marginally yet the gross profit margin remained stable.” The report goes on to refer to the paying down of the accruing GST liability and points to the impact of COVID-19 “in Melbourne has been the most significant factor in the reduction in profitability”. Even so, the report points out that the “gross profit margin again remained consistent”.
Policy proposes that: “Decision-makers should bear in mind that the assessment they are making is whether the business has the capacity to meet its employment obligations in regard to the nominee for a period of at least two years. The assessment is based on a future projection of the financial capacity of the business in an environment that is subject to change. While there is an element of subjectivity, decision makers are to make their considered assessments based on factual historical financial data and actual details about the size, nature and scope of the business.”
The Tribunal finds it is satisfied the applicant’s business is viable based on the historical information produced, the current financial evidence as corroborated by the accountants, and taking into consideration the submissions that the applicant intends to maintain the business in the current environment, and from the existing premises where the applicant holds the lease until 2025, and with an option to renew.
The Tribunal finds that the current evidence aligns with Policy and a reasonable projection in terms of profitability and financial performance for at least the next 2 years, considering the nomination, and probably for a considerably longer period.
Given the above findings, the Tribunal finds it is satisfied that the requirement in r.5.19(3)(d) is met.
No less favourable terms and conditions of employment: r.5.19(3)(e)
Regulation 5.19(3)(e) requires that the terms and conditions of employment applicable to the nominated position will be no less favourable than those that are, or would be, provided to an Australian citizen or permanent resident performing equivalent work in the same workplace at the same location.
The Tribunal has considered the applicant’s written contract of employment. The Tribunal also asked questions of the nominee as to his employment and the conditions at his workplace, including salary provision and hours worked. The nominee explained that he felt his employment conditions were very good, that he was held in high regard and respected. He said he had worked regularly as a cook under direction from the head chef and was not aware of any complaints or concerns about his performance. He said he loved the work and was very appreciative of what he referred to as “support” from his employer.
The applicant’s representative commented that the nominee had worked above and beyond his station by continuing to provide his labour during the Melbourne lockdown, working at the alternative kitchen to produce and assist in the temporary takeaway business as the only permitted service, notwithstanding that he could have taken advantage of the Job Keeper. program so as to actually reduce his workload without affecting his income. She said he was a very loyal and hard-working employee and who the applicant was “desperate to keep”.
The Tribunal has had regard to the current evidence which indicates the applicant’s salary is well within the range [4] ($40,000-$56,000) payable for a cook working in a similar environment in Australia. The applicant’s salary is $53,900 plus superannuation. The nominee stated he works regular shifts on a full-time basis currently 5 days per week. The nominee explained the restaurant pre-COVID trades regularly 7 days per week from approximately 12 noon until 10 PM. He said he works a roster in which he shares with 2 of the chefs.
[4] PayScale Australia
The applicant’s witness explained that of the 20 staff, all are Australian citizens or permanent residents (except for temporary or casual staff employed during peak seasons), and except for the nominee who is the only visa holder. The applicant’s witness said that this is their initial experience of a nomination application. The witness said it has proved very difficult to locate, retain and recruit adequate restaurant staff, including kitchen staff which is highly competitive. She said as far as the applicant is aware, it pays in accordance with industry and Award rates, has always met its PAYG obligations and salary obligations to the nominee.
Having regard to this evidence, the Tribunal finds it is satisfied that the terms and conditions of the standard written employment agreement, and as per the description provided by the nominee of his duties and work responsibilities, are no less favourable than those that are or would be provided to an Australian citizen or permanent resident performing equivalent work in the same workplace at the same location
Accordingly, the requirement in r.5.19(3)(e) is met.
Training commitments and obligations: r.5.19(3)(f)
Regulation 5.19(3)(f) requires the applicant to have fulfilled any commitments made relating to meeting training requirements, and complied with applicable obligations relating to training requirements, during the period of the applicant’s most recent sponsorship approval. These requirements may be disregarded if it is reasonable to do so.
The Tribunal finds that the applicant’s most recent sponsorship approval dates from 23 January 2019 to 23 January 2024. Formerly, the applicant was a standard business sponsor for Subclass 457 visa applications in the period from 13 November 2014 to 13 November 2017.
The Tribunal notes that from 12 August 2018, among various changes introduced by statute, the relevant training regulation [5] which had required an approved standard business sponsor to meet certain training Benchmarks, was repealed. Those Benchmarks required either expenditure based on total payroll at a rate of 1% for up skilling or training Australian citizens or permanent residents (Benchmark B), or 2% of payroll to an industry training fund (Benchmark A).
[5] R 5.19(3)(f)

If the former regulation applied, the applicant was required to meet those Benchmark obligations in each of the financial years ending June 2016 and June 2017. The applicant provided evidence of training expenditure in July 2016 and March 2017, to a total value of $9,691.The Tribunal noted that it did not have sufficient evidence of the payroll expenditure in each of those years to determine whether that met the threshold 1% necessary for Benchmark B.
The Tribunal finds that regardless, the repealed regulation makes provision wherein the particular facts or circumstances found by the decision-maker, might be “reasonable to disregard”. The Tribunal notes that the recent payroll activity summary provided by the applicant for the period 20 April 16 to 19 April 17 shows a total payroll figure for all employees of approximately $772,000. The evidence of training expenditure provided relevantly under the previous SBS of $9,691, in total, exceeded the then required benchmark B requirement of 1%.
Further, the Tribunal finds that the applicant was most recently approved as a standard business sponsor on 23 January 2019 for a further period of 5 years. The requirements at the time of this sponsorship approval do not include any training commitments that have to be fulfilled by the applicant. The Tribunal finds therefore that the sponsorship obligation does not apply to this case as from the commencement of the SBS agreement on 23 January 2019.
In any event considering the expenditure under the previous SBS agreement, the Tribunal finds it would be reasonable to disregard any training expenditure requirement found to exist and that the Tribunal considers the requirements relating to training have been satisfied.
Accordingly, the requirement in r.5.19(3)(f) is met.
No adverse information known to Immigration: r.5.19(3)(g)
Regulation 5.19(3)(g) requires that there is no adverse information known to Immigration about the nominator or person associated with the nominator; or it is reasonable to disregard any such information. For these purposes, ‘adverse information’ and ‘associated with’ have the meaning given in rr.1.13A and 1.13B.
The Tribunal notes that the applicant was previously subject to a sanction issued by the Department and effective 27 March 2012 until 13 November 2014. A bar of 18 months against the sponsor was found to be warranted and imposed. The imposition of a sanction imposing a bar on the applicant constitutes adverse information within the meaning given in rr.1.13A and 1.13B.
The Tribunal raised this issue with the witnesses at the hearing, none of whom were aware of the previous sanction, imposed more than 8 years ago. The Tribunal is not aware of any further sanction, investigation or imposition of any penalty imposed on the applicant for any breach found to occur since March 2012.
The Tribunal notes that on the information before it there is nothing to indicate the applicant, or any associated entity or person, has been found guilty of an offence, acted in contravention of a relevant law or been the subject of an administrative action for contravention of such a law. The Tribunal notes the applicant is currently not under investigation nor subject to disciplinary action or legal proceedings or regarding any contravention of any relevant law.
Taking into account the current circumstances of the applicant, which demonstrate it is meeting all its current sponsorship requirements, and that no further issues have been raised either by the Department or any other person or entity and that nothing further has been disclosed to the Tribunal, the Tribunal finds it is reasonable in the circumstances not to have regard to the previous sanction incurred outside the more recent history, and which has not occurred within the last 3 to 5 years.
Accordingly, the requirement in r.5.19(3)(g) is met.
Satisfactory compliance with workplace relations laws: r.5.19(3)(h)
Regulation 5.19(3)(h) requires the applicant to have a satisfactory record of compliance with the laws of the Commonwealth, and of each State or Territory in which the applicant operates a business and employs employees in the business, relating to workplace relations.
The applicant’s representative gave evidence at the hearing that it has complied with applicable workplace relations laws, and which the nominee himself indicated, at least as far as his own circumstances were concerned, was correct. The nominee assured the Tribunal that in his own case, all his contractual and workplace obligations were being met.
The Tribunal finds there is no evidence before it to indicate that the applicant does not have a satisfactory record of compliance with workplace relations laws in the locations in which it operates a business and employs staff.
Accordingly, the requirement in r.5.19(3)(h) is met.
Based on the findings above, the Tribunal is satisfied that the applicant meets the requirements of r.5.19 for approval of the nomination of the position in Australia.
DECISION
The Tribunal sets aside the decision under review and substitutes a decision approving the nomination.
Alan McMurran
Member

ATTACHMENT - EXTRACTS FROM THE MIGRATION REGULATIONS 1994
5.19Approval of nominated positions (employer nomination)
…
(2)The application must:
(a)be made in accordance with approved form 1395…; and
(aa) include a written certification by the nominator stating whether or not the nominator has engaged in conduct, in relation to the nomination, that constitutes a contravention of subsection 245AR(1) of the Act; and
(b)be accompanied by the fee mentioned in regulation 5.37.
Temporary Residence Transition nomination
(3)The Minister must, in writing, approve a nomination if:
(a)the application for approval:
(i)       is made in accordance with subregulation (2); and
(ii)      identifies a person who holds a Subclass 457 … visa granted on the basis that the person satisfied the criterion in subclause 457.223(4) of Schedule 2; and
(iii)     identifies an occupation, in relation to the position, that:
(A)is listed in ANZSCO; and
(B)has the same 4-digit occupation unit group code as the occupation carried out by the holder of the Subclass 457 … visa; and
(b)the nominator:
(i)       is, or was, the standard business sponsor who last identified the holder of the Subclass 457 … visa in a nomination made under section 140GB of the Act or under regulation 1.20G or 1.20GA as in force immediately before 14 September 2009; and
(ii)      is actively and lawfully operating a business in Australia; and
(iii)     did not, as that standard business sponsor, meet regulation 1.20DA, or paragraph 2.59(h) or 2.68(i), in the most recent approval as a standard business sponsor; and
(c)either:
(i)       both of the following apply:
(A)in the period of 3 years immediately before the nominator made the application, the holder of the Subclass 457 …visa identified in subparagraph (a) (ii) has:
(I)held one or more Subclass 457 visas for a total period of at least 2 years; and
(II)been employed in the position in respect of which the person holds the Subclass 457 … visa for a total period of at least 2 years (not including any period of unpaid leave);
(B)the employment in the position has been full-time, and undertaken in Australia; or
(ii)      all of the following apply:
(A)the person holds the Subclass 457 … visa on the basis that the person was identified in a nomination of an occupation mentioned in sub-subparagraph 2.72(10)(d)(iii)(B) or sub-subparagraph 2.72(10)(e)(iii)(B);
(B)the nominator nominated the occupation;
(C)the person has been employed, in the occupation in respect of which the person holds the Subclass 457 … visa, for a total period of at least 2 years in the period of 3 years immediately before the nominator made the application; and
(d)for a person to whom subparagraph (c)(i) applies:
(i)       the person will be employed on a full-time basis in the position for at least 2 years; and
(ii)      the terms and conditions of the person’s employment will not include an express exclusion of the possibility of extending the period of employment; and
(e)the terms and conditions of employment applicable to the position will be no less favourable than the terms and conditions that:
(i)are provided; or
(ii)would be provided;
to an Australian citizen or an Australian permanent resident for performing equivalent work in the same workplace at the same location; and
(f)either:
(i)       the nominator:
(A)fulfilled any commitments the nominator made relating to meeting the nominator’s training requirements during the period of the nominator’s most recent approval as a standard business sponsor; and
(B)complied with the applicable obligations under Division 2.19 relating to the nominator’s training requirements during the period of the nominator’s most recent approval as a standard business sponsor; or
(ii)      it is reasonable to disregard subparagraph (i); and
Note Different training requirements apply depending on whether the application for approval as a standard business sponsor was made before 14 September 2009 or on or after that date.
(g)either:
(i)       there is no adverse information known to Immigration about the nominator or a person associated with the nominator; or
(ii)      it is reasonable to disregard any adverse information known to Immigration about the nominator or a person associated with the nominator; and
(h)the nominator has a satisfactory record of compliance with the laws of the Commonwealth, and of each State or Territory in which the applicant operates a business and employs employees in the business, relating to workplace relations.

[2020] AATA 6078

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