Gurbani Australia Pty LTD (Migration)

[2023] AATA 1828

Gurbani Australia Pty LTD (Migration) [2023] AATA 1828 (7 March 2023)

DECISION RECORD

DIVISION:Migration & Refugee Division

APPLICANT:  Gurbani Australia Pty LTD

REPRESENTATIVE:  Mr Bimal Bhattarai (MARN: 9685736)

CASE NUMBER:  2105360

HOME AFFAIRS REFERENCE(S):          OPF2020/13557

MEMBER:Wan Shum

DATE:7 March 2023

PLACE OF DECISION:  Sydney

DECISION:The Tribunal sets aside the decision under review and substitutes a decision to bar the sponsor under s 140M from sponsoring more people under the terms of the approved standard business sponsorship until 19 April 2022.

Statement made on 7 March 2023 at 4:49pm

CATCHWORDS

MIGRATION – sponsorship cancellation or bar – record keeping obligations – ensuring equivalent terms and conditions of employment – providing false or misleading information – sponsored person underpaid – overdue pay and superannuation corrected – pay slip software issue – ensuring Award wages and superannuation contributions are made – substantial compliance – decision under review set aside       

LEGISLATION

Migration Act 1958, s 140
Migration Regulations 1994, rr 2.79, 2.82, 2.86, 2.89-2.94

STATEMENT OF DECISION AND REASONS

APPLICATION FOR REVIEW

1.This is an application for review of a decision made by a delegate of the Minister for Home Affairs to take an action under s 140M of the Migration Act 1958 (Cth) (the Act) in relation to the applicant’s sponsorship.

2.The applicant was approved as a standard business sponsor on 6 February 2019 for five years. On 9 April 2021, the delegate decided to cancel the applicant’s (the sponsor’s) approval as a standard business sponsor under 140M(1)(a) and bar the sponsor for 2 years from making applications for approval as a standard business sponsor or temporary activities sponsor under s 140M(1)(d).

1. The sponsor sought review of that decision and appointed a migration agent for the review.

   4.On 9 November 2022, the Tribunal invited the sponsor to give oral evidence and present arguments at a hearing on 30 November 2022. The Tribunal received three requests to postpone the hearing which it agreed to due to health issues of Mr Sunil Mor, the Director, but then on 17 January 2023 was notified that Mr Mor would not participate in the hearing and consented to the Tribunal proceeding to make a decision on the review without taking any further action to allow or enable him to appear before it. This matter has therefore been determined on the evidence available to the Tribunal.

   5.The Tribunal was provided with information from the Department which was covered by a non-disclosure certificate issued by an Immigration officer pursuant to s 376 of the Act. The Tribunal provided a copy of the certificate to the sponsor seeking comments on the validity of the certificate. In response, the Tribunal was informed that the certificate was issued in respect of baseless allegations and that it is up to the tribunal to validate or invalidate if it believes there is sufficient public interest element in it (harm to the nation or public). The comments appear to be addressing whether the information covered by the certificate is reliable instead of whether it was validly issued. In this regard, the Tribunal notes that the certificate is electronically dated and signed and stated that the release of the documents would be contrary to the public interest because it would disclose, or enable a person to ascertain the existence or identity of, a confidential source of information and the information was provided “in confidence”, the provider of the information has not consented to the disclosure of the information to the review applicant. The Tribunal considers that the reasons given for non-disclosure are specific, detailed and correctly identify the reason for non-disclosure and is therefore of the view that the certificate is valid. However, the allegation was not supported by evidence and the Tribunal has focused on the information which arose through the sponsor monitoring in making its decision.

2. For the following reasons, the Tribunal has decided set aside the decision under review and substitutes a decision to bar the sponsor under s 140M from sponsoring more people under the terms of the approved standard business sponsorship until 19 April 2022.

   CONSIDERATION OF CLAIMS AND EVIDENCE

3. Sections 140K, 140L and 140M of the Act provide for the imposition of sanctions on approved sponsors in certain circumstances.

4. 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.

5. 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.

6. 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.

   Sponsor monitoring

7. The Department commenced monitoring of the sponsor in October 2020 following an allegation. The monitoring period was from 1 January 2020 to 1 July 2020. The sponsor had sponsored Mr Sandeep Singh under the Temporary Business Activity program for the nominated occupation of Café or Restaurant Manager which was approved and a Subclass 457 visa was granted to Mr Singh (the sponsored person) on 30 March 2017 for a period of 4 years.

8. As part of the monitoring, officer(s) of the Department interviewed the sponsored person on 23 November 2020, and then Mr Sunil Mor on 8 December 2020.  

9. The officers obtained copies of the sponsored person’s payslips from him directly and also from the sponsor, for the monitoring period 1 January 2020 to 1 July 2020. They also requested time sheets of the sponsored person and the roster from the sponsor, as well as from DEPUTEC in relation to Deputy, which is a scheduling system used by the sponsor for recording hours of work.

10. During the monitoring, the delegate identified a potential failure to satisfy a sponsorship obligation in respect of: reg 2.79 - the obligation to ensure equivalent terms and conditions of employment for the sponsored person; reg 2.86 - rostered for work outside the scope of the nominated position and discrepancies between sponsored person and Mr Mor regarding duties performed; reg 2.82 - obligation to keep records. In addition, the delegate was of the view that the sponsor had breached reg 2.90 – provision of false or misleading information.

11. The perceived failure arose from examination of payslips and records provided by the sponsor and DEPUTEC regarding the sponsored person’s employment which reflects that he is being paid $57,500 per annum.

    16.Based on the payslips, the delegate was of the view that the sponsored person had not been receiving the annualised salary he is entitled to under the Restaurant Award 2010 (Award) and had been working substantially more hours than 38 hours per week. The delegate also considered that for the 2020/21 Financial Year, the sponsored person should have received $59,749 under the Award – which is the minimum amount an Australian would receive in his position - and not $57,500. The delegate considered that the sponsored person has been underpaid $2,135.21 for the 2019/20 financial year. Furthermore, the delegate considered that the the sponsor has failed to contribute to Superannuation within statutory timeframes.

    17.Having regard to information contained on the rosters, the delegate was of the view that the sponsored person was rostered in the coffee bar and kitchen which is out of scope of the nominated position of café/restaurant manager. This information matched that of the information provided by the director, Mr Sunil Mor at the interview and that there appeared to be discrepancies in the information provided by the sponsored person and director in relation to the duties performed. The delegate was also of the view that timesheets and rosters provided by a third party, Deputec Pty Ltd, shows the sponsored person working hours outside of the café’s trading hours.

    18.Based on the rosters and timesheets provided by the sponsor and Deputec Pty Ltd, the delegate was of the view that the sponsor altered the data on the rosters and timesheets to mislead the ABF and to show compliance with the obligations. Moreover, there appears to be discrepancies in the payslips provided by both Deputec Pty Ltd and sponsor. Whilst the calculations and payments match, the written data recorded is different.

12. The delegate invited the sponsor to address the perceived failures in a notice of intention to take action (NOITTA) dated 11 November 2020.

    20.In response, the representative provided a response stating that the sponsor was not aware of the wage difference and have agreed to comply with the calculation made by the ABF. The sponsor has since paid the sponsored person the difference of $4895 which was evidenced by a Commonwealth Bank of Australia receipt. In relation to Superannuation, the sponsor states that due to administrative errors, there was a shortfall in the Superannuation of the visa holder which is now revised and paid up to date from the time the sponsored person started working for the business and provided receipts as evidence of back pay. In terms of work hours, it was explained that time keeping is done electronically and the sponsored person is responsible to accurately enter the time and that this system has been revised and from now, the sponsored person will record his hours, and sign and date before the wages is processed and that wage book will be in the hands of the sponsor as the employer. It was explained that the copy of that record will be available to the monitoring unit whenever needed. Finally, it was submitted that the sponsor is a decent business in regional area and employs more than 25+ people who are mostly locals and the sponsored person manages the entire workforce and has 24 hours access to the premises whenever he wants to, in order to manage day to day business therefore his contribution to the employment of locals in significant. It was also submitted that the sponsor has provided information “best to their knowledge” for the purpose of monitoring, and that the sponsor is “willing to accommodate any recommendations”, they have only sponsored one person on a Subclass 457/482 visa and has no plans to employ anyone else soon other than the sponsored person.

    Does a circumstance for the taking of an action exist?

    21.In the present case, the delegate found that the sponsor had failed to satisfy a sponsorship obligation, specifically: has not met the obligation to ensure equivalent terms and conditions of employment for the sponsored person; has not kept records and appears to have manufactured the payslips to comply with obligations during the monitoring; had not met the obligation to ensure primary sponsored person works or participates in nominated occupation, program or activity. The manufactured payslips was considered to be provision of false or misleading information.

    Failure to satisfy a sponsorship obligation: reg 2.89

13. 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).

    23.In determining whether there was a breach of reg 2.79, the sponsorship obligation is not only that the sponsor is required to ensure that the terms and conditions of employment provided to the primary sponsored person are no less favourable than those based on which the nomination was approved; but also that the terms and conditions of employment provided to the primary sponsored person are no less favourable than the terms and conditions of employment that the sponsor provides, or would provide, to an Australian citizen or an Australian permanent resident to perform equivalent work in the person’s workplace at the same location.

    24.The response to the NOITTA in summary was essentially that the sponsor was not aware that the terms and conditions of employment provided to the sponsored person needs to be at least the annualised salary for that classification under the Award. However, while the payment shortfall was made, the Tribunal notes that this is a sponsorship (and employment) obligation and the failure to comply with this requirement is concerning. In terms of whether the sponsored person worked more than 38 hours per week, the responses given to the Department and to the Tribunal on review appear to claim that the sponsored person was not properly using the Deputy system to log on and off, with the submissions of 6 March 2023 stating that the sponsored person was “new to this system” and was “using his entry and exit card whenever he wanted to use, including after hours and also to visit friends, and sometime he even used to go and eat in the restaurant and all that was recorded by the Deputec.” The submissions were that because of this “[t]he employer had to change this and pay the staff correctly according to the contract and according to the hours worked…” and “believe it is the employer’s prerogative to check employee’s hours and pay accurately” but without explaining how the employer accurately monitored hours worked if not using the Deputy system which is the tool utilised by the sponsor to record employee time and attendance.

    25.The response reflects that the sponsored person was attending the premises even when he was not working and that this was recorded by the Deputy system. It was further suggested that the sponsored person was not properly using the Deputy system. However, if this was the case, the Tribunal is of the view that the sponsor should have ensured that the sponsored person was properly using the system and not simply adjusting the hours worked to reflect the contract unless that was in fact the hours worked by the sponsored person for that pay period.

    26.The Tribunal acknowledges that the hours of work provided by DEPUTEC to the Department are at odds with the claimed opening hours of the Scrumptious Café in Orange, NSW. It is claimed that the café opening hours are in the daytime, whereas the hours provided by DEPUTEC reflect that the sponsored person commenced his shift any time between 18:30 to 21:30 and ceased any time between 11:30pm to 6:15am the next day, with the most common start time of 18:30 and end time of 4:00am. According to the table which contains records from DEPUTEC and those from the sponsor, a copy of which was provided for the sponsor to comment on, the hours worked varied between 3 and 15 hours, mostly between 7 to 9 hours. Given the hours do not reflect that of a café which is open for breakfast until early afternoon, the Tribunal has considered whether the start and end times recorded should be re-aligned so that e.g. the shift time of 2 January 2020 would reflect a start time of 4:00am on 2 January 2020 and an end time of 18:30 on 2 January 2020 and not a shift start time of 18:30 on 1 January 2020 and end time of 4:00am on 2 January 2020. The Tribunal has also considered the roster records provided by the sponsor to the Department, which includes a copy of the roster on 2 January 2020. This reflects that the sponsored person was rostered to work from 05:30 AM - 03:00 PM in the Kitchen, with the Deputy records would more closely align with the start and end times on the roster if reversed. However, if that was the case, the sponsored person’s hours of work recorded on Deputy for the shift on 2 January 2020 would be 14 hrs and 30 minutes which would clearly exceed 38 hours per week if extrapolated to 5 days of work. The rosters provided by the sponsor from January to July 2020 reflect that the sponsored person was rostered for 46 hours of work per week on average which, while it exceeds 38 hours per week as per the contract, would reflect those of a café that trades from the morning till afternoon.

    27.In terms of the hours of operation of the café recorded on Google at the time of the monitoring, Mr Mor claimed in his statutory declaration that the business was purchased in 2018 and when the sponsor started operating, they did not advertise online or contact Google. It was submitted by the representative that the previous operators may have had different hours and the opening hours appearing online were not changed until sometime later. It was submitted that the cafe’s trading hours are 6am-5pm Monday to Friday and 7am-3pm Saturday and Sunday and the representative sought to prove that even now, the information from the Google website was not entirely accurate, with the screenshot provided reflecting closing hours of 11pm which the employer disputes.

    28.While the Tribunal accepts as a general statement that information appearing on Google searches does not necessarily accurately reflect the opening hours of any given business, there is no other reliable and contemporaneous evidence of the actual hours worked by the sponsored person. If the sponsored person’s hours were being checked by the sponsor when making wage payments as submitted, then the sponsor as the employer should have ensured that the sponsored person and all other employees were properly using the Deputy system. This is particularly important when the sponsored person’s claimed position is that of café manager and Mr Mor’s comments and response included that “most of the supervision of Deputy is done by [the sponsored person]” which would mean that he would need to have accurate information regarding the other employee’s work hours for the purposes of creating rosters etc. Even if the sponsored person had not been using Deputy properly, the failure to ensure accurate records lies with the sponsor.

    29.The Tribunal concurs with the delegate that there was a failure to ensure that the nominated salary paid to the sponsored person was no less favourable than the terms and conditions of employment that the sponsor provides, or would provide, to an Australian citizen or an Australian permanent resident to perform equivalent work in the person’s workplace at the same location. This is because the annual salary of $57,500 appearing on the payslips was less than the annualised salary of $59,749 for financial year ending 30 June 2020 which is the minimum salary payable under the Award for a café/restaurant manager. The failure to make superannuation contributions until 9 months after the sponsored person’s employment commenced is another failure to ensure compliance with the terms and conditions that would be provided to an Australian employee. The Tribunal considers that there was a breach of reg 2.79(3)(a)(iv) for the financial year ending 30 June 2020 and therefore a breach of reg 2.89. The Tribunal considers that this obligation was not met.

    30.The Tribunal considers that there was a failure to meet reg 2.79 and reg 2.82. In terms of reg 2.86, while there is some information which suggests that the sponsored person was rostered for work in the ‘kitchen’ and ‘coffee bar’, on the whole, the information reflects that he had worked as a manager of Scrumptious Café. Given the failures to comply with two obligations, 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.

    False or misleading information: reg 2.90

1. 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).

   32.In respect of the perceived breach of reg 2.90, the Tribunal will first address the discrepancy identified by the delegate in the payslips from the sponsor and those provided by the sponsored person. The payslips provided by the sponsor set out under the year to date column a payment described as “other previous earnings” while those provided by the sponsored person have “Mon-Fri rate” and “Other previous earnings” which added together amount to same total under the year to date column. In response to the Tribunal’s invitation to comment on this information, Mr Mor claimed that they were investigating this issue with the software provider “Xero” to determine why the system is making an error. Mr Mor explained that the amount paid is correct but that the errors which appear in the pay slip appear to be a software issue. It was submitted that the pay slips are automatically generated by the system once the hours are filled in and there are bank statements to verify pay slips therefore pay slips could not be wrong or manufactured for convenience because the pay slip match with the bank deposits.

   33.Having considered the details contained on the payslips provided by the sponsor and the sponsored person, as well as the regular payments made by the sponsor as reflected in the redacted bank account statements, the Tribunal notes that the critical information of pay period, payment date, gross and net pay and year to date are the same. Although it is unclear why the payslips provided by the sponsor and sponsored person are not exactly the same in appearance, the Tribunal does not consider that the use of different descriptors of itself leads to a finding that the sponsor provided false or misleading information.

   34.In respect of the rosters provided, the Tribunal does have concerns as to the reliability of this information and notes further that the rosters appear to include locations of ‘kitchen’ and ‘coffee bar’. There does appear to be a discrepancy with other records of timesheets before the Tribunal. However, it is the Tribunal’s understanding that a roster would not necessarily match the actual hours worked by an employee(s), particularly in hospitality where factors such as customer numbers may have an impact on closing time. This is why it is necessary to have an employee clock in and out of work, whether by manual timecards or by using an app or by facial recognition which some venues utilise and is one of the optional capabilities of the Deputy system.[1]

   [1] the Tribunal does not consider that the evidence supports a conclusion that the sponsor had provided false or misleading information to Immigration and is not satisfied that the prescribed circumstance in reg 2.90 exists for the purpose of s 140M of the Act.

   Action to be taken

2. For the reasons outlined above, 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.

3. In considering what action to take, the Tribunal has had regard to the prescribed criteria, as extracted in the attachment to this decision.

   38.The Tribunal considers the following matters to be relevant: that the sponsor has rectified the underpayments of wages and superannuation contributions and seeks to use the Deputy system properly to record employee work hours accurately; that the failure to ensure the sponsored person was paid the Award wages did not appear to be intentional as the wages paid to the sponsored person reflected the employment contract; that the wages paid to the sponsored person, except for 2020/21 due to COVID-19 exceed the annualised wage applicable for his classification under the Award; and that the sponsored person is still employed in the same position and has sought review in respect of the visa refusal connected with the sponsor’s ENS application. Having considered these matters with regard to Division 3A of the Act, and in particular Subdivision D, as well as Division 2.21 of the Regulations, the Tribunal has decided that it is not appropriate or proportional to cancel sponsor’s approval as a standard business sponsor under 140M(1)(a) and bar the sponsor from making future applications for approval as a work sponsor for a period of 2 years.

4. However, considering the failures to comply with the obligations identified above and having regard to the significance of ensuring Award wages are met and superannuation contributions are made, as well as the need to ensure accuracy of record keeping, the Tribunal finds that the action mentioned in s 140M(1)(c) to bar the sponsor from sponsoring more people under the terms of the approved standard business sponsorship until 19 April 2022 should be taken.

   DECISION

   40.The Tribunal sets aside the decision under review and substitutes a decision to bar the sponsor under s 140M from sponsoring more people under the terms of the approved standard business sponsorship until 19 April 2022.

   Wan Shum
   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.

   …