H Koya And S Koya (Migration)

H Koya And S Koya (Migration) [2020] AATA 5867 (14 December 2020)
DECISION RECORD
DIVISION:Migration & Refugee Division
APPLICANT:  H Koya And S Koya
CASE NUMBER:  1824702
HOME AFFAIRS REFERENCE(S):          BCC2017/4800657
MEMBER:De-Anne Kelly
DATE:14 December 2020
PLACE OF DECISION:  Brisbane
DECISION:The Tribunal affirms the decision under review to refuse the nomination.

Statement made on 14 December 2020 at 9:45am
CATCHWORDS
MIGRATION – approval of a nomination – Temporary Residence Transition Nomination stream – financial capacity to employ the nominee for at least 2 years – business operations are due to cease – impact of COVID-19 pandemic – no evidence of distribution to the partners – employer’s high regard for the nominee – decision under review affirmed
LEGISLATION
Migration Act 1958, ss 48, 359
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 Home Affairs on 10 August 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 15 December 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 on the basis of the evidence before the delegate the nominator failed to demonstrate its financial capacity to such that the appointment will provide the employee with full time employment for at least 2 years and to meet all employment obligations for two years full time employment.
The applicant appeared before the Tribunal on 17 November 2020 to give evidence and present arguments. This was a dual hearing of both the employer nomination refusal review and the visa application refusal review.
The applicant was represented in relation to the review by its registered migration agent, Mr Ernie Hu MARN: 1383659. The agent attended the hearing.
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 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.
On 5 December 2017 the nominator H Koya and S Koya lodged an employer nomination visa subclass 186 in the Temporary Residence Transition (TRT) stream for the position of Sales and Marketing Manager ANZSCO 131112 in favour of Mrs Kanchan Bala. The partnership owns and operates two business Koya’s Curry House 1 and Cityscape Cleaning.
Documents including the following were provided;
1)Letter dated 23 September 2020 from the registered migration agent advising the business operations are due to cease in the coming months due to the effects of COVID-19. The letter states;
‘Although the partnership will not be able to continue employing Ms Bala for the next two years and beyond, Ms Bala still requests for the opportunity to present oral evidence before a decision is made by the Tribunal on her visa refusal appeal. Ms Bala is requesting for this on the basis that there are unique or exceptional circumstances which may warrant the Minister’s invention.’
The letter lists these circumstances as follows; the partnership had intended to continue employing the nominee had it not been for COVID-19 effecting the business financially; the nominee had no control over the financial performance; the nominee continued to work for the partnership for nearly three years after the nomination was lodged; a customer has provided a glowing reference for the nominee and may be willing to sponsor the nominee in the future; the nominee’s son arrived in Australia as a minor and has integrated himself into the Australian community and bot the nominee and her son are of good character. The letter further maintains that exceptional economic and cultural benefits will result from allowing the nominee and her son to remain in Australia.
2)Letter dated 14 September 2020 stating that the financial losses for the FY 2018 and 2019 were due to the distribution to the partners being $59,768 and $131,740 respectively. The revenue for the cleaning business increased 100 % for the FY 2019. Despite this they intended to close both businesses. The nominee has performed the duties of her position admirably.
3)Financial statements for FY 2018 and FY 2019.
4)BAS 2018.
5)Tax returns 2018 and 2019.
6)Job description.
7)Exchange of emails between nominee and prospective clients.
8)Selection of advertisements for business development managers.
9)Employment contract dated 20 November 2017.
10)Notification of nomination approval dated 2015.
11)PAYG payment summaries dated 2016; 2017; 2018; 2019 and 2020 for the nominee.
12)Payslips for the nominee.
13)Notice of assessment for the nominee 2010;2011;2012; 2013;2014;2015; 2016; 2017; 2018 and 2019.
14)Receipt for training expenditure dated 29 June 2017.
15)Letter accountant dated 2017.
16)Letters of support; qualifications and references for the nominee.
17)Banks statements.
18)Letter dated 23 September 2020 from a beachside resort with an unrelated ABN number stating that it would be their intention to sponsor the nominee if her visa situation changed.
19)Photos of the owners of the resort and the nominee.
20)Letter of offer dated 15 September 2020 to nominee’s son of Certificate III in Painting and Decorating. Receipt for course fees.
21)Certificate of education awarded to nominee son.
22)Bronze lifesaving medallion for nominee son.
23)Tenancy agreement for the nominee.
24)Bank account and drivers’ licence for nominee son.
25)Police clearances for nominee and son.
Documents including the following were provided after the hearing;
26)Letter dated 4 December 2020 from the registered migration agent stating the cleaning business has suffered from COVI-19; business did not improve in the FY 2021 which caused the restaurant side of the nominators business to close. They state that although the initial plan was to close the cleaning business they have not done so but the owner Ms Koya is undertaking some of the cleaning herself to reduce contractor payments; the nominee has been working hard to obtain more business and they have secured a cleaning contract with an apartment complex and the nominee has been working reduced hours to support the business recovery. The registered migration agent request that the Tribunal apply for Ministerial intervention in respect of the nominee’s visa application.
27)Financial statements for 2019 and 2020.
28)BAS Q3, Q4, 2019; Q1, Q2, Q3, 2020
29)Bank statements 25 May to 25 November 2020.
30)Emails between the nominee and prospective customers.
31)Organisation chart.
32)Payslips 2020 for the nominee showing gross for FY 2020.
33)Letter dated 1 December 2020 from the accountants stating the business is struggling however the opening of the border ‘there is a real chance that the business will survive and continue to operate going forward’.
34)Training receipts.
Section 359AA of the Act
At the commencement of the hearing, the Tribunal explained that it may put information to the applicant, under s.359AA of the Act, that would be the reason, or a part of the reason, for affirming the decision that is under review and that it would explain why this information was relevant to the decision and how it may be relied upon in reaching a decision. The Tribunal also advised that the applicant would be given an opportunity to respond to this information in one of three ways: they could request an adjournment and the hearing could be stopped for 15 or 20 minutes or whatever period of time they wished and they could seek advice from the registered migration agent; the applicant could make a written submission within 14 days or an extended period of time if it requested an extension; or they could respond in the hearing. If they responded in the hearing, it would not prevent them from making a written submission within 14 days or a longer period if they requested an extension of time.
Section 359AA provides as follows:
(a) The Tribunal may orally give to the applicant clear particulars of any information that the Tribunal considers would be the reason, or a part of the reason, for affirming the decision that is under review; and
(b) if the Tribunal does so—the Tribunal must:
(i)ensure, as far as is reasonably practicable, that the applicant understands why the information is relevant to the review, and the consequences of the information being relied on in affirming the decision that is under review; and
(ii)orally invite the applicant to comment on or respond to the information; and
(iii)advise the applicant that he or she may seek additional time to comment on or respond to the information; and
(iv)if the applicant seeks additional time to comment on or respond to the information—adjourn the review, if the Tribunal considers that the applicant reasonably needs additional time to comment on or respond to the information.
Extensions of time and adjournments
The applicant applied for an extension of time on the 11 August 2020 to provide information which was granted to 8 September 2020.
The applicant applied for an extension of time on the 20 August 2020 to provide information which was granted to 10 September 2020.
The applicant applied for an extension of time on the 4 September 2020 to provide information which was granted to 24 September 2020.
The registered migration agent requested an extension of time dated 30 December 2020 to provide further information which was granted to 4 December 2020.
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.
During the hearing Mrs Koya explained that there were originally the two businesses registered under the partnership and ABN number. The restaurant had been closed in August 2020. Mrs Koya believed she would have to close the cleaning company Cityscape Cleaning which operated under the partnership H Koya & S Koya ABN: 79766141602 because the cleaning business relied on the tourist sector and without tourists the resorts were not busy.
The Tribunal put to the applicant under s359AA of the Act that because the business financials had declined due to COVID -19; wages for the nominee had been reduced and that there was a suggestion the business may be closed, if the Tribunal gave this consideration to this it may find that the person will not be employed on a full-time basis in the position for at least 2 years. Mrs Koya chose to reply in the hearing.
Mrs Koya said it is very quiet, but she is trying her best. It is 70 – 80% down on revenue. Tourists are not coming, and it is really bad, but the nominee tries every day and she sends Mrs Koya information every day and feedback.
The nominee advised she had been working since 2009 in the Sales and marketing position. Basically, she goes with her price offer contracts to the prospective clients and follows up how it is going. At the moment they have bond cleaning and some resort cleaning. It is very quiet, and her wages are reduced to $550 per week before tax.
Mr Hu addressed the Tribunal and said that the nominee had spoken about her personal circumstances and given over 10 years’ service but now with COVID-19 there are reduced wages and hours, but she is doing her best. There has been hardship endured by the business, but she is contributing her best.
If the Tribunal chooses to refuse the employer nomination and visa, he requests that the unique circumstances of COVID-19 be considered, and the fact the nominee had been working legally since 2009 and paying taxes. She is doing everything right and trying to bring in more business for the company and COVID-19 has happened and she may not be employed for the next 2 years.
The nominee has an employment offer from one of the resorts that would be happy to sponsor but it is going through some financial hardship however they have expressed willingness to employ her once it picks up. The resort is the Grand Florida and they would be willing to sponsor and employ but because she is barred by s48 of the Migration Act from applying onshore they require the Minister to intervene such that she can be given a permanent or temporary visa. She will keep contributing through her skills and contribute her marketing expertise. Her son is studying in Australia. The registered migration agent advised that the Minister will treat a referral from the Tribunal more favourably.
The Tribunal gave the applicant 14 days to provide further information.
The applicant after the hearing provided financial statements for FYs 2019 and 2020 as shown below;

Profit & Loss 2020 2019

Income     304,660     468,380

Expenses     319,866     483,919

Loss       (15,206)       (15,539)

The Tribunal is concerned that there have been losses for both the FY 2020 due to business shutdowns and more worryingly FY 2019 which was before the impact of COVID-19. The Tribunal has noted the letter dated 14 September 2020 stating that the financial losses for the FY 2018 and 2019 were due to the distribution to the partners being $59,768 and $131,740 respectively. However, on close examination of the financial statements for FY 2019 there is no evidence of distribution to the partners being included in the expenses for the businesses. There are the expected expenses with the largest being wages and rental expenses as is typically the case. Since the financial statements have been provided in response to the Tribunals concerns and are the most recent figures available it is these that will be considered and the claims in the 14 September 2020 letter are given little weight.
The Tribunal noted the BAS statements as follows;

BAS Sales Wages

Q3 2019 99,562 40,999

Q4 2019 71,210 31,481

Q1 2020 89,178 27,573

Q2 2020 75,176 19,299

Q3 2020 50,974 14,579

The Tribunal notes that the business has not succeeded in rebuilding their revenue in the Q3 July to September 2020 quarter and it is in fact significantly less that in Q3, Q4 2019 and Q1 2020 which were all prior to the advent of COVID-19. It is noted that the owner Mrs Koya is undertaking some of the cleaning contracting work herself; has reduced wages for the employee who is also the nominee and is actively trying to secure additional cleaning contracts. There is one more concerning factor which is the amount owed to the Australian Taxation Office as evidence on the BAS. On the Q3 2020 BAS it states ‘Total amount to pay $377,907.89’ which is a significant debt to the Commonwealth for a small business although the Tribunal is not basing a decision on this factor.
The Tribunal notes the applicant has high regard for the nominee and that a local resort has stated they would sponsor her but only if she can apply onshore. While this is encouraging, they are not matters, that would weigh on the consideration of whether the nominator is financially viable such that it can employ the nominee for at least 2 years.
It is noted that the applicant is making every effort to secure new cleaning contracts and the nominee is trying to market the business and they have apparently secured some bond cleaning and a new resort cleaning contract however there is scant evidence of the contribution these new contracts will make to the revenue and whether they are long term contracts or one-off.
The Tribunals considers the applicant is not financially viable because it had losses in the FY 2019 and 2020 and the BAS statement for Q3 2020 shows that the revenue has not recovered, despite wages cost being reduced, and it is significantly less than the income for the four quarters from Q3 2019 to Q2 2020.
The Tribunal finds the applicant is not financially viable for the reasons give above and the person (the nominee) will not be employed on a full-time basis in the position for at least 2 years. Therefore, r.5.19(3)(d)(i) is not met.
The applicant requests the Tribunal to refer this matter to the Minister for Home Affairs for Ministerial intervention on the basis that the partnership had intended to continue employing the nominee had it not been for COVID-19 effecting the business financially; the nominee had no control over the financial performance; the nominee continued to work for the partnership for nearly three years after the nomination was lodged; a customer has provided a glowing reference for the nominee and may be willing to sponsor the nominee in the future; the nominee’s son arrived in Australia as a minor and has integrated himself into the Australian community and both the nominee and her son are of good character. The applicant further maintains that exceptional economic and cultural benefits will result from allowing the nominee and her son to remain in Australia.
The Tribunal has carefully considered the request for the Tribunal to recommend the matter to the Minister for intervention on the basis of the submissions above and the Minister’s guidelines regarding the unique and exceptional circumstances under which a matter may be recommended to the Minister for intervention. Having considered all of the information available to it, the Tribunal declines the applicant’s request to recommend the matter to the Minister for intervention. However, it remains open to the applicant to make such a request if she believes that she has sufficient grounds to warrant Ministerial intervention.
Given the above findings, the requirement in r.5.19(3)(d) is not met.
For the above reasons the Tribunal is not satisfied that the applicant meets the requirements of r.5.19(3). The applicant has not sought to satisfy the criteria in Direct Entry nomination stream, and as such has not met the requirements in r.5.19(4). 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.
De-Anne Kelly
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
(iv)    identifies a need for the nominator to employ the person, as a paid employee, to work in the position under the nominator’s direct control; 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; and
(i)there is a genuine need for the nominator to employ the person, as a paid employee, to work in the position under the nominator’s direct control.

[2020] AATA 5867

Key Legal Topics

Areas of Law

Immigration

Administrative Law

Legal Concepts

Judicial Review

Procedural Fairness

Statutory Construction

Jurisdiction

Remedies

Profit & Loss	2020	2019
Income	304,660	468,380
Expenses	319,866	483,919
Loss	(15,206)	(15,539)

BAS	Sales	Wages
Q3 2019	99,562	40,999
Q4 2019	71,210	31,481
Q1 2020	89,178	27,573
Q2 2020	75,176	19,299
Q3 2020	50,974	14,579