Ivapine Pty Ltd ATF PMI Family Trust (Migration)
[2021] AATA 2591
•20 July 2021
Ivapine Pty Ltd ATF PMI Family Trust (Migration) [2021] AATA 2591 (20 July 2021)
DECISION RECORD
DIVISION:Migration & Refugee Division
APPLICANT: Ivapine Pty Ltd ATF PMI Family Trust
CASE NUMBER: 1823295
HOME AFFAIRS REFERENCE(S): BCC2017/4699676
MEMBER:Terrence Baxter
DATE:20 July 2021
PLACE OF DECISION: Brisbane
DECISION:The Tribunal sets aside the decision under review and substitutes a decision approving the nomination.
Statement made on 20 July 2021 at 11:21am
CATCHWORDS
MIGRATION – application for approval of nomination of position – temporary residence transition stream – financial capacity to employ nominee for 2 years – employment contract and financial documents provided to tribunal – significant trading losses and net liabilities – losses incurred in closing venues after expanding too quickly – reduced operational costs, adjusted profit and beneficiary loans – nominee’s current employment, salary and performance – decision under review set asideLEGISLATION
Migration Act 1958 (Cth), s 140 GB
Migration Regulations 1994 (Cth), r 2.87B(2), 5.19(3)(d)CASES
MIBP v Jayshree Enterprises Pty Ltd [2017] FCA 264
Re Drake No 2 (1979) 2 ALD 634STATEMENT 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 23 July 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, Ivapine Pty Ltd as trustee for the PMI Family Trust, applied for approval on 9 December 2017. The applicant nominated Ms Man Yee Lam in the position of Restaurant Manager. 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) of the Regulations because the applicant did not demonstrate the financial capacity to provide the nominee with at least two years of full-time employment and meet all the employment obligations of two years of full-time employment.
The applicant lodged an application for review of the delegate’s decision with the Tribunal on 13 August 2018.
Ms Melissa Ip, a director of the applicant company, appeared before the Tribunal by video conference on 21 April 2021 to give evidence and present arguments. The hearing was a joint hearing with the application for review of a decision to refuse the visa application of the nominee. The Tribunal also received oral evidence from the nominee and Mr Jason Wong, who is the applicant’s external accountant.
The Tribunal exercised its discretion to hold the hearing by video conference. The hearing was held during the COVID-19 pandemic. The Tribunal determined it was reasonable to hold a hearing by video conference, having regard to the nature of this matter and the individual circumstances of the applicant. The Tribunal also had regard to the Tribunal’s objective of providing a mechanism of review that is fair, just, economical and quick, and the delay to the matter if the hearing was not to be conducted by video conference.
The applicant was represented in relation to the review by its registered migration agent, Dr Xinlei Xu of Sunshine International Consulting Pty Ltd. The representative attended the Tribunal hearing by video conference
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.
Evidence presented prior to the hearing
The applicant produced to the Department of Immigration and Border Protection (now the Department of Home Affairs) (the Department) the following documents:
a.Submissions from the applicant’s director dated 19 June 2017 and accountant dated 3 October 2017.
b.Employment contracts of the nominee, Head Chef, Kitchen Trainer and Workplace Health and Safety Officer Trainer and Restaurant Manager at the Carindale business premises.
c.An Organisational Chart.
d.Evidence of internal training procedures and invoices for external food safety training from January to June 2017.
e.Leave records of the applicant’s employees.
f.Payslips, PAYG payment summaries and taxation assessments of the nominee.
g.Payslips of the Restaurant Manager at the Carindale business premises.
h.Activity statements for the period July 2016 to June 2017 and financial report for the 2016 financial year.
The applicant produced to the Tribunal the following documents, including:
a.Submissions from the representative dated 18 February 2021, including details of their migration agent registration and Department Form 956.
b.An ASIC Current and Historical Company Extract, and Certificate of Registration for the applicant.
c.Updated submissions from the applicant’s accountant dated 16 February 2021.
d.Trust deed of the PMI Family Trust.
e.Activity statements for the period January 2019 to September 2020.
f.Internally generated profit and loss statements for the 2019 and 2020 financial years.
g.Financial statement for the 2019 financial year.
h.An updated Organisational Chart.
i.Restaurant photos and menus.
j.Evidence of the applicant’s tenancy of its business premises in Carindale, Portside and Southbank.
k.Submissions from the applicant dated 16 February 2021.
l.Updated employment contract, job description and employee remuneration summary for the nominee.
m.An Australia and New Zealand Standard Classification of Occupations (ANZSCO) extract for the occupation of Café and Restaurant Manager.
n.Passport, visa grant details, payslips and payroll activity details of an Australian employee.
o.PAYG payment summaries of the nominee for the 2017 to 2020 financial years.
p.Evidence of tasks performed by the nominee in the position.
q.Copies of documents previously produced to the Department.
r.Updated invoices for external food safety training from 2017 and 2018, and evidence of external training.
s.Summary of the training benchmark requirements for the 2016, 2017 and 2018 financial years and further evidence of internal training programs.
Evidence presented at the hearing regarding the applicant’s operations
Ms Ip gave evidence regarding the business operations of the applicant. She stated that the applicant trust had commenced its business operations in 1996 and that it was a family business, operating restaurants in the city of Brisbane. She said that the applicant presently operated three restaurants, with another restaurant having been closed recently. She said that the restaurant which had been closed was not COVID compliant and that its closure had considerably reduced operational costs for the applicant.
Ms Ip stated that the position to be filled by the nomination was as Restaurant Manager at the Ginga Sushi Bar in the suburb of Hamilton. She said that the restaurant had a seating capacity of 80 patrons and that it offered takeaway and delivery services.
The nominee gave evidence regarding her employment by the applicant and the tasks performed by her in the position.
Evidence presented after the hearing
After the hearing, the applicant produced to the Tribunal the following documents:
a.Submissions from the representative dated 20 May 2021.
b.Trust taxation returns for the 2018 to 2020 financial years.
c.Financial reports for the 2017, 2019 and 2020 financial years.
d.Further copies of documents produced to the Tribunal and the Department.
e.PAYG payment summaries of the Head Chef and Kitchen Trainer, Workplace Health and Safety Officer Trainer and Restaurant Manager at the Carindale business premises for the 2017 financial year.
On 8 July 2021 the Tribunal wrote to the applicant requesting further information to establish that it met the requirements for an approved employer nomination as set out in r.5.19(3) of the Regulations. In response to the request, the applicant produced to the Tribunal the following documents:
a.A PAYG payment summary of the Workplace Health and Safety Officer Trainer for the 2018 financial year.
b.A PAYG payment summary of the Head Chef and Kitchen Trainer for the 2018 financial year.
c.A copy of the applicant’s training benchmark requirements summary for the 2018 financial year previously produced to the Tribunal.
d.Copies of internal training documents previously produced to the Tribunal.
e.Copies of external invoices for food safety training from 2017 and 2018, and evidence of external training programs from 2018 previously produced to the Tribunal.
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) of the Migration Act 1958 (the Act). The application must also identify a relevant person and occupation and identify a need for the nominator to employ that person, as a paid employee, to work in the position under the nominator’s direct control.
Having regard to the information provided by the Department, the Tribunal is satisfied that the application for approval was made on the approved form, was accompanied by the prescribed fee and included a written certification stating whether the applicant had engaged in conduct in relation to the nomination that contravenes s.245AR(1). The requirements of r.5.19(2) and consequently of r.5.19(3)(a)(i) are met.
Regulation 5.19(3)(a)(ii) requires that the application for approval identifies a person who holds a Subclass 457 (Temporary Work (Skilled)) visa granted on the basis that the person satisfied the criterion in cl.457.223(4) of Schedule 2 to the Regulations. The person identified in the application is the nominee, Man Yee Lam. Department records reveal that the nominee was granted a Subclass 457 visa on 12 March 2015, which was valid until 12 March 2019. Accordingly, the nominee held the required subclass of visa on the date of the application, 9 December 2017. The Tribunal is satisfied that the requirements of r.5.19(3)(a)(ii) are met.
Regulation 5.19(3)(a)(iii) requires that the application identifies an occupation, in relation to the position, that is listed in ANZSCO and has the same 4-digit occupation unit code as the occupation carried out by the holder of the Subclass 457 (Temporary Work (Skilled)) visa. The application identifies the position as Restaurant Manager and the occupation (ANZSCO) as Café or Restaurant Manager. The Tribunal finds that ANZSCO lists the occupation Café or Restaurant Manager, ANZSCO Code 141111, unit group code 1411. The nominee’s 2017 employment contract describes her position as Restaurant Manager. At the hearing, Ms Ip gave evidence of the tasks performed by the nominee in the position. Having regard to the evidence as to the duties being performed by the nominee, the Tribunal is satisfied that the nominee has carried on the occupation of Café or Restaurant Manager listed in ANZSCO. Accordingly, the Tribunal is satisfied that the requirements of r.5.19(3)(a)(iii) are met.
Regulation 5.19(3)(a)(iv) requires that the application identifies a need for the applicant to employ the nominee as a paid employee to work in the position under the applicant’s direct control. The Tribunal takes the view that r.5.19(3)(a) as a whole is directed towards requirements for the application form/process of an administrative nature, such that r.5.19(3)(a)(iv) could be met by a simple statement or certification of need. Support for this view can be found in the contrast between the wording of r.5.19(3)(a)(iv) and, for example, r.5.19(3)(i), which requires that there be a genuine need for the nominator to employ the nominee to work in the position under the nominator’s direct control – clearly requiring a qualitative assessment, and r.5.19(3)(d)(i), which requires satisfaction that the employee will be employed on a full-time basis in the position for at least two years. Given the requirement in relation to this application to satisfy r.5.19(3)(i), the Tribunal considers that this issue is more appropriately considered under r.5.19(3)(i) later in these Reasons.
The Tribunal considers that r.5.19(3)(a)(iv) is more directed to the administrative process, consistent with the requirements of r.5.19(3) as a whole. The nomination application, on page 4 of that document, identifies that the position to be filled is that of Restaurant Manager. The Tribunal is therefore satisfied that the application for approval identifies a need to employ the nominee in the position of Restaurant Manager under the applicant’s direct control such that r.5.19(3)(a)(iv) is met. The Tribunal will consider later in these Reasons whether the applicant has established a genuine need for the applicant to employ the nominee to work in the position under the nominator’s direct control for the purposes of r.5.19(3)(i).
Given the above findings that the requirements in r.5.19(3)(a)(i), (ii), (iii) and (iv) are met, 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.
The applicant is or was the standard business sponsor who last identified the nominee in a nomination – r.5.19(3)(b)(i)
The Department’s records confirm the applicant was approved as a standard business sponsor from 11 May 2016 for five years and was the standard business sponsor who last identified the nominee in a nomination under s.140GB of the Act. Regulation 5.19(3)(b)(i) is therefore met.
The applicant is actively and lawfully operating a business in Australia – r.5.19(3)(b)(ii)
This regulation requires that the applicant is actively and lawfully operating a business in Australia. The applicant produced various documents to the Tribunal including the trust deed for the Trust, taxation returns, activity statements, financial statements and current ASIC registration documents for the trustee of the applicant trust. Ms Ip gave evidence regarding the business activities of the applicant. The financial documents produced to the Tribunal disclose that the applicant recorded the following sales:
Financial year
2018
2019
2020
Total income
$9,986,573
$8,943,057
$6,271,498
Having regard to the evidence presented to the Tribunal, the Tribunal is satisfied that the applicant is actively and lawfully operating a business in Australia, namely several restaurants. The requirement in r.5.19(3)(b)(ii) is therefore met.
The applicant did not, as a standard business sponsor, meet r.1.20DA, or r.2.59(h) or r.2.68(i), in the most recent approval as a standard business sponsor – r.5.19(3)(b)(iii)
Department records confirm that the applicant was not granted its most recent standard business sponsorship on the basis of meeting r.1.20DA, r.2.59(h) or r.2.68(i) of the Regulations. Accordingly, the requirement in r.5.19(3)(b)(iii) is met.
Given the above findings that the requirements in r.5.19(3)(b)(i), (ii) and (iii) are met, 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 two of the three 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 two years in the three years immediately before the application.
The nomination application was lodged on 9 December 2017. It is therefore required that the nominee was employed in the position for at least two years in the period from 9 December 2014 to 9 December 2017. The applicant produced PAYG payment summaries for the nominee for the 2015 to 2018 financial years together with payslips of the nominee from the pay period commencing on 15 March 2015. Ms Ip gave evidence that the nominee had been employed full-time by the applicant in the position of Restaurant Manager from March 2015 until the present time. Having had regard to the evidence of Ms Ip as to the duties performed by the nominee, the Tribunal is satisfied that the nominee was employed in the position of Restaurant Manager.
The Tribunal is accordingly satisfied that the nominee has been employed full-time in Australia in the position for which she held a Subclass 457 visa for at least two of the three years immediately before the date of the nomination application. Accordingly, the requirement in r.5.19(3)(c)(i) is met.
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 two years on terms that do not expressly preclude the possibility of an extension.
The nominee is a person to whom r.5.19(3)(c)(i) applies (see paragraph 33 above) and is therefore required to meet this requirement.
The Tribunal has had regard to the terms and conditions of the nominee’s employment as set out in the 2021 Employment Contract. The contract provides that the nominee is to work “less than 38 hours” per week. However, a recent payslip of the nominee describes her employment basis as “full-time employment”. The Tribunal accepts that the nominee has been and will be employed on a full-time basis. The contract is to commence upon approval of the nominee’s Subclass 186 visa and is for a duration of two years. The contract provides that the nominee’s employment may be extended by mutual agreement. There is no exclusion of the possibility of extension.
However, it is also open to the Tribunal to consider whether the applicant’s business has the financial resources to meet the wages costs for the nominee over the employment period (MIBP v Jayshree Enterprises Pty Ltd [2017] FCA 264).
The delegate found that this requirement had not been met. The financial documents which were produced to the Department included the applicant’s financial statements for the year ended 30 June 2016 (which included comparative figures for the 2015 financial year) and various activity statements. The delegate noted that the financial statements disclosed that the applicant had sustained significant trading losses in the 2015 and 2016 financial years.
The financial statements produced by the applicant to the Tribunal disclose the following trading figures:
Financial year
2018
2019
2020
Sales
$9,986,573
$8,943,057
$6,271,498
Cost of sales
$2,876,660
$2,610,464
$1,823,143
Gross profit
$7,109,913
$6,332,593
$4,448,355
Other income
$98,209
$184,164
$318,868
Total income
$7,208,122
$6,516,757
$4,767,223
Expenses
$7,723,164
$6,876,796
$4,885,122
Net loss
$515,042
$360,039
$117,899
The applicant’s balance sheets reveal the following information:
Financial year
2018
2019
2020
Bank accounts/cash
$676,548
$531,907
$611,662
Financial liabilities
$758,807
$500,989
$485,434
Net liabilities
$2,409,434
$2,769,473
$2,887,374
Beneficiary loans to Trust
$5,292,654
$5,354,458
$4,836,414
The financial viability of the applicant has been a cause of concern for the Tribunal. At first glance, the view could be formed that the applicant does not have the capacity to pay the nominee’s salary package for at least two years. According to the profit and loss statements, the applicant has continued to record significant trading losses. According to the balance sheets, the applicant has significant net liabilities. However, the Tribunal is satisfied that a closer examination of the financial statements tells a different story.
On the matter of trading losses, the applicant’s external accountant Mr Wong provided, on the morning of the hearing, a spreadsheet recording the applicant’s trading history for the 10 financial years from 2010 to 2019 inclusive, together with particulars of claims made in those years for depreciation and losses on the scrapping of assets. The applicant’s 2020 financial statements were not then available. Those statements have subsequently been provided to the Tribunal and the Tribunal has considered those statements, together with the document submitted by Mr Wong.
The applicant made trading profits exceeding $3,900,000 in the 2010 to 2013 financial years. A series of trading losses then followed. The applicant had been increasing the number of restaurants that it operated, and Mr Wong stated that the applicant realised that it was expanding too quickly. The applicant began shutting down some of its venues, which resulted in significant losses on the scrapping of furniture and fit-out. Ms Ip gave evidence that the applicant had closed four restaurants since 2018.
The financial statements for the 2015 to 2020 financial years reveal that the applicant has sustained trading losses of $2,881,442 during that period. During those years, the applicant made claims totalling $3,304,313 for depreciation and loss on the scrapping of assets. Mr Wong submitted that, in cash flow terms, the applicant had made profits over this period. The Tribunal accepts that the claims referred to by Mr Wong did not impact on the applicant’s cash flow and has calculated that the adjusted profit over the period under consideration, (disregarding the deductions previously mentioned), was $422,931.
The applicant’s 2020 balance sheet reveals that it held over $600,000 in cash as at 30 June 2020. Although the applicant had substantial net liabilities as at that date, the amount of the beneficiary loans significantly exceeded the net liabilities to the extent of $1,949,040. This amount effectively represents the equity of the beneficiaries in the Trust.
The applicant has employed the nominee throughout the 2018 to 2020 financial years, having paid her salaries of $57,361, $54,999 and $51,615 in those years. The Tribunal is satisfied that the applicant has the financial capacity to employ the nominee in the position of Restaurant Manager in accordance with the Employment Contract and that the nominee will be employed on a full-time basis in that position for at least two years. Accordingly, the requirement in r.5.19(3)(d)(i) is met.
Given the above findings that the requirements of both r.5.19(3)(d)(i) and (ii) are met, 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 recent organisational chart establishes that the applicant has an Australian permanent resident, Mr Yusuke Tateno, working in the position of Restaurant Manager at another of its venues at the present time. Ms Ip confirmed accordingly at the hearing.
The current Employment Contract provides that the applicant will pay to the nominee a salary of $55,000 per annum, plus superannuation in accordance with the Superannuation Guarantee (Administration) Act 1992. The amount of the salary being paid to the nominee is supported by recent payslips produced to the Tribunal.
The applicant has produced evidence in the form of Mr Tateno’s payslips and payroll activity details to confirm that the salary to be paid to the nominee is identical to the salary presently being paid to Mr Tateno.
Based on the evidence available, the Tribunal is satisfied that the terms of employment applicable to the nominee are no less favourable than the terms and conditions which would be provided to an Australian citizen or Australian permanent resident for performing such work in that workplace at that 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.
In relation to the Subclass 457 scheme, a person who was a standard business sponsor of at least one primary sponsored person was required by r.2.87B(2) to comply with requirements relating to training of Australian workers, in each year they engaged a Subclass 457 visa holder.
The period of the applicant’s most recent sponsorship approval is for five years from 11 May 2016. The nominee was issued a Subclass 457 visa on 12 March 2015, which was valid until 12 March 2019 and has been employed continuously by the applicant since March 2015.
The training benchmarks and training requirements which apply during the period of the applicant’s standard business sponsorship are specified in Instrument IMMI 13/030. The business is required to show that the training that has been, and continues to be, provided to employees who are Australian citizens and Australian permanent residents is related to the purpose of the business. The training benchmarks for an established business are:
(A) recent expenditure, by the business, to the equivalent of at least 2% of the payroll of the business, in payments allocated to an industry training fund that operates in the same industry as the business; or
(B) recent expenditure, by the business, to the equivalent of at least 1% of the payroll of the business, in the provision of training to employees of the business.
The Instrument provides that expenditure that can count towards Benchmark B includes:
a. Employment of a person who trains the business’s Australian employees who are Australian citizens and Australian permanent residents as a key part of their job.
b. Evidence of payment of external providers to deliver training for Australian employees.
c. On-the-job training that is structured with a timeframe and clearly identified increase in the skills at each stage and demonstrating:
i.The learning outcomes of the employee at each stage.
ii.How the progress of the employee will be monitored and assessed.
iii.How the program will provide additional and enhanced skills.
iv.The use of qualified Trainers to develop the program and set assessments; and
v.The number of people participating and their skill/occupation.
d. Employment of a person who trains the businesses Australian employees who are Australian citizens and Australian permanent employees as a key part of their job.
There is no evidence before the Tribunal of any expenditure by the business during the sponsorship period in payments allocated to an industry training fund that operates in the same industry as the business to meet Benchmark A.
It is necessary to determine the periods of time, if any, in respect of which the applicant was or is required to comply with the training benchmarks. The relevant regulation, being r.2.87B of the Regulations, was repealed by the Migration Amendment (Skilling Australians Fund) Regulations 2018. A transitional provision introduced by those Regulations provides that a person is not required to comply with r.2.87B(2) or (3) in relation to a period of 12 months ending on or after the commencement day (12 August 2018). As the only annual periods of the applicant’s most recent sponsorship which ended prior to 12 August 2018 were the years which ended on 11 May 2017 and 11 May 2018, the Tribunal finds that the applicant is required to comply with the training obligations in respect of those periods only.
In order to meet Benchmark B, the applicant is required to establish that its expenditure in the provision of training to employees is equivalent to at least 1% of the payroll of the business in the relevant period. It is necessary to consider the meaning of “the payroll of the business” for this requirement. The Department’s policy contained in its Procedures Advice Manual (PAM3) states that for this requirement, payroll expenditure includes any wages, remuneration, salary, commission, bonuses, allowances, superannuation contributions or eligible termination payments, defined as wages in the Act relating to payroll tax in the relevant State/Territory, that the applicant has paid to their employees during the relevant 12 month period. The Tribunal is not bound by the policy but may be guided by it (per Brennan J in Re Drake No 2 (1978 – 1980) 2 ALD 634).
The definition in the policy is consistent with the definition in the Macquarie Dictionary (accessed August 2020), which relevantly defines the term as:
Noun 1. A roll or list of persons to be paid, with the amounts due.
2. the aggregate of these amounts.
3. the money that is actually paid out.
The definition in the policy is also consistent with the terminology contained in the Payroll Tax Act 1971 of Queensland under which payroll tax is imposed on all taxable wages, and wages are relevantly defined to mean any wages, remuneration, salary, commission, bonuses or allowances paid or payable (whether at piecework rates or otherwise and whether paid or payable in cash or in kind) to an employee as an employee, and, without limiting the generality of the foregoing, includes a superannuation contribution. Accordingly, the Tribunal finds that the term payroll in the Instrument for any period includes wages and superannuation paid for that period.
The applicant did not produce evidence of the amount of its payroll in each of the sponsorship years ending on 11 May 2017 and 11 May 2018. The applicant did provide evidence of the amount of its payroll in the corresponding financial years ending on 30 June 2017 and 30 June 2018. At the hearing, Ms Ip consented on behalf of the applicant to the use of the payroll figures in the corresponding financial years in the Tribunal’s consideration of this requirement. The applicant made submissions to the Tribunal accordingly. As the financial years closely correspond to the relevant sponsorship years, the Tribunal is prepared to deal with this requirement having regard to the payroll figures in the relevant financial years.
According to the financial statements provided by the applicant, its payroll expenditure and the corresponding Benchmark B amounts for the relevant years are as follows:
Financial year
2017
2018
Wages
$3,727,482.61
$3,664,483.54
Superannuation
$254,374.33
$293,633.35
Total payroll
$3,981,856.94
$3,958,116.89
Benchmark B amount
$39,819
$39,582
The instrument provides that expenditure that can count towards Benchmark B includes employment of a person who trains the business’s Australian employees who are Australian citizens and Australian permanent residents as a key part of their job. The applicant produced Employment Contracts for a Workplace Health and Safety (WH&S) trainer and two Kitchen trainers and evidence of salaries paid to them during the sponsorship years. Ms Ip gave evidence that the WH&S trainer was employed on a part-time basis and was engaged wholly in the training of employees. She also stated that the Kitchen trainers were employed full-time and spent 50% of their time in training. She gave evidence of the nature of training provided to the applicant’s employees. The nomination application discloses that, at the time of the application, the applicant employed 42 Australian citizens or permanent residents. The Tribunal is satisfied that the training which was provided by the applicant was for the training of Australian employees.
The applicant produced evidence of payment of wages to the trainers amounting to $65,512 in the 2017 financial year and $53,584 in the 2018 financial year. The Tribunal accepts that this expenditure was for the payment of persons who trained the business’s Australian employees and that the expenditure exceeded the Benchmark B amounts in the relevant years. Accordingly, the Tribunal is satisfied that the requirements of r.5.19(3)(f)(i) are met.
The applicant has submitted evidence of expenditure to external trainers to deliver training to the applicant’s employees. As the Tribunal has found that the requirement has been met, it is not necessary to consider the payments to external trainers.
As the Tribunal has found that the requirements of r.5.19(3)(f)(i) have been met, it is not necessary to consider whether it is reasonable to disregard any non-compliance under r.5.19(3)(f)(ii).
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 a 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.
There is no evidence before the Tribunal that there is any adverse information of the type described in the relevant definitions known to the Department about the applicant or any associated person.
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.
There is no evidence before the Tribunal to suggest that the applicant has an unsatisfactory record of compliance with workplace relations laws of the Commonwealth or any State or Territory in which the applicant operates a business. The Tribunal is satisfied that the applicant does have a satisfactory record of compliance.
Accordingly, the requirement in r.5.19(3)(h) is met.
Genuine need to employ nominee: r.5.19(3)(i)
Regulation 5.19(3)(i) requires that 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.
The applicant provided to the Tribunal substantial evidence of the tasks performed by the nominee in her position, together with a written submission setting out its need to employ the nominee as Restaurant Manager. At the hearing, Ms Ip stated that the nominee had been employed in her position since 2015 and that she was irreplaceable. Ms Ip said that the nominee reported to her personally regarding management of the restaurant.
The organisational chart reveals that each of the applicant’s three restaurants has a manager in charge of the operations of that restaurant. Ms Ip was asked whether she personally could manage the Hamilton restaurant. She said that each restaurant required its own manager and that she could not handle the tasks of management because of demands on her time supervising the operations of the three businesses, as well as personal commitments.
The applicant submitted divisional profit and loss statements for the Hamilton restaurant for the 2020 financial year. These statements disclose that the business recorded sales exceeding $1,000,000 during that period, with a wages expense exceeding $360,000. The Tribunal accepts that a business such as this requires the employment of a full-time Restaurant Manager. The Tribunal is satisfied that there is a genuine need for the applicant to employ the nominee to work in the position of Restaurant Manager under the nominator’s direct control.
Accordingly, the requirement in r.5.19(3)(i) 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.
Terrence Baxter
MemberATTACHMENT - EXTRACTS FROM THE MIGRATION REGULATIONS 1994
5.19Approval of nominated positions (employer nomination)
…
(2)The application must:
(a)be made in accordance with approved form 1395…; and
(aa) include a written certification by the nominator stating whether or not the nominator has engaged in conduct, in relation to the nomination, that constitutes a contravention of subsection 245AR(1) of the Act; and
(b)be accompanied by the fee mentioned in regulation 5.37.
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.
Key Legal Topics
Areas of Law
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Immigration
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Administrative Law
Legal Concepts
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Judicial Review
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Procedural Fairness
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Standing
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Statutory Construction
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Natural Justice
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