JA6 Pty Ltd ATF JA6 Investment Trust (Migration)

JA6 Pty Ltd ATF JA6 Investment Trust (Migration) [2020] AATA 3271 (18 June 2020)
DECISION RECORD
DIVISION:Migration & Refugee Division
APPLICANT:  JA6 Pty Ltd ATF JA6 Investment Trust
CASE NUMBER:  1931990
HOME AFFAIRS REFERENCE(S):          BCC2018/1279064
MEMBER:Karen McNamara
DATE:18 June 2020
PLACE OF DECISION:  Sydney
DECISION:The Tribunal sets aside the decision under review and substitutes a decision approving the nomination.

Statement made on 18 June 2020 at 2:39pm

CATCHWORDS
MIGRATION– Direct Entry Nomination stream – Massage Therapist –position is located in regional Australia – genuine need for the nominator to employ a paid employee – No less favourable terms and condition of employment –applicant lawfully operating a business in Australia–decision under review set aside
LEGISLATION
Migration Act 1958, s 245AR,
Migration Regulations 1994, rr 1.13, 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 (the delegate) on 23 October 2019 to reject the application by JA6 Pty Ltd ATF JA6 Investment Trust (the applicant) for approval of the nomination of a position in Australia under r.5.19 of the Migration Regulations 1994 (the Regulations).
The applicant applied for approval on 17 March 2018. 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 Direct Entry nomination stream.
The delegate refused the application on the basis the applicant’s nomination did not satisfy r.5.19(4)(h)(ii)(D) of the Regulations because the delegate found that the tasks performed in the position did not correspond to the tasks of an occupation specified by the Minister in the relevant instrument.
The applicant lodged an application for review with the Tribunal on 11 November 2019. A copy of the delegate’s decision was provided to the Tribunal.
Mr Antonio D’Angelo appeared on behalf of the applicant before the Tribunal on 9 June 2020, to give evidence and present arguments. The Tribunal also received oral evidence from the nominee (Mr Fernando Rodriques Do Prado) in the related matter for the Subclass 187 visa (AAT Case file 1934583). The related matters were heard concurrently in a combined hearing and heard via telephone.
The Tribunal exercised its discretion to hold the hearing by telephone. The hearing was held during the COVID-19 pandemic. The Tribunal determined it was reasonable to hold a hearing by telephone, having regard to the nature of this matter and the individual circumstances of the applicant and nominee. 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 telephone. The Tribunal is satisfied that the applicant and nominee were given a fair opportunity to give evidence and present arguments.
At the conclusion of the hearing, the Tribunal invited the applicant and nominee to provide further documentation including copies of the applicant’s Business Activity Statements (BAS) for the period July 2017 to June 2018 (inclusive), business and nominee’s bank account statements March 2018 to March 2020, nominee’s PAYG summaries and Notice of Assessments (NOA,s) 2018 and 2019 and superannuation statement. The Tribunal also invited the applicant to make any further submissions in support of their application.
The abovementioned documentation was provided by the applicant to the Tribunal on 15 June 2020.
The applicant was represented in relation to the review by its registered migration agent. The representative attended the Tribunal hearing.
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 Direct Entry nomination stream set out in r.5.19(4), which is extracted in the attachment to this decision. For the nomination to be approved, all the requirements must be met.
BACKGROUND
The Tribunal was told that the applicant operates four day spa facilities under franchise agreements with Endota Spa. Endota Spa is one of Australia’s largest day spa networks with over 100 spas across Australia. The applicant has owned and operated day spas since 2008. The applicant has operated the Glenelg spa for approximately ten years.
ASIC records provided by the applicant to the Tribunal show that JA6 Pty Ltd was registered on 11 November 2008.
On 17 March 2018, the applicant lodged an application for an employer nomination approval for the position of Massage Therapist (ANZSCO 411611) under the under the Regional Sponsored Migration Direct Entry stream. The nominated salary is $49,400 per annum plus 9.5% superannuation. The position is located at Glenelg, South Australia.
The Tribunal notes that numerous evidence and submissions were lodged by or on behalf of the applicant. While the Tribunal has considered all of same, only that which was considered material to its decision has been expressly referred to herein.
The application is compliant: r.5.19(4)(a)
Regulation 5.19(4)(a) requires that the application for approval must be in the approved form, must be accompanied by the prescribed fee, and, where applicable, must include the required written certification relating to conduct that contravenes s.245AR(1). The application must also identify a need for the nominator to employ an identified person as a paid employee to work in the position under their direct control.
Based on the material in the Department’s file, the Tribunal is satisfied that the application was made on the approved form. As the position is located in regional Australia, no fee is payable (r5.37(2)(a)). The application also included written certification relating to conduct that contravenes s.245AR(1) of the Act, declared and signed by the applicant. Accordingly, the requirements of r.5.19(4)(a)(i) are met.
In considering whether the application for approval identifies a need for the nominator to employ a paid employee to work in the position under the nominator’s direct control, the Tribunal has had regard to the evidence before it, including written submissions and the oral evidence received at the hearing by Mr Antonio D’Angelo and Mr Fernando Rodriques Do Prado. In support of the need for the position, the applicant has provided at time of application to the Department a supporting statement dated 14 March 2018.
Accordingly, the requirement in r.5.19(4)(a) is met.
Nominator is actively and lawfully operating a business in Australia: r.5.19(4)(b)
Regulation 5.19(4)(b) requires that the applicant is actively, lawfully and directly operating a business in Australia.
The Tribunal accepts on the evidence before it that the applicant operates numerous day spa facilities under a franchise agreement with Endota Spa. Based on the material provided to the Tribunal, including; financial statements, BAS returns, ASIC Company details, payroll advice and ATO tax records the Tribunal is satisfied the applicant is actively and lawfully operating day spa facilities in Australia and directly operates that business.
Accordingly, the requirement in r.5.19(4)(b) is met.
Position is not labour-hire: r.5.19(4)(c)
Regulation 5.19(4)(c) applies to nominators whose business activities include those relating to labour hire to an unrelated business. In these cases, the nominated position must be within the business activities of the nominator.
There is no evidence before the Tribunal to suggest that the applicant’s business is involved in labour hire.
Accordingly, the requirement in r.5.19(4)(c) does not apply.
Term of employment of the visa holder: r.5.19(4)(d)
Regulation 5.19(4)(d) requires the nominee to be employed in the nominated position for at least 2 years full time, and the terms and conditions of that employment do not expressly exclude the possibility of an extension.
The Tribunal examined the financial information submitted by the applicant. The business’s BAS returns for the 2017/18 financial year record sales of $1,848,901. The corresponding financial statements for the 2018 financial year record salary and wages expense $591,059 and negative net profit of ($45,909). The business’s 2018/19 financial year BAS returns record sales of $1,685,041. The corresponding financial statements for the 2019 financial year record salary and wages expense $590,036 and net profit of $23,241. The applicant provided BAS returns for the period July 2019 to March 2020 which record sales of $1,036,053.
At the hearing the Tribunal discussed with the applicant its concern regarding the business’s reported negative net profit in 2018. The applicant addressed this at the hearing in addition to the applicant’s representative providing a written submission dated 12 June 2020. The Tribunal has taken into consideration the circumstances as explained by the applicant contributing to the negative net profit. During 2017/2018 the Glenelg spa premises underwent improvement renovations which cost approximately $100,000. During the period of renovations, the business was closed which had a direct impact on the business’s revenue stream. The applicant has provided the Tribunal evidence of the renovations and associated cost.
The Tribunal discussed with the applicant the impact of COVID -19 pandemic on the business. The applicant told the Tribunal that as a result of Government and Public Health directives, beauty therapy treatments including remedial massage, ceased operating from midnight on 25 March 2020. As a result, Endota Spa experienced a complete stoppage of all work and staff including the nominee, were stood down indefinitely. On 1 June 2020 the South Australian Government lifted the closedown restriction on beauty therapy facilities and allowed reopening under strict public health guidelines. Endota Spa, Glenelg reopened on 1 June 2020. The applicant is confident that business will return to pre COVID-19 trading capacity. Whilst the lockdown restrictions will have some immediate impact upon the applicant’s revenue and profit, the applicant has operated in the Glenelg area for a considerable time and is confident the COVID- 19 restrictions will not impact materially in the medium to long term. The applicant told the Tribunal that the nominee has recommenced employment with the applicant.
In considering whether the business has the financial capacity to pay a full time salary of $49,400 per annum to the nominee for two years, the Tribunal has taken into consideration evidence before it including the business’s financial statements and documents submitted to the ATO. The Tribunal has afforded weight to information before it including the applicant’s financial statements, BAS returns and payroll records, which show the applicant has met payroll and operating costs.
The Tribunal has also taken into consideration the nominee has been employed by the applicant on a full time basis since March 2018. The nominee’s bank account statements, PAYG’s, NOA’s and applicant’s payroll records, support the nominee has received remuneration in excess of the nominated salary of $49,400 per annum.
Based on the evidence before it, the Tribunal is satisfied the applicant has the financial capacity to pay the nominee a full-time salary and maintain the employment of the nominee on a full time basis for two years.
Accordingly, the requirement in r.5.19(4)(d)(i) is met.
The Tribunal has had regard to the contract of employment for the nominee signed and dated 14 March 2018. The contract sets out the terms and conditions of employment and indicate that the period of employment is two years upon the granting of a visa. At the hearing, the nominator advised the Tribunal that the business would employ the nominee indefinitely for as long as the nominee wished to stay in their employ. The contract stipulates the base salary is $49,400 per annum plus Saturday penalty rates, with hours of work 38 hours per week. There is no term excluding an extension of the contract.
The Tribunal is satisfied based on the employment contract dated 14 March 2018 and other material before it, that the nominee will be employed on a full-time basis for at least two years on terms that do not exclude the possibility of extending the period of employment. Accordingly, the requirement in r.5.19(4) (d) (ii) is met.
As the criteria in both r.5.19(4)(d)(i) and (ii) are satisfied, accordingly the requirements in r.5.19(4)(d) are met.
No less favourable terms and conditions of employment: r.5.19(4)(e)
Regulation 5.19(4)(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 Contract of Employment (dated 14 March 2018) sets out the terms and conditions of employment and indicates that the nominee’s salary will be $49,400 per annum plus Saturday penalty rates, and hours of work 38 hours per week. The nominee’s leave entitlements include annual and personal/carers leave, parental and compassionate leave.
The Tribunal has received copies of the nominee’s PAYG’s, NOA’s, bank statements and payslips confirming that the nominee has been paid by the applicant, in excess of the nominated salary amount of $49,400 per annum. Superannuation statements provided to the Tribunal support that the nominee is being paid superannuation. The Tribunal is therefore satisfied based on the evidence before it, that the nominee will be paid in accordance with the terms of employment.
The Tribunal is satisfied on the totality of the evidence before it that the terms and conditions applicable to the position will be no less favourable than those that would be provided to an Australian citizen or permanent resident performing equivalent work in the same workplace at the same location.
Accordingly, the requirements of r.5.19(4)(e) are met.
No adverse information known to Immigration: r.5.19(4)(f)
Regulation 5.19(4)(f) requires that there is no adverse information known to Immigration about the nominator or person associated with the nominator; or it is reasonable to disregard any such information. For these purposes, ‘adverse information’ and ‘associated with’ have the meaning given in rr.1.13A and 1.13B.
There is no evidence before the Tribunal to indicate that there is adverse information known to the Department about the applicant or an associated person.
Accordingly, the requirements of r.5.19(4)(f) are met.
Satisfactory compliance with workplace relations laws: r.5.19(4)(g)
Regulation 5.19(4)(g) requires that the applicant 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.
There is no evidence before the Tribunal that indicates the applicant does not have a satisfactory record of compliance with the relevant Commonwealth and State workplace relations laws.
Accordingly, the requirements of r.5.19(4)(g) are met.
Tasks of the position, genuine need for the position and training requirements r.5.19(4)(h)
Regulation 5.19(4)(h) contains a number of alternative requirements. These are set out in detail in the attachment to the decision but can be briefly summarised as requiring either that:
·the tasks to be performed in the position will be performed in Australia and correspond to those of an occupation specified by the Minister in the relevant instrument, the occupation is applicable to the proposed employee in accordance with any specifications made in that instrument, there is a genuine need for the nominee to be employed as a paid employee in the position, and certain specified training requirements are met; or
·the position and nominator’s business is located in regional Australia, there is a genuine need for the nominee to be employed as a paid employee in the position under the nominator’s direct control, the position cannot be filled by a locally resident Australian citizen or permanent resident, the tasks of the position correspond to those of an occupation specified in the relevant legislative instrument, the occupation is applicable to the proposed employee in accordance with the specification of the occupation, and that a regional certifying body has advised the Minister about certain matters relating to the position.
In this case, the applicant claims to meet the requirements in r.5.19(4)(h)(ii). The Tribunal has considered each of these requirements as follows:
The evidence before the Tribunal indicates that the applicant’s business, which is operated by the applicant and the position are located in Glenelg, South Australia postcode 5045 which is a postcode specified in the relevant instrument as being in regional Australia, accordingly r.5.19(4)(h)(ii)(A) and ( e) are met.
The Tribunal next considered whether there is a genuine need for the applicant to employ a Massage Therapist (ANZSCO 411611) and for the tasks of that position. The evidence before the Tribunal indicates the applicant operates a day spa located at Glenelg in South Australia. The applicant gave evidence at the hearing that client demand for remedial massage has increased with custom remedial massage accounting for approximately 11% of total revenue in 2018/2019.
The delegate refused the application on the basis the delegate was not satisfied that the tasks performed in the position did not correspond to the tasks of an occupation specified by the Minister in the relevant instrument.
The Tribunal has formed a different view and accepts the evidence presented by the applicant that the tasks associated with the position are that of a Massage Therapist (ANZSCO 411611).
At the hearing the Tribunal discussed with the applicant and nominee the precise nature of the tasks and responsibilities of the position. The Tribunal has sighted evidence in support that Endota Spa Glenelg offers remedial massage treatment and is satisfied that the nominee is not providing beauty therapies. The Tribunal was told that the nominee is registered with Health Funds health fund rebate and is a member of the representative body Massage and Myotherapy Australia. The applicant and nominee hold professional indemnity insurance.
The nominee has been working with the applicant on a full time basis since March 2018 having previously been self-employed as massage therapist. The Tribunal was told the applicant is constantly looking for remedial massage therapists and advertises on an ongoing basis. The applicant has provided evidence of advertising the position on Seek and of the recruitment outcome. The applicant has numerous vacancies for massage therapists and told the Tribunal that he employs qualified Australian Citizens to carry out the role. The physically challenging nature of the role contributes to a high turnover of staff and that staff retention is an issue. Prior to offering the nominee employment, the applicant required the nominee to undergo an assessment of his work to ensure that he was qualified and experienced and met Endota Spa standards.
The Tribunal has considered evidence supporting the nominee’s suitability in so far as his experience and qualifications for the position. Department records show that the nominee has worked as a remedial massage therapist for the applicant since 2018. His prior employment included over six years experience as a shiatsu therapist and acupuncturist in Brazil and was self-employed as a remedial massage therapist in Australia from 2017 to 2018. The nominee holds qualifications in remedial massage, shiatsu therapy and acupuncture. Having considered the evidence attesting to the nominee’s experience and qualifications the Tribunal is satisfied that he is suitably qualified for the position.

The Tribunal is satisfied that there is a genuine need for a paid employee to work in the position of Massage Therapist (ANZSCO 411611) under the nominator’s control. The Tribunal is also satisfied that the tasks of the position to be performed correspond to the tasks of an occupation specified by the Minister in a relevant instrument in writing for this sub-subparagraph. Furthermore, the Tribunal is satisfied the occupation is applicable to the person identified under subparagraph (a)(ii) in accordance with the specification of the occupation. Accordingly, the requirements of r.5.19(4)(h)(ii) (B) and (D) and (DA) are met.
The Tribunal is satisfied that the material and evidence provided by the applicant, supports the applicant’s claims that they have made efforts to fill the position locally by an Australian citizen or an Australian permanent resident. The applicant provided evidence that they have been unsuccessful in sourcing an experienced and qualified Australian citizen or an Australian permanent resident to the position. The applicant told the Tribunal that they have advertised the position online on Seek and continue to advertise for massage therapists.
The Tribunal also gives weight to the RCB’s advice that the position cannot be filled locally. On the evidence, the Tribunal is satisfied that the position cannot be filled by an Australian citizen/permanent resident living in the same local area. Accordingly, the requirements of r.5.19(4)(h)(ii)(C) are met.
The Tribunal notes the completed Form 1404 dated 26 February 2020 from the relevant RCB, Department of State Development, South Australia, indicating that they are satisfied regarding the matters specified in paragraph (e) and sub subparagraphs (B) and (C). On this basis, the Tribunal is satisfied that r.5.19(4)(h)(ii)(F) is met.
Given the above, the Tribunal finds that the requirements of r.5.19(4)(h)(ii) are met and accordingly r.5.19(4)(h) is met as a whole.
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.
Karen McNamara
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.
…
Direct Entry nomination
(4)The Minister must, in writing, approve a nomination if:
(a)the application for approval:
(i)       is made in accordance with subregulation (2); and
(ii)      identifies a need for the nominator to employ a paid employee to work in the position under the nominator’s direct control; and
(b)the nominator:
(i)       is actively and lawfully operating a business in Australia; and
(ii)      directly operates the business; and
(c)for a nominator whose business activities include activities relating to the hiring of labour to other unrelated businesses — the position is within the business activities of the nominator and not for hire to other unrelated businesses; and
(d)both of the following apply:
(i)       the employee will be employed on a full-time basis in the position for at least 2 years;
(ii)      the terms and conditions of the employee’s employment will not include an express exclusion of the possibility of extending the period of employment; and
(e)the terms and conditions of employment applicable to the position will be no less favourable than the terms and conditions that:
(i)       are provided; or
(ii)      would be provided;
to an Australian citizen or an Australian permanent resident for performing equivalent work in the same workplace at the same location; and
(f)either:
(i)       there is no adverse information known to Immigration about the nominator or a person associated with the nominator; or
(ii)      it is reasonable to disregard any adverse information known to Immigration about the nominator or a person associated with the nominator; and
(g)the nominator has a satisfactory record of compliance with the laws of the Commonwealth, and of each State or Territory in which the applicant operates a business and employs employees in the business, relating to workplace relations; and
(h)either:
(i)       all of the following apply:
(A)the tasks to be performed in the position will be performed in Australia and correspond to the tasks of an occupation specified by the Minister in an instrument in writing for this sub-subparagraph;
(AA)there is a genuine need for the nominator to employ the person identified under subparagraph (a)(ii), as a paid employee, to work in the position under the nominator’s direct control;
(AAA)the occupation is applicable to the person identified under subparagraph (a)(ii) in accordance with the specification of the occupation;
(B)either:
(I)the nominator’s business has operated for at least 12 months, and the nominator meets the requirements for the training of Australian citizens and Australian permanent residents that are specified by the Minister in an instrument in writing for this sub-sub-subparagraph; or
(II)the nominator’s business has operated for less than 12 months, and the nominator has an auditable plan for meeting the requirements specified in the instrument mentioned in sub-sub-subparagraph (I); or
(ii)      all of the following apply:
(A)the position is located in regional Australia;
(B)there is a genuine need for the nominator to employ the person identified under subparagraph (a)(ii), as a paid employee, to work in the position under the nominator’s direct control;
(C)the position cannot be filled by an Australian citizen or an Australian permanent resident who is living in the same local area as that place;
(D)the tasks to be performed in the position correspond to the tasks of an occupation specified by the Minister in an instrument in writing for this sub-subparagraph;
(DA)the occupation is applicable to the person identified under subparagraph (a)(ii) in accordance with the specification of the occupation;
(E)the business operated by the nominator is located at that place;
(F)a body that is:
(I)specified by the Minister in an instrument in writing for this sub-subparagraph; and
(II)located in the same State or Territory as the location of the position;
has advised the Minister about the matters mentioned in paragraph (e) and sub-subparagraphs (B) and (C).

[2020] AATA 3271

18 June 2020

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