Kerry's Traditional Chinese Massage Centre Pty Ltd (Migration)

Kerry's Traditional Chinese Massage Centre Pty Ltd (Migration) [2018] AATA 3821 (30 July 2018)
DECISION RECORD
DIVISION:Migration & Refugee Division
APPLICANT:  Kerry's Traditional Chinese Massage Centre Pty Ltd
CASE NUMBER:  1614145
DIBP REFERENCE(S):  BCC2015/3266449
MEMBER:Karen McNamara
DATE:30 July 2018
PLACE OF DECISION:  Sydney
DECISION:The Tribunal affirms the decision under review to refuse the nomination.

Statement made on 30 July 2018 at 10:57am
CATCHWORDS
Migration – Nomination refusal – Direct Entry Nomination stream – Retail Manager – Genuine need for the nominator to employ a paid employee – Decision under review affirmed
LEGISLATION
Migration Act 1958, ss 245, 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 Immigration on 29 June 2016 to reject the application by Kerry’s Traditional Chinese Massage Centre Pty Ltd (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 6 November 2015. 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 (r.5.19(3)) stream and a Direct Entry nomination (r.5.19(4)) stream. 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).
The applicant operates five massage centres under the name Kerry’s Traditional Chinese Massage Centre Pty Ltd, located in various metropolitan areas of Darwin in the Northern Territory. Based on the financial information provided by the applicant to the Tribunal, the business recorded in its 2017 BAS returns, sales of $1,779,933. At hearing, the Tribunal was advised the business employs three full time employees and 27 casual staff. BAS lodgements for the financial year 2017 show a salary expense of $316,896. In this case, the applicant has applied for approval of a nomination, seeking to satisfy the criteria in the Direct Entry Nomination stream. It has nominated the position of Retail Manager under the occupation Hospitality, Retail and Service Managers ANZSCO 149999.
The delegate refused the application on the basis the applicant’s nomination did not satisfy r.5.19(4)(a)(ii) of the Regulations because the delegate was not satisfied that the applicant identified a need to employ the nominee Ms Huang in the position of a Retail Manager on a full time basis, for at least two years. The delegate concluded that the nominator did not meet r.5.19(4) (a) and the nomination therefore could not be approved.
The Applicant applied to the Tribunal on 3 September 2016 for review of the delegate’s decision. A copy of the delegate’s decision record was provided with the application for review.

Information to the Tribunal

On 13 February 2018, the Tribunal wrote to the applicant pursuant to section 359(2) of the Act (dispatched by email) requesting the applicant to provide updated and current information that would assist to determine whether the criteria in r.5.19(2) & (4) of the Regulations were met.
On 27 February 2018, the applicant via their registered Migration Agent sought an extension of time to provide information to the Tribunal.
On the 28 February 2018, the Tribunal granted an extension of time to the 14 March 2018.
On the 14 March 2018, the applicant provided the following documents to the Tribunal:
·Covering letter from Stanley Chan Immigration Law dated 13/03/2018
·Letter of support from Pei Zhao dated 13/03/2018
·ASIC Extract
·Financial statements 2016 & 2017
·Employment contract signed and dated 1 July 2017
·BAS Returns
oJuly to September 2016
oOctober to December 2016
·Position description – Traditional Chinese Centre Manager
·General Retail Industry Award 2010
·Job Outlook extract – Retail Managers
·Employee list
·Website information relating to the business
·Facebook posts
·Training invoices dated 19/02/2018 and 22/02/2018
·Photographs of the Centres and staff
·Invoice for advertising Darwin Life 19/02/14
·Invoice P&Y Beauty and Massage Accessories dated 30/06/2016
·Insurance invoice 8/02/2016
·RCB 1404 form dated 10/08/2016
Following the hearing on the 22 May 2018, the applicant provided the following;
·Payroll summary - Mr LI
·Payslips – Mr Li
·Bank statement – Mr Li
·BAS Returns
oJuly 2016 to March 2018
·Notice of Assessment - Mr Li
·Certification and Declaration - Paying for Visa sponsorship – Ms Huang & Mr Li
Ms Pei Zhao Director and owner of the business appeared before the Tribunal by video conference on 17 May 2018 to give evidence and present arguments. The Tribunal also received oral evidence from Ms Jingsi Huang, the nominee. The Tribunal hearing was conducted with the assistance of an interpreter in the Mandarin and English languages.
The applicant’s registered migration agent did not attend 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 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.
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 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)). Whilst the application was made before 14 December 2015, the applicant has also included written certification relating to conduct that contravenes s.245AR(1) of the Act. Accordingly the requirements of r.5.19(4)(a)(i) are met.
The issue in this case however turned on whether the application identifies a need for the nominator to employ a paid employee to work in the position under their direct control as required by r.5.19(4)(a)(ii).
The nomination form identifies Ms Jingsi Huang as the nominee who will fill the position of Retail Manager with the nominator. The Tribunal notes that the nominator lodged two separate applications with the department on 6 November 2015 for the proposed occupation of Hospitality, Retail and Service Managers ANZSCO 149999. One for a Mr Yuhan Li and a second for Ms Jingsi Huang.
Both nomination applications were refused by the Department. The applicant’s nomination application for Mr Li was refused by a delegate of the Department on 29 June 2016 on the basis the applicant’s nomination did not satisfy r.5.19(4)(d)(i) of the Regulations.
The applicant’s application nominating Ms Jingsi Huang was refused by a delegate of the Department on 23 August 2016 on the basis the applicant’s nomination did not satisfy r.5.19(4)(a)(ii) of the Regulations, because the delegate was not satisfied that the applicant identified a need to employ a paid employee to work in the position of a Retail Manager.
The Applicant applied to the Tribunal on 3 September 2016 for review of the respective decisions of the nomination of Mr Li (AAT Case 1610905) and Ms Huang (subject of this decision).
In regard to the nomination application for Mr Li, on the 30 July 2018, the Tribunal found that based on the evidence before it, that the Tribunal was satisfied that the applicant met the requirements of r.5.19(4) for approval of the nomination of the position in Australia and set aside the decision under review and substituted a decision approving the nomination of Mr Li.
In considering whether this application (being nomination of a second position of Retail Manager), 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 Ms Pei Zhao and Ms Jingsi Huang. Ms Huang provided evidence about her experience and understanding of the duties and responsibilities of the position.
The Tribunal accepts on the evidence before it that the nominator operates five massage centres under the name Kerry’s Traditional Chinese Massage Centre Pty Ltd, located in various metropolitan areas of Darwin in the Northern Territory. Based on the financial information provided by the applicant to the Tribunal, the business recorded in its 2017 BAS returns lodged via the ATO portal, sales of $1,779,933. At hearing, the Tribunal was advised the business employs three full time employees and 27 casual staff. BAS lodgements for the financial year 2017 show a salary expense of $316,896.
Ms Zhao gave evidence at the hearing that she established business a year after coming to Darwin in 2009. Over the last nine years, she has expanded the business and now operates five premises. Ms Zhao told the Tribunal that she and her husband have been overseeing the management of the centres but now due to her husband’s ill health and her desire to concentrate more on the training of new techniques from China and introduce more Chinese therapies and medicines into the business, the business is seeking to employ two Retail Managers of which Ms Huang is one.
The Tribunal questioned whether Ms Huang had actually commenced employment with the business in light of her signing a contract of employment with the applicant on the 1 July 2017. The Tribunal was told that Ms Huang had communicated with the applicant over the phone over a two year period providing advice. When asked the nature of the advice and whether Ms Huang had received a wage for this advice, the applicant did not provide a satisfactory explanation.
The Tribunal was told Ms Huang commenced in the position two weeks prior to the date of the hearing but had not been paid yet. There is no evidence before the Tribunal to indicate salary payments from the business to Ms Huang or a satisfactory explanation of tasks undertaken by Ms Huang over this two week period except that Ms Huang had suggested the business advertise on another television channel and Google.
Ms Huang provided evidence that she had been working with the business for two years then later clarified this response by telling the Tribunal that she had not commenced work. The Tribunal acknowledged the amount of confusion the applicant and the nominee appeared to have in respect of whether or not Ms Huang had in fact commenced working with the business.
In seeking clarification as to Ms Huang’s commencement in the position, the applicant and Ms Huang told the Tribunal that prior to Ms Huang’s arrival in Darwin (as recently as two weeks prior to the hearing), she had not been employed in the position since the nomination application was submitted to the Department in November 2015.
The Tribunal put to the applicant its doubts as to the whether the business has an identifiable need to employ a paid employee to work in the position of Retail Manager given evidence that the business has continued to operate and expand even though the position has remained vacant for over two and half years.
The applicant told the Tribunal that she and her husband had been filling the position but due to her husband now being in bad health and that the applicant was thinking about introducing new techniques and products into the business, she needed the position of a Retail Manager to look after two of her stores. There is little information before the Tribunal, to indicate the specific role Ms Zhao’s husband played in the management of her business, specifically in the management of the two Centres that the applicant is seeking to employ a Retail Manager to oversee.
When asked how the business came to recruit Ms Huang, the Tribunal was told that the applicant’s migration agent Mr Stanley Chan had told the applicant that he could provide a suitable person for the position of Retail Manager and suggested Ms Huang to the applicant. Ms Huang had been unable to work in the position until recently due to her holding a 457 visa with an approved SBS in Sydney but that had fallen through and Ms Huang could not commence working in the nominated position until she attained the appropriate visa.
With respect to the requirement that the applicant identifies a need for the nominator to employ a paid employee to work in the position under the nominator’s direct control, the Tribunal is not satisfied that the applicant provided a satisfactory explanation as to how she managed the business before Ms Huang commenced two weeks prior to the hearing and why she did not attempt to fill the second position of Retail Manager since November 2015.
The Tribunal has taken into account and given weight to evidence that the position remained vacant for the period coinciding with Ms Huang’s availability pending her visa. This suggests to the Tribunal non-urgency by the applicant to fill the position hence raising concerns by the Tribunal as to the business’s need for this position.
In consideration of Ms Zhao’s evidence that the business needs a position of Retail Manger to manage two of her stores, because her husband is suffering ill health and she is concentrating on introducing new techniques and products into the business, the Tribunal has given weight to the absence of verifiable information to suggest that Ms Zhao’s husband or she performed the actual role of Retail Manager. Furthermore, there is no evidence before the Tribunal to suggest that the applicant has taken steps to introduce new techniques and products into her business and how this will impact on the operations of the business in requiring additional management of the two centres. The Tribunal has also afforded weighting to evidence before it that the position has remained vacant for over two and half years. The Tribunal therefore is not satisfied the business needs this position at this point in time.
Having regard to all of the evidence before it, the Tribunal is not satisfied that the applicant has identified a need for the nominator to employ a paid employee to work in the position of Retail Manager under the nominator’s direct control.
Accordingly, the requirements in r.5.19(4) (a)(ii) are not met
As a mandatory requirement for approval of the nomination has not been met, the Tribunal has not considered whether the other requirements set out in r.5.19(4) have been met.
For the above reasons the Tribunal is not satisfied that the applicant meets the requirements of r.5.19(4). The applicant has not sought to satisfy the criteria in Temporary Residence Transition Nomination stream, and as such has not met the requirements in r.5.19(3). 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.
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
(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)       both 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;
(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 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).

[2018] AATA 3821

30 July 2018

Key Legal Topics

Areas of Law

Immigration

Statutory Interpretation

Legal Concepts

Judicial Review

Procedural Fairness

Statutory Construction