LZM Group Pty Ltd (Migration)

LZM Group Pty Ltd (Migration) [2020] AATA 4515 (29 October 2020)
DECISION RECORD
DIVISION:Migration & Refugee Division
APPLICANT:  LZM Group Pty Ltd
CASE NUMBER:  1800912
HOME AFFAIRS REFERENCE(S):          BCC2017/463843
MEMBER:Karen McNamara
DATE:29 October 2020
PLACE OF DECISION:  Sydney
DECISION:The Tribunal sets aside the decision under review and substitutes a decision approving the nomination.

Statement made on 29 October 2020 at 4:19pm

CATCHWORDS
MIGRATION – application for approval of nomination of position – direct entry nomination stream – tasks of position – nominee’s qualifications and experience – director’s other business interests – attempts to recruit citizen or permanent resident – decision under review set aside
LEGISLATION
Migration Regulations 1994 (Cth), r 5.19(4)(h)(ii)(D)
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 3 January 2018 to reject the application by LZM Group 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 5 February 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 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 formed the view that the tasks of the position were that of Retail Supervisor and not Retail Manager.
The applicant applied to the Tribunal on 11 January 2018 for review of the delegate’s decision. The applicant submitted a copy of the primary decision record with the review application.
On 13 October 2020, the applicant represented by Mr Zhiming Liu (referred to below as the applicant) appeared before the Tribunal via telephone, to give evidence and present arguments. The Tribunal also received oral evidence from Ms Yanan Chen (the nominee) in the related matter for the subclass 187 visa (AAT Case file 1803380). The related matters were heard concurrently in a combined hearing.
The applicant was represented in relation to the review. The representative attended the Tribunal hearing.
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 2020 financial statements, BAS returns July 2018 to June 2020, Workers Compensation Certificate of Currency, business and nominee’s bank account statements, nominee’s PAYG’s 2018, 2019 & 2020 and evidence of the nominee receiving superannuation payments. The Tribunal also invited the applicant to make any further submissions in support of their application.
The applicant provided to the Tribunal the above mentioned documentation on 20 and 28 October 2020.
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.
The applicant operates a fast food restaurant specialising in Chinese cuisine. The business trades as Inn Ur Wok, located at Frenchville (Rockhampton) Queensland. ASIC records show LZM Group Pty Ltd was registered on 14 December 2015. The Tribunal was told that the applicant purchased the business in 2016.
On 5 February 2017, the applicant lodged an application for an employer nomination approval for the position of Retail Manager (ANZSCO 142111) under the Regional Sponsored Migration Direct Entry stream. The nominated salary is $55,000 per annum.
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)). The application also included written certification relating to conduct that contravenes s.245AR(1) of the Migration Act 1958, 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 Zhiming Liu and Ms Yanan Chen. In support of the need for the position, the applicant has provided evidence in the form of supporting statements dated 20 May 2017 and 10 August 2020.
Accordingly, the requirements in r5.19(4)(a)(ii) are met.
As the criteria in both r.5.19(4)(a)(i) and (ii) are satisfied, accordingly the requirements in r.5.19(4)(a) are 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 a fast food restaurant located at Frenchville a suburb of Rockhampton, Queensland. Based on the material provided to the Tribunal (including; financial statements, company tax returns, bank statements, supplier invoices, QLD Government issued business licences, BAS returns, ASIC Company details, payroll advice and workers compensation policy details) the Tribunal is satisfied the applicant is actively and lawfully operating a retail food outlet 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 financial statements for the 2018/19 financial year record sales of $510,012, wage expense $159,494, net profit $23,659 and net equity $50,220.
The business’s 2019/20 financial statements report income of $559,695, wage expense $134,355, net profit $52,779 and net equity $86,976. The applicant has provided a letter from his accountant dated 20 October 2020 attesting to the financial capacity of the business to employ the nominee for at least two years.
BAS statements and financial statements provided to the Tribunal show the business has traded steadily during the COVID -19 pandemic.
In considering whether the business has the financial capacity to pay a full time salary of $55,000 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 also considered the advice of the applicant’s accountant dated 20 October 2020 attesting to the financial capacity of the business to employ the nominee for at least two years. The Tribunal has afforded weight to information before it, including the applicant’s financial statements, company tax returns, BAS returns and payroll records which show the applicant has met payroll and operating costs for the last two financial years.
The Tribunal has also taken into consideration the nominee has been employed by the applicant in a full time capacity since April 2017. The nominee’s bank account statements, Tax returns, NOA’s and applicant’s payroll records, support the nominee has received remuneration of the nominated salary of $55,000 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 employment agreement dated 1 July 2020. The agreement sets out the terms and conditions of employment and indicate that the period of employment is in accordance with the applicant’s visa conditions. The agreement stipulates the base salary is $55,000 per annum 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 agreement dated 1 July 2020 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 employment agreement dated 1 July 2020 sets out the terms and conditions of employment and indicates that the nominee’s salary will be $55,000 per annum and hours of work 38 hours per week. The nominee’s leave entitlements include annual, personal carers, compassionate, parental and long service leave in accordance with the Industry Award and National Employment Standards.
The Tribunal has received copies of the nominee’s tax returns, bank statements and payslips confirming that the nominee has been paid by the applicant, the nominated salary amount of $52,000 per annum. Superannuation information 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 as per the meaning given in rr.1.13A and 1.13B, 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, and specified training requirements are met; or
·the position and nominator’s business is located in regional Australia, there is a genuine need for the paid position under the nominator’s direct control which 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).
In consideration of whether the applicant satisfies the requirements under r.5.19 (4)(h)(ii), all subclauses r.5.19(4)(h)(ii)(A) to r.5.19(4)(h)(ii)(F) must be met.
The evidence before the Tribunal indicates that the applicant’s business, which is operated by the applicant and the position are located in Frenchville, Rockhampton Queensland, postcode 4701 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 has considered whether there is a genuine need for the applicant to employ a Retail Manager (ANZSCO 142111) and for the tasks of that position. The evidence before the Tribunal indicates the applicant operates a takeaway fast food restaurant in Frenchville a suburb of Rockhampton Queensland. The applicant gave evidence at the hearing that the position is vital in order to manage and maintain the daily operations of the business and is fully responsible for overseeing the operations of the restaurant. The applicant has other business interests including three restaurants and two commercial properties. In order to concentrate on managing his business portfolio the applicant cannot solely manage one business and therefore requires the position to manage the Inn Ur Wok store on his behalf.
The Tribunal was told that the applicant purchased the restaurant in early 2017 and that the position of store manager was an existing position. When he purchased the business, he retained the staff, however some left including the former store manager. The applicant has employed other people in the position however they resigned after completing a few shifts citing that they could not work at night and some were not familiar with Asian food.
The delegate refused the application on the basis the applicant’s nomination did not demonstrate the tasks to be performed in the position 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 and nominee that the tasks to be performed correspond to the tasks of Retail Manager (ANZSCO 142111). The Tribunal notes the Tribunal has had the benefit of discussing with the applicant and nominee at the hearing, the precise tasks and responsibilities associated with the position.
The Tribunal has considered evidence supporting the nominee’s suitability in so far as her experience and qualifications for the position. Department records show that the nominee at time of application holds a Bachelor of Business degree in Hotel Management from Griffith University, Graduate Diploma of Accounting from James Cook University. The applicant previously worked as an Assistant Manager at 7 eleven prior to commencing the position with the applicant. At the hearing the applicant and the nominee told the Tribunal that the nominee has worked in the position since 2017. Having considered the evidence attesting to the nominee’s experience and qualifications the Tribunal is satisfied that she 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 Store Manager in the occupation of Retail Manager (ANZSCO 142111) 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 locally through placement of advertisements in store and online through SEEK. The applicant provided evidence to support the advertisements and recruitment outcomes. The applicant told the Tribunal that he has found it difficult to recruit staff including the Manager position as the store trades in the evening and the required hours are a deterrent to applicants who only wish to work set hours during the day.
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 advice dated 2 June 2017 from the relevant RCB Chamber of Commerce & Industry Queensland 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)       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).

[2020] AATA 4515

29 October 2020

Key Legal Topics

Areas of Law

Immigration

Administrative Law

Legal Concepts

Judicial Review

Statutory Construction

Procedural Fairness

Jurisdiction