Melara Holdings Pty Ltd (Migration)

[2020] AATA 5856

Melara Holdings Pty Ltd (Migration) [2020] AATA 5856 (30 November 2020)

.

DECISION RECORD

DIVISION:Migration & Refugee Division

APPLICANT:  Melara Holdings Pty Ltd

CASE NUMBER:  1808821

HOME AFFAIRS REFERENCE(S):          BCC2017/1956081

MEMBER:Susan Reece Jones

DATE:30 November 2020

PLACE OF DECISION:  Melbourne

DECISION:The Tribunal sets aside the decision under review and substitutes a decision approving the nomination.

Statement made on 30 November 2020 at 8:16pm

CATCHWORDS
MIGRATION – Employer Nomination – approval of nominated position – Temporary Residence Transition nomination stream – financial capacity to maintain term of employment – highly specialised, marine spray-painting business – recent financial evidence provided – nominee’s remuneration package – decision under review set aside

LEGISLATION
Migration Regulations 1994 (Cth), r 5.19

STATEMENT OF DECISION AND REASONS

APPLICATION FOR REVIEW

1. This is an application for review of a decision made by a delegate of the Minister for Home Affairs on 26 March 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).

2. The applicant applied for approval on 2 June 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).

3.    In this case, the applicant has applied for approval of a nomination, seeking to satisfy the criteria in the Temporary Residence Transition nomination stream.

4. The delegate refused the application on the basis the applicant’s nomination did not satisfy r.5.19 (3)(d)(i) of the Regulations because the applicant did not demonstrate that the nominee will be employed on a full-time basis in the position for at least 2 years.

5.    The Tribunal received a review application on AAT application lodged 29 March 2018. It was signed on behalf of the applicant by a director, Mr Neil McCleary, and was accompanied by a copy of the delegate’s decision.

6. On 10 August 2020, the Tribunal wrote to the applicant’s sole director via the agent, Ms. Chandrika Maria D'mello, of Pinnacle Migration Pty Ltd, pursuant to s.359(2), to invite her to provide updated and current information demonstrating that the applicant met all of the criteria in r.5.19(3). The Tribunal provided examples of the kinds of information that would assist it to assess the criteria in r.5.19(3) and noted that all of the criteria had to be met in order for the Tribunal to set aside the refusal decision and substitute a decision to approve the nomination.

7.On 20 August 2020, the applicant provided the Tribunal with the following documents:

·ASIC Current and Historical; Extract dated 17 August 2020

·Business Activity Statements (BAS) 2017, 2018, 2019, 2020

·Financial Statements: 2016, 2017, 2018, 2019, 2020

·ATO Tax Returns 2017, 2018, 2019

·Letter from the applicant’s Accountant Laurie Tatam of Complete Business Consultants, dated 18 August 2020

·Organisation Structure of the company, including the nominated position

·Job description

·Nominee Employment Agreements 2015, 2017, August 2020

·Comparison of market salary with an Australian employee to evidence that the nominee will be paid the same as another Australian in the business performing equivalent work

·Current comparative payslip for an Australian citizen 2020

·Previous comparative payslip for an Australian citizen 2017.

·PAYG summaries for tax years 2015 to 2020.

·Nominee ATO 2015, 2016, 2017, 2018, 2019, 2020.

·Purchase Orders for various jobs including with Austal

·Applicant NAB Bank account with salary payments

1. 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 applicants. 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 was given a fair opportunity to give evidence and present arguments.

2. The applicant appeared before the Tribunal on 30 October 2020 to give evidence and present arguments in relation to this case and in relation to one other case, 1808817.          On the basis of the two cases to be heard, the Tribunal held a joint hearing to discuss the applicant’s submission in each case. The Tribunal received oral evidence in relation each case from the applicant’s sole director, Mr Neil McCleary and in relation to this case, from the nominee, Mr Kenneth Alcotin.  

3. The applicant was represented in relation to the review by its registered migration agent.

4. On 4 November 2020, the applicant provided the following documents to the Tribunal:

   ·     Nominee Superannuation: Suncorp Superannuation 2012 to 2020

   ·     Purchase Order from Austal

   ·     Austal Letter re RAN Vessels 

   ·     Purchase Order Echo Marine

5. 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

6. 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.

   The application must be compliant: r.5.19(3)(a)

7. 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). The application must also identify a relevant person and occupation.

8. From the material on the Department file, the Tribunal is satisfied that the nomination application complied with the above requirements.

9. Given the above findings, the requirement in r.5.19(3)(a) is met.

   Status of the nominator: r.5.19(3)(b)

10. 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.

11. The Tribunal is satisfied that the company was the standard business sponsor who last identified the nominee, Mr Kenneth Alcotin, and nominated him for a subclass 457 visa.   The Tribunal is further satisfied that the company did not meet certain criteria relating to the operation of a business overseas in its most recent sponsorship approval.

12. The applicant’s business is domiciled at Henderson, Perth, Western Australia, within the Australian (naval) defence precinct. According to the applicant, and the ASIC Current and Historical Extract dated 17 August 2020, the applicant commenced operations in 1985, and is a family business, whose core business is marine spray painting. 

13. In relation to whether the applicant is actively and lawfully operating a business in Australia, the applicant has provided evidence of its current ASIC registration, its Financial Statements for 2016 to 2020, ATO Tax Returns 2017 to 2020, and its Business Activity Statements (BAS) for 2017 to 2020  which show that it is actively trading.

14. Given the above, the requirement in r.5.19(3)(b) is met.

    Previous employment of the nominee: r.5.19(3)(c)

15. 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 2 of the 3 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 2 years in the 3 years immediately before the application.

16. The Tribunal is satisfied on the evidence before it that:

    • the nomination was made on 2 June 2017 for the position of Vehicle Painter - 324311;
    • the relevant 3-year period is therefore 2 June 2014 to 2 June 2017;
    • the nominee applied for a subclass 457 visa offshore on 21 February 2007 and was granted a 457 visa on 12 April 2007, he arrived in Australia on 17 May 2007;
    • he commenced working for the applicant in May 2007;
    • he was granted a subclass 457 visa on 12 April 2007 valid to 12 April 2011, 13 May 2011 valid to 14 April 2015 and 14 April 2015 valid until 14 April 2019; and

    he had therefore worked for the applicant in the nominated position for approximately 10 years prior to the nomination, and for 3 years in the 3-year period immediately prior to the nomination application being lodged.

17. 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)

18. Regulation 5.19(3)(d) only applies to certain nominees (those described in r.5.19(3)(c)(i)). For this class of person, the Regulations require that the nominee will be employed on a full time basis for at least 2 years on terms that do not expressly preclude the possibility of an extension.

19. The Department in its decision, found that on assessment of the information submitted, the applicant did not demonstrate that the nominated person would be employed on a full-time basis in the position for at least 2 years. The applicant failed to provide BAS that had been lodged with the ATO, financial reports (profit and loss statements), Bank statements covering the most recent 12 month period of operation, Lease agreements or property ownership relating to business/organisation’s premises, registration with industry associations, or contracts to provide services or work orders. 

20. The applicant operates a family business known as Boat Spray, which is a highly specialised, marine spray-painting business. The applicant is a preferred supplier to Austal for the work being undertaken by Austal for the Royal Australian Navy (Cape Class vessels) and Border Force. In addition, the applicant has been contracted to undertake work for vessels for Trinidad valued at $6.28m and has a $2.5m contract with Echo Marine for painting luxury boats. The luxury boat sector is also highly specialised and unique work and the applicant plans to expand this part of its operation into a new division in order to expand its overall capacity and business. The work is by all accounts, highly profitable, and Mr McCleary told the Tribunal that the applicant’s future order book is very strong. The applicant provided evidence of a significant purchase order from Echo Marine in support.

21. The applicant director Mr McCleary told the Tribunal at hearing that during COVID-19, the applicant has secured additional contracts because other competing businesses have been unable to access Western Australia because of the restrictions imposed by the WA State government.

22. The Tribunal’s analysis of the applicant’s recent financial evidence shows as follows:

$	2018	2019	2020
Total income	2,383,998	1,572,305	2,091,993
Total Assets	957,165	625,088	529,445
Total Liabilities	767,140	603,272	772,686

1. The applicant provided the Tribunal with a letter from the applicant’s Accountant, Laurie Tatam of Complete Business Consultants, dated 18 August 2020 to confirm that the applicant can comply with the obligations required under r.5.19(3)(d). The applicant also submitted in support, its NAB Bank statements for the past 12 months which also show the rental paid for the applicant’s business premises. In addition, the applicant has provided the Tribunal with a selection of current purchase orders showing current and future work orders including substantial orders from Austal in relation to the Royal Australian Navy work.

2. The Tribunal also notes that each of the nominee’s Employment Agreements provides a remuneration package which includes an annual trip to Philippines, overtime payments and subsidised accommodation in a luxury home (with pool) in Perth. The nominee’s more recent PAYG summaries show as follows:

$	2015	2016	2017	2018	2019	2020
Agreement	29 January 2015 66,560	26 May 2016	5 May 2017 69,680	18 August 2020 83,200
PAYG	73,290	88,735	84,937	83,508	87,112	101,992

1. The Tribunal is satisfied on the totality of the evidence that the nominator has the financial capacity to maintain the nominee's salary, as it has demonstrated for the past 13 years, and 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.

2. Given the above findings, the requirement in r.5.19(3)(d) is met.

   No less favourable terms and conditions of employment: r.5.19(3)(e)

3. 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.

4. Mr McCleary told the Tribunal at hearing that the applicant finds that due to the WA mining industry, there is a continual issue with skilled labour supply and finding Australians to do the work required is very challenging. As Austal used to operate a shipyard in the Philippines and because the workforce there is highly skilled and very well trained, Mr McCleary told the Tribunal that he travelled to the Philippines to interview the nominee. Together with several other employees, the nominee was hired by the applicant.

5. The applicant’s Organisation chart shows that the applicant employs 12 employees,10 of whom are Australian or Permanent residents. The Tribunal notes from the evidence provided that whilst there is another employee employed with the same title, that employee is an Australian (Mr Nolly Subangn) and he is paid the same as the nominee.   

6. In addition, the Tribunal has had regard to the Job Outlook and Seek.com websites. Whilst Job Outlook notes that an equivalent employee may earn $1,410 per week ($73,320), the Tribunal’s view is that is for a motor vehicle painter as opposed to a highly skilled painter required for marine work. There are no comparative positions available which show a salary on Seek.com.

7. From the above, the Tribunal is satisfied that the proposed salary associated with the nominated position is within the salary range of what an equivalent Australian employee would be paid, and that it is no less favourable than what the equivalent Australian employee is in fact being paid.

8. The Tribunal is further satisfied that the nominee’s most recent contract of employment dated 18 August 2020 has standard provisions relating to leave and termination that are consistent with those in the Fair Work Act 2009 (Commonwealth) and National Employment Standards (NES).

9. Accordingly, the requirement in r.5.19(3)(e) is met.

   Training commitments and obligations: r.5.19(3)(f)

10. 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.

11. The applicant’s first Standard Business Sponsorship commenced on 29 September 2006 to 29 September 2008, after which it had the following additional approved periods as an SBS: 25 October 2007 to 25 October 2009, 15 April 2011 to 15 April 2014 and 19 April 2014 to 19 April 2017. The applicant’s most recent SBS period is 28 October 2019 to 28 October 2024.

12. On 12 August 2020, the representative wrote to the Tribunal to clarify whether the applicant was required to provide information about the applicant’s compliance with training commitments as the applicant currently holds a Standard Business Sponsorship (SBS) approved in 2019 until 2024. The Representative noted that the applicant’s current SBS approval did not require the applicant to demonstrate compliance to training in accordance with the new criteria for SBS approval. In response, the Tribunal advised the applicant on 12 August 2020 that the provision of the applicant’s current SBS approval was sufficient.

13. Despite the above, the Tribunal is of the view that the applicant has complied with the Training Benchmarks obligations nonetheless because of the training that it is legally obligated to undertake (work, health, safety etc) as a provider to Austal and also through its regular engagement of apprentices.

14. Accordingly, the requirement in r.5.19(3)(f) is met.

    No adverse information known to Immigration: r.5.19(3)(g)

15. Regulation 5.19(3)(g) 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. 

16. The Tribunal has reviewed the Department's records, including its Integrated Client Services Environment (ICSE) and has found nothing to indicate that there is any adverse information known to Immigration about the nominator or person associated with the nominator.

17. Accordingly, the requirement in r.5.19(3)(g) is met.

    Satisfactory compliance with workplace relations laws: r.5.19(3)(h)

18. 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.

19. There is no evidence before the Tribunal of any breaches of the workplace relations laws of the Commonwealth or Western Australia by the applicant.

20. Accordingly, the requirement in r.5.19(3)(h) is met.

21. 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

22. The Tribunal sets aside the decision under review and substitutes a decision approving the nomination.

    Susan Reece Jones
    Member

    
    

    ATTACHMENT  -  EXTRACTS FROM THE MIGRATION REGULATIONS 1994

    5.19Approval of nominated positions (employer nomination)

    …

    (2)The application must:

    (a)be made in accordance with approved form 1395…; and

    (aa) include a written certification by the nominator stating whether or not the nominator has engaged in conduct, in relation to the nomination, that constitutes a contravention of subsection 245AR(1) of the Act; and

    (b)be accompanied by the fee mentioned in regulation 5.37.

    Temporary Residence Transition nomination

    (3)The Minister must, in writing, approve a nomination if:

    (a)the application for approval:

    (i)       is made in accordance with subregulation (2); and

    (ii)      identifies a person who holds a Subclass 457 … visa granted on the basis that the person satisfied the criterion in subclause 457.223(4) of Schedule 2; and

    (iii)     identifies an occupation, in relation to the position, that:

    (A)is listed in ANZSCO; and

    (B)has the same 4-digit occupation unit group code as the occupation carried  out by the holder of the Subclass 457 … visa; and

    (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.