O'CONNOR CONTRACTING PTY LTD (Migration)

[2020] AATA 5816

O'CONNOR CONTRACTING PTY LTD (Migration) [2020] AATA 5816 (18 December 2020)

DECISION RECORD

DIVISION:Migration & Refugee Division

APPLICANT:  O'CONNOR CONTRACTING PTY LTD

CASE NUMBER:  1804942

HOME AFFAIRS REFERENCE(S):          BCC2017/3981201

MEMBER:Michelle East

DATE:18 December 2020

PLACE OF DECISION:  Perth

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

Statement made on 18 December 2020 at 10:36am

CATCHWORDS

MIGRATION – approval of a nomination – Direct Entry nomination stream – evidence of training expenditure – identified need for the employee – actively and lawfully operating a business – terms and conditions of employment – financial capacity to employ the nominee – decision under review set aside          

LEGISLATION

Migration Act 1958, s 245
Migration Regulations 1994, rr 1.13, 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 14 February 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 27 October 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 Direct Entry nomination stream.

4. The delegate refused the application on the basis the applicant’s nomination did not satisfy r.5.19(4)(h)(i) of the Regulations because there was no verifiable evidence of training expenditure provided.

5. Mr O’Connor on behalf of the applicant appeared before the Tribunal on 25 November 2020 to give evidence and present arguments. The Tribunal also received oral evidence from the nominee Mr Cole.

6. The applicant was represented in relation to the review by its registered migration agent, Ms Higgins.

7. The Tribunal exercised its discretion to hold the hearings by Microsoft Teams video.  The hearings were held during the COVID-19 pandemic.  The Tribunal determined it was reasonable to hold a hearing by video, having regard to the nature of this matter and the individual circumstances of the applicant.  The Tribunal also had regard to its objective of providing a mechanism of review that is fair, just, economical and quick and the delay to the matter if the hearing was not to be conducted by video.  The parties confirmed at the hearing that they did not have any objection to the hearing proceeding by video.

8. 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

9. 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)

10. 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.

11. Based on the material in the Department’s file, the Tribunal is satisfied that the application was made on the approved form.  The application was accompanied by the prescribed fee of $540.

12. The requisite certification to the effect that the applicant has not engaged in any conduct in relation to this nomination that constituted a contravention of s.245AR(1) of the Act was also provided as part of the application process. Accordingly the requirements of r.5.19(4)(a)(i) are met.

13. 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 had regard to the evidence before it, including the further documents provided by the applicant after lodging its application for review.

14. The Tribunal accepts that the business needs to employ a paid employee to work in the position under the nominator’s direct control.  The tasks that the business needs the position to undertake are discussed in more detail below.

15. 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)

16. Regulation 5.19(4)(b) requires that the applicant is actively, lawfully and directly operating a business in Australia.

17. Having considered the material before it, including the applicant’s financial statements, business registration records and tax records, the Tribunal is satisfied that the applicant is actively and lawfully operating a business in Australia and directly operates that business.

18. Accordingly, the requirement in r.5.19(4)(b) is met.

    Position is not labour-hire: r.5.19(4)(c)

19. 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.

20. There is no evidence before the Tribunal to indicate that the applicant’s business is involved in labour hire.  The Tribunal is satisfied that the employment contract and organisational chart confirm that the nominee will work in the applicant’s direct employ.

21. Accordingly, the requirement in r.5.19(4)(c) is met.

    Term of employment of the visa holder: r.5.19(4)(d)

22. 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.

23. The Tribunal has received a copy of the applicant’s most recent employment contract dated 25 August 2017.  Its terms provide for the nominee to be employed as a Fitter (plant mechanic) commencing upon approval of his visa for at least two years with no exclusion of an extension to the term of his contract.

24. The Tribunal has received substantially more material than was available to the delegate when she made her decision.

25. The applicant company does groundwork services, including roadworks, drainage, sewerage, electrical conduits and transport.  Work in undertaken in Perth and regional areas.

26. A review of the financial documents indicates the business has a substantial turnover and significant assets in the form of plant and equipment.  PAYG summaries for the applicant provided to the Tribunal indicate that the applicant has been paid his entitlements.

27. On balance and after considering the documentary and oral evidence of the applicant and the nominee, the Tribunal is satisfied that the applicant has the financial capacity to employ the nominee, in the nominated position for at least two years.

28. Accordingly, the requirement in r.5.19(4)(d) is met.

    No less favourable terms and conditions of employment: r.5.19(4)(e)

29. 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.

30. The Tribunal has had regard to the terms and conditions of employment as set out in the employment contract.  The contract provides for the nominee’s entitlements and indicates that the base salary will be paid weekly at the rate of $30 per hour, plus superannuation.

31. The Tribunal has been provided with advertisements indicating the equivalent salaries paid for similar work.

32. The Tribunal questioned whether the applicant employs Australian citizens or permanent residents to perform equivalent work.  Mr O’Connor said there was no other fitter employed in Perth, although he had recently engaged one to work in Willuna.

33. The Tribunal is satisfied that the salary amount and the terms and conditions paid to the nominee are no less favourable than those that would be provided to an Australian citizen or permanent resident performing the same work in the same place in Western Australia.

34. Accordingly the requirements in r.5.19(4)(e) are met.

    No adverse information known to Immigration: r.5.19(4)(f)

35. 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.

36. There is no adverse information before the Tribunal of any adverse information known to Immigration about the nominator or person ‘associated with’ the nominator.

37. Accordingly, the requirements of r.5.19(4)(f) are met.

    Satisfactory compliance with workplace relations laws: r.5.19(4)(g)

38. 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.

39. 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.

40. 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)

41. Regulation 5.19(4)(h) contains a number of alternative requirements. These are set out in detail in the attachment to the decision but those relevant to this decision are:

    ·the tasks to be performed in the position will be performed in Australia and correspond to those of an occupation specified by the Minister (see legislative instrument IMMI 17/080, 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

42. The application was made in the non-regional stream. The Tribunal has confirmed from the Department’s records that the application fee of $540 (non-regional application fee) was paid. Therefore, the Tribunal has considered whether the applicant can meet the requirements of r.5.19(4)(h)(i).

    Regulation 5.19(4)(h)(i)(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 subparagraph

43. The position nominated by the applicant is Fitter (General), which occupation is listed in IMMI 17/080 as ANZSCO classification 323211.  The Tribunal has considered the tasks specified in the ANZSCO for that occupation and compared it to those of the nominee as described in the documents provided as well as the oral evidence of the nominee and the applicant.

44. Based on all the evidence the Tribunal is satisfied that the tasks to be performed in the position correspond to the tasks of the occupation of Fitter (General) specified by the Minister in the relevant instrument, being IMMI 17/080. Accordingly, the requirements of r.5.19(4)(h)(i)(A) are met.

    Regulation 5.19(4)(h)(i)(AA) – there is a genuine need for the nominator to employ the person identified under r.5.19(4)(a)(ii) as a paid employee, to work in the position under the nominator’s direct control

45. In considering this issue, the Tribunal has taken into account the evidence provided to the Tribunal regarding the nature and size of the business and the explanation as to why the nominator requires the services of the nominee.

46. The Tribunal accepts that the services of the nominee are pivotal to the business running smoothly.  Furthermore, the nominee has been employed by the sponsor for 5 years and knows the business.  Mr O’Connor described the possibility of losing Mr Cole as a ‘disaster’ for his business.

47. Having had the benefit of the applicant’s oral evidence as well as that of the nominee the Tribunal is satisfied that the requirements of r.5.19(4)(h)(i)(AA) are met.

    Regulation 5.19(4)(h)(i)(B)(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-paragraph

48. The applicant produced evidence to demonstrate that the business has operated for at least 12 months.  The training benchmarks and training requirements are specified in IMMI 17/074.  The business is required to show that training has been and continues to be provided to employees who are Australian citizens and Australian permanents residents and is related to the purpose of the business.  The outlay is required to be the equivalent of at least 1% of the payroll.

49. The Tribunal outlined these requirements to the applicant at the hearing and the representative requested and was granted further time within which to provide further evidence and submissions.

50. The representative in her submission said:

    Prior to the lodgement of the subclass 186(DE), the company renewed their Standard Business Sponsorship.  To successfully renew their sponsorship the company had to evidence that they had met the training benchmark.  As less than 12 months had passed since being reapproved as a Standard Business Sponsor, the training benchmark for the subclass 186 (DE) application should have been deemed to have been met.

51. The representative further stated that if the previous migration agent who lodged the nomination application had explained this it is unlikely the nomination would have been refused on the basis of the training requirement.  The applicant was notified of their approval as a sponsor on 5 July 2017.

52. The representative also said that the training benchmark requirement should be construed as a time of application criterion, rather than at time of decision.

53. Ms Higgins also submitted that should the Tribunal find it needs to be satisfied that the training benchmark is to be met at the time of decision, it is reasonable to disregard non-compliance with the obligations.

54. Evidence was provided that the applicant employed a trainee in 2017/18 and continues to employ him.  The trainee was organised by the Salvation Army who also paid for courses associated with his training.  The wages were paid by the applicant.  The submission provided that the amount paid by the Salvation Army only went partially towards the costs of training and wages.  After it was exhausted, the applicant was responsible for the cost of the training and wages.

55. The Tribunal refers to IMMI 17/074 which defines ‘Recent expenditure for Training Benchmark B as ‘expenditure made in the previous financial year or the previous 12 months, as evidenced by a receipt for the payment(s) or a contract for employment of the relevant individual for whom salary payments are being included within expenditure than can count towards the benchmark’.

56. The Tribunal has also referred to the previous instrument, IMMI 13/030, which does not define ‘recent expenditure’.  According to policy at that time it was taken to mean for the 12 months prior to lodging the nomination.  Parties at that time appeared to argue the interpretation of that instrument in a way that was most favourable to the nominator.  On a clear reading of the current instrument, the Tribunal is satisfied that the correct interpretation is that ‘recent expenditure’ refers to expenditure in the previous financial year or the previous 12 months prior to the date of its decision.

57. As noted at the hearing the Tribunal does not have the most recent financial accounts for this applicant.  The submissions and evidence demonstrate that gross payroll for the applicant for 2019/2020 was $1,900,183 and wages for the trainee were $78,302 (which equates to 4% of payroll).   Receipts for various training services were also provided.

58. The Tribunal has considered the training receipts provided and is satisfied that at least 1% of the gross payroll expenditure was paid for training in the 12 months prior to the Tribunal’s decision.

59. Having regard to the above findings, the Tribunal finds that the requirements of r.5.19(4)(h) are met.

60. 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

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

    Michelle East
    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).