Salay Investments Pty Ltd (Migration)

[2020] AATA 1596

Salay Investments Pty Ltd (Migration) [2020] AATA 1596 (11 May 2020)

DECISION RECORD

DIVISION:Migration & Refugee Division

APPLICANT:  Salay Investments Pty Ltd

CASE NUMBER:  1707879

DIBP REFERENCE(S):  BCC2016/3286548

MEMBER:Ian Berry

DATE:11 May 2020

PLACE OF DECISION:  Brisbane

DECISION:The Tribunal affirms the decision under review to refuse the nomination.

Statement made on 11 May 2020 at 12:49pm

CATCHWORDS
MIGRATION – Employer Nomination – approval of nominated position – Temporary Residence Transition nomination – Cook – catering business – actively and lawfully operating – business restructure – entity continuing to exist – ceased active trading – catering business transferred to related entity – nominee employed by related entity under the same directors – decision under review affirmed

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 Immigration on 24 March 2017 to reject the application of Salay Investments Pty Ltd (the applicant) for approval of the nomination for the position of ‘Cook’ in Australia under r.5.19 of the Migration Regulations 1994 (the Regulations).

2. The applicant applied for approval on 4 October 2016. 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).

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)(f) of the Regulations because the applicant did not provide any information to evaluate whether compliance with the Training Benchmarks had been achieved.

5. The applicant appeared before the Tribunal on 18 December 2018 to give evidence and present arguments. The Tribunal also received oral evidence from the identified nominee Mr Sudheendran (nominee).  

6. The applicant was represented in relation to the review by its registered migration agent Mr Sanders of Troy Migration.

7. For the following reasons, the Tribunal has decided to affirm the decision under review to refuse the nomination.

   CONSIDERATION OF CLAIMS AND EVIDENCE

   The Question to be decided

8. 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. Particularly, r.5.19 (3)(b)(ii) requires the nominator is actively and lawfully operating a business in Australia.

9. The applicant, was incorporated on 19 September 1995, is a corporation limited by shares with directors Mr Michael Salay (Mr Salay) and his mother Mrs Esther Salay.  The shareholding is divided between Mrs Salay who holds 70 shares with one Mr Henry Sich holding 30 shares.   

10. Mr Salay’s evidence is that the applicant while still registered does not now play a part in the business previously operated by the applicant.  The applicant’s business is now operating through Salay Trading (Qld) Pty Ltd (Salay Trading).  Salay Trading is the trustee of the Salay Family Trust (a discretionary trust) the details of which are unknown to the Tribunal as it was not provided with a copy of the trust deed.   

11. Because the historical search of Salay Trading was not provided to the Tribunal, the Tribunal procured the search of Salay Trading and its relevant details are: –

    ·Salay Trading was incorporated on 18 November 2015.

    ·The sole director is Mr Michael Salay.

    ·The shareholder member is Mr Michael Salay who holds ten shares both beneficially and legally.

12. Salay Trading now employs all staff including the nominee Mr Sudheendran (the nominee).  Mr Salay says that there are at least two operations now involved in the business namely ‘Barbecue Bazaar’, and the food manufacturing wholesaling business.  Barbecue Bazaar is a night market and licensed to sell alcohol and food manufactured by it.  It operates on Friday and Saturday nights. The night markets have been created and developed by Mr Salay (by himself or as the director of Salay Trading) over three years. It has five employees; some are foreign workers on student or 417 visas as well as contractors such as sound engineers.

13. The applicant and the nominee entered into an employment agreement on 10 August 2011 identifying the agreement to be operative on the nominee being granted a 457 visa.  That event happened on 15 December 2011, after the applicant was approved as a sponsor for the period 15 December 2011 to 15 December 2015.  It is the nominee who is the subject of the applicant’s nomination application.

14. The applicant’s migration representative’s letter of 31 October 2018[1],  explains the applicant’s position:

    3.We confirm that the business has undertaken a restructure, and that Salay investments is no longer operating the catering business.  We have attached financial statements for the financial year ending 30 June 2016.

    4.The nominee continues to work as a Cook at 6/15 John Duncan Court, Varsity Lakes, with Michael Salay, and his brother, Paul Salay, who are both Australian citizens.

    5.…

    6.We have not received information in relation to the terms and conditions of employment;

    7.We have attached tax documentation in relation to the 2016, 2015, 2014, 2013, 2012 and 2011 financial years as provided by the nominee;

    8.Salay investments made a contribution to TAFE Queensland in order to comply with train benchmark “A” in December 2017.

    [1] T1 - folio 55.

15. The ‘restructure’ was the incorporation of Salay Trading with this entity undertaking the operations the applicant.  It employs all the applicant’s staff.   It appears the applicant has not been carrying on the business, the subject of the nomination, after 2016. The applicant has not submitted the company tax returns and the Financial Accounts from 2017 to the present. The Tribunal invited the applicant to provide information about its financial position in its s.359(2) letter dated 17 October 2018[2]. Paragraph 3 invited the applicant to provide information of, among other information, the applicant’s company tax return and financial accounts for the year ended 30 June 2017. This information has not been given to the Tribunal. Moreover, the applicant provided the Tribunal with tax invoices sent to its customers. For instance, tax invoice 12240 dated 19 October 2018 directed to Draculas Pty Ltd was issued by Salay trading[3].

    [2] T1 folio 21.

    [3] T1 folio 43. Similar tax invoices dated 26 October 2018 invoice number 12257, dated 26 October 2018 tax invoice number 12257 and 25 October 2018 invoice numbered 12256 were all issued by Salay trading.

16. On 14 February 2020 the Tribunal wrote to the applicant pursuant to s.359A of the Act, inviting the applicant to provide, in writing comment on and respond to adverse information namely:

    ·The applicant made an application for the nomination of a Cook (ANZSCO 351411) on 4 October 2016.

    ·The application was made by Salay Investments Pty Ltd (the applicant), which was established on 13 May 1997 with ABN (withheld by the Tribunal).

    ·In a letter dated 31 October 2018 from Troy Migration, the migrant agents for the applicant, the Tribunal was informed:

    We confirm that the business has undertaken a restructure, and that Salay Investments is no longer operating the catering business.  We have attached financial statements for the financial year ending 30 June 2016.

    The nominee continues to work as a Cook at 6/15 John Duncan Court Varsity Lakes, with Michael Salay, and his brother, Paul Salay, who are both Australian citizens.

    ·This information is relevant to the review because the information provided to the Tribunal by the applicant’s migration agent implies that the applicant now does not employ the nominee.  There is no provision under r. 5.19 of the Migration Regulations 1994 for any other person to employ the nominee other than the applicant.

    ·If we rely on this information and making a decision, we may decide that the change of the employer from the applicant to another person may be a reason, or part of the reason, to affirm the delegate’s decision. 

17. The applicant responded to the 20 February 2020 invitation letter and made the following submissions in its letter of 28 February 2020[4]:

    ·We enclose a letter from the applicant’s accountants Arnold & Finlay accountants of 24 February 2020 confirming that to Salay Investments had been the principal trading entity of a commercial catering services business, for whom we are instructed the nominee has been employed since November 2010, prior to the grant of his subclass 457 Visa in 2012.

    ·We confirm our previous advice that the business underwent a restructure, after which Arnold & Finlay confirm the owners established a night venue under a separate entity.  Following the restructure, Salay Investments continue to operate as part of the Salay Group, but on our instructions were not employing staff.

    ·Michael Salay, the director of Salay Investments, confirms that he is in the process of securing new premises for the purpose of relocating his commercial catering services business.  He instructs that once premises are secured, the catering team will transfer back to Salay Investments, and on the basis, Salay Investments, and on this basis, Salay Investments will again be actively and lawfully operating a business.  We refer the Tribunal to the enclosed letter from Arnold & Finlay, confirming that it is planned for this to occur in the new financial year.

    Submissions

    ·We confirm that the nominee, Kartik has been employed by Michael Salay since November 2010.

    ·In our view the nomination met the requirements for approval, the issue since the application was refused and the appeal lodged has been whether Salay Investments:

    1.    Is lawfully and actively operating a business in Australia; and

    2.    will employ Kartik on a full-time basis for at least two years.

    [4] T1 folio 135

18. The above submission does not negate the assertion that the applicant is not actively operating the business, the subject of the nomination and employing the nominee.  The submission states that the applicant does not now employ the nominee but will do so once the applicant decides an appropriate course in the future. 

19. Arnold & Finlay Accountants letter of 24 February 2020 refers to the applicant’s current employment arrangements causing confusion in relation to the sponsorship application.  The accountants assert that the applicant ‘had been the principal trading entity, providing commercial catering services.  The Group recently commenced a night venue, and all of the team were paid by it was sometime because it involved much of their working time’.  Further, the accountants expand upon that submission by stating that the applicant ‘is intending to move to new premises as soon as a property suitable for commercial catering purposes is located around Burley.  The catering team will then transfer back to Salay Investments and again be paid from that entity.  It is planned that this will occur around the start of next/new financial year’.

20. The Tribunal wrote to the applicant through its migration agent on 5 March 2020. The Tribunal invited the applicant to comment on the following information:

    ·Firstly, whether the applicant had disposed of its interest in the business the subject of the nomination application.

    ·Secondly, whether this disposal was to Salay Trading (Qld) Pty Ltd in its capacity as trustee of the Salay Family Trust.

    ·Lastly the Migration Regulations did not permit the disposal of the business, the subject of the nomination, from the nominator to another person.

21. By letter dated 19 March 2020, the applicant responded through its migration agent:

    ‘Michael Salay confirms his advice to the Tribunal that his businesses were restructured, such that Salay Investments Pty Ltd (Salay Investments), while continuing to exist, ceased active trading, the result being that the businesses previously operated by Salay Investments were transferred to Salay Trading (QLD) Pty Ltd (Salay Trading).

    The nominee, Kartik, continues his employment as a Cook at 6/15 John Duncan Court, Varsity Lakes to the present date, under the same directors.

    Michael confirms that he is in the process of securing new premises for the purpose of relocating his commercial catering services business. He instructs that once premises are secured, he intends to transfer the catering team back to Salay Investments, and on this basis, Salay Investments will once again be actively and lawfully operating a business. This plan may however be adversely impacted by the effects of the outbreak of coronavirus. The business has had to temporary close for reason that their main customer, Dracula’s Cabaret Gold Coast, has been forced to close for two (2) weeks with effect from 17 March 2020.

    We agree that the issues in relation to the nomination are as follows:

    1.  Regulation 5.19(3)(b)(ii) which requires that the nominator is actively and lawfully operating a business in Australia; and

    2.  Regulation 5.19(3)(d), which requires the nominee will be employed on a full-time basis in the position for at least 2 years.

    We confirm our previous advice that as an employer Michael Salay empathises with Kartik’s situation, in that Kartik would continue to meet the criteria clearly but for the restructure of the companies under Michael’s group.

    At the present time the only submission Michael can make is that while Salay Investments continues to lawfully operate (in that it remains lawfully established), it would not be regarded as currently actively operating having regard to the relevant policy in relation to active operation. Salay Investments was actively operating while it employed the nominee as the holder of his subclass 457 visa and until the restructure, and there are plas to re-establish Salay Investments as an actively operating entity, but not until the new financial year.

22. Regulation 5.19(3)(ii) requires the applicant to be actively and lawfully operating a business in Australia. The applicant’s evidence is that the applicant, from at least from 2017/2018 is not actively operating a business, and not operating the business which had employed the nominee.

23. Given the above, the requirement in r.5.19(3)(b) is not met.

24. The Tribunal is not satisfied the applicant meets the requirements of r.5.19(3). The applicant has not sought to satisfy the criteria in Direct Entry nomination stream, and as such has not met the requirements in r.5.19(4).

25. Therefore, the Tribunal must affirm the decision under review.

    DECISION

26. The Tribunal affirms the decision under review to refuse the nomination.

    Ian Berry
    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.