SINGH & SONS PTY LTD ATF THE SAMSHER SINGH FAMILY TRUST (Migration)

[2019] AATA 6423

SINGH & SONS PTY LTD ATF THE SAMSHER SINGH FAMILY TRUST (Migration) [2019] AATA 6423 (13 November 2019)

DECISION RECORD

DIVISION:Migration & Refugee Division

APPLICANT:  SINGH & SONS PTY LTD ATF THE SAMSHER SINGH FAMILY TRUST

CASE NUMBER:  1713997

DIBP REFERENCE(S):  BCC2016/3203901

MEMBER:Amanda Ducrou

DATE:13 November 2019

PLACE OF DECISION:  Melbourne

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

Statement made on 13 November 2019 at 10:09am

CATCHWORDS
MIGRATION – nomination – Temporary Residence Transition stream – cook – training benchmark – sponsorship obligation to provide training no longer applicable – training requirements repealed by Migration Legislation Amendment – evidence of financial capacity to employ nominee for at least 2 years provided – decision under review set aside

LEGISLATION
Migration Act 1958 (Cth), ss 140GB, 245AR(1), 359(2)
Migration Legislation Amendment (Temporary Skill Shortage Visa and Complimentary Reforms) Regulations 2018
Migration Regulations 1994 (Cth), rr 1.13, 2.59, 5.19, cl 457.223(4)

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 13 June 2017 to reject the applicant’s application for approval of the nomination of a position in Australia under of the Migration Regulations 1994 (the Regulations).

2. The applicant applied for approval on 27 September 2016. The requirements for the approval of the nomination of a position in Australia are found in r.5.19 of the Regulations which contain 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)(f)(i)(A) of the Regulations because the evidence did not establish that the applicant met either Training Benchmark A or Training Benchmark B during the period of the nominator’s most recent approval as a standard business sponsor. Further, the delegate found that it was not reasonable to disregard the applicant’s failure to meet those requirements under r.5.19(3)(f)(ii).

5. On 13 May 2019 the Tribunal wrote to the applicant in accordance with s.359(2) of the Migration Act 1958 (the Act) inviting the applicant to provide information to the Tribunal. The letter invited the applicant to provide information that demonstrated that all of the relevant criteria in r.5.19 of the Regulations were met currently including, but not limited to the criteria that the delegate had found were not established. Extracts of relevant parts of r.5.19 accompanied the letter. The letter asked the applicant to provide the information by 27 May 2019 and noted that the applicant could request an extension of time provided that any such request must be received before 27 May 2019. The letter explained that if the requested information was not received within the period allowed or as extended (if an extension were requested and granted), then the applicant would lose any entitlement it might otherwise have had under the Act to appear before the Tribunal to give evidence and present arguments.

6. The applicant responded to the Tribunal’s request for information on 20 May 2019 and provided submissions and documents in support of the application. On 3 October 2019 and on 11 October 2019 the Tribunal received further documents from the applicant.

7. Mr Samsher Singh, a director of Singh and Sons Pty Ltd, appeared for the applicant before the Tribunal on 10 October 2019 to give evidence and present arguments. The Tribunal also received oral evidence from Mr Shailender Kumar. At the hearing the Tribunal invited the applicant to provide further documentation relevant to the application. The Tribunal received documents from the applicant on 12 October 2019.

8. The applicant’s registered migration agent, Mr Amber Gupta, represented the applicant in relation to the review.

9. 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

10. 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)

11. 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) of the Act. The application must also identify a relevant person and occupation.

12. On the basis of the information in the Department’s file the Tribunal is satisfied that the application was made on the relevant form and was accompanied by the prescribed fee. The relevant s.245AR(1) certification was also provided in the application form.

13. The application for approval identifies Mr Shailender Kumar as the nominee. According to the Department’s records, Mr Kumar held a Subclass 457 visa granted on 20 March 2014 on the basis of satisfying cl.457.223(4) at the time when the application was made.

14. The application for approval identifies the occupation of a cook (ANZSCO 351411). The Tribunal is satisfied, based on the employment documents for the nominee that the occupation identified in the application for approval is the same occupation as that carried out by the nominee as the holder of a Subclass 457 visa. The Tribunal is satisfied that this occupation carries the same 4-digit code (1411) as the occupation carried out by the nominee while he held the Subclass 457 visa.

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

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

16. 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.

17. The Department’s records confirm that the nominator was the standard business sponsor who last identified Mr Kumar in a nomination made under s.140GB of the Act. The nominator was not granted the most recent business sponsorship on the basis of meeting either r.1.20DA, r.2.59(h) or r.2.68(i) of the Regulations.

18. The documents provided to the Tribunal included: ASIC current and historical company extracts for the applicant; deed of discretionary trust dated 24 October 1991 establishing The Samsher Singh Family Trust (the Trust) with Singh & Sons Pty Ltd named as the trustee; the applicant’s financial statements for the financial years from 2016 to 2019; profit and loss statement, balance sheet and trading account for the 2015 financial year (which included 2014 financial year information); the applicant’s company tax returns for the 2017 and 2018 financial years; activity statements lodged by the applicant with the Australian Taxation Office (ATO) for the period from 1 July 2017 to 31 March 2019; payroll documents; and other documents containing information about the applicant’s business activities. The documentary evidence was consistent with the applicant actively and lawfully operating a business in Australia.

19. In his oral evidence, Mr Singh described the nature of the business and the business operations. The business was already established when Singh and Sons as trustee for The Samsher Singh Family Trust purchased it in 1988 or 1989. The business trades under the registered business name, Singh’s Gourmet Indian Foods. It specialises in making North Indian dishes for take away or delivery. Mr Singh and his wife, Mrs Dharm Kaur Singh are the directors of Singh and Sons Pty Ltd. They both work in the business full-time. Mr Singh is the manager of the business. Currently there are four employees, including Mr Kumar. Mr Kumar works full-time and the other employees work part-time. Based on the documentary and oral evidence the Tribunal is satisfied that the nominator is actively and lawfully operating a food services business of cooking ready to eat food, specialising in North Indian cuisine located at Nicholson Street, Brunswick East, Victoria, Australia.

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

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

21. 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 (not including any period of unpaid leave); 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.

22. In this case the relevant provision is r.5.19(3)(c)(i). The nomination application was made on 27 September 2016. The nominee was granted the Subclass 457 visa to work in the nominated occupation of cook on 20 March 2014.

23. The Tribunal was provided with: PAYG payment summaries issued by the applicant for the nominee for the 2014 to 2018 financial years; notices of assessment issued by the ATO for the nominee for the 2014 to 2018 financial years (amended notices of assessment were also issued by the ATO for the 2015 to 2016 financial years); and payslips the applicant issued to the nominee.

24. The Tribunal was also provided with: employment contracts dated 31 May 2013, 22 September 2016 and 20 May 2019 made between the applicant and the nominee; a document setting out details of the position and duties for a full-time cook’s position signed by a director of the applicant; letters dated 22 September 2016 and 20 May 2019 from the applicant that stated that the nominee had been employed by the applicant as a full-time cook since 21 April 2014; and a schedule from the applicant setting out details of the periods when the nominee took paid and unpaid leave.

25. The oral evidence that Mr Singh and Mr Kumar presented was consistent with the documentary evidence concerning the nominee’s duties and responsibilities in the position. The Tribunal noted that Mr Singh and Mr Kumar gave oral evidence that Mr Kumar commenced employment with the applicant on a part-time basis as a cook, with Mr Kumar commencing full-time employment in that position in 2014 after he was granted the Subclass 457 visa. The Tribunal is satisfied based on the documents and the oral evidence that the nominee commenced employment with the nominator as a cook on a full-time basis on 21 April 2014 and that his employment with the nominator in that position has been continuing and is current.

26. Mr Singh told the Tribunal that he prepared the schedule of the paid and unpaid leave taken by Mr Kumar with the help of his former manager, who is now retired. The information in the schedule was generally consistent with the information in the PAYG payment summaries issued for Mr Kumar. However, there was a discrepancy in relation to the 2017 financial year. The schedule showed that Mr Kumar took 10 weeks of unpaid leave while the level of gross payments in the 2017 PAYG payment summary was consistent with him taking 9 weeks of unpaid leave. Notwithstanding the discrepancy, after noting the information in the PAYG summaries and the payslips the Tribunal was satisfied that the evidence established that the nominee has been employed by the nominator in the position of cook on a full-time basis in Australia for at least 2 years in the 3 years immediately before the nomination application was made.

27. 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)

28. 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.

29. The nominee is a person to whom r.5.19(3)(c)(i) applies. The employment contract dated 20 May 2019 between the applicant and Mr Kumar is the current employment contract that applies to Mr Kumar’s employment with the applicant. The contract provided for Mr Kumar’s employment on a full-time basis for at least 2 years. It did not expressly exclude the possibility of extending the period of employment.

30. The employment contract stipulated that the nominee’s salary was $54,000 per annum exclusive of superannuation. It provided that the applicant was required to make superannuation contributions for the nominee in accordance with the Superannuation Guarantee (Administration) Act 1992. The level of superannuation contributions specified in the schedule to the employment contract was 9.5% per annum. The employment contract made provision for the nominee to receive such other remuneration as agreed to by the parties from time to time. The payroll information before the Tribunal was consistent with Mr Kumar receiving remuneration at the rate of $1,040 per week ($54,080 per annum) and with the applicant making contributions of $197.60 per fortnight to the nominee’s superannuation fund. Mr Singh and Mr Kumar confirmed that this reflects Mr Kumar’s current remuneration. The level of superannuation contributions made by the applicant for the nominee is commensurate with the level of contributions specified in the employment contract.

31. The Tribunal considered the evidence relating to the applicant’s financial capacity to employ the nominee for a period of at least 2 years. The Tribunal had regard to the financial statements, tax returns and activity statements for the applicant. The 2017 to 2019 profit and loss statements showed gross sales of more than $500,000 for each financial year. The gross profit from trading was: $427,962 for the 2017 financial year; $390,186.51 for the 2018 financial year; and $405,967.99 for the 2019 financial year. The profit from ordinary activities before income tax was: $206,323.16 for the 2017 financial year; $183,453.50 for the 2018 financial year; and $136,989.46 for the 2019 financial year.

32. The Tribunal observed that the expense for wages and salaries increased by more than 50% in the 2019 financial year. Mr Singh told the Tribunal that the reason for this was that he and his wife had started to receive wages from the business. Prior to the 2019 financial year the only income they had received from the business was the income distributions made to them as beneficiaries of the Trust. Other family members also used to receive income distributions as beneficiaries of the Trust but this is no longer the case.

33. The information in the 2017 and 2018 financial year tax returns and financial statements was consistent with Mr Singh’s oral evidence. The tax return for the 2019 financial year had not been prepared. However, the 2019 financial year trust distribution statement prepared by the accountant showed that the net profit, for accounting purposes, was distributed equally to Mr Singh and his wife. The Tribunal considered, having regard to Mr Singh’s oral evidence and the documentary evidence, that the increase in the wages and salaries expense in the 2019 financial year was unremarkable.

34. The largest liability shown in the balance sheets for the 2018 and 2019 financial years was for loans owed to beneficiaries of the Trust. This was $264,383.50 for the 2018 financial year and $231,286.30 for the 2019 financial year. The 2018 and 2019 financial year balance sheets showed that the value of the applicant’s liabilities exceeded the value of its assets by $68,701.25.

35. Mr Singh told the Tribunal that the only debt the business has is for money he has spent on it. It does not owe loans to external parties. The customer base and the level of sales have always remained much the same. He believes that the value of the business would be much greater than the value of goodwill shown in the financial statements if he were to sell the business. The information in the letter from PPR Audit Experts dated 12 October 2019 was consistent with the oral evidence that Mr Singh gave at the hearing.

36. The Tribunal observed that in both the 2018 and 2019 financial years the profit of the business from ordinary activities before income tax was well in excess of the amount by which the value of the liabilities exceeded the value of the assets. The Tribunal considered that this demonstrated that the overall financial position of the business was sound. The Tribunal is satisfied based on the financial statements and the oral evidence that the nominator has the financial capacity to maintain the nominee’s employment, as has been the case since 2014.

37. The Tribunal is satisfied based on the evidence before it that the nominee will be employed on a full-time basis in the position for at least 2 years on terms that do not expressly preclude the possibility of an extension.

38. 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)

39. 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.

40. The terms and conditions of the employment contract dated 20 May 2019 include terms relating to the nominee’s working hours, his annual salary and superannuation. It stipulates that Mr Kumar will be required to work for 38 hours per week during the normal business hours and at other times as may be reasonable and necessary.  The employment contract provides that Mr Kumar is entitled to: 20 days paid annual leave per year of service; 10 days paid personal leave per year and 2 days unpaid carer’s leave for each permissible occasion.

41. The nominee’s current weekly salary of $1,040 per week equates to an annual salary of $54,080 per annum and an hourly salary of $27.37 per hour, based on a 38-hour working week. Mr Singh gave evidence that two other cooks are employed in the business. They both work part-time and are paid at a pro rata rate based on the full-time pay rate in the award. Mr Singh did not identify the award.

42. Mr Singh told the Tribunal that he did not advertise for Mr Kumar’s position. One of his friends knew that Mr Kumar was available for work and suggested him. Initially, he employed Mr Kumar for a trial period. When he decided to employ Mr Kumar he obtained advice from his migration agent (Mr Gupta) about what Mr Kumar should be paid.

43. It was not entirely clear whether the Restaurant Industry Award 2010 applied to the nominated position. However, the Tribunal noted that the nominee’s hourly pay rate is higher than and compares favourably with the adult minimum weekly wage for a cook listed in the Award which ranges from $791.30 per week for a cook grade 1 to $941.10 for a cook grade 5. The Payscale website ( report (accessed November 2019) listed the average hourly pay rate for a ‘cook, restaurant’ in Australia as $21.62 per hour (approximately $42,721 per annum) plus average annual bonus of $400 (total approximately $43,121 per annum).[1] The nominee’s rate of pay is higher than and compares favourably with that rate.

    [1]

1. The Tribunal is satisfied, based on the employment contract, the oral evidence and the Award and Payscale information that the terms and conditions of employment applicable to the nominated 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 nominator’s business premises.

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

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

3. 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.

4. At the time of the nomination application, the applicant was most recently approved as a standard business sponsor on 13 November 2012 for a period of 3 years until 13 November 2015. The applicant’s representative provided written submissions dated 20 May 2019 in relation to the satisfaction of the training commitments and obligations. The representative confirmed that they did not wish to make any further submissions at the hearing.

5. In the written submissions, the applicant’s representative noted that on 22 May 2018 the applicant had been approved as a standard business sponsor from 22 May 2018 until 22 May 2023. The representative noted that from 18 August 2019 with the introduction of the SAF levy, the requirements for meeting training benchmarks were removed. (The SAF levy is the Skilling Australians Fund levy). The documents that the Tribunal received on 20 May 2019 included a letter dated 22 May 2018 from the Department notifying the applicant that an application that the applicant made for a standard business sponsorship had been approved and was effective until 22 May 2023.

6. The Tribunal accepted, based on the documentary evidence, that the applicant was most recently approved as a standard business sponsor on 22 May 2018 for a period of 5 years until 22 May 2023. As the most recent standard business sponsorship was approved on or after 18 March 2018 the applicant was not required to fulfil any training obligations or commitments in order to meet the sponsorship approval criteria. This is because for applications for approval of standard business sponsorship which were undetermined as at 18 March 2018 or made after that date, the criteria in r.2.59(d) and (e) of the Regulations (which required businesses operating in Australia either to meet the training benchmarks for training Australian citizens and permanent residents as specified by a legislative instrument if the business had traded in Australia for 12 months or more, or have an auditable plan for meeting those benchmarks if the business traded for less than 12 months) no longer applied. These requirements for training were repealed by the Migration Legislation Amendment (Temporary Skill Shortage Visa and Complimentary Reforms) Regulations 2018 (F2018L00262) with the effect that the repealed criteria no longer applied to live applications for approval as a standard business sponsor from 18 March 2018.

7. Therefore, the sponsorship obligation to provide training no longer applies. The Tribunal was satisfied that the training requirements were met in relation to the applicant’s most recent sponsorship approval.

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

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

9. 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 of the Regulations.

10. There is no information before the Tribunal indicating that there is adverse information known to the Department about the nominator or a person associated with the nominator.

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

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

12. 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.

13. There is no information before the Tribunal indicating that the applicant does not have a satisfactory record of compliance with workplace relations laws in the location in which the applicant operates its business and employs employees in the business.

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

15. 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

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

    Amanda Ducrou
    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.