Telugu Ruchulu Pty Ltd (Migration)

Telugu Ruchulu Pty Ltd (Migration) [2018] AATA 3814 (2 August 2018)
DECISION RECORD
DIVISION:Migration & Refugee Division
APPLICANT:  Telugu Ruchulu Pty Ltd
CASE NUMBER:  1711992
DIBP REFERENCE(S):  BCC2016/4331787
MEMBER:Cathrine Burnett-Wake
DATE:2 August 2018
PLACE OF DECISION:  Melbourne
DECISION:The Tribunal sets aside the decision under review and substitutes a decision approving the nomination.
Statement made on 02 August 2018 at 8:37am

CATCHWORDS
Migration – Nomination refusal – Temporary Residence Transition nomination stream – Café and Restaurant Manager – Financial status of the business – Nominator is actively and lawfully operating business – Nominator has the financial capacity to maintain the nominee's employment – Decision under review set aside
LEGISLATION
Migration Act 1958, s 140GB, 245AR, 359AA
Migration Regulations 1994, rr 1.13, 1.20, 2.59, 2.68, 2.89, 2.86, 5.19, 5.37
STATEMENT OF DECISION AND REASONS
APPLICATION FOR REVIEW

This is an application for review of a decision made by a delegate of the Minister for Immigration on 19 May 2017 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).
The applicant applied for approval on 20 December 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).
In this case, the applicant has applied for approval of a nomination, seeking to satisfy the criteria in the Temporary Residence Transition nomination stream.
The delegate refused the application on the basis the applicant’s nomination did not satisfy r.5.19(3)(d)(i) of the Regulations. The delegate stated in their decision:
‘ …The business has been trading since 1 November 2015 due to the lack quarterly BAS statements and along with no verifiable financial information for the year ended 30 June 2016 by way of financial statements and it is not possible to determine the financial status of the business...’
Mr Surya Prakas Nandina, the Managing Director of Telugu Ruchulu Pty Ltd appeared before the Tribunal on 15 June 2018 to give evidence and present arguments. The Tribunal also received oral evidence from the nominee, Mandeep Kaur, whose related 186-visa application, Tribunal file 1715282 was heard at the same time.
The hearing was held as a combined hearing with a related matter, Tribunal file number 1716111 also for Telugu Ruchulu Pty Ltd. This too was a nomination refusal under r.5.19, however, for the position of Café and Restaurant Manager. As the issues under review were similar, and for the purposes of efficiency, the Tribunal decided to hold a combined hearing.
The applicant was represented in relation to the review by its registered migration agent.
For the following reasons, the Tribunal has decided to set aside the decision under review and substitute a decision approving the nomination.
CONSIDERATION OF CLAIMS AND EVIDENCE
The issue in this case is whether the applicant meets the requirements for approval of the nomination under the 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.
By way of background, Telugu Ruchulu Pty Ltd trades as Akshaya India Restaurant. Telugu Ruchulu Pty Ltd purchased the restaurant from Innovatum Strategic Solutions Pty Ltd at the end of 2015, however did not take over the day-to-day management and trading until March 2016. The restaurant is located in the Melbourne suburb of Braybrook and was established at the beginning of 2013. The restaurant is open 6 days per week, and is closed on a Monday. At hearing Mr Nandina gave evidence that the restaurant employs 11 staff members being: a full-time Restaurant Manager, the nominee for related matter, 1716111 Ramanjeet Kaur; a head Chef, who is an Australian permanent resident; A full time Cook, Mandeep Kaur, the nominee for this matter; Two part time cooks, one who is an Australian permanent resident, currently on parental leave, and another who is on a temporary visa; Two apprentice cooks, one on a graduate visa, the other on a student visa; and four casual staff who are front of house and all students. The Tribunal has reviewed payroll records and compared these with what was reported in the BAS and is satisfied that the business is paying wages that equate to staffing levels as claimed.
The application must be compliant: r.5.19(3)(a)
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.
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.
The application for approval identifies Mandeep Kaur, the nominee who, according to Departmental records, held a 457 visa that was granted on 12 July 2014 and expired on 12 August 2017. This visa was granted on the basis of satisfying subclause 457.223(4) of Schedule 2.
The occupation identified in the application is Cook (ANZSCO 351411). The Tribunal is satisfied, based on the employment documents for the nominee, that the occupation identified is the same occupation as that carried out by her as the holder of a Subclass 457 visa. The Tribunal is accordingly satisfied that this occupation carries the same 4-digit code (3514) as the occupation carried out by the nominee whilst she held the Subclass 457 visas.
Given the above findings, the requirement in r.5.19(3)(a) is met.
Status of the nominator: r.5.19(3)(b)
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.
During the hearing, Mr Nandina described the nature of the business and its operations in general. He outlined that Akshaya Indian Restaurant was established at the beginning of 2013 and was previously owned and operated by Innovatum Strategic Solutions Pty Ltd. He told the Tribunal that the restaurant has been in the same location and premises since it first opened.
Mr Nandina stated to the Tribunal that he agreed to purchase the restaurant at the end of 2015 and that he took full control through his company, Telugu Ruchulu Pty Ltd in March 2016 after the sale was finalised. A copy of the sale agreement is on file.
Departmental records reflect that the nominee was originally sponsored by Innovatum Strategic Solutions Pty Ltd for her initial 457 visa. Telugu Ruchulu Pty Ltd became an approved standard business sponsor on 2 June 2016 and a nomination to transfer the nominee’s 457 under Telugu Ruchulu Pty Ltd was approved on 26 August 2016.
Departmental records confirm that the nominator was the standard business sponsor who last identified Ms Kumar, the nominee, 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).
The Tribunal is satisfied on the basis of the material before it, including the business' registration documents, activity statements, payroll activity information and other information about the business' activities that the nominator is actively and lawfully operating business in Australia, specifically an Indian restaurant.
Given the above, the requirement in r.5.19(3)(b) is met.
Previous employment of the nominee: r.5.19(3)(c)
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.
As already discussed, Akshaya Indian Restaurant has changed ownership. The change of ownership occurred whilst the nominee was employed on a 457 visa. The nominee was first granted a 457 visa on 12 July 2014. This visa was granted on the basis of her employment with Innovatum Strategic Solution Pty Ltd. At hearing Mr Nandina gave evidence that as part of the sale agreement, Telugu Ruchulu Pty Ltd would apply to become an approved standard business sponsor and apply for new nominations for any workers on 457 visas, thus taking over employment and standard business sponsorship obligations as part of the sale.
Telugu Ruchulu Pty Ltd was approved as a business sponsor on 2 June 2016 and the nomination relating to the nominee under Telugu Ruchulu’s was approved on 26 August 2016. Although the nominee has not exclusively worked for Telugu Ruchuku for 2 of the 3 years preceding this nomination application, policy takes into consideration that entities do at times change structure, such as through the sale of the business, becoming a new discreet entity. Moreover, policy considers that in such circumstances the employment across the two entities may still be assessed as the same employer for the 457 visa holder, provided the circumstances fall under certain parameters.
Policy provides:
There may be applications for the Temporary Residence Transition stream where the nominator has not been the nominee’s sole standard business sponsor during the whole required 2 year period. In these cases, work undertaken with an entity other than the most recent standard business sponsor may still be considered towards the 2 year requirement if the nominator can demonstrate that the nominee has actively performed the duties of the position for the required 2 years despite a change of their employer. This may occur in situations where the current standard business sponsor has undergone business restructure/takeover/sale/closure and may have changed their ABN/ACN/name, which required a new standard business sponsorship approval. That is, there must be some connection between the most recent standard business sponsor and any previous standard business sponsor/s of the nominee to be counted towards the 2 year requirement.
When assessing this criterion for cases where there has been more than one standard business sponsor, delegates should consider the following three questions and, if they consider the answers to the three questions to be generally ‘yes’, may consider this criterion to be met:
•Is the nominee still working in the same position, performs the same duties and has the same working conditions in the required 2 year period, regardless of the change of sponsor?
•Does the nominee report to the same management structures?
•Has the nominator retained the same business name and/or operations, but is considered to be a new legal entity?
The policy intent is to accommodate for UC-457 visa holders that apply for Temporary Residence Transition stream that have been affected by circumstances outside of their control, such as their employer undergoing a business restructure, takeover, sale or closure.
Although the nominee went from working for Innovatum Strategic Solutions Pty Ltd to Telugu Ruchulu Pty Ltd, yes could be answered to the three questions as set out in policy above. Evidence at hearing was provided that:
i.The nominee is still working in the same position, at the same location, as a Cook and she performs the same duties and her working conditions have not changed;
ii.The nominee reports to the same management structure; and
iii.The nominator retained the same trading name ‘Akshaya Indian Restaurant through the course of the sale of the business and the operations have remained the same.
The Tribunal is satisfied, taking into consideration the circumstances, and given the intent of the policy, that the nominee should not be affected because of the sale of the business and has been employed in her occupation of Cook for at least 2 years in the 3 years immediately before the application. The Tribunal has also had regard to payslips along with the payroll activity information on file, which confirms the nominee's employment with the nominator.
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)
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.
The Tribunal has had regard to the signed offer of employment and the letter of guarantee on file, confirming the nominee will be employed on a full-time basis for at least 2 years; and that her employment contract does not expressly exclude the possibility of extending the period of employment. At hearing Mr Nandina also have verbal evidence to support this.
The Tribunal has had regard to the documents provided on review, including the nominator's financial statements, company tax returns and BAS, all reflect the company is financially sound and is turning a profit.
The Tribunal is satisfied on the totality of the evidence that the nominator has the financial capacity to maintain the nominee's employment as they have done since 2016.
The Tribunal is satisfied on the material before it that the nominee will be employed on a full-time basis for at least 2 years on terms that do not exclude the possibility of extending the period of employment.
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)
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.
The evidence on file indicates the nominee's base salary is $55,000 plus superannuation. At hearing, Mr Nandina outlined that there was an equivalent worker within the organisation who has the same terms and conditions and is paid a comparable salary. This was supported by evidence provided to the Tribunal for another employee in the role of Cook who is an Australian permanent resident.
The Tribunal is satisfied that the terms and conditions 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 same location.
Accordingly, the requirement in r.5.19(3)(e) is met.
Training commitments and obligations: r.5.19(3)(f)
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.
The nominator has provided evidence to the Tribunal of training expenditure for the 2016, 2017 and 2018 financial years. The expenditure is in excess of 1% of their payroll as reflected in the financial statements, and recorded in the BAS.
The Tribunal is satisfied on the evidence before it that the applicant has fulfilled commitments made relating to meeting the training requirements during the relevant period.
In addition to fulfilling the commitment relating to training, the Tribunal is also satisfied that the applicant has also kept the required records showing that they have complied with their sponsorship obligation relating to the training requirement.
Accordingly, the requirement in r.5.19(3)(f) is met.
No adverse information known to Immigration: r.5.19(3)(g)
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.
On 24 November 2017, following sponsorship monitoring, the nominator received a formal warning from the Department as it was found that the nominator failed to comply with sponsorship obligations as per r.2.89, specifically, r.2.86 ‘Obligation to ensure primary sponsored person works or participates in nomination occupation, program activity’. The Department had concerns that a 457 worker and the nominee in related matter 1712114, may have been undertaking duties beyond those of a Restaurant Manager. The Department took issue with the nominee being described as ‘like the owner’ therefore regularly completed duties outside her position description. The Department was satisfied the majority of the nominee’s duties were associated with the nominated occupation of Restaurant Manager; however, they were not satisfied with the ‘like the owner’ explanation in response to her undertaking duties beyond those as set out in the ANZSO for her nominated occupation. The Department stated that while the 457 worker can undertake duties such as assisting in the kitchen, serving customers and working in the bar area, these tasks should be incidental only and not performed on a daily basis. The Tribunal obtained this warning letter direct from the Department; the applicant did not disclose it to the Tribunal.
At hearing the Tribunal put the information and contents of the warning letter to the nominator under s. 359AA of the Act as it was information that it considered at the time would be the reason, or part of the reason, for affirming the delegate's decision, and it invited the applicant to comment on or respond to the information as it was directly relevant to the Tribunal’s considerations under r.5.19(3)(g).
Mr Nandina outlined to the Tribunal that he thought this information would have already been with the Tribunal, this is why he did not raise it. Further, as it was a warning and no action was taken he did not think that it was relevant. Mr Nandina explained that he thought the comments ‘like the owner’ were taken out of context. He explained that several nights per week, he was not present at the restaurant, and the sponsored 457 worker had full control and autonomy over the management of the restaurant in his absence, just as any Restaurant Manger would. He outlined it was a small business, and often the front of house and kitchen assistant staff would not show up for work, and it was all hands on deck and the 457 worker, as the Restaurant Manager would have to pick up any slack to ensure the smooth operations of the evening service. Further, that they had many regular customers and the nominee would take the extra time to give personal service such as serving their food and drinks – just as any owner would for patrons who frequented regularly and as he does when he is present at the restaurant. Mr Nandina confirmed to the Tribunal that the 457 worker absolutely does work as a Restaurant Manager and any additional duties were indeed incidental that formed part of her role of ensuring customers had exceptional service and the evening service ran smoothly.

Given Mr Nandina’s explanation at hearing, and the fact the Department did not take any action against the nominator, the Tribunal has determined it reasonable to disregard the information that the nominator received an official warning for breach of r.2.89 and r.2.86. The Tribunal finds Mr Nandina’s explanation to be plausible and unlike the Department was satisfied with the response it received regarding the situation.
Accordingly, the requirement in r.5.19(3)(g) is met.
Satisfactory compliance with workplace relations laws: r.5.19(3)(h)
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.
There is no information before the Tribunal to suggest that the applicant does not have a satisfactory record of compliance with workplace relations laws
Accordingly, the requirement in r.5.19(3)(h) is met.
Based on the findings above, the Tribunal is satisfied that the applicant meets the requirements of r.5.19 for approval of the nomination of the position in Australia.
DECISION
The Tribunal sets aside the decision under review and substitutes a decision approving the nomination.
Cathrine Burnett-Wake
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.

[2018] AATA 3814

2 August 2018

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Immigration

Administrative Law

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Judicial Review

Procedural Fairness

Natural Justice

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Appeal