TM ENTERPRISE PTY LTD (Migration)

TM ENTERPRISE PTY LTD (Migration) [2020] AATA 3145 (28 July 2020)
DECISION RECORD
DIVISION:Migration & Refugee Division
APPLICANT:  TM ENTERPRISE PTY LTD
CASE NUMBER:  1805397
HOME AFFAIRS REFERENCE(S):          BCC2016/4050802
MEMBER:W Frost
DATE:28 July 2020
PLACE OF DECISION:  Canberra
DECISION:The Tribunal sets aside the decision under review and substitutes a decision approving the nomination.

Statement made on 28 July 2020 at 9:50am
CATCHWORDS
MIGRATION – application for approval of nomination of position – direct entry nomination stream – financial capacity to pay full-time salary for two years – financial records – nominee’s employment history with the applicant – director’s other sources of income – decision under review set aside
LEGISLATION
Migration Act 1958 (Cth), s 43(1)(c)(i)
Migration Regulations 1994, r 5.19(4)(d)(i)
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 Home Affairs on 16 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 (Regulations).[1]
[1] The Regulations referred to in this decision are to the Regulations as they were at the time of application.
The applicant applied to the Department for approval on 1 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 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).
In this case, the applicant has applied for approval of a nomination, seeking to satisfy the criteria in the Direct Entry nomination stream.
The nominated position is ‘Massage Therapist’ (ANZSCO Code 411611), with TM Enterprise Pty Ltd, trading as ‘Belconnen Thai Massage’ (Nominator) in the Australian Capital Territory (ACT). The nominated position is to be filled by the nominee, Ms Nisarat Siriprapakon, a current employee with the Nominator (Employee).
The delegate of the Minister refused the application on the basis that the applicant’s nomination did not satisfy r.5.19(4) of the Regulations, because the delegate was unable to determine the financial capacity of the business to pay the full-time salary for the nominated position for at least two years. Therefore, the delegate found that the business had not demonstrated that the Employee will have full-time employment for at least two years and r.5.19(4)(d)(i) was not satisfied.
The applicant appeared by telephone before the Tribunal on 6 July 2020 to give evidence and present arguments. The Tribunal received oral evidence from Ms Pornrat Tepparach, the sole Director of the Nominator and from Ms Nisarat Siriprapakon, the Employee of the nominating business. The applicant was also represented by its registered migration agent, Ms Qingqing Wang. The Tribunal hearing was conducted with the assistance of an interpreter in the Thai and English languages.
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 Direct Entry nomination stream set out in r.5.19(4) of the Regulations, 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)
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) of the Migration Act 1958 (Act). The application must also identify a need for the nominator to employ a paid employee to work in the position under their direct control.
The material on the departmental and Tribunal files demonstrates that the application was made on form 1395, or 1395 (Internet) and accompanied by the fee prescribed in r.5.37. The application identified a need for the Nominator to employ a paid employee to work in the position under the Nominator’s direct control. The nominated position was identified as ‘Massage Therapist’ (ANZSCO Code 411611) at TM Enterprise Pty Ltd (trading as ‘Belconnen Thai Massage’). The application contained written certification that the Nominator has not engaged in conduct in relation to the nomination that contravenes s.245AR(1) of the Act. 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)
Regulation 5.19(4)(b) requires that the applicant is actively, lawfully and directly operating a business in Australia. On the available evidence, the Tribunal is satisfied that the Nominator is actively and lawfully operating a business in Australia and that it directly operates the business. Accordingly, the requirement in r.5.19(4)(b) is met.
Position is not labour-hire: r.5.19(4)(c)
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. Based on the information before the Tribunal, it finds that the Nominator is not involved in labour-hire activities and it is satisfied that the nominated position is not a labour-hire position. Accordingly, the requirement in r.5.19(4)(c) does not apply.
Term of employment of the visa holder: r.5.19(4)(d)
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.
The application made by the Nominator contained declarations that the visa applicant will be provided with full-time employment ‘for at least two years’ and acknowledged that ‘any resulting visa may be cancelled if holder…does not continue to work in the nominated position for at least two years’.
The Employee has been employed with the Nominator since it began operating the Belconnen Thai Massage business in 2015. That is, the Employee has been employed with the business for approximately five years. The Nominator provided the Tribunal with a copy of an ‘Offer of employment as Head Massage Therapist’ addressed to the Employee and dated 31 October 2016. The offer relevantly stated that:
This is a full time ongoing position.
…
You will be paid $55,328.00 per annum, payable monthly for base salary plus 9.50% superannuation. It includes payment for all your ordinary hours of work (38 hours) and any additional hours you may be required to work.
…
You are entitled to public holidays, annual leave (4 weeks per annum), long service leave, personal leave, compassionate leave and parental leave in conformity with statutory requirements.
…
Either you or TM Enterprise Pty Ltd may terminate your employment for any reason by the giving of one (1) month’s notice.
While the offer of employment document is dated 31 October 2016, it contains the Employee’s signature with the accompanying handwritten date of 30 June 2017. However, at the hearing both the Nominator and the Employee told the Tribunal that the Employee had signed the offer of employment document in 2016, not June 2017, although they could not recall in which month this had occurred in 2016. In this regard, the decision record of a delegate of the Minister notes that the signed document was provided to the Department on 1 December 2016 and ‘is post-dated to the 30/06/2017’. The departmental file contains a signed copy of the document and records it as having been received from the Nominator on 11 December 2016. This copy of the document contains the handwritten date of 30 June 2017. As a result of the evidence before the Tribunal, it accepts that the document was signed in late 2016 and took effect from 30 June 2017.
More importantly, it is evident from the signed document and the subsequent employment and remuneration arrangements for the Employee that it constitutes the current employment agreement between the Nominator and the Employee. The document expressly states that the employment is ‘ongoing’, rather than time limited. The Employee has been employed by the Nominator pursuant to this contract for over three years and has been employed for a total period of approximately five years. Based on the Employee’s payslips provided to the Tribunal, as at 23 June 2019, the Employee had been paid $55,328 in wages for that financial year, together with superannuation of $5,256.16, which amounts accord with the terms contained in the signed offer of employment document. Additionally, the Tribunal notes that the Nominator’s financial statements for the years ending 30 June 2018 and 30 June 2019 list the payment of $95,578 and $88,173 in wages to all employees respectively.
The Nominator told the Tribunal that the business had five staff and, of those, the Employee was the only full-time employee. The Nominator further told the Tribunal that the Employee was a valued member of the business and was required in an ongoing capacity because it was difficult to find staff in the ACT that could perform Thai massage. Indeed, the Employee had worked on a part-time basis for the director of the Nominator at her former Thai massage business on the Gold Coast and had subsequently been offered work when the Nominator established this business in the ACT in 2015.
The Employee told the Tribunal that she ‘very much’ enjoyed her job with the Nominator and viewed her employer favourably. The Employee was responsible for providing massage services, including remedial, sports and deep tissue and for communicating with customers. The Employee told the Tribunal that she was previously studying on the Gold Coast (the Employee’s resume states that she attained a Master of Engineering at Griffith University in Queensland between 2013 and 2014, following completion of a Bachelor’s Degree in Electrical Power Engineering in Thailand between 2007 and 2011), although she said it was ‘very hard’ to find an engineering job because of her lack of relevant work experience and current visa status. In this regard, the Tribunal asked the Employee whether she wanted to remain in her current role with the Nominator, rather than seek employment using her qualification as an engineer; the Employee said she was ‘happy’ in her current job and had a ‘very good boss’ and wished to continue working in the business.
The delegate of the Minister refused to approve the nomination in February 2018. For its application to the Department, the Nominator had provided a profit and loss statement for the financial year ending June 2016, which listed the payment of wages and salaries in the amount of $10,850 and expenses for “Contractor – girls” totalling $16,302. The Nominator also provided two quarterly Business Activity Statements, one for April to June 2016 and one for July to September 2016. The delegate found that:
Given the number of staff employed by the business, it is reasonable to conclude that wages expenditure should be significantly higher than claimed within the profit and loss statement for the financial year 2015 to 2016. I therefore give little weight to the profit and loss statement as being an accurate measure of the financial viability of the business.
…the business has not provided any further financial evidence with which to demonstrate the financial capacity of the business to employ a full time massage therapist with an annual salary of $55,328 for a period no less than 2 years and not excluding the possibility of extension.
The Nominator has provided the Tribunal with substantial financial information for the purpose of its review of the refusal decision. To this end, the Tribunal notes that it had before it the following documents (among others):
a.Accountant’s letters dated 2 April 2020 regarding the financial position of the Nominator for the financial years ending 30 June 2018 and 30 June 2019, including the quantum of wages payments made to employees;
b.Business Activity Statements for the 2018 and 2019 calendar years;
c.PAYG payment summary for the Employee for the financial year ending 30 June 2019, showing total gross payments of $55,328;
d.Multiple payslips, including a payslip for the fortnight ending 23 June 2019 showing the payment of ‘YTD’ [Year to Date] wages of $55,328 and a payslip for the fortnight ending 29 March 2020 showing ‘YTD’ ordinary income of $41,328.04 and superannuation of $3,926.26;
e.Financial statement for the financial year ending 30 June 2018 listing, under ‘Expenses’, wages in the amount of $88,173, with the Nominator’s net income listed as $3,672;
f.Financial statement for the financial year ending 30 June 2019 listing, under ‘Expenses’, wages in the amount of $95,578 plus ‘Contractor/ABN costs of $20,000, which were said to be remuneration for another employee, with the Nominator’s net income listed as $5,168;
g.Bank Statement for the period 22 May to 23 June 2020; and
h.EFTPOS Receipts for 30 May, 31 May and 1 June 2020.
Based on this evidence, the Tribunal is satisfied that the Nominator has been paying a significant amount in wages to its employees over some years, including the Employee the subject of the nomination. As a result of the Nominator’s low net income for the financial years ending 2018 and 2019, the Tribunal asked the representative of the Nominator to tell it about the sustainability of such a business. The representative of the Nominator acknowledged that it was not an overly profitable business, but told the Tribunal that the income from the business was not her sole source of income; it supplements remuneration from her full-time job in Sydney. The representative also previously owned and operated two similar businesses, one on the Gold Coast in Queensland (where the Employee had worked) and one in Goulburn, New South Wales. The representative further told the Tribunal that she was able to use the business to secure a car loan, which she otherwise would not have been able to obtain. In addition, the Tribunal was told that the business was busier than at the same time last year and additional staff have been required at certain times of the day to meet the increasing demand following the lifting of restrictions that were in place as a result of the COVID-19 pandemic. To this end, after the conclusion of the hearing, the Nominator provided copies of receipts from recent transactions demonstrating the businesses’ improved turnover, which accorded with transactions listed in a bank statement for the business from 22 May to 23 June 2020. Moreover, as detailed further below, the Tribunal was told that the businesses’ changed advertising model and move away from relying heavily on ‘Groupon’, which charged a 30% commission from the sale of vouchers to be redeemed at the business, will see its income rise this year.
The representative of the Nominator told the Tribunal that she required the Employee to run her business and she would be employed for ‘at least two years’.
Having regard to the evidence before the Tribunal, it is satisfied that the Employee will be employed on a full-time basis in the position for at least two years and the terms and conditions of the Employee’s employment do not include an express exclusion of the possibility of extending the period of employment. Accordingly, the requirement in r.5.19(4)(d) is met.
No less favourable terms and conditions of employment: r.5.19(4)(e)
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.
As noted above, the Employee is paid $55,328 per annum, plus superannuation. The Nominator has advertised the position in Australia using various methods and the remuneration was stated in these advertisements as $55,000 plus superannuation.
Based on the material before the Tribunal, it is satisfied that the terms and conditions applicable to the 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. Accordingly, the requirements of r.5.19(4)(e) are met.
No adverse information known to Immigration: r.5.19(4)(f)
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 of the Regulations. Based on the information before the Tribunal, there is no adverse information known to Immigration about the Nominator or a person ‘associated with’ the Nominator. Accordingly, the requirements of r.5.19(4)(f) are met.
Satisfactory compliance with workplace relations laws: r.5.19(4)(g)
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.
Based on the information before the Tribunal, it is satisfied that the applicant has a satisfactory record of compliance with workplace relations laws in locations in which it operates a business and employs staff. 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)
Regulation 5.19(4)(h) contains a number of alternative requirements. These are set out in detail in the Attachment to the decision but can be briefly summarised as requiring either that:
·the tasks to be performed in the position will be performed in Australia and correspond to those of an occupation specified by the Minister, the occupation is applicable to the proposed employee in accordance with any specifications made in that instrument, and specified training requirements are met; or
·the position and nominator’s business is located in regional Australia, there is a genuine need for the paid position under the nominator’s direct control which cannot be filled by a locally resident Australian citizen or permanent resident, the tasks of the position correspond to those of an occupation specified in the relevant legislative instrument, the occupation is applicable to the proposed employee in accordance with the specification of the occupation and that a regional certifying body has advised the Minister about certain matters relating to the position.
The nomination was made on the basis that the position and business is located in regional Australia. The Tribunal finds that the entire territory of the ACT is defined as part of ‘regional Australia’ under the Regulations. The position and the business are located in the ACT and they are therefore located in regional Australia.
The Tribunal accepts the evidence from the Nominator that 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. The Employee has been employed with the Nominator for approximately 5 years. The Employee is employed in the nominated position and has been working in that role since at least 2016. The sole director of the Nominator informed the Tribunal that because she cannot perform massage services and the business has between twelve and twenty customers per day, the position currently filled by the Employee is required to undertake the role of full-time massage therapist. An organisational chart provided to the Tribunal shows the Employee to be the lead massage therapist for the Nominator and the only full-time employee.

The Nominator told the Tribunal that she cannot find appropriately trained Australian citizens or permanent residents for the role of Massage Therapist living in the ACT. To this end, the Nominator provided evidence that it had advertised the position in various forums, including online, in The Canberra Times newspaper and in the shopfront window of the business. The Employee was said to be the most suitable candidate because of her skill in performing Thai massage, together with her work experience and formal qualifications (the Employee holds a Diploma of Remedial Massage which was awarded in 2016, in addition to her engineering qualifications).
The Tribunal was also told that the Nominator’s business has been increasing since restrictions have been eased in the ACT regarding the COVID-19 pandemic. To that end, the Nominator said that the business was trading at a higher volume than at the same time last year and profitability would improve because of a changed operating and advertising model that does not rely on business being generated with the purchase of vouchers by customers through ‘Groupon’, which occurred in 2018 and 2019, whereby Groupon retained, as a commission, 30% of a $59 or $115 voucher purchased for a massage service at the business, rather than all of those amounts remaining with the business.
As detailed above in these reasons, the tasks of the position include massage and communicating with clients regarding the businesses’ services. Additionally, the Employee supervises and trains the other, part-time, masseurs employed by the Nominator. Accordingly, and based on the evidence before the Tribunal, it is satisfied that the tasks to be performed in the position are those of a ‘Massage Therapist’ (ANZSCO Code 411611), which correspond to the tasks of an occupation specified by the relevant instrument.
Finally, the relevant Regional Certifying Body, being the ACT Economic Development Directorate, located in the same Territory as the position, has advised the Minister about the matters in r.5.19(4)(e) and r.5.19(4)(h)(ii)(B) & (C). There is nothing to indicate that the advice is no longer valid.
Accordingly, the Tribunal finds that the requirements of r.5.19(4)(h) are 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
Pursuant to subsection 43(1)(c)(i) of the Administrative Appeals Tribunal Act 1975, the Tribunal sets aside the decision under review and substitutes a decision approving the nomination.
W Frost
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)       both 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;
(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 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).

[2020] AATA 3145

28 July 2020

Key Legal Topics

Areas of Law

Immigration

Administrative Law

Legal Concepts

Judicial Review

Statutory Construction

Procedural Fairness