WISECASE AUSTRALIA PTY LTD (Migration)

[2018] AATA 2022

WISECASE AUSTRALIA PTY LTD (Migration) [2018] AATA 2022 (17 May 2018)

DECISION RECORD

DIVISION:Migration & Refugee Division

APPLICANT:  WISECASE AUSTRALIA PTY LTD

CASE NUMBER:  1619855

DIBP REFERENCE(S):  BCC2016/592474

MEMBER:Mark Bishop

DATE:17 May 2018

PLACE OF DECISION:  Melbourne

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

Statement made on 17 May 2018 at 2:20pm

CATCHWORDS
Migration – Nomination refusal – Retail Manager – Direct Entry nomination stream – Sufficient financial capacity to employ the nominated position full time for two years – Decision under review set aside

LEGISLATION
Migration Act 1958, s 245AR
Migration Regulations 1994, rr 1.13, 5.19

STATEMENT OF DECISION AND REASONS

APPLICATION FOR REVIEW

1. This is an application for review of a decision made by a delegate of the Minister for Immigration on 15 November 2016 to reject the applicant’s application for approval of the nomination of a position in Australia under r.5.19 of the Migration Regulations 1994 (the Regulations).

2. The applicant applied for approval on 10 February 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 Direct Entry Nomination stream.

4. The delegate refused the application on the basis the applicant’s nomination did not satisfy r.5.19(4)(d)(i) of the Regulations because the delegate was not satisfied the nominator had sufficient financial capacity to employ the nominated position full time for two years in the nominated role given the business’ current financial status, the consistent losses over the last three years, along with the Director providing additional funds each year for the last three years without claiming any Director fees.

5. The Tribunal determined the matter on the papers.

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

7. 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

8. The issue in this case is whether the applicant meets the requirements for approval of the nomination under the Direct Entry nomination stream set out in r.5.19(4), which is extracted in the attachment to this decision. For the nomination to be approved, all the requirements must be met.

   The application is compliant: r.5.19(4)(a)

9. Regulation 5.19(4)(a) requires that the application for approval must be in the approved form, must be accompanied by the prescribed fee, and, where applicable, must include the required written certification relating to conduct that contravenes s.245AR(1). The application must also identify a need for the nominator to employ a paid employee to work in the position under their direct control.

10. The application was lodged with the prescribed form, did not include a written certification in relation to s.245AR(1) (receiving a benefit) and was accompanied by the prescribed fee.

11. The nominator lodged the application on 15 November 2016. The nominator identified a need to employ a paid person in the position of Retail Manager. The nominator provided an organisational chart and a statement (job description) that outlined the responsibilities of the Retail Manager as reporting directly to the Director.

12. 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)

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

14. The nominator provided the following documentation:

    ·Current and historical extract for Wisecase Australia Pty Ltd ACN 123 021 778;

    ·Certificate of Company Registration for Wisecase Pty Ltd ACN 123 021 778.

15. The nominator actively and lawfully operates a business in Australia and directly operates the business.

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

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

17. 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.

18. The nominator provided a copy of the organisational chart of the company that showed the position of Retail Manager reporting directly to the Director of the company. The nominator provided a job description outlining the major duties, responsibilities and experience and skills required to fill the position. The nominator provided a letter of engagement between itself and Mr Yan ZHOU. The letter of engagement was signed and dated. The letter of engagement provided for a salary of $54,750 comprising base salary of $50,000 and superannuation of $4,750. The organisational chart identified the nominated position as being within the company.

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

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

20. 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. Clause 1.1 of the Letter of Engagement expressed “you will be employed in a permanent and ongoing full time position for a minimum of two years, no exclusion of extending”.

21. The Tribunal needs to be satisfied the business is able to operate sufficiently and can afford to pay the nominee.

22. The nominator provided a copy of the following documents:

    ·Financial statements for the FY2016 for Wisecase Pty Ltd;

    ·Financial statements for the FY2017 for Wiseacre Pty Ltd;

    ·Company tax return 2016;

    ·BAS statements July to September 2015, October to December 2015, January  to March 2016, April to June 2016, July to September 2016, October  to December 2016, January to March 2017, April to June 2017;

    ·Lengthy and detailed statement from the nominator that addressed the financial analysis carried out by the delegate, shortcomings in that particular approach and the findings of the delegate.

23. The Departmental file contained the following additional documents:

    ·BAS statements July to September 2014, October to December 20124, January to March 2015, April to June 2015;

    ·Financial statements for the FY2013, FY2014, FY2015, FY2016 for Wisecase Australia Pty Ltd.

24. The Tribunal has examined all the above material and paid particular regard to the decision of the delegate of 15 November 2016.

25. The above documentation showed the following:

    ·P & L statements for the FY2015, FY2016 and FY201 show a return to operating profit from $5,113 to $80,430 over a three year period;

    ·Operating profit as disclosed by the Income Statement for the FY2015, FY2016 and FY2017 shows growth from $5,113 up to $43,077;

    ·Sales increased from $896,000 in FY 2015 up to $1,193,000 in FY2017 an increase of $297,000 of 33%;

    ·Expenses increased from $475,000 in FY2015 up to $526,000 in FY2017, an increase of $51,000 of 10%;

    ·Expenses as a % of sales declined from 53% in FY2015 to 44% in FY2017;

    ·A significant cost rent and outgoing declined from $$250,000 in FY2015 to $$166,000 in FY2017;

    ·Wages and superannuation as a % of sales declined from 28% in FY2015 to 19% in FY2017;

    ·Retained profits have grown from $(13,321) in FY2015 to $80,340 in FY2017. This growth in retained profits continues a trend began in FY2013 and shows growing profitability over a 5 year period;

    ·Net assets have grown from $(18,321) in FY2015 to $109,303 in FY2017. This growth in net assets continues a trend begun in FY2013 and shows a growing asset base.

26. The financial statements show the company is growing at a significant rate, that expenses are under control and declining as a % of sales, that critical and large parts of expenses in wages, superannuation, rent and outgoings are well under control and in strong decline, that expenses grew at a modest rate (10%) compared to sales which grew at a more than healthy rate (33%) over the 3 year period from 2015 until 2017. In short unit costs are down, sales are increasing, profit is growing, expenses are under control and the company is profitable.

27. The BAS and annual company tax returns for the FY2016 and FY2017 were consistent with the above financial statements.

28. C S Beh Chartered Accountant provided a statement dated 2 March 2018 in respect of Wisecase Australia Pty Ltd as follows: “at the request of the Director I have reviewed the financial performance of the above entity. Based on the work done, I confirm that the company has the ability to meet its obligations to employ one nominee including salary, superannuation, WorkCover and other employee related costs for at lese 2 years”.

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

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

29. Regulation 5.19(4)(e) requires that the terms and conditions of employment applicable to the nominated position will be no less favourable than those that are, or would be, provided to an Australian citizen or permanent resident performing equivalent work in the same workplace at the same location.

30. The nominator provided extracts as follows:

    ·Letter from Montgomery International Consultants dated 9 March 2018 that outlined endeavours by the nominator to locate and hire a person for the position of Retail Manager to look after business operations in Shepparton, Bendigo and Mildura;

    ·Copies of relevant job extracts from Seek and Payscale plus associated invoicing for position of store manager showing salary range of $43,000 to $55,000 per annum plus superannuation. The Tribunal has considered the annual salary date referred to above and examined the detail of the available BAS statements that disclose total wage and salary paid on a quarterly basis and PAYG withheld. The Tribunal is satisfied the salary amount, terms and conditions paid to the nominee are no less favourable than those that would be provided to an Australian citizen or permanent resident performing the same work in the same work place in Victoria. 

31. Accordingly the requirements of r.5.19(4)(e) are met.

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

32. 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.

33. There was no evidence before the Tribunal concerning adverse information known to Immigration about the nomination or the person associated with the nominator.

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

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

35. 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.

36. There was no evidence before the Tribunal that suggests the applicant does not have a satisfactory record of compliance with workplace relations of the Commonwealth and the State of Tasmania. 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)

37. 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 (see legislative instrument IMMI) 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.

38. The Tribunal determines as follows:

    ·The position is located in Shepparton, Victoria. Instrument 17/059 specifies what is considered ‘regional Australia’ and it includes the postcode 3630. The postcode of Bendigo is 3630;

    • The nominator provided a comprehensive “genuine position statement” that addressed the background, growth and development of Wisecase Australia Pty Ltd The statement addressed the following matters:

    o  Background and origins of the business from December 2006 providing a range of mobile phone accessories through retail stores in a couple of regions in Victoria;

    o  A staff of 8 persons including 7 Australian employees and 1 foreign employee;

    o  Market trends creating a burgeoning market demand for mobile phone accessories globally and significant competition locally;

    o  Steady growth in revenue

    ·The nominator provided detail of advertising for the position of Retail Manager. The nominator advised the nominee started working part time in February 2017 and full time as Retail Manger in March 2017. The nominator provided evidence it had attempted to fill the position without success. The nominator provided detail of applicant s to SEEK and Shepparton News and Indeed and provided a critique that identified the shortcomings of each particular applicant.

    ·The nominator advised the nominee had proved his leadership and dedication to the success of the business. He was a strategic thinker, results oriented, and a good merchant knowing what and how much products to carry will make or break a business. The nominator outlined the particular skill set the nominee brought to the position and the difficulty in finding a local person. The Tribunal is satisfied there are no other relevant people in the particular location that can fill the position

    ·The nominator provided a detailed job description of the position of Retail Manager outlining the purpose of the position, the responsibilities and duties of the selected employee, necessary academic and trades qualifications, work experience and skills and personal qualities and traits.

    ·Instrument 17/059 provides that Retail Manager is a specified occupation for the purposes of r.5.19(4)(h)(ii)(D). Retail Manager with ANZSCO code 142111 may be found in Schedule 1 of that instrument. The Tribunal has examined the ANZSCO description of a Retail Manager. The Tribunal is satisfied the information provided by the nominator to the Tribunal in the document headed “Detailed Job Description” (as discussed immediately above) shows the tasks allocated to the nominated position correspond to the tasks of a Retail Manager.

    ·The nominator provided a signed Regional Certifying Body Advice Certificate from the Department of Economic Development, Jobs, Transport and Resources, Victoria. Instrument 17/059 lists the aforementioned department as a relevant regional certifying body in Shepparton.

    ·The Advice Certificate from the above Department includes advice on the matters in r.5.19(4)(e) and r.5.19(4)(h)(ii)(B) and r.5.19(4)(h)(ii)(C). The Advice Certificate addresses the following detail:

    o   the terms and conditions of employment will be no less favourable than those provided to an Australian citizen/permanent resident performing equivalent work in same workplace at the same location;

    o    there is a genuine need for the nominator to employ a paid employee to work in the position under the nominator's direct control; and

    o    the position cannot be filled by an Australian citizen/permanent resident who is living in the same local area as that place.

39. Accordingly the requirements of r.5.19(4)(h) are met.

    CONCLUDING PARAGRAPHS

40. 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.

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

    Mark Bishop
    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).