Yu v Minister for Immigration
[2007] FMCA 153
•23 March 2007
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| YU & ORS v MINISTER FOR IMMIGRATION & ANOR | [2007] FMCA 153 |
| MIGRATION – MRT decision – Business Skills (Residence) visa based on established business in Australia – assessment of business skills points – employment of not less than 3 full-time employees throughout the period of 12 months preceding the visa application – whether broad assessment of equivalence permissible – business ceased to have any employees two weeks before end of relevant period – no error found in Tribunal’s award of nil points. |
Acts Interpretation Act 1901 (Cth), s.8
Judiciary Act 1903 (Cth), s.39B
Migration Act 1958 (Cth), s.483A,
Migration Litigation Reform Act 2005 (Cth), Sch.1 cl.41
Migration Regulations 1994 (Cth)
Migration Regulations (Amendment) 1995 (Cth)
Islam v Minister for Immigration & Anor [2006] FMCA 1229
Lobo v Minister for Immigration & Multicultural & Indigenous Affairs (2003) 132 FCR 93
Minister for Immigration & Multicultural & Indigenous Affairs v SGLB (2004) 207 ALR 12
Yang v Minister for Immigration & Anor [2007] FMCA 38
| First Applicant: | YONG PING YU |
| Second Applicant: | JUN MOU |
| Third Applicant: | ZHEN SHAN MU |
| Fourth Applicant: | HAN YU MU |
| Fifth Applicant: | SUSU MOU |
| Sixth Applicant: | JUANJUAN MOU |
| First Respondent: | MINISTER FOR IMMIGRATION & CITIZENSHIP |
| Second Respondent: | MIGRATION REVIEW TRIBUNAL |
| File Number: | SYG 2902 of 2005 |
| Judgment of: | Smith FM |
| Hearing date: | 8 February 2007 |
| Delivered at: | Sydney |
| Delivered on: | 23 March 2007 |
REPRESENTATION
| Counsel for the Applicant: | Mr N Poynder |
| Counsel for the First Respondent: | Mr G Kennett |
| Solicitors for the Respondents: | DLA Phillips Fox |
ORDERS
The application is dismissed.
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT SYDNEY |
SYG 2902 of 2005
| YONG PING YU |
First Applicant
| JUN MOU |
Second Applicant
| ZHEN SHAN MU |
Third Applicant
| HAN YU MU |
Fourth Applicant
| SUSU MOU |
Fifth Applicant
| JUANJUAN MOU |
Sixth Applicant
And
| MINISTER FOR IMMIGRATION & CITIZENSHIP |
First Respondent
| MIGRATION REVIEW TRIBUNAL |
Second Respondent
REASONS FOR JUDGMENT
This is an application filed on 10 October 2005 under s.483A of the Migration Act 1958 (Cth) (“the Migration Act”), which seeks orders by way of judicial review of a decision of the Migration Review Tribunal (“the Tribunal”) made on 26 September 2005. The Tribunal affirmed a decision of a delegate made on 28 June 2002, which refused to grant to the first applicant a Business Skills (Residence)(Class BH) subclass 845 (Established Business in Australia) permanent residence visa, and to grant secondary visas of the same subclass to her family.
The Migration Litigation Reform Act 2005 (Cth) has repealed s.483A and has restructured the Court’s jurisdiction in relation to migration decisions. However, these amendments apply only to proceedings commenced after 1 December 2005, and the repeal does not affect the present proceeding (see Sch.1 cl.41, and Acts Interpretation Act 1901 (Cth), s.8).
Section 483A gives the Court the jurisdiction of the Federal Court under s.39B of the Judiciary Act 1903 (Cth). This is subject to limitations under Part 8 of the Migration Act, which have the effect that that I cannot set aside the Tribunal decision and send the matter back unless I am satisfied that the decision was affected by jurisdictional error. In the present case, the applicant argues that the Tribunal applied a material misconstruction of the relevant Migration Regulations when reaching its decision. It appears to be common ground that this would provide jurisdictional error, if the Tribunal did make the error contended (cf. Lobo v Minister for Immigration & Multicultural & Indigenous Affairs (2003) 132 FCR 93 at [42]-[62] and Minister for Immigration & Multicultural & Indigenous Affairs v SGLB (2004) 207 ALR 12 at [51]).
The applicant’s efforts to obtain permanent residence for herself and her family are narrated in the Tribunal’s decision, and it is unnecessary for me to repeat this extensive history. Nor is it necessary for me to describe the tortuous procedures which preceded the Tribunal’s decision. Explained shortly, the applicant obtained periods of temporary residence after 1996 under subclass 457 visas, presumably on the basis of her proposed business or employment in Australia. On 16 October 1998, she applied for the permanent residence visa now under consideration.
To qualify for the visa under the Migration Regulations as they stood in 1998, the applicant was required to satisfy “time-of-application” criteria under Sch.2 item 845.21 of the regulations. These included criteria requiring a preceding period of active ownership and management of an Australian business, and a prescribed level of personal and business assets:
845.213The applicant:
(a)has had an ownership interest in 1 or more established main businesses in Australia for the period of 18 months immediately preceding the making of the application; and
(b)continues to have an interest of that kind.
845.214The total value of the net assets in Australia of the applicant, or the applicant and the applicant’s spouse together:
(a)is; and
(b)has been throughout the period of 12 months immediately preceding the making of the application;
at least AUD250,000.
845.215The total value of the net assets owned by the applicant, or by the applicant and the applicant’s spouse together, in the main business or main businesses in Australia:
(a)is; and
(b)has been throughout the period of 12 months immediately preceding the making of the application;
at least AUD100,000.
845.216In the 12 months immediately preceding the making of the application, the applicant, as the owner of an interest in a main business or main businesses in Australia, maintained direct and continuous involvement in the management of that business or those businesses from day to day and in making decisions that affected the overall direction and performance of that business or those businesses.
845.217The applicant has overall had a successful business career.
845.218Neither the applicant nor his or her spouse (if any) has a history of involvement in business or investment activities of a nature that is not generally acceptable in Australia.
845.219The applicant has signed a declaration in a form approved by the Minister that the applicant acknowledges the Government’s requirements in relation to residence in Australia as the holder of a Subclass 845 visa.
Much effort was taken by the applicant’s migration agent to address these criteria with evidence and submissions to the delegate and Tribunal. The applicant sought to satisfy them by reference to her involvement in a company, Mountain Three Pty Ltd, of which she claimed to be general manager, and whose business was claimed to be the import and export of manchester, foodstuffs and furniture. It is unnecessary to examine any of the evidence presented in this respect, since the Tribunal ultimately did not find it necessary to address any of the ‘time-of-application’ criteria.
The ‘time-of-decision’ criteria for the visa under item 845.221 required that the applicant should continue to satisfy the time-of application business and assets criteria, and also that she should have achieved a Gazetted level of points in a “business skills points test”. This was provided for under item 845.222:
845.222(1) The applicant’s score on the business skills points test is not less than the number of points that is specified for the purposes of this subclause by Gazette Notice.
(2) For the purposes of subclause (1):
(a) an applicant's score on the business skills points test is the sum of the applicant's scores under:
(i) Division 1.4 of Schedule 7; and
(ii) Parts 2, 3 and 4 of that Schedule; and…
Schedule 7 in Part 1 provided points for “business attributes” under different items relating to different subclasses of visa. For a subclass 845 visa, it allowed one score of 60 points upon satisfaction of item 7170:
Division 1.4 Established business in Australia (Subclass 845 visas)
7170 Throughout the period of 12 months immediately preceding the making of the application, the main business or main businesses of the applicant or that of the applicant and the applicant’s spouse: 60 (a) employed not less than 3 full-time employees (or a number of part-time employees working an equivalent number of hours) each of whom: (i) is not the applicant or a member of the family unit of the applicant; and (ii) is an Australian citizen, an Australian permanent resident or an eligible New Zealand citizen; and (b) either: (i) had a turnover of not less than AUD200,000; or (ii) exported goods or services of a value of not less than AUD100,000
In the present case, the Tribunal addressed the applicant’s qualification for 60 points under this table, and held that she did not satisfy the requirements of paragraph (a). It found it unnecessary to address paragraph (b), and did not assess the applicant’s entitlement to further points under Part 2 of Schedule 7, which provided for points based on the age of the applicant, language ability, net assets, and regional sponsorship. The Tribunal affirmed the delegate’s decision due to a finding of failure to satisfy Sch.7 item 7170(a) alone.
No issue is taken by the applicant with the Tribunal’s failure to address other criteria, and it is conceded that the applicant could not accumulate sufficient points to satisfy the Gazetted minimum of 105, without obtaining points under Sch.7 item 7170.
The Tribunal’s reasons were expressed briefly:
64.The visa application was made on 16 October 1998, therefore, the relevant period is 15 October 1997 to 15 October 1998. The evidence provided by the visa applicant at the hearing on 29 July 2005 was that all 3 employees, Ms Qing Lian Tian, Mr Lei Song and Mr Jian Leng, who were at the time employed by the company ceased work on 30 September 1998. The wage records and PAYG summaries provided to the Tribunal confirm this. Mr Leng’s 1999 Group Certificate is at D2, f.134 and his wage records are at T1, ff.478-479. Ms Tian’s 1999 Group Certificate is at D2, f.127 and her wage record is at T1, f.480. Mr Song’s 1999 Group Certificate is at D2, f.138 and his wage record is at T1, f.483. The PAYE Employer’s Annual Reconciliation 1998/1999 states that 3 Group Certificates were issued in that financial year. That is, after the 3 employees left on 30 September 1998, no further employees were employed by Mountain Three for the financial year ending on 30 June 1999.
65.Therefore, from 1 October 1998 and until 16 October 1998, the date of the lodgement of the visa application, the visa applicant’s main business, Mountain Three did not meet the requirements of item 7170(a) as it did not, throughout the period of 12 months immediately preceding the making of the visa application, employ not less that 3 full time employees and the Tribunal finds accordingly. The Tribunal, therefore, also finds that the visa applicant is not entitled to 60 points for item 7170 of Division 1.4.
66.On the above findings the Tribunal also finds that the visa applicant cannot score on the business skills points test at least 105, as specified in Gazette Notice S238 and, therefore, the visa applicant does not meet the criteria in clause 845.222 at the time of this decision.
The applicant’s counsel conceded before me that the Tribunal’s findings as to the relevant evidence in paragraph [64] was correct. He challenged its reasoning from those findings on two grounds:
(a)The Second Respondent failed to consider the First-named Applicant’s claim that she met the criteria in Item 7170(a) of Division 1 .4 in Schedule 7 to the Migration Regulations by reason of the number of hours worked pro rata by her part-time employees.
(b)The Second Respondent erred in its application of Item 7170(a), in that it failed to calculate the number of full-time employees in the First-named Applicant’s main business with reference to the pro-rata equivalent period of time worked by her part-time employees.
Counsel did not press a further ground, which contended that the Tribunal failed to follow required procedures “because it failed to provide her with particulars or an opportunity to respond to information that she might not meet the requirements of item 7170(a)”. This has meant that I do not need to investigate the procedures followed by the Tribunal, nor consider whether the applicant was fairly put on notice of the issues upon which the Tribunal ultimately decided the matter.
The submissions to the Tribunal of the applicant’s agent relevant to issues concerning the 12 month employment test appear to have treated as uncontentious that the Tribunal would follow Departmental guidelines set out in its Procedures and Advice Manual (PAM3), and that the application of PAM would allow the Tribunal to overlook the absence of any employees during the last two weeks of the relevant 12 month period. The agent appears to have thought that the periods of work by employees employed at any time within the relevant 12 month period could be aggregated and averaged over that period, so as to achieve equivalence to the employment of 3 full-time employees over the full 12 months period.
At the time of the visa application in 1998, the PAM advice in relation to item 7170 included:
1. It is the policy that “full-time” be regarded as referring to employees who normally work the agreed or award hours for employees in that occupation. Where agreed/award hours do not apply, it is policy that “full-time” is to be regarded as meaning “not less than 30 hours a week”.
2.Pro-rata equivalent of the prescribed number of employees may be accepted for periods of less than a full fiscal year. For example, six (part-time) workers employed for six months may be considered equivalent to three (full-time) workers employed for a full fiscal year. (Note that paid holidays may be counted as paid employment)
3. Full-time may also include, for example, positions subject to part-time and/or job sharing arrangements provided the position is a discrete, identified job and the total number of hours worked by occupants in that position is at least 30 hours a week
4. It is policy that ‘employees’ be regarded as meaning those persons (whether permanent, casual or, subject to paragraph 7, contract labour) who are paid a wage, salary, commission or fee by the applicant’s main business. Where the occupation has a legal minimum working age, only persons of at least that minimum age should be regarded as employees.
At the time of the Tribunal’s decision, the relevant parts of PAM advised:
5.2Full-Time
It is policy that ‘full-time’ be regarded as referring to employees who normally work the agreed or award hours for employees in that occupation. If agreed/award hours do not apply, it is the policy that ‘full-time’ be regarded as meaning “not less than 30 hours a week”.
Pro-rata equivalent of the prescribed number of employees may be accepted for periods of less than a full fiscal year, particularly where business/es experience seasonal and/or market fluctuations. For example, 2 (full-time) workers employed for 6 months may be considered equivalent to 1 (full-time) worker employed for a full fiscal year. (Note that paid holidays may be counted as full time employment).
Full-time may also include, for example, positions subject to part-time and/or job-sharing arrangements provided the position is a discrete, identified job and the total number of hours worked by occupants in that position is at least 30 hours a week.
Counsel for the applicant submitted that the advice that “pro-rata equivalent of the prescribed number of employees may be accepted for periods of less than a full fiscal year” reflected a correct interpretation of item 7170(a). He also submitted that the Tribunal had implicitly declined to adopt that construction, and had therefore erred in law.
He referred me to five published decisions of the Tribunal, and invited me to approve those which had followed the PAM advice. Neither counsel cited any judicial discussion of the effect of item 7170. The MRT decisions, arranged chronologically, were:
a)[2003] MRTA 5073, decided on 14 July 2003. The applicant’s export business had employed five employees over the year before the visa application, only one of whom was full-time for the whole period. The Tribunal referred to policy, and at [42] decided that two employees who had worked full time for periods of 10½ and 4½ months “can be considered the equivalent of a second full-time employee”. It found that two other employees working each full-time for 7½ months, “can be considered the equivalent of a third full-time employee”. It did so, notwithstanding that the flexibility suggested by the words in brackets in 7170(a) could not be invoked since the employees had not been part-time.
b)[2004] MRTA 6775, decided on 12 May 2004. The applicant’s construction business had employed two permanent full-time employees over the relevant period and seven small contractors over four months of it. The Tribunal quoted the PAM policy, but thought that it was ambiguous. It said that it would not be “appropriate to simply aggregate all the periods of employment of all the employees engaged by the business during the relevant period in order to find that the business meets the requirement in relation to three full-time employees”. It said: “taking a merely arithmetical approach to the issue does not appear to the Tribunal to reflect the underlying purpose of this particular visa subclass, that is that the visa is granted on the basis of an established business”. It said: “item 7170 requires the business to have employed at least three fulltime employees or their equivalent at every point in time for the whole of the relevant twelve months period”. Notwithstanding this interpretation, the Tribunal was able to find that the applicant satisfied item 7170(a) on the basis that “bearing in mind that most employees in the construction arm were employed for 1/3 of the 12 months before the application … the seven building contractors alone would be sufficient to equal 1 employee”.
c)[2005] MRTA 1097, decided on 14 December 2005. The applicant’s business organised bus tours to the Blue Mountains, and had employed six staff full-time on two days only during the relevant period, apart from the applicant himself and occasional contract staff. The Tribunal discussed difficulties of interpreting the legislation and policy, but found that the applicant could not qualify. It said at [44]: “there is nothing which indicates to the Tribunal that (the period of 12 months) can be read down to a lesser period where a greater number of employees are employed for a shorter term”.
d)[2006] MRTA 1, decided on 4 January 2006. The applicant’s business imported clothing and furniture, and employed two full-time employees over the relevant period, together with three employees working over 30 hours per week for a total of 63 weeks including the period, and two other employees starting within the period working over 30 hours for a total of 45 weeks. The Tribunal found that this satisfied item 7170(a), without explaining its reasoning.
e)[2006] MRTA 453, decided on 24 October 2006. The applicant’s business processed and exported jelly-fish, and had employed one person full time over the relevant period, two persons full time for periods “7 days short of the 12 month period”, and two persons full time starting 7 days before the end of the relevant period. The Tribunal found that “the business employed the equivalent of three persons on a full-time basis for the relevant 12 months period.”
Contrary to the submissions of counsel for the applicant, I do not consider that any of these decisions is inconsistent with the present Tribunal’s reasoning. Nor do I consider that they reveal any clear division of opinion within the Tribunal as to the interpretation of item 7107(a). They do, however, usefully illustrate the circumstances in which the provision is intended to operate, at least at its margin. As will appear below, I do not consider that their recognition of some situations as “equivalent” to the employment of three full-time employees over the relevant 12 months generally reflects a misapprehension of the effect of the regulation.
Counsel for the Minister accepted, or assumed, that the PAM advice might encompass a calculation such as was proposed by the applicant’s agent, but contended that this was not open on the simple language of item 7170(a). He also supported the Tribunal’s reasoning, on the basis that it reflected a correct appreciation of the effect of the word “throughout”. He pointed out that the explanatory statement accompanying an amendment to item 7170 made by the Migration Regulations (Amendment) 1995 No.268. This stated in relation to amending reg.34:
This regulation amends item 7170 of Schedule 7 of the Migration Regulations by omitting the word “During” and substituting the word “Throughout”. This regulation is intended to clarify that the employment of the required number of employees must have been at all times throughout the period of 12 months immediately preceding the making of the application.
In the Macquarie Dictionary, Revised 3rd Edn, “throughout” is given two meanings as a preposition: “1. in or to every part of; everywhere in 2. from the beginning to the end of”.
In my opinion, the word has the second of these meanings in item 7170, rather than the first. That is, what is required is satisfaction as to the specified tests under paragraphs (a) and (b) over the full period of 12 months preceding the visa application, rather than satisfaction of those tests on each moment of time during that twelve month period.
This construction is pointed to by several considerations:
i)The provision requires a retrospective factual assessment in relation to a twelve month period which will always have passed. It does not set up an on-going test requiring satisfaction from time to time into the future, for example, as does a ‘no work’ condition attaching to a visa or approval (e.g. Islam v Minister for Immigration & Anor [2006] FMCA 1229, 202 FLR 281 at [23], and Yang v Minister for Immigration & Anor [2007] FMCA 38 at [23]).
ii)The purpose of the item 7170 tests is to provide two measures of a business’s “attributes” over that past period: its employment record, and its turnover or export record. It sets benchmarks for each of these attributes, which must be met to achieve the requisite score in a “business skills test”. It is irrelevant to this purpose to examine or test fluctuations within the 12 month period in relation to the matters measured, and sufficient for the apparent purpose of the item that the matters measured should have occurred “throughout” the relevant 12 month period.
iii)Considering the test set up in par.(b) of item 7170, it is intelligible to measure “turnover” and “exported goods and services” by reference to the start and end of the twelve month period. It is not intelligible to discover in that paragraph the testing of a state of affairs in relation to either of these matters which exists “in every part of” the twelve month period.
iv)It would be consistent to treat the test of employment numbers similarly under par.(a), so as to address the defined level of employment which is assessed to have continued from the beginning to the end of the 12 month period.
Giving the less-demanding meaning to the word “throughout” in item 7170 therefore allows some flexibility in the measurement of the test of whether an applicant’s business “employed not less than 3 full-time employees” throughout the relevant 12 months. It means that a general test of a level of employment over 12 months is intended, rather than tests of whether on each day in that period – or during any other meaningful period within 12 months – the business actually had 3 full-time employees, or whether the same employees were employed for the full twelve months.
An intention not to require such tests is also suggested by the parenthetical reference to equivalent part-time employees.
I therefore consider that PAM is consistent with the regulation, to the extent - as illustrated in the MRT cases summarised above – that it permits or requires an over-all assessment of all the workers employed in a business over the twelve month period, to consider whether their work amounts to the equivalent of 3 full time employees being employed from the beginning to the end of the relevant 12 months period.
PAM would, however, not correctly interpret item 7170 if it were read as advising that it is sufficient for the employment of an equivalent number of full-time and part-time employees to have occurred at any times within the full 12 month period. It is necessary that their collective employment pattern throughout the 12 month period may appropriately be characterised as equivalent to 3 full-time employees working in the business from the beginning to the end of the relevant 12 months.
In this respect, I accept, as PAM suggests, that the peculiar circumstances of some seasonal or other fluctuating businesses might present a pattern of normal employment in which the numbers of employees might peak over part of the year and lead to lay-offs or reductions during other parts. The item 7170(a) test of employment “throughout” the 12 month period in such situations, is whether, notwithstanding periods of lay-off or down-turn, the business may appropriately be regarded as still operating on a yearly basis with “not less than 3 full-time employees” from the start to the end of the 12 months before the visa application.
I accept that this interpretation carries uncertainties in its application to many situations, and leaves to a decision-maker an area of factual assessment in which judgments might differ. However, I consider that the intention of the tests set up in item 7170 would not be achieved without allowing such flexibility. I also consider that allowing for a broad judgment as to equivalence is consistent with other broad criteria which are found in the Migration Regulations, including some of the criteria for a 845 visa which I have set out above.
I turn then to consider whether the present Tribunal’s reasoning reflects a misunderstanding of the effect of Sch.7 item 7170 on the interpretation given above.
I am not persuaded that it does reflect any misunderstanding. This is because I do not read the Tribunal as requiring that the applicant’s business should, in fact, be found to have had three employees, or their equivalent, actually employed on every day during the relevant twelve month period. I do not read it as rejecting the possibility of addressing fluctuations in employment levels by taking a broader view of a business’s employment pattern over the relevant period. I do not accept the contentions in the Grounds of Review, that the Tribunal failed to consider whether, by some appropriate aggregation or averaging of the periods actually worked by the employees of the applicant’s business, it could treat their employment as satisfying the required test of employment “throughout the period of 12 months immediately preceding the making of the application”.
Rather, I consider that the Tribunal found against the applicant’s business because its records showed a clear cessation of employment before the end of the relevant 12 month period, which in the Tribunal’s opinion prevented its employment history being characterised as continuing “throughout” that period.
That the Tribunal was taking a broad view when characterising the employment pattern is shown by its readiness, properly, in my opinion, to consider the context of the gap in employment at the end of the 12 months period, by taking into account the business’s subsequent employment history. As it said: “after the 3 employees left on
30 September 1998, no further employees were employed by Mountain Three for the financial year ending on 30 June 1999”. The Tribunal thus appears to have considered whether the absence of employees at the end of the period might be accounted for as a short or seasonal fluctuation in an over-all continuity of the business’s employment history at the level of “not less than 3 full-time employees”. It decided that it could not.I am not persuaded that the Tribunal’s reasoning reflects any error of law in its application of Sch.1 item 7170 to the evidence before it.
I must therefore dismiss the application.
I certify that the preceding thirty-five (35) paragraphs are a true copy of the reasons for judgment of Smith FM
Associate: Michael Abood
Date: 23 March 2007
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