Zohha Holdings Pty Ltd as The Trustee for Zohha Family Trust (Migration)

[2018] AATA 5312

Zohha Holdings Pty Ltd as The Trustee for Zohha Family Trust (Migration) [2018] AATA 5312 (30 October 2018)

DECISION RECORD

DIVISION:Migration & Refugee Division

APPLICANT:  Zohha Holdings Pty Ltd as The Trustee for Zohha Family Trust

CASE NUMBER:  1720588

DIBP REFERENCE(S):  BCC2017/2319916

MEMBER:Mr S Norman

DATE:30 October 2018

DECISION:The Tribunal affirms the decision under review to refuse the nomination.

STATEMENT MADE ON 30 OCTOBER 2018 AT 9:00AM

CATCHWORDS
MIGRATION – Employer Nomination – approval of nominated position – Direct Entry Nomination – Retail Manager – need for a paid employee in specified position – work has effectively been undertaken by visa applicant on part time basis – director’s capacity to engage in business – financial capacity – salary of new position would cause substantial drop in profitability – decision under review affirmed

LEGISLATION
Migration Regulations 1994 (Cth), r 5.19

CASES
WZANC (No. 2) v MIAC [2012] FMCA 504

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 16 August 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 Department delegate’s decision was lodged with the Tribunal.

2. The applicant applied for approval on 29 June 2017. 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)(a)(ii) of the Regulations because they were not satisfied there was an identified need to employ a paid employee to work in the nominated position.

5. The applicant (represented by its Director,[1] Mr Hassan ZAHEER) appeared before the Tribunal on 25 September 2018 to give evidence and present arguments. The visa applicant (Mr Hassan HAYAT), also provided oral evidence at the Tribunal hearing. The applicant was represented in relation to the review by its registered migration agent.

   [1] Tribunal – folio 43 (reverse side).

6. For the following reasons, the Tribunal has decided to affirm the decision under review to refuse the nomination.

   CONSIDERATION OF CLAIMS AND EVIDENCE

7. 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.

8. The applicant/nominator (Zohha Holdings P/L as the Trustee for Sohha Family Trust - represented by its Director,[2] Mr Hassan ZAHEER), attended the hearing by telephone (as he was then in Pakistan). The visa applicant (Mr Hassan HAYAT) was in Australia, and also attended the hearing by telephone. The clarity of the telephone connection with Mr Hassan Zaheer (in Pakistan) was not as strong as the Tribunal would prefer (the audio connection with Mr Hassan HAYAT was clear). However, after occasionally requesting Mr Hassan Zaheer to repeat his material evidence, and then having summarised and confirmed with him what the Tribunal understood he was saying, the Tribunal was eventually satisfied the nominator was given a real opportunity to put evidence and submissions in support of their case (including at hearing).

   [2] Tribunal – folio 43 (reverse side).

9. Mr Hassan Zaheer also said he had been subject to ‘more than one’ identified surgical procedure in ‘recent times’ (including knee surgery). However, he did not claim this had materially impacted his capacity to put his case at hearing (though the Tribunal remained mindful of the possible impact of such procedures during the hearing). Be that as it may, and as stated above, the Tribunal was eventually satisfied the applicant/nominator, who was represented by a registered migration agent, was given a real opportunity to put evidence and submissions in support of their case (including at hearing).

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

10. 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.

11. The applicant/nominator (Zohha Holdings P/L as the Trustee for Sohha Family Trust), lodged an application online on 29 June 2017. In that application the nomination type was listed as RSMS Nomination (Nil fee) (DE) (Web) (RN 187). The visa applicant/nominee (Mr Hassan HAYAT), was nominated for the position of Retail Manager (General) (ANZSCO: 142111). The base salary was listed as $44,460 per annum. The nominating business was registered (ABN number provided). It was claimed the business was established or commenced trading in Australia on 8 March 2016, and that it employed nine Australian employees and seven foreign employees. The head office of the business was located in Dunlop ACT 2615 and the nominated position was to be located in Manuka Terrace, Griffith, ACT 2603.  

12. For nominations made before 1 July 2017, r.5.19(4)(a)(ii) requires that the application for approval ‘identifies a need for the nominator to employ a paid employee to work in the position under the nominator’s direct control’. For reasons not elaborated herein, the Tribunal understands it is unsettled whether this requirement is directed just at (first) a statement to this effect[3] or (second) something of a more qualitative nature.[4] As did the delegate, the Tribunal proposes to find the second interpretation of r.5.19(4)(a)(ii), should be accepted.

    [3] It may be argued that r.5.19(4)(a) as a whole is directed towards requirements for the application form / process of a more administrative nature, such that r.5.19(4)(a)(ii) could be met by a simple statement or certification of need.

    [4] The wording ‘identifies a need’ arguably suggests more is required to meet this criterion than simply a statement or declaration that there is such a need. This appears to reflect Department policy (PAM3: Migration Regulations – Divisions – Div 5.3 – General > Approval of nominated positions (employer nomination) > Part C - Criteria applicable to Direct Entry stream nominations > Need for a paid employee > Applicability and overview (reissued 12/05/17 – last reissue prior to 1 July 2017).

13. The delegate referred to a number of documents lodged in support of the nomination application (and the Tribunal has had regard to same prior to drafting this decision). The delegate then noted that reg. 5.19(4)(a)(ii) required that there be an identified need for the nominator to employ a paid employee to work in the position under the nominator’s direct control. The delegate noted the nominator had lodged an organisation chart but was not satisfied this was sufficient evidence of an identified need to employ a paid employee in the nominated position. The delegate was not satisfied the applicant met reg. 5.19(4)(a)(ii) of the Regulations (and therefore had not met reg. 5.19(4)).

14. The delegate then noted the nominator had only provided claims against reg. 5.19(4) of the Regulations, and that since insufficient evidence and claims had been submitted against reg. 5.19(3), the nominator had not met that alternate reg.

15. Much of the material evidence before the Tribunal and relating to this issue, has also been set out elsewhere herein. However, based on the evidence before it, the Tribunal is not satisfied there was an identified need for the nominator to employ a paid employee to work in the nominated position under their direct control. Based on the evidence, the Tribunal was not satisfied the visa applicant’s part time work (since March 2017) ostensibly in the nominated position, could not have been effectively undertaken by a person continuing to work part time in that position. The Tribunal was not satisfied it was necessary to employ a full time person in the position of Retail Manager (General) at Manuka, which work had apparently been effectively undertaken by the visa applicant and other casual staff, for at least the prior 2 ½ years). Furthermore, based on the evidence before it, the Tribunal was not satisfied the nominating businesses’ Director’s (Mr Hassan Zaheer) more recent medical issues would prevent him (and his wife) from continuing to have an adequate engagement in the Manuka business, in the reasonably foreseeable future. Accordingly, the requirement in r.5.19(4)(a)(ii) is not met.

16. The applicant has not met r.5.19(4)(a) of the Regulations.

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

17. 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.

18. As noted above, the applicant/nominator (Zohha Holdings P/L as the Trustee for Sohha Family Trust), lodged an application online on 29 June 2017. The visa applicant/nominee (Mr Hassan HAYAT), was nominated for the position of Retail Manager (General) (ANZSCO – 142111). The base salary was listed as $44,460 per annum. The head office of the business was located in Dunlop ACT 2615 and the nominated position was to be located in Manuka Terrace, Griffith, ACT 2603.

19. By s.359(2) letter of 13 February 2018, the Tribunal invited the applicant to provide updated and current information addressing the relevant criteria (being reg. 5.19 (2) and (4)). With the Tribunal the applicant lodged:

    ·     Health certificates relating to the replacement of both knees[5] of the Director[6]  - in order to explain a request for an extension of time to respond, and same had been granted

    [5] Tribunal – folio 30. 

    [6] Tribunal – from folio 28.

    ·     A decision to support the employer nomination by the ACT Government[7] 

    ·     An organisation chart[8]

    ·     A position description[9]

    ·     Offer of Employment dated 23 January 2018[10] – (including that the starting wage for the visa applicant was $57,304 per annum)

    ·     Evidence of the ‘Salary Manuka’ – six months to 31 Dec 2017 - $27,919   

    ·     Emails relating to interviewing for a position from 24 May 2018 (and noting the position was advertised on Gumtree[11])

    ·     A Taxpayers Declaration[12]

    ·     An “Electronic Lodgement Declaration (Activity Statement)” inter alia for the period July to September 2017[13] for the Trustee for Zohha Family Trust 

    ·     Other more recent BAS were also lodged[14]

    ·     A Profit and Loss statement for 1 July 2017 to 31 December 2017 - indicating a net profit of $40,379 in Manuka where the applicant was to be located[15] - and a total net profit across all three identified businesses as $45,244[16]

    [7] Tribunal – from folio 54.

    [8] Tribunal – folio 43.

    [9] Tribunal – from folio 44.

    [10] Tribunal – folio 21.

    [11] Tribunal – from folio 91.

    [12] Tribunal – folio 36.

    [13] Tribunal – around folio 40.

    [14] See Tribunal – from folio 46 (reverse side).

    [15] Tribunal – folio 38.

    [16] Tribunal – folio 44.

20. Further, by letter dated 2 August 2017 from the nominator,[17] it was claimed “the restaurant currently serves freshly made gelato, waffles, donuts, coffee and biscotti”. It was claimed the company had spent an estimated $270,000 and “continues to invest money and resources in training, business registration costs and working capital”. This had improved the business but same would not have been achieved ‘without the support and dedication’ of the visa applicant.

    [17] Tribunal – from folio 36.

21. The nominator (who authored the letter) then said that he was not personally able to fill the role of Retail Manager due to other business commitments; including that he operated two other restaurants in Canberra.

22. By submissions received 11 July 2018, after noting the visa applicant was then in Bali, further evidence was lodged:

    ·     A Gelatissimo Induction Checklist[18] and a Gelatissimo introduction letter[19]

    ·     Text messages regarding training[20]

    ·     A Gelatissimo Employee form – indicating a start date for another employee of 10 February 2018[21]

    ·     A Gelatissimo Online Order Form[22]

    ·     Emails relating to interviewing for the position from 24 May 2018 (and noting the position was advertised on Gumtree[23])

    ·     Night Shift Checklist and Opening Checklist[24]

    ·     Work for faulty machinery form[25]

    ·     Fortnightly time sheets from 14 January 2018[26]; and  

    ·     Interview Checklists (undertaken by the visa applicant) for persons interviewed for positions in the nominating business[27]

    [18] Tribunal – folio 98.

    [19] Tribunal – folio 90.

    [20] Tribunal – from folio 97; and from folio 95; and from folio 89. .

    [21] Tribunal – folio 96. 

    [22] Tribunal – from folio 93; and from folio 84.

    [23] Tribunal – from folio 91.

    [24] Tribunal – from folio 83 .

    [25] Tribunal – folio 78.

    [26] Tribunal – from folio 77.

    [27] Tribunal – from folio 75.

23. The abovementioned Tribunal letter of 13 February 2018 (dispatched by email to the authorised recipient), invited the applicant to provide further evidence and submissions about the criteria in r.5.19(2) & (4) of the Regulations. The Tribunal also notes it may consider all issues in the review of the Department decision, and that its questioning during the hearing would have indicated it was considering a range of issues, and not confining itself to those considered material by the Department delegate.

24. That being said, at hearing the Tribunal noted the Profit and Loss Statement for the nominating business for the six month period 1 July 2017 to 31 December 2017, set out the following (in part):  

BUSINESS	Belconnen	Manuka	Pide & Doner	Total
Wages/Salaries	$15,014	$27,919	$7,183	$50,116
Net Profit	$25,095	$40,379	($20,231)	$45,244

1. Based on discussions with Mr Hassan Zaheer at hearing, the Tribunal understands that all three businesses are separate legal entities; and there is no evidence available to the Tribunal of any (words to the effect) shared debt arrangements between any of the businesses.

2. At hearing, Mr Hassan Zaheer explained the visa applicant had worked for him in the Manuka business since March 2017. However, as the visa applicant was claimed to still be in Australia on a Student visa, which visa was subject to qualified work rights, the visa applicant was claimed to only work around 16-18 hours per week at the Manuka business.  

3. At hearing, the Tribunal noted the wages and salary for the Manuka business for the six month period 1 July 2017 to 31 December 2017, was $27,919 (which would amount to $55,833 for the 2017 calendar year). The Tribunal noted the Offer of Employment dated 23 January 2018[28], indicated the starting wage for the visa applicant was $57,304 per annum (as compared to the $44,460 per annum base salary identified in the nomination application). The Tribunal then said it was uncertain how the salary could be paid for the visa applicant (and for the other casual staff that may be retained) in the Manuka business. Mr Hassan Zaheer said the wages and salary for the business was over $100,000 (but the Tribunal notes that only the total salary for all three businesses in the 2017 calendar year was over $100,000  - being $102,232).  

   [28] Tribunal – folio 21.

4. The Tribunal also notes the visa applicant was claimed to only work part time in the Manuka business (since commencing in March 2017), and his proposed employment in the full time Retail Manager position would presumably (at least) double his salary. Assuming the visa applicant would receive an extra $28,500 per annum in the new position (being roughly half of the salary proposed in the Offer of Employment dated 23 January 2018), this would mean the Manuka business would at least suffer a substantial drop in profitability (based on the financial information lodged).

5. At hearing, the nominator said the visa applicant was well presented, and prepared the Manuka business in a way that should ensure its ongoing profitability (since commencing there part time in March 2017). However, based on the financial evidence lodged, the Tribunal doubts the nominator’s business (particularly the Manuka business where the visa applicant was to be located), would risk taking on the visa applicant full time, in circumstances where that businesses’ profitability would quite probably be substantially and adversely impacted in this way.

6. Next, at hearing and on more than one occasion, the Tribunal asked Mr Hassan Zaheer how many persons were employed in the Manuka business. He said three full time persons and nine casual staff. The nominator later said that both he and his wife also worked full time hours in the business (but the Tribunal understood this was a reference to working full time in all three businesses). The number of staff the nominator claimed were engaged with the Manuka business, varied from the number identified as being employed in the Organisation Chart lodged with the Tribunal.[29] That had said only seven persons (one full time and six casuals), were employed at the Manuka store (though the Tribunal concedes this number could be boosted by Mr Hassan Zaheer and his wife working in the business, and the seasonal fluctuations in staff needs for that business).

   [29] Tribunal – folio 43 (reverse side).

7. As noted above, the visa applicant was claimed to only work part time in the Manuka business (since commencing in March 2017), and his proposed employment in the full time Retail Manager position would presumably (at least) double his salary. As the profit for the Manuka business (for the six month period 1 July 2017 to 31 December 2017) was only $40,379, and that profit appeared to constitute the major component of the business profit to offset the losses in the Pide & Doner business, the Tribunal put to Mr Hassan Zaheer it may not appear the nominating business had the capacity to pay the visa applicant the proposed salary for two years full time (with the possibility of an extension). The nominator said the Manuka business (principally selling gelato) fluctuated and the profitability of the business improved in the summer months, with that profitability decreasing from around April each year. However, and based on all the evidence before it, the Tribunal doubts the nominating business had the capacity to pay the visa applicant the proposed salary for at least 2 years full time (with the possibility of an extension).

8. Regarding 5.19(4)(d), and after considering the above ‘doubts’ cumulatively, the Tribunal is not satisfied the nominating business had the capacity to pay the visa applicant the proposed salary for at least two years full time (with the possibility of an extension).

9. The applicant has not met r.5.19(4)(d) of the Regulations.

   The post hearing s.359A letter

10. The Department lodged a s.376 Certificate with respect to the visa applicant.  The Tribunal understands it has a discretion regarding disclosure in respect of documents or information that is certified under ss.376 [Part 5], and as such it is possible to comply with both 359A/424A.[30]

    [30] See WZANC (No. 2) v MIAC [2012] FMCA 504 (Lucev FM, 29 June 2012).

11. At hearing, the Tribunal then said that subject to comments the following information may be the reason, or part of the reason, for affirming the decision under review. That being said, the gist of the s376 Certificate referred to the following:  

    ·that the visa applicant paid money to obtain the sponsorship

    ·that he does not get paid by the nominator’s business (and evidence to the contrary is fake)

    ·that the visa applicant may have engaged in criminal activities in Pakistan.

1. At hearing, both the visa applicant and the nominator said this information was false.  

2. By post hearing s.359A letter dated 26 September 2018 (dispatched by email to the authorised recipient), the Tribunal again put to the nominator that subject to their comments, the following information may be the reason of part of the reason for affirming the decision under review. The relevant information was as follows:

   ·that the visa applicant paid money to obtain the sponsorship

   ·that he does not get paid by the nominator’s business (and evidence to the contrary is fake)

   ·that the visa applicant may have engaged in criminal activities in Pakistan.  

3. After an extension of time was requested and granted, the applicant was allowed to respond in writing by 19 October 2018 (which timeframe had been requested by the applicant). By emailed response of 11 October 2018,[31] it was claimed that a ‘comprehensive answer to this RFI [was] in the applicant’s submissions…[and that] Hassan Zaheer is still overseas’. In an email from Mr Hassan Zaheer,[32] he denied taking any payment from the visa applicant, that there had been no exchange of monies; that the visa applicant has been paid by the nominating business as claimed; and that the visa applicant had no criminal convictions against him, which was evidenced in his Police Clearance.

   [31] Tribunal – folio 156.

   [32] Tribunal – folio 156.

4. Be that as it may, and for the reasons set out above, the Tribunal remains satisfied the nominating applicant has not met r.5.19(a)(ii) or (d) of the Regulations.

   Conclusion:

5. For the above reasons the Tribunal is not satisfied the applicant meets the requirements of r.5.19(4). The applicant has not sought to satisfy the criteria in Temporary Residence Transition Nomination stream, and as such has not met the requirements in r.5.19(3). Accordingly, the nomination of the position cannot be approved. Therefore, the Tribunal must affirm the decision under review.

   DECISION

6. The Tribunal affirms the decision under review to refuse the nomination.

   Mr S Norman
   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).