Australia's national industrial relations statute, the Fair Work Act 2009 (Cth) (the "Act"), imposes numerous duties on Australian employers and grants Australian employees numerous rights and entitlements. However, in certain situations, the Act has an extended application, which foreign companies doing business in Australia, or Australian companies doing business overseas, are unlikely to expect. In 2014, the Federal Court of Australia determined two significant cases that helped to clarify the extent to which Australia's employment laws apply to foreign employees (and to foreign companies employing people within Australia).
In December 2014, the Federal Court of Australia held the sole director and shareholder of Devine Marine Group Pty Limited liable for contraventions by the company of its obligations to pay two Fijian workers the minimum wages and other benefits required under Australian Law.
The defendant, Captain Devine, had arranged for the two workers to be brought to Australia as apparent participants in a training program when, in reality, they were carrying out work as employees and were entitled to the benefit of Australia law. The workers undertook salvaging activities for the company in Port Adelaide, South Australia, although they were paid significantly below the applicable Australian minimum wage (quite possibly more than they would otherwise expect to earn in Fiji, however). Consequently, the court reaffirmed the principle that non-Australian employees of Australian employers are afforded the same protections under the Act, at least where their work is carried out in Australia.
The Fair Work Regulations 2009 (Cth) further extend the extraterritorial application of the Act in ways employers are unlikely to expect. Critically, certain protections are extended to employees of Australian employers (including companies incorporated in Australia) whether or not those employees are based in Australia. These extraterritorial protections include (but are not limited to) sections of the Act that prohibit unlawful discrimination and dismissing employees because they were absent by reason of illness or injury.
In 2012, the Fair Work Ombudsman (the Australian regulator) sought to prosecute Australian budget airline Jetstar for contraventions of the Act in respect of non-Australian crew members employed by two subcontractors that were companies incorporated in Thailand and Singapore. The FWO argued that Jetstar was "involved in" and therefore liable for the contraventions, which included a failure to pay the employees the applicable minimum wage. The case was dismissed by the Federal Court in July 2014, largely because the employment relationships in question did not have a sufficient connection with Australia since the foreign employees were employed by foreign companies.
If the non-Australian crew members had been employed by Jetstar (i.e., an Australian employer), they may have been entitled to residual protections under the Act—notwithstanding that the employment relationship otherwise had little to no connection with Australia. The Fair Work Ombudsman may well seek to run another test case along the lines of Jetstar if appropriate facts arise. The risk of noncompliance by Australian employers in respect of non-Australian employees is heightened considering that these non-Australian employees may be willing to work in conditions (and for benefits) that Australian employees would not accept.