22 Jul Overseas Employment and Application of the Fair Work Act
Overseas Employment
Businesses may employ workers from overseas to overcome skills shortages, source specialised talent or to begin expanding into new locations.
Businesses in developed countries, like Australia, may also look to offshore work to jurisdictions that have less progressive industrial regimes.
However, Australia’s minimum safety net entitlements may in fact apply to a worker who is overseas.
Overseas Application of the Fair Work Act
The geographical application of the Fair Work Act 2009 (Cth) (Act) is intentionally broad. By virtue of section 34, the Act extends beyond Australia’s exclusive economic zone and the continental shelf to Australian employers and Australian-based employees.
Section 35 of the Act classifies employees who are overseas as Australian-based workers if an Australian employer employs them. However, this excludes employers who engage employees outside Australia to perform duties outside Australia.
Case law indicates that the term ‘engaged outside Australia’ refers to the physical location where an employee entered into a contract of employment (Cohen v iSoft Group Pty Limited [2012] FCA 1071 at [165]; Sng v Canvas Australia Solutions [2019] FCCA 1155 at [43]).
National System Employees and Employers
While section 34 allows the Act to apply outside Australia, individuals must meet an additional criterion to receive all the benefits under the Act. That is, employees must be national system employees.
An individual employed by a national system employer is a national system employee.
Commonly recognised national system employers are Commonwealth government departments and constitutional corporations, being corporations to which paragraph 51(xx) of the Constitution applies. An example of non-national system employers are State government departments, excluding Victoria.
As such, the Act does not grant non-national system employees all the available protections, particularly those relating to termination.
For more information about employment conditions generally, please see our article here.
Conclusion
Australian employers need to be mindful that employees based overseas may still have protections under the Act. Failure to recognise this can lead to significant consequences if there is not compliance with the Act.
For information about underpayment of wages, please see our article here.
GENERAL AND CONTACT INFORMATION
The article, the content and references made are intended to keep an audience updated with information. It is not intended that the article or part of it should be relied upon as advice. Information provided may not apply to in all circumstances or in particular situations. If you do want particular advice , we welcome you to contact us on (02) 9189 5905 or at general@cdclaw.com.au.