Foreign ships involved in Australian trade subject to federal industrial law: High Court

Cases

Foreign ships involved in Australian trade subject to federal industrial law: High Court

The High Court has unanimously held that a federal industrial award can apply to foreign non-resident seafarers engaged outside Australia when involved in Australian trade.

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The High Court has unanimously held that a federal industrial award can apply to foreign non-resident seafarers engaged outside Australia when involved in Australian trade.

Consequently the AIRC has power to make an award regulating the working conditions of foreign crews employed on foreign registered ships when such vessels are operating in domestic trade within Australian waters or on a voyage to or from an Australian port.

Background

On 22 January 2002, an application was lodged with the Australian Industrial Relations Commission on behalf of the Maritime Union of Australia, the Australian Institute of Marine and Power Engineers and the Australian Maritime Officers' Union.

The application sought a variation to the Maritime Industry Seagoing Award 1999. The variation would have added to Schedule 1 of the Award 'CSL Pacific Shipping Inc, and any other person or corporation who from time to time is the employer of the crew engaged upon the ship CSL Pacific'.

CSL Australia argued that s5(3) of the Workplace Relations Act should be read with the unexpressed limitations that it did not apply to industrial matters where the employer had no presence in Australia. Moreover, the employees who were foreign non-residents were excluded from coverage - according to CSL. The Federal Government intervened to support CSL's case.

The AIRC had found in favour of jurisdiction on the following grounds:

'The subject matter at issue pertains to the relationship of the employer and the employees who are members of the organisations party to the issue.

'This is so because the employer's non-observance of standard minimum conditions of employment for maritime employees engaged in maritime trade and commerce within or about Australian territory causes such employees to be engaged on terms and conditions less favourable to them and less onerous on the employer than would be the case if terms and conditions under the Award were applicable.'

The High Court dismissed all objections by CSL.

Decision

The High Court stated:

'The question thus becomes whether the interests of the coastal State are engaged such as to attract the operation of its legislation upon a particular subject to the visiting ship.

'An example of legislation of that nature is provided by Pt VI of the Navigation Act. That, as has been indicated, applies to all ships (s 284) and requires licensing to engage in the coasting trade. Moreover, the licensing system carries requirements, discussed earlier in these reasons, respecting the payment of wages.

'The licensing requirements of Pt VI do not apply to the CSL Pacific by reason of the operation of the permit system. However, the terms of s 5(3) of the WRA, in particular par (b), found the exercise of jurisdiction by the AIRC in matters engaging the interstate and territories and overseas commerce power. Whether, and the extent to which, an award or variation of an award is to affect the "internal economy" of ships such as the CSL Pacific is a matter entrusted for consideration by the AIRC.

'In that regard, s 111(1)(g) of the WRA is important. This applies to the present application before the AIRC for variation by dint of s 113(4). ... Paragraph (g)(iii) empowers the AIRC to dismiss an application in whole or in part, or to refrain from further hearing or determining the industrial issue, if it appears to the AIRC that further proceedings would not be "desirable in the public interest".

'Considerations respecting the significance of the "internal economy" rule on the one hand and the economic interests of Australia on the other will be for consideration in due course by the AIRC.

'The "internal economy" rule does not require, as a matter of construction, the reading of s 5(3) of the WRA in such a fashion as to preclude entry by the AIRC upon consideration of the subject.

'The suggested canons of construction upon which the prosecutor relies do not warrant any conclusion that the determination by the AIRC on 27 September 2002 was made in excess of jurisdiction.'

Arguments on the difficulty of serving legal documentation etc on a foreign company were also rejected by the High Court.

See: Re The Maritime Union of Australia & Ors; Ex parte CSL Pacific Shipping Inc [2003] HCA 43 - Gleeson CJ, McHugh, Gummow, Kirby, Hayne, Callinan and Heydon JJ - 7 August 2003.

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