Australia: Employment Status of Foreign Workers in Australia's Offshore Sector is in Flux Yet Again

After years of uncertainty over the issue of whether foreign workers in Australia’s offshore sectors are required to have Australian work visas, it seems that the tides have turned yet again, leaving the future status of such foreign workers’ employment – and the booming oil and gas industries at large – uncertain.  In a recent decision, the Federal Court decided that these foreign workers are required to hold work visas.  In response, the government has vowed to appeal the decision and introduce an interim measure to allow them to work without the visas.  In all of this, the offshore industry is forced to wait for what will happen next whilst scrambling to try to comply with these immigration requirements.  

In Australian Maritime Officers’ Union v. Assistant Minister for Immigration and Border Protection [2015] FCAFC 45, the Federal Court was presented with the issue of whether the Minister for the Immigration and Border Protection had power under The Migration Act 1958 (Cth) to determine that offshore activity was excluded from the migration zone and, thus, work visa and other immigration requirements did not apply to non-Australian workers in such offshore sectors.  The Maritime Union of Australia (MUA) and Australian Maritime Officers’ Union (AMOU) appealed the Minister’s determination, seeking to reinstitute immigration requirements upon overseas workers.  On 26 March 2015, the Federal Court unanimously upheld the MUA and AMOU appeal, essentially requiring offshore sector non-citizen employees to hold visas once again. 

In response, the government has indicated that it will appeal the Federal Court’s decision, as well as introduce a temporary legal instrument to shield offshore industry employers and foreign employees until the issue is fully resolved.  However, it is unclear what that instrument will look like and when it will take effect.  Even if special leave is granted to appeal the Australian Maritime Officers’ Union decision, the hearing and determination of an appeal would not likely take place by the end of 2015.

The history leading up to last week’s decision is tumultuous.  In 2012, in Allseas Construction SA v. Minister for Immigration and Citizenship [2012] FCA 529, the Federal Court found that workers on two vessels owned by Swiss-based Allseas Construction fell outside of Australia’s migration zone, thus eliminating the need for work visas.  In response, the government at that time introduced the Allseas bill, which required anyone engaged in work related to an offshore resources activity to maintain an Australian work visa.  However, the Allseas legislation was introduced mere months before the new Liberal-National Coalition government took office in late 2013, and one of the first steps that the new government took was to seek to repeal the Allseas legislation.  When the repeal stalled in the Senate, the Coalition attempted to enact a regulation to allow the Immigration Minister to grant offshore resource workers a new type of visa; however this was rejected by the Senate.  

On the day following the Senate rejection, Assistant Immigration Minister Michaelia Cash made a determination that reversed the Allseas legislation and which allowed the oil and gas sector to attract foreign labor yet again, sans work visa or immigration issues.  The unions’ challenge to Senator Cash’s determination was rejected by Justice Buchanan last September.  And finally now the Federal Court has set aside Justice Buchanan’s ruling last week and unanimously upheld MUA and OMUA’s challenge, holding that Senator Cash’s determination was “not authorised by s 9A(6) of the [Migration] Act or otherwise and is invalid”, and holding that offshore sector non-citizen employees are indeed required to hold work visas. 

More than 400 foreign workers currently engaged in laying undersea pipes and building maintenance for other structures are impacted by the Federal Court ruling.  In addition to its intention to appeal the Federal Court’s ruling, the government intends to introduce an interim measure to allow the offshore industry employers and foreign employees to operate without work visas until the issue is fully resolved in the courts or through legislation.  

We will continue to monitor these important developments for our clients with employees in the offshore resources sector.

Information contained in this publication is intended for informational purposes only and does not constitute legal advice or opinion, nor is it a substitute for the professional judgment of an attorney.