Allens

Employment & Safety

Increase text sizeDecrease text sizeDefault text size

Focus: Key changes to working conditions for offshore oil and gas projects

3 June 2013

In brief: A proposed amendment to Australia's migration legislation seeks to ensure that foreign offshore oil and gas workers will require a 457 visa and be subject to Australian employment law. If this change is made, owners and operators of offshore oil and gas projects will need to ensure they and their contractors are aware of, and comply with, their obligations regarding visas and the application of Australian employment laws. The proposed amendment will also most likely increase the scope for union activity on these projects. Special Counsel Eleanor Jewell reports.

How does it affect you?

  • Owners, operators and contractors will need to ensure all foreign workers participating in an 'offshore resources activity' hold a 457 visa, to avoid committing a possible offence under the Migration Act 1958 (Cth) (the Act).
  • To minimise the risk of delays in the project deadline and offences under the Act and the Fair Work Act 2009 (Cth), owners and operators need to ensure that they, and all contractors, comply with Australian employment laws.
  • This amendment will be closely followed by unions, including the Maritime Union of Australia, and may result in increased union activity in relation to these projects. 

Background

In the Allseas1 decision, the Federal Court ruled that ships laying gasfield pipelines off the coast of Western Australia were not within the Australian 'migration zone' as defined under the Act. Specifically, the ships were not a 'resources installation' within the meaning of the Act, as they were:

  • not a 'resources industry fixed structure', as they moved as single entities; and
  • not a 'resources industry mobile unit', as they did not drill, or obtain substantial quantities of material from, the seabed.

The consequence of this finding is that non-citizens could be engaged without breach of Australian laws, notwithstanding they did not hold 457 Visas. Foreign workers could therefore be engaged without reference to Australian employment laws.

Proposed amendment to the Act

The Migration Amendment (Offshore Resources Activity) Bill 2013 was introduced into Parliament on 30 May 2013. The amendment will expand the definition of 'migration zone' under the Act to include 'offshore resources activities', in response to the Allseas decision.

Further, the amendment will provide that a person is regarded as in the migration zone while he or she is in an area to 'participate in, or to support, an offshore resources activity' in relation to that area. The phrase 'participate in, or to support' is very broad. An 'offshore resources activity' is defined by reference to the Offshore Petroleum and Greenhouse Gas Storage Act 2006 (Cth) and the Offshore Minerals Act 1994 (Cth). The Minister for Immigration and Citizenship can also make a written determination that a particular activity constitutes an 'offshore resources activity'.

This means that most offshore oil and gas projects off the Australian coastline would be regarded as within the migration zone.

Key implications

All foreign workers engaged in relation to offshore oil and gas projects would, if the amendment is passed, be:

  • required to hold a 457 visa; and
  • entitled to terms and conditions of employment that are equivalent to Australian employees, (including the right to be a member of a union).

This will have two immediate effects. One is to increase the administrative burden of engaging foreign workers on these projects. A section 457 visa and the application of Australian employment laws will be required, even if the employee is engaged to participate in a project for a very short time.

Owners and operators of offshore projects will need to ensure that any contractors they appoint engage appropriately qualified workers and allow for these workers' minimum employment entitlements. Failure to do so will result in breaches of Australian migration and employment laws. It could also result in extensive delays in project delivery while visas are sought and working conditions are negotiated, or alternative workers are engaged.

The second effect is to increase the opportunity for relevant Australian unions, such as the militant Maritime Union of Australia, to extend their reach in relation to such projects. This could also result in delays due to industrial disruption and unrest. For example, it may result in increased right of entry visits, based on workers' rights to be union members. This is of particular concern, given recent proposed amendments to the Fair Work Act that would require employers to provide transport to, and accommodation at, remote sites for union officials exercising rights of entry. Also, in light of recent media focus on the 457 visa 'issue', there are likely to be reputational consequences if this type of employment is not handled correctly.

Footnotes
  1. Allseas Construction S.A. v Minister for Immigration and Citizenship [2012] FCA 529 (22 May 2012).

For further information, please contact:

Share or Save for later

What are these?

 

To save this publication on your smartphone or
tablet for off-line reading (eg on a plane flight),
we recommend Pocket.

 

 

You can leave a comment on this publication below. Please note, we are not able to provide specific legal advice in this forum. If you would like advice relating to this topic, contact one of the authors directly. Please do not include links to websites or your comment may not be published.

Comment Box is loading comments...