Australia: Off again, on again: Foreign workers in the offshore resources sector now require visas

The Federal Court of Australia's decision in Australian Maritime Officers' Union v Assistant Minister for Immigration and Border Protection [2015] FCAFC 45 (26 March 2015) is important for employers in the offshore oil and gas industry.

The effect of the decision is that non-citizens working on offshore projects fall within the operation of the Migration Act 1958 (Cth) (Migration Act) and, as a result, require visas to take part in such activity.

BACKGROUND

For a full history of the matter, please refer to our previous Corrs in Brief.

Basically, the decision in Allseas Construction SA v Minister for Immigration and Citizenship [2012] FCA 529 (Allseas) resulted in workers on vessels, who were mainly non-citizens, not requiring visas.

Unions representing offshore oil and gas workers expressed discontent with this decision. The then Labor government sought to rectify the situation, establishing a taskforce which produced recommendations leading to the enactment of the Migration Amendment (Offshore Resources Activity) Act 2013 (2013 Amending Act), which inserted ss 9A, 41(2B) and 41(2C) into the Migration Act, with effect from 29 June 2014.

Under s 9A(1), persons engaged in 'offshore resources activity' as defined in s 9A(5) were deemed to be in the 'migration zone'. The effect was that non-citizens involved in such an activity were not allowed to work without a permanent visa or a visa prescribed for that purpose (s 41(2B) and (2C)).

Significantly, the amendments included a Ministerial power in s 9A(6) to make a determination for the purposes of the definition of 'offshore resources activity' in s 9A(5). Such a determination could 'except' an operation or activity from that definition or add certain further activities, operations or undertakings to the definition.

The Coalition Government elected to office in September 2013 then sought to repeal the Amending Act, but its repeal bill¹ is yet to be passed by the Senate.

On 29 May 2014, the Governor-General made the Migration Amendment (Offshore Resources Activity) Regulation 2014 (2014 Amending Regulation). The effect of the 2014 Amending Regulation was to prescribe three existing visas for the purposes of s 41(2B)(b) of the Migration Act to avoid the consequence that, otherwise, workers in offshore resource activities would require a permanent visa, a requirement that was likely significantly to restrict non-citizens in the migration zone who could carry out such work.

The 2014 Amending Regulation was disallowed by the Senate on 16 July 2014. The next day, the Minister – purporting to rely upon s 9A(6) of the Migration Act – made the Determination, which was registered on the Federal Register of Legislative Instruments on the same day.

By the Determination, the Minister relied on the power to 'except' an operation or an activity from the classes of regulated operations and activities identified in s 9A(5)(a) and (b) to exclude all regulated operations and all regulated activities from the whole of the defined content of 'offshore resources activity'. The consequence was that non-citizen workers involved in those operations and activities did not require visas.²

The AMOU and the MUA, concerned about the impact that this would have on local workers, unsuccessfully challenged the validity of the Determination before the Federal Court.³ They then appealed to the Full Court of the Federal Court.

DECISION ON THE VALIDITY OF THE DETERMINATION

The central issue for decision by the Full Court was whether the Determination was within the power contained in s 9A(6) of the Migration Act.⁴

Essentially, this was a matter of interpretation. The Court observed that the focus must necessarily be on interpreting the enabling statute and then interpreting the relevant subordinate legislative instrument to determine whether it was within the enabling power.⁵

The Full Court (Gordon, Katzmann and Griffiths JJ) overturned the decision at first instance,[6] and held that the Minister's Determination was invalid.

The Full Court's reasoning was that section 9A(1) effectively creates a rule or proposition that a person who is engaged in an offshore resources activity as defined in s 9A(5) is deemed to be in the migration zone. That rule or proposition operates by reference to the definition of offshore resources activity in s 9A(5). The deeming rule applies except where the Minister has made a relevant determination under s 9A(6).

The Minister's power of determination under s 9A(6) operates differently in relation to s 9A(5)(a) and (b) than it does in respect of s 9A(5)(c).

The word 'except' was chosen deliberately. In s 9A(5), the definition of 'offshore resources activity' is by reference to a potentially wide range of operations or activities carried out under the Offshore Petroleum Act or the Offshore Minerals Act, except an operation or activity determined by the Minister under s 9A(6).

When used in that context, the word 'except' (which appears in s 9A(5)(a) and (b), but not in s 9A(5)(c)) does not mean that the Minister's power of determination can be exercised so as to completely extinguish the items within the relevant category or class in s 9A(5)(a) or (b).

Properly interpreted, the statute reflects Parliament's intention that, in the case of s 9A(5)(a) and (b), the scope of the definition of 'offshore resources activity' was able to be contracted to some extent – but that a level of operation or activity should be maintained beyond that which related to the matters described in ss 8 and 9.

The Court held that the Parliament's intention was to confer upon the Minister a power to except or exempt particular activities or operations carried out under the Offshore Petroleum Act or Offshore Minerals Act, not to reverse the Parliament's desire and intention to bring within the Migration Act non-citizens who are engaged in operations and activities under the Offshore Petroleum Act or the Offshore Minerals Act.

IMPLICATIONS FOR EMPLOYERS

The decision in AMOU v Assistant Minister for Immigration and Border Protection delivers a negative outcome for employers in the offshore oil and gas industry.

The Court's decision is a significant victory for the unions involved since it re-introduces the barriers to engagement of foreign workers in the resources sector that persisted before the commencement of the Minister's Determination, now declared invalid. Given the fractious state of the Australian Senate, it is unlikely that the Parliament will pass the Government's legislation to effectively 'reinstate' the operative effect of the Determination.

It would be surprising if an application is not made for special leave to appeal the Full Federal Court's decision to the High Court. Even if special leave is granted, the hearing and determination of an appeal will be unlikely to take place before the end of 2015.

In the meantime, foreign workers engaged in offshore resources activity will, once again, be required to obtain appropriate visas. Employers who engage such workers should immediately seek advice as to what needs to be done in this respect.

Footnotes

¹Migration Amendment (Offshore Resources Activity) Repeal Bill 2014.

²[2015] FCAFC 45 at [2] – [6].

³ See here.

⁴ [2015] FCAFC 45 at [6] – [7].

⁵ [2015] FCAFC 45 at [56]

⁶ MUA v Assistant Minister for Immigration and Border Protection [2014] FCA 993.

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