Under the Fair Work Act employers are not allowed to pay employees if they take strike action, even if the strike is lawful.
The accommodation provided to fly-in, fly-out workers onsite is deemed to be part of their pay packet.
Therefore, Federal Court Judge John Gilmour ruled that employers should tell striking workers to vacate their company-provided accommodation for the duration of the strike.
Given the dearth of accommodation around some of the resource projects, particularly those in Australia’s north, the ruling offers quite a deterrent to strikes.
The ruling comes from the case of the Construction, Forestry, Mining and Energy Union versus Mammoet Australia.
The case had been referred to the Federal Court on appeal.
The federal magistrate had ruled that heavy lift and transport specialist Mammoet was right to remove accommodation from four workers on Woodside’s Pluto LNG project.
Three of those workers were accommodated at Searipple village and the other was housed at the Gap Ridge village, each located in Karratha.
On April 28, 2010, a dozen Mammoet workers, including the four, went on strike.
The four were warned that if they took part in the strike Mammoet could not provide them with accommodation or pay the living away from home allowance during the strike.
Once the strike began, Mammoet made good on its warning and did not accommodate or pay them LAHA during the protected industrial action period.
The CFMEU argued that this was “adverse action” under the Fair Work Act.
However, the magistrate determined the provision of accommodation was payment and Mammoet was right to withhold it.
Gilmour found that the accommodation provided to workers onsite, certainly in this case, made up part of their payment.
One of the points he raised was that Woodside was deemed to be the owner of the accommodation villages and Mammoet was paying Woodside for the accommodation.
“The respondent [Mammoet] did not prevent the relevant employees from staying at Searipple village or Gap Ridge village,” Gilmour said in his judgement.
“The evidence was that the respondent, by letter dated April 27, 2010, informed those relevant employees living at Searipple village that failure to vacate that accommodation would render them liable for the costs of the accommodation.
“However, those three relevant employees also were informed in the letter that they were at liberty to make their own arrangements with the management at Searipple village.”
It is understood a similar letter was sent to the fourth employee.
It has been held that the policy of the act is to put the costs of industrial action on the employee and not the employer.
Following that reasoning Gilmour argues that the provision of accommodation during a strike action would put the employer in the position of having to carry the cost of that strike.
“The accommodation was provided to enable the employees to be in a position to perform their employment and earn their pay, not for their use while on strike,” he said.