The global nature of business means that the employment
relationship is no longer confined to the Australian mainland.
Employees completing international placements as part of their
tenure (either with a host employer, or in the overseas office of
their main employer) and insourcing of foreign expertise either
temporarily or permanently is also commonplace. The question arises
as to whether Australian employment law obligations will follow or
attach to these arrangements?
It is particularly relevant when you consider that some
Australian employment benefits are fairly unique to our
jurisdiction – for example, long service leave and
Some areas for employers to consider when negotiating such
arrangements are the following:
FAIR WORK ACT
The Fair Work Act ("FW Act") is the
principal piece of legislation to consider when assessing the
applicability of Australian law. It applies even in circumstances
where a worker may be based overseas – provided they are
actually employed by an Australian employer.
An exception arises where the employee is "engaged"
outside Australia and only ever works outside the country.
In deciding if an employee is "engaged" outside the
Country relevant factors include:
Was the employee recruited initially either from within
Australia or from elsewhere?
Does the employee receive expatriate benefits or do local laws
Did the employee receive relocation assistance at the
commencement of their employment?
LONG SERVICE LEAVE
This area of law is particularly complex as each State and
Territory has its own laws on long service leave.
As a general rule, overseas service can count towards an
employee's entitlement to long service leave in Australia, if a
sufficient "connection" with Australia is demonstrated.
Where was the employee first engaged?
Are there periods when the employee returned to Australia?
Did the business fund moving and repatriation costs and were
reunion visits paid for regularly?
Was it intended for the employee to ultimately return to
Australia at the end of their posting?
If "connection" can be established, then an
entitlement to long service will usually arise, particularly if a
determining event (such as a termination of employment) occurs
whilst the employee is fulfilling a period of Australian
The laws concerning the need to pay superannuation to non
residents is particularly complex. The superannuation guarantee
legislation contains a range of exceptions to the obligations to
make compulsory superannuation payments. Often their applicability
will be determined by matters personal to the parties to the
employment contract and, in some instances, the nature of the
relationship between the two employing entities (if an employer is
moving an employee to a different employing body as part of the
In most of these matters, a carefully drafted contract that
takes account of the interests of all parties is a necessary
precondition to success in the employment relationship.
It is vitally important to prepare these documents at the same
time as matters such as visas and rights to work documentation are
being prepared, so that any uncertainty about entitlements can be
addressed at the beginning of the engagement.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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An employee that refused a reasonable offer of settlement was ordered by the FWC to pay his ex-employer's legal costs.
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