Fair Work Ombudsman v Transpetrol TM AS

The Fair Work Ombudsman brought an action against Transpetrol TM AS, a foreign employer of crew members on a vessel engaged in coastal trading, alleging contraventions of sections 45 and 293 of the Fair Work Act 2009 (Cth) by underpaying crew members under an award or the National Minimum Wage Order 2014. The vessel was sailing in Australia’s exclusive economic zone and waters above the continental shelf under a temporary licence issued under the Coastal Trading (Revitalising Australian Shipping) Act 2012 (Cth). The purpose of the extension of the Act to the vessel was to ensure the cost of employing the crew was comparable to that of a vessel of a general licence holder for some part of the voyage. Transpetrol admitted the contraventions but argued it was entitled to set off top-up payments against the overall underpayment of wages. The court was required to determine whether Transpetrol was entitled to set off the top-up payments against the overall underpayment of wages and whether civil pecuniary penalties should be imposed.

The court found that Transpetrol was entitled to set off the top-up payments against the overall underpayment of wages. The court held that Transpetrol had complied with its obligations to pay the crew under the Maritime Labour Convention, employment and collective bargaining agreements as required by law in the crew members' domicile. Transpetrol cooperated with the Ombudsman and paid the crew the full amount of the alleged underpayment. The court found that the alleged underpayment was greater than the sum actually due. The employer was bound to pay the crew and allocate payments in accordance with the Maritime Labour Convention and the laws of the crew members' domicile, which required particular allocations in total pay different to those under the Fair Work Act. The employer had to comply with the Convention, agreements and foreign law to maintain the maritime labour certificate for the vessel as required by Marine Order 11 (Living and working conditions on vessels) 2013 and the "blue certificate" for the vessel as required by the International Transport Workers’ Federation. The court held that imposing a penalty on Transpetrol was unlikely to deter unintentional contravening conduct by another shipowner who had a current, valid maritime labour certificate in force for the crew of his ship and who was unaware that his ship was on a third or later voyage the subject of any temporary licence that a third party had obtained and used without notice to him.

The proceeding was dismissed. The parties have liberty to file and serve written submissions, limited to 2 pages, as to seeking any costs order on or before 2 April 2019. Any party against whom or which a costs order is sought pursuant to order 2, file and serve written submissions in reply, limited to 2 pages, on or before 9 April 2019.