Australia: Accommodation is not a 'payment' - the Mammoet Case

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We have now had just over a week to consider the effect of the Mammoet Case (CFMEU v Mammoet [2013] HCA 36).

In the Mammoet Case, the High Court unanimously allowed an appeal from a decision of the Federal Court of Australia, which held that the provision of accommodation to employees during a period of 'protected industrial action' would have constituted a 'payment' by their employer that was prohibited by s 470(1) of the Fair Work Act 2009 (Cth) (the Act).

Section 470(1) provides that if an employee engages in 'protected industrial action… the employer must not make a payment to an employee in relation to the total duration of the industrial action on that day'. 

The High Court held that the provision of the accommodation would not have constituted a 'payment… in relation to the total duration of the industrial action.'  It held that when s 470(1) speaks of 'payment' it means a payment in money and not simply the transfer of any economic benefit by an employer to an employee. The court held that the section was principally concerned to prohibit the payment of 'strike pay'.

It will be a difficult task for employers to bring the notion of accommodation within the meaning of a payment for the purposes of Section 470(1). The relevant enterprise agreements and contracts of employment will need to be reviewed and altered to achieve this end.

The Mammoet decision has serious consequences in the industrial context, which will be difficult to overcome.

Topics:  Australia, Fair Work Act, Industrial Action, Wages

Published In: Civil Procedure Updates, Labor & Employment Updates

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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