Australian workplace protections may extend to overseas employees

Employers thinking about such hires should consider changing their engagement processes to reduce that risk.

Gautam Parimoo, a US national, was employed by Australian company Lake Resources NL to perform work at one of its mine sites in Argentina. After dismissal, Parimoo brought adverse action proceedings against Lake Resources.

Despite never performing work in or having been based in Australia for the job at all, the FWC found (14-page / 440KB) that Parimoo was an Australian employee entitled to protections under the Fair Work Act 2009 (Cth) (FW Act) because of the way his employment agreement was made.

What this means for employers

Subject to any appeal, the decision appears to expand the circumstances in which an overseas employee, engaged by an Australian employer, may be covered by Australian employment laws. This can have significant ramifications in relation to terms and conditions of employment including pay and leave entitlements, as well for potential legal claims, litigation and, ultimately, legal remedies including possible penalties, damages or other monetary compensation.

Any Australian employers operating and considering employing people overseas should review how they engage those individuals. While using email to enter into a binding employment is common, efficient and convenient, it may have unintended consequences. To avoid nasty surprises, Australian employers might want to consider alternatives when hiring foreign workers, for example by using foreign agents to facilitate the signing of the contract overseas where the employee is based, rather than directly via email. 

Facts of the case

Parimoo was born in India and was a citizen of the US. He had never been to Australia for recruitment or work.

Lake Resources is an Australian company, with its principal registered office in Sydney, NSW. It operates lithium mines in Argentina.

Parimoo was approached by a recruiter in Santiago, Chile, on behalf of Lake Resources, about a chief operating officer role in Argentina. He then attended three interviews via video conference from Chile, with representatives from Lake Resources, who attended the video conference interviews from Australia.

In October 2021, Lake Resources sent a signed, unconditional employment agreement to Parimoo via email from Sydney. Parimoo opened the employment agreement and signed it in Chile. He sent it back to Lake Resources via email, where the email containing the signed employment agreement was opened by a Lake Resources representative in Sydney.

Parimoo then commenced work in Argentina, where he performed work exclusively until his dismissal in January 2023. Parimoo filed a general protections application with the FWC regarding the dismissal.

Decision of the Fair Work Commission

For the FWC to have jurisdiction to determine Parimoo’s application, he had to fall within the definition of an 'Australian-based employee' under the FW Act. There are two ways an employee can be an Australian-based employee. The first is by being an employee whose primary place of work is in Australia. Parimoo clearly did not meet this test, given his work was entirely performed outside Australia.

The other way to be classified as an Australian-based employee is by being employed by an Australian employer, such as Lake Resources. However, an employee of an Australian employer is not an “Australian-based employee” if they were engaged outside Australia and engaged to perform duties outside Australia.

As Parimoo was employed by an Australian employer, and engaged to work outside Australia, the only question for the FWC was whether he was “engaged” inside or outside Australia.

The FWC found that the point at which Parimoo was engaged as an employee of Lake Resources was when his signed employment agreement was opened by Lake Resources. That is, the acceptance of Lake Resources’ offer of employment was held to be communicated to Lake Resources when it opened Parimoo’s email acceptance of its offer.

The FWC found that as Lake Resources had opened Parimoo’s signed employment agreement in its Sydney office, the employment agreement was formally made in Sydney, and Parimoo was engaged in Sydney. Accordingly, Parimoo was held to be an Australian-based employee.

The FWC considered but ultimately dismissed an argument from Lake Resources that, as the employment agreement it sent Parimoo was unconditional and signed by it, he was engaged when he signed it in Chile.