Published in Workplace Express on 28 April 2016

In a crucial ruling for the Ichthys LNG project, an FWC full bench has ruled today that an electrical contracting company is entitled to give its fly-in, fly-out employees notice of retrenchment immediately before a rest and recreation period.

Senior Deputy President Ian Watson, Deputy President Nicole Wells and Commissioner Tanya Cirkovic quashed a finding by Commissioner Michelle Bissett in February that notice of termination “cannot run concurrent with a period of leave”.

The bench effectively upheld the practice of Kentz (Australia) Pty Ltd, which gave 150 electricians notice when they began a seven-day rest and recreation (R&R) period at the end of their 28-day swing (see Related Article).

The bench said the R&R “is an incident of the working arrangements applicable to employees working under the Kentz agreement, involving the compression of working hours (and associated income) into four weeks of the [five-week work] cycle with non-work time within the Kentz agreement substantially compressed into a week of R&R, which is more practical and of a greater utility given the fly-in fly-out arrangements and the geography of the Ichthys Project”.

It said Commissioner Bissett was wrong to find rest and recreation to be “a form of regulated and approved leave” and said the authorities on the subject provided no basis “to draw a general principle” that notice of termination and leave can’t be concurrent.

The bench emphasised it had made the decision in the “specific terms and context” of the Kentz agreement, so it didn’t necessarily have wider application.

AMMA legal director Amanda Mansini, said the full bench had “upheld the longstanding practice in the resource industry whereby employers can give employees notice of demobilisation that runs concurrently with a period of R&R”.

“Resource employers welcome the FWC confirming on appeal that R&R is akin to weekends and is not a special kind of leave.

“The erroneous implication of the original decision was that employees should be paid-out for their R&R time if it falls within notice of their demobilisation”, she said in a statement.

The industry association, along with CCI WA, won leave to intervene because most work on Ichthys is regulated by agreements with “identical terms” that flow from the project agreement.

Click here to read the decision.