Federal Court of Australia

Royal Embassy of Saudi Arabia Cultural Mission v Saleh [2025] FCAFC 184

ORDERS

THE COURT ORDERS THAT:

1.    The applicant’s application filed on 6 November 2024 be dismissed.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

RANGIAH J:

1    I have had the great advantage of reading the respective reasons for judgment of Lee J and Raper J. I agree with their Honours’ reasons and have nothing to add.

Associate:    

Dated:    15 December 2025

REASONS FOR JUDGMENT

LEE J:

2    I have had the considerable benefit of reading the reasons of Raper J in draft and adopt her Honour’s abbreviations.

3    In the way (and for the reasons) her Honour explains, five issues were raised in this application alleging jurisdictional error: first, whether the Commission is a “court”; secondly, whether the exceptions to immunity apply to unfair dismissal claims; thirdly, whether arts 20 and 21 of the employees’ contracts are “inconsistent provisions” for the purposes of s 12(4)(a) of the FSI Act; fourthly, whether the applicant is a “national system employer”; and fifthly, whether the relevant employees were “permanent residents” of Australia.

4    I agree with her Honour’s reasons for rejecting the applicant’s submissions. I would simply add the following in relation to the first contention.

5    Section 3 of the FSI Act has a broadly inclusive definition which provides that:

court includes a tribunal or other body (by whatever name called) that has functions, or exercises powers, that are judicial functions or powers or are of a kind similar to judicial functions or powers.

6    As is immediately apparent, the definition expressly embraces bodies, including tribunals, exercising powers like judicial functions or powers. The breadth of the text is unsurprising given the identifiable statutory purpose and context.

7    The ALRC Report recommended that the definition of “court” (at [76]):

be broad enough to cover any body in Australia which exercises broadly judicial functions, with respect to those functions. It should not depend on whether that body is properly described as a ‘court’ in some narrower sense. On the other hand, it should not extend to cover the exercise of legislative, administrative, arbitral or conciliation functions.

(Emphasis added)

8    What is relevant and decisive is that the Commission exercises several judicial-like or quasi-judicial functions or powers when exercising its jurisdiction under Part 3-2 of the FW Act.

9    The Commission conducts adversarial hearings, applies legal principle to the facts of the case and makes orders which involves consideration of the rights and obligations of those with whom it deals. Simply put, those functions or powers are of a kind like judicial functions or powers. The fact that the procedure is intended to be flexible and informal, can involve issues being determined without a hearing, and involves a broad, evaluative exercise, taking into account the factors identified in s 387 of the FW Act, does not detract from the true character of the functions and powers being exercised.

10    While the statutory framework is intended to be flexible and informal and is underpinned by an obligation to ensure “a fair go all round”, evaluative assessments informed by such broad considerations are not foreign to the exercise of functions which are similar to judicial functions and powers and one can readily draw to mind many examples where broad notions of fairness or, put more bluntly, a “fair go”, inform the judicial function (the evolution of the doctrines and remedies of equity or a suite of statutory remedies alleviating the harshness of unfair bargains being the most obvious examples).

11    For the reasons explained by Raper J, the application must be dismissed.

Associate:    

Dated:    15 December 2025

REASONS FOR JUDGMENT

RAPER J:

12    A foreign State is ordinarily immune from jurisdiction. This application concerns whether certain exceptions from immunity apply, by operation of the Foreign State Immunities Act 1985 (Cth), such that the Royal Embassy of Saudi Arabia Cultural Mission (the applicant) is not immune from claims brought by some of its (former) employees for an unfair dismissal remedy, before the Fair Work Commission, pursuant to s 394 of the Fair Work Act 2009 (Cth). Relatedly, the application also concerns the application of the FW Act to foreign States.

13    The applicant engaged a number of staff to perform work at its Embassy in Canberra. In 2022, the engagement of a number of those staff ended. Some of those employees applied to the Commission for an unfair dismissal remedy. The applicant asserted immunity from the jurisdiction of the Commission and that, as a diplomatic mission of a foreign State, an unfair dismissal remedy under the FW Act was not available against it. The Commission rejected the applicant’s contentions with respect to 15 of the 18 employee claims: Saleh & Ors v Saudi Arabia/Saudi Embassy [2024] FWC 1152 and in a supplementary decision: Saleh & Ors v Embassy of Saudi Arabia/Saudi Embassy [2024] FWC 121. On appeal, the Full Bench rejected the applicant’s claims and found that it was not immune from each of the unfair dismissal claims: Embassy of Saudi Arabia/Saudi Embassy v Saleh & Ors [2024] FWCFB 372 (Full Bench’s decision or FB). These are the decisions which are the subject of this review. By this application, the applicant seeks a declaration that they are immune from the remaining 13 claims and constitutional writs which would bring those claims before the Commission to an end.

14    Accordingly, this application concerns whether the applicant has established that the Full Bench erred in not finding that the applicant is immune from jurisdiction. The applicant contended that there were five different bases upon which it was immune and therefore, five issues require resolution before this Court: first, whether the Commission is a “court” under the FSI Act; secondly, whether the applicant is able to escape immunity on the basis that the exceptions to immunity, under s 12(1)–(2) of the FSI Act, do not apply to unfair dismissal claims; thirdly, whether arts 20 and 21 of the employees’ contracts are “inconsistent provisions” for the purposes of s 12(4)(a) of the FSI Act, and if so, whether there is a provision of Australian law which avoids the operation of, prohibits, or renders unlawful the contractual provisions in question; fourthly, whether the applicant is a “national system employer”, and falls within the scope of s 14(1)(f) of the FW Act; and fifthly, whether the second, eighth and ninth respondent employees were each not “permanent residents” of Australia within the meaning of s 12(7)(b) of the FSI Act by virtue of their visa status.

15    For the reasons which follow, the applicant has failed to establish that the Full Bench erred in concluding that the applicant is not immune from the Commission’s unfair dismissal jurisdiction with respect to the relevant employees.

16    Much of the argument centres on the construction of the bounds of the FSI Act. The High Court has examined the legislative history and structure of the FSI Act on numerous occasions: PT Garuda Indonesia Ltd v Australian Competition and Consumer Commission [2012] HCA 21; 247 CLR 240; Firebird Global Master Fund II Ltd v Republic of Nauru [2015] HCA 43; 258 CLR 31; Kingdom of Spain v Infrastructure Services Luxembourg Sàrl [2023] HCA 11; 275 CLR 292; and Greylag Goose Leasing 1410 Designated Activity Company v PT Garuda Indonesia Ltd [2024] HCA 21; 98 ALJR 828.

17    The FSI Act’s purpose was to “set out in clear and accessible form the law relating to the jurisdiction of Australian courts over foreign States, their agencies and instrumentalities”: Australia, House of Representatives, Parliamentary Debates (Hansard), 21 August 1985 at 141; Australia, House of Representatives, Foreign States Immunities Bill 1985, Explanatory Memorandum at 2.

18    The Act was enacted upon the recommendation of the Australian Law Reform Commission arising from a comprehensive report entitled Foreign State Immunity (Report No 24 (1984)) (the ALRC Report). As the plurality of the High Court observed in Greylag Goose, at [16], that Report considered a then recent interim report of the International Law Commission. When construing the text, content and purpose of the FSI Act, account is often taken of the content of the ALRC Report. Justices Nettle and Gordon in Firebird at [173] succinctly described the place within, and effect the FSI Act had on, the evolution of the law of sovereign immunity in Australia:

…. the Immunities Act was based on a comprehensive report by the Australian Law Reform Commission (the ALRC) which traced the development of the common law doctrine of foreign State immunity from the former rule of absolute sovereign immunity to the now current restrictive view of foreign State immunity. The report proposed Australian legislation on the topic which was designed to reflect the more restrictive view of the common law immunity that had been taken in other countries and adopted in their legislation. For present purposes, the ALRC report is significant because, although it cannot displace the clear meaning of the Immunities Act, it assists in ascertaining the legislative context and purpose and the particular mischief that the legislation is seeking to remedy.

19    As is notable from these observations, as at the time of the inception of the FSI Act, foreign States no longer enjoyed absolute immunity. Both the text of the FSI Act and its context recognise that the current approach is one of restrictive immunity: Playa Larga v I Congreso del Partido [1983] 1 AC 244. Restrictive immunity means that there is now recognition that a foreign State is not immune from certain areas of activity where the administration of justice (both in an international and domestic sense) requires the empowering of individuals transacting with states to be able to subject those transactions to the scrutiny of the courts; so long as that enquiry does not involve a challenge to a sovereign or governmental act: Hazel Fox CMG QC, The Law of State Immunity (The Oxford International Law Library 2nd ed, 2008) 64. This is because international law recognises that the function of state immunity is to facilitate the performance of public functions by states and their representatives: James Crawford, Brownlie’s Principles of Public International Law (OUP, 9th ed, 2019) 470, and, as such, international law has evolved to delineate between public or governmental activities (for which there is immunity) and commercial activities (for which there is no immunity): Trendtex Trading Corporation v Central Bank of Nigeria [1977] QB 529. These reasons concern the applicant’s activities as an employer and whether those activities can be the subject of scrutiny by the Commission.

20    The High Court has recognised the FSI Act comprises a complete codification of foreign State immunity: Firebird at [5]-[7], Greylag Goose at [69] and PT Garuda at [8]. The FSI Act is to provide general immunity to a foreign State pursuant to s 9 and then to codify restrictive immunity by setting out “[e]xhaustively the circumstances in which the general rule of immunity is to be relaxed”: Greylag Goose at [18].

21    Section 9 renders foreign States immune from the jurisdiction of Australian “courts”, in a “proceeding”, except as otherwise provided by the FSI Act. A “court” and a “proceeding” are broadly defined in s 3 to include:

court includes a tribunal or other body (by whatever name called) that has functions, or exercises powers, that are judicial functions or powers or are of a kind similar to judicial functions or powers.

…

proceeding means a proceeding in a court but does not include a prosecution for an offence or an appeal or other proceeding in the nature of an appeal in relation to such a prosecution.

…

22    Ground one of the review and the first issue concerns whether the Full Bench erred in failing to find that the applicant was wholly immune from the jurisdiction of the Commission by reason of the common law of the foreign State immunity and the Commission not being a “court” for the purposes of the FSI Act.

23    Part II of the FSI Act contains a number of exceptions. This application concerns primarily the exception contained in s 12, which stipulates where a foreign State will and will not be immune in a proceeding concerning the employment of a person. Grounds two, three and five involve the construction of this provision. Section 12 provides:

12 Contracts of employment

(1)     A foreign State, as employer, is not immune in a proceeding in so far as the proceeding concerns the employment of a person under a contract of employment that was made in Australia or was to be performed wholly or partly in Australia.

(2)     A reference in subsection (1) to a proceeding includes a reference to a proceeding concerning:

(a)     a right or obligation conferred or imposed by a law of Australia on a person as employer or employee; or

(b)     a payment the entitlement to which arises under a contract of employment.

(3)     Where, at the time when the contract of employment was made, the person employed was:

(a)     a national of the foreign State but not a permanent resident of Australia; or

(b)    an habitual resident of the foreign State;

subsection (1) does not apply.

(4)     Subsection (1) does not apply where:

(a)     an inconsistent provision is included in the contract of employment; and

(b)     a law of Australia does not avoid the operation of, or prohibit or render unlawful the inclusion of, the provision.

(5)     Subsection (1) does not apply in relation to the employment of:

(a)     a member of the diplomatic staff of a mission as defined by the Vienna Convention on Diplomatic Relations, being the Convention the English text of which is set out in the Schedule to the Diplomatic Privileges and Immunities Act 1967; or

(b)     a consular officer as defined by the Vienna Convention on Consular Relations, being the Convention the English text of which is set out in the Schedule to the Consular Privileges and Immunities Act 1972.

(6)     Subsection (1) does not apply in relation to the employment of:

(a)     a member of the administrative and technical staff of a mission as defined by the Convention referred to in paragraph (5)(a); or

(b)     a consular employee as defined by the Convention referred to in paragraph (5)(b);

unless the member or employee was, at the time when the contract of employment was made, a permanent resident of Australia.

(7)     In this section, permanent resident of Australia means:

(a)     an Australian citizen; or

(b)     a person resident in Australia whose continued presence in Australia is not subject to a limitation as to time imposed by or under a law of Australia.

24    Whilst the scheme of the FSI Act is to provide general immunity and to set out the circumstances in which general immunity is to be relaxed, it does not follow that those circumstances are to be narrowly construed. Section 12 of the FSI Act operates as, in substance, a provision conferring jurisdiction and to narrowly construe it would be “contrary to long established principle and wholly inappropriate”: Knight v FP Special Assets Limited [1992] HCA 28; 174 CLR 178 at 205 per Gaudron J; Owner of the Ship “Shin Kobe Maru” v Empire Shipping Co Ltd [1994] HCA 54; 181 CLR 404 at 421.

25    Further, s 6 of the FSI Act makes it clear that nothing in the FSI Act affects an immunity or privilege conferred inter alia by the Diplomatic Privileges and Immunities Act 1967 (Cth), which gives force of domestic law to certain aspects of the Vienna Convention on Diplomatic Relations, opened for signature 18 April 1961. 500 UNTS 95 (entered into force on 24 April 1964). The authorities recognise that the FSI Act, like all other Acts, must be construed in conformity with international law, especially where the statute implements or codifies Australia’s obligations under international law: Firebird at [44] per French CJ and Kiefel J; Kingdom of Spain at [16].

26    However, ultimately the FSI Act must be construed by its text and context: Sydney Seaplanes Pty Ltd v Page [2021] NSWCA 204; 106 NSWLR 1 at [25]–[42] per Bell P.

The factual backdrop

27    After each of the employees applied to the Commission seeking an unfair dismissal remedy, the applicant objected to the jurisdiction of the Commission to deal with the applications on two bases. It was first contended that the FW Act did not apply to it, and alternatively, or in addition, because it is a sovereign foreign State, it and its diplomatic mission are immune from jurisdiction by virtue of the FSI Act and other Acts and Conventions. An additional objection was also raised with respect to certain employees on the basis that they were not “permanent residents” for the purpose of ss 12(6) and (7) of the FSI Act at the relevant time and the applications were premature because they had been initiated before the dismissals had taken effect. The Deputy President rejected all the jurisdictional objections save for those with respect to two individuals, Mr Wedissa and Mr Mubaidin: Saleh & Ors v Embassy of Saudi Arabia/Saudi Embassy [2024] FWC 1152. These objections were upheld on the basis that there was insufficient evidence to conclude that they were permanent residents at the time their employment contracts were made, and therefore an exclusion to the exception allowing for jurisdiction applied: ss 12(6). The Deputy President made a further decision dismissing the application of Mr Almahadi, for the same reason: Saleh & Ors v Embassy of Saudi Arabia/Saudi Embassy [2024] FWC 1211.

28    Whilst constitutional writs are sought with respect to the Deputy President’s decisions, no attention was paid, by the applicant by its grounds of review or in submissions, to the Deputy President’s reasons in this review. The focus was the outcome of the Full Bench’s reasoning and again very little attention, in argument, was given to the Full Bench’s reasoning. Nonetheless it is worthwhile briefly outlining the Full Bench’s reasoning.

29    The applicant and Messrs Wedissa and Mubaidin lodged applications for permission to appeal and an appeal from the Deputy President’s decision. Mr Almahadi also sought permission to appeal from the Deputy President’s second decision, but this decision was not before the Full Bench.

30    Before the Full Bench, the applicant propounded four main contentions as to why it was immune from the Commission’s jurisdiction, each of which were rejected by the Commission. Those contentions and the Commission’s related reasons may be summarised in the following way: first the applicant is immune from the jurisdiction of the Commission by operation of s 9 of the FSI Act and that immunity has not been lifted by an exception that arises under s 12(1). This was said to be so because, when s 12(1) and 12(2) are properly construed, they do not countenance unfair dismissal proceedings being brought against a foreign State. This challenge was developed in two ways: that an unfair dismissal proceeding does not concern “the employment of a person under a contract of employment that was made in Australia or was to be performed wholly or partly in Australia” (s 12(1)) and separately on the basis that unfair dismissal proceedings are not proceedings concerning a “right or obligation conferred or imposed by a law of Australia on a person as an employer or employee” for the purposes of s 12(2)(a). The Full Bench rejected both of these arguments, respectively at FB[49]–[52] and FB[53]–[62]. To further aid the applicant’s construction of s 12(1), the applicant relied upon Australia’s international obligations, in particular with respect to diplomatic immunity. This argument was also not accepted: FB[63]–[80].

31    Secondly, and alternatively, the applicant contended that, even if s 12(1) lifts the immunity that was otherwise conferred by s 9 with respect to unfair dismissal claims under Pt 3-2 of the FW Act, s 12(1) does not apply to the employees’ applications in this case because s 12(4) applied. This was said to be the case because the employees’ contracts contained an inconsistent provision, namely, purported “exclusive jurisdiction clauses” (in art 21 of the worker contracts) for the purposes of the s 12(4)(a) exception and where it was submitted that there was no law of Australia that avoids the operation of, or prohibits or renders unlawful the inclusion of, the provision for the purpose of s 12(4)(b). The Full Bench concluded that the provision was inconsistent, that is an unfair dismissal claim was not a type of dispute referred to in art 21: The resolution of whether a dismissal was harsh, unjust or unreasonable does not involve the determination of any contractual claim: FB[92]-[94]. Further, in the alternative, the Full Bench found that such a provision in the FW Act is a law which falls under s 12(4)(b), which confers a right on a person who has been dismissed to apply to the Commission for an order granting a remedy: FB[98]-[99].

32    Thirdly, the applicant submitted that it is not a “person” for the purposes of the definition of a “national system employer” in s 14(1)(f) of the FW Act, and therefore not an “employer” within the meaning of s 380 of the FW Act. The Full Bench reasoned that this submission ought be rejected because it did not conform with the definition of “person” (which includes a body politic), in the then applicable s 22(1)(a) (and now in s 2C(1)) of the Acts Interpretation Act 1901 (Cth), which has force by operation of s 40A of the FW Act: FB[106]. The Full Bench rejected the argument that “body politic”, in s 22(1)(a), should be confined to a body politic in and of Australia: FB[109]-[112]. The Full Bench relied upon decisions of this Court relating to other aspects of the FW Act and under the Migration Act 1958 (Cth): FB[114]-[118]. The Full Bench dismissed the applicant’s argument that a contrary intention was identified by the text of s 14 and alternatively its purported conflict with the DPI Act: FB[119]-[122].

33    Lastly, the final issue on appeal concerned the applicant’s claim, and the appeals of Mr Wedissa and Mr Mubaidin, regarding whether certain of the employees were “permanent residents” for the purpose of s 12(6) (and as defined in s 12(7)). The Deputy President had found that all employees were permanent residents, within the meaning of s 12(7), at the time their contracts of employment were made, with the exception of three employees, including Mr Wedissa and Mr Mubaidin. On appeal, the applicant put in issue whether a further five employees were “permanent residents” at the time the contracts of employment were made: FB[124]. The Full Bench rejected the applicant’s narrow construction of s 12(7) that “permanent resident” must mean that the person currently holds a “permanent visa” under the Migration Act and Migration Regulations 1994 (Cth) and would not include a person who holds a “temporary visa”, but which has no temporal limitation: FB[131]. Ultimately, whilst rejecting the rigidity of the applicant’s construction, the Full Bench held that if a person is entitled to remain in Australia while “he or she holds a visa with a special status, whether the condition represents a temporal requirement may depend on the nature of the status. If the status is held by the person indefinitely, it might not be possible to say that the person’s presence in Australia is subject to a limitation as to time”: FB[140]. The Full Bench went on to make findings based on the evidence peculiar to the employees and the different visa statuses. With respect to the employees who were New Zealand citizens and on sub-class 444 visas, the Full Bench concluded that those visas were not the subject of a temporal limitation, and therefore the relevant employees were “permanent residents” within the meaning of s 12(7): FB[146]. There is no need to consider the different circumstances of the other employees for the purpose of this review.

34    As a consequence, the Full Bench rejected the applicant’s appeal with respect to 13 claims and upheld immunity with respect to two: FB[9], [171]-[172] and made the following orders:

9    We have decided to grant permission to appeal with respect to the Embassy's appeal and the appeals brought by Mr Wedissa and Mr Mubaidin. For the reasons which follow, the bulk of the Embassy's submissions cannot be accepted. The FW Act applies to a foreign State and foreign States are not generally immune from being subject to unfair dismissal proceedings. The Embassy's appeal must be dismissed save that the decision of the Deputy President should be varied to include a conclusion that Suzanne Maksoud and Mohamed Ben Mansour were not permanent residents for the purposes of s 12(6) and (7) of the FSI Act and the Embassy has immunity with respect to their applications. For different reasons, the appeals of Mr Wedissa and Mr Mubaidin must also be dismissed.

…

171    For these reasons, permission to appeal is granted with respect to the Embassy's appeal and the appeals brought by Mr Wedissa and Mr Mubaidin. The contentions advanced by the Embassy to the effect that it is immune from unfair dismissal proceedings under Part 3-2 of the FW Act must be rejected. The appeal succeeds only to the extent that, with respect, the Deputy President erred in concluding that Ms Maksoud and Mr Mansour were permanent residents at the time their contracts of employment were made with the Embassy. The Embassy's appeal is otherwise dismissed. The appeals by Mr Wedissa and Mr Mubaidin are also dismissed.

172     The Full Bench makes the following orders:

(1)     In Matter No. C2024/3385, Mr Mubaidin be allowed further time to lodge his notice of appeal to 24 May 2024;

(2)     Permission to appeal is granted in Matter No. C2024/3320, C2024/3385 and C2024/3230;

(3)     The appeal in Matter No. C2024/3320 is allowed to the extent that the decision of the Deputy President is varied so as to include a conclusion that Ms Maksoud and Mr Mansour were not permanent residents for the purposes of s 12(6) and (7) of the FSI Act;

(4)     The applications for an unfair dismissal remedy made by Suzanne Maksoud in Matter No. U2022/5015 and Mohamed Ben Mansour in Matter No. U2022/9536 are dismissed;

(5)     The appeal in Matter No. C2024/3320 is otherwise dismissed; and

(6)     The appeals in Matter No. C2024/3385 and C2024/3230 are dismissed.

The application to this Court

35    The applicant advanced by its written submissions five grounds upon which the Commission fell into jurisdictional error, all of which sound in statutory construction.

36    The applicable principles informing statutory construction are well established. The starting point is the text of the provision, having regard to its context and purpose: SZTAL v Minister for Immigration and Border Protection [2017] HCA 34; 262 CLR 362 at [14] per Kiefel CJ, Nettle and Gordon JJ, citing Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA 28; 194 CLR 355 at [69]–[71] per McHugh, Gummow, Kirby and Hayne JJ; Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue (Northern Territory) [2009] HCA 41; 239 CLR 27 at [47] per Hayne, Heydon, Crennan and Kiefel JJ.

The Commission is a “court” within the meaning of s 3 of the FSI Act (Ground one)

37    By the applicant’s first ground of review, the applicant contends that the Commission is not a “court” and therefore the restrictive doctrine of state immunity in the FSI Act does not apply to proceedings in the Commission. The applicant had reserved its position in this respect and not argued it below: FB[24]. The applicant’s submissions in support of its construction that the Commission is not a “court”, within the meaning of s 3 of the FSI Act, can be summarised as follows:

(a)    The determination of whether the Commission is a “court” is analysed through the prism of the relevant application being made to the body in question which, in this case, requires an analysis of the application made to, and of the functions and powers to be exercised by, the Commission in deciding an unfair dismissal application for unfair dismissal remedies.

(b)    It was submitted that in granting an unfair dismissal remedy, the Commission is exercising a power antithetical to judicial power: It creates a new legal right (to reinstatement) and a duty as contained in s 405 of the FW Act.

(c)    This construction was said to be reinforced by two contextual historical facts: that industrial regulation has always been constitutionally recognised as wholly foreign to judicial power; and as at the inception of the FSI Act, there was no Federal unfair dismissal remedy available.

(d)    Further, it was submitted that, by reason of the FSI Act not applying to Commission proceedings because the Commission is not a ‘court’ within the meaning of the FSI Act, the common law of Australia governs the applicant’s immunity. It was submitted that the common law at the time of enactment was “likely that of Van Heyningen v Netherlands Indies Government [1949] StRQ 54” namely that a foreign State enjoys absolute immunity in employment claims. Or alternatively, if the current common law is to be applied, it has not progressed by the effect of the operation of the FSI Act.

38    I do not accept the applicant’s contentions. On the proper construction of s 3, the Commission, when exercising its functions and powers, with respect to the employees’ unfair dismissal applications, is a “court”.

39    The FSI Act confronts and removes the dichotomy between so-called private and sovereign acts considered in Playa Larga. The authorities reveal that the common law in the United Kingdom has evolved such that the restrictive doctrine of foreign State immunity applies (that is, there is no longer absolute state immunity). A “private law character” act of a foreign State is susceptible to the jurisdiction, but a sovereign act is not: Playa Larga at 262-3, 267. Benkharbouche v Embassy of the Republic of Sudan [2019] AC 777 lucidly describes the evolution of the common law and finds that the relevant foreign State immunity legislation has codified the common law and, by that, expanded the areas in which a foreign State is susceptible to the jurisdiction of domestic courts. This is relevant when considering the common law context in which the FSI Act came into being and departed from common law doctrine. It reveals that one is not to read the FSI Act as operating in a sea of common law general immunity and as creating narrow exceptions.

40    The statutory architecture reveals that the FSI Act grapples with various areas of engagement between sovereigns and individuals and the extent of sovereign immunity in each area. As adverted to by Lord Alexander, careful consideration needs to be given to the way in which immunity affects individual rights which would otherwise accrue.

41    There has been consistent recognition that the FSI Act is a complete codification of foreign State immunity: Firebird at [5]–[7] per French CJ and Kiefel J, Greylag Goose at [69] per Gageler CJ, Gleeson, Jagot and Beech-Jones JJ, and PT Garuda at [8] per French CJ, Gummow, Hayne and Crennan JJ.

42    As is apparent from the above summary, the applicant’s contention was premised on arguments which avoided the text of the provision. Sections 8 and 9 of the FSI Act provide:

8 Application to courts

In the application of this Act to a court, this Act has effect only in relation to the exercise or performance by the court of a judicial power or function or a power or function that is of a like kind.

9 General immunity from jurisdiction

Except as provided by or under this Act, a foreign State is immune from the jurisdiction of the courts of Australia in a proceeding.

43    When ss 8 and 9 are read together, they make clear that the immunity conferred is an immunity from the jurisdiction of the courts in a proceeding.

44    The broad definition of “court” in s 3 expressly embraces bodies, including tribunals, exercising powers “of a kind similar to judicial functions or powers”. To the extent necessary, this is confirmed by the context. The ALRC Report recommended that the definition of “court” (at [76]):

be broad enough to cover any body in Australia which exercises broadly judicial functions, with respect to those functions. It should not depend on whether that body is properly described as a ‘court’ in some narrower sense. On the other hand, it should not extend to cover the exercise of legislative, administrative, arbitral or conciliation functions.

(Emphasis added)

45    Parliament confronted the potential mischief (a narrow interpretation) by extending the definition of a “court” to a “tribunal” and to functions and powers “of a similar kind” to judicial functions and powers. It is true that the ALRC Report recommended the exclusion of “arbitral or conciliation functions” but for the following reasons, it would be wrong to characterise the Commission’s functions in this way. As the respondents submitted, the focus is on the exercise of functions and powers, not on any label.

46    The applicant submitted that, at all times, the Commission’s exercise of the arbitration power in response to unfair dismissal claims has had each of the essential attributes indicative of the Commission not exercising a judicial function. This was said to be so because:

(a)    an employee does not have a right not to be unfairly dismissed and an employer does not have any duty not to unfairly dismiss;

(b)    Part 3-2 hinges upon broad evaluative judgments (whether the dismissal was harsh, unjust or unreasonable) by the FWC involving a “fair go all round” and pursuing objectives of a social policy character (FW Act ss 381(1) and (2) and 385);

(c)    the FWC may order reinstatement or compensation, but may only order compensation when satisfied that reinstatement is inappropriate (involving a further, broad evaluative judgment) (FW Act ss 390 and 391);

(d)    when the FWC makes an unfair dismissal order it has no legal effect, but the FW Act operates to create a legal consequence by imposing a duty on the respondent not to contravene the order (FW Act s 405). If the respondent contravenes the order, s 675 of the FW Act creates a criminal offence, but not so as to expose the Commonwealth, an Australian State or a Territory to criminal liability (see FW Act s 37(2)); and

(e)    the applicant may enforce an unfair dismissal order by Court proceedings (FW Act s 539 Item 13) in which the Court may, in its discretion, grant relief by way of injunction, compensation or reinstatement (FW Act s 545).

47    It is my view that the applicant’s focus on the Commission purportedly not exercising judicial power is a distraction, it was never contended by the respondents that the Commission exercises judicial power, nor, by operation of the FSI Act, is it required to do so.

48    In any event, the Commission exercises a number of judicial-like or quasi-judicial functions, which are “of a kind similar to judicial functions and powers” when exercising its jurisdiction under Part 3-2 of the FW Act. The Commission conducts an adversarial hearing, applies legal principle to the facts of the case and makes orders which determine the rights and obligations of the parties. The remedies afforded by s 394 of the FW Act involve a vindication of the right of protection from unfair dismissal. Those functions or powers are of a kind similar to judicial functions or powers. The fact that the procedure is intended to be flexible and informal, can involve issues being determined without a hearing, and involves a broad, evaluative exercise, taking into account the factors identified in s 387 of the FW Act, does not detract from the true nature of the functions and powers being exercised.

49    While the statutory framework is intended to be flexible and informal, as submitted by the respondents, it is underpinned by an obligation to ensure that “a fair go all round” is accorded to both employer and employee: s 381(2). That expression, as the note to s 381(2) indicates, is derived from in re Loty and Holloway v Australian Workers’ Union [1971] AR (NSW) 95. The expression adverts to the balancing of the employer’s managerial prerogative (the right to manage its business), the nature and quality of the employee’s work, the circumstances of the dismissal and the practical utility of reinstatement. As this Court has previously recognised, the arbitration of claims concerning unfair dismissal is done in a quasi-judicial setting where the Commission is required to act judicially and afford procedural fairness: Edwards v Justice Giudice [1999] FCA 1836; 94 FCR 561 at [43], per Marshall J with Moore J agreeing.

50    The applicant made much of the restriction under s 29(2) of the FSI Act: A court may not make an order requiring a foreign State to employ or reinstate a person. To the extent that this submission was directed to the question of whether the Commission is a “court” for the purpose of the FSI Act, the fact that the Commission has this power supports the view that it is a body exercising functions “of a kind similar to judicial functions or powers”. The power to order reinstatement is “akin to an injunction compelling a wrongdoer to restore the position of the innocent party”: Anthony Smith & Associates Pty Ltd v Sinclair (1996) 67 IR 240 at 244. The fact that this observation was made by an Industrial Court does not detract from the relevance of the observation to the characterisation of the Commission’s functions or powers. As submitted by the respondents, the power is one of an adjudicative and remedial character, tenets of judicial functions or powers. Notably, the Commission also has a power, albeit limited, to order costs against a party for costs incurred by the other party: ss 400A and 401.

51    It was also said that this restriction, under s 29(2), supported the applicant’s construction that Parliament did not intend for foreign States to be subject to unfair dismissal matters. I do not accept this submission.

52    The unfair dismissal regime includes, as its primary remedy, reinstatement, but it also allows for compensation. The restriction on the power of courts to order reinstatement does no more than recognise the particular “sensitivities” of foreign States and does not support the applicant’s construction of “court”. This construction is aided by reference to the consideration of and rationale for preclusions of this kind in the ALRC Report: Recognition is given to “a particular sensitivity about the choice of employees or reinstatement of unfairly dismissed employees”. The justification for the exclusion is to acknowledge and protect this sensitivity “rather than an exclusion of jurisdiction altogether”: ALRC Report at 56 [96] fn 46, 84 [137]-[138].

53    Furthermore, these aspects of the Report fortify the respondents’ construction as they reveal specific contemplation by the ALRC of foreign States being the subject of cases involving unfair or wrongful dismissal where remedies of unfair dismissal were available.

54    The content of s 29(2) coheres with the more expansive forms of statutory proceedings (contemplated by s 12(2)) which may allow for this form of relief. As previously observed by Moore J in Robinson v Kuwait Liaison Office (1997) 73 IR 33 at 78, the effect of s 29(2) is such that it will preclude the Court, if this point is reached, from ordering reinstatement, but not compensation. That is, in the Commission’s consideration of appropriate relief, it was clearly in contemplation of the ALRC Report, and within the ambit of the Commission's function, to decline to order reinstatement.

55    The applicant’s construction was said to be reinforced by two contextual historical facts: that industrial regulation has always been constitutionally recognised as wholly foreign to judicial power; and as at the inception of the FSI Act, there was no Federal unfair dismissal remedy available.

56    Much was made by the applicant of the jurisprudential recognition of the constitutional demarcation between the Commission’s exercise of arbitral as opposed to judicial power, with reference to R v Kirby; Ex parte Boilermakers’ Society of Australia [1956] HCA 10; 94 CLR 254 at 281, 289; Construction Forestry Mining and Energy Union v Australian Industrial Relations Commission [2001] HCA 16; 203 CLR 645 at [31] and the approval and application of this holding in TCL Airconditioner (Zhongshan) Co Ltd v Judges of the Federal Court of Australia [2013] HCA 5; 251 CLR 533 at [29] per French CJ and Gageler J. The applicant also submitted, through this jurisprudential prism, that by the Commission granting an unfair dismissal remedy, the Commission was not vindicating an existing right but creating a new right. The fact that the Commission is so able does not mean that it is not performing functions or powers that are of a kind similar to judicial functions and powers. Courts do perform functions which create new rights, for example a decree of adoption or the exercise of the advisory jurisdiction of the New South Wales Supreme Court concerning the management or administration of trust property: s 63, Trustee Act 1925 (NSW). Rather, contrary to the applicant’s contention, that jurisprudential recognition provides context and justification for the expansive definition in s 3.

57    Indeed, the ALRC specifically referred to this constitutional demarcation or “problem”, at page 41, [76], fn 61:

There is no constitutional problem in Commonwealth legislation by a single provision establishing the law to be applied both by courts in the sense of ch III of the Constitution and by other bodies which do not constitute courts in that sense. Valid Commonwealth legislation is binding according to its terms on State administrative agencies and tribunals. Such bodies cannot, of course, be vested with 'federal jurisdiction' but in its application to them the provision, of the proposed legislation would not involve such a vesting”.

58    Furthermore, the above references in the ALRC Report confirm that specific attention was given to the prospect of unfair dismissal claims and for the remedy of reinstatement. The applicant failed to refer to two additional critical historical facts: first, there was, as at the time of the inception of the FSI Act, a right to bring a statutory claim for unfair dismissal in South Australia: Industrial Conciliation and Arbitration Act 1972 (SA) ss 15(1)(d)(iii), 156(4). Secondly, the fact that the International Labour Organization had convened on 2 June 1982 and adopted the Termination of Employment Convention, 1982, opened for signature 22 June 1982, ILO C158 (entered into force 23 November 1985) on 22 June 1982, two years before the ALRC had completed its report (on 30 June 1984). Articles 8.1 and 10 of that Convention stated:

Article 8.1

A worker who considers that his employment has been unjustifiably terminated shall be entitled to appeal against that termination to an impartial body, such as a court, labour tribunal, arbitration committee or arbitrator.

Article 10

If the bodies referred to in Article 8 of this Convention find that termination is unjustified and if they are not empowered or do not find it practicable, in accordance with national law and practice, to declare the termination invalid and/or order or propose reinstatement of the worker, they shall be empowered to order payment of adequate compensation or such other relief as may be deemed appropriate.

59    Notably, that Convention was used as a reference point in the Termination, Change and Redundancy Case (1984) 8 IR 34. This case was being decided at the very time of the ALRC Report and the inception of the FSI Act.

60    The applicant thereafter submitted that Parliament’s intention ought be informed by a footnote in the ALRC Report (at 41, [76], fn 60) which purportedly expressly foreshadowed the conclusion that unfair dismissal claims would be excluded. The relevant footnoted sentence appeared at [76] of the ALRC Report: “The question arises as to which bodies, apart from the ordinary courts, should extend immunity to a foreign State”, to which footnote 60 attached, which read “cf Sengupta v Republic of India [1983] ICR 221 (unfair dismissal claim before industrial tribunal).”

61    This submission is rejected. First, the paragraph is concerned with the extension of “courts” to bodies apart from ordinary courts. On its terms, it appears to contemplate industrial tribunals. Secondly, the use of the qualifier “cf” at the commencement connotes that a comparison is being made with the finding in that case. It does not comprise an endorsement. Thirdly, the decision in Sengupta v Republic of India [1983] ICR 221 concerned whether the foreign State was immune from an unfair dismissal claim at common law because the relevant statute dealing with foreign State immunity did not apply because the employee had entered into the contract of employment before the commencement of the statute. The decision said nothing dispositive about the relevant statute not applying to unfair dismissal claims. Rather it highlighted the uncertainty and inconsistency involved when considering whether a foreign State is immune from employment disputes at common law. It does not support nor “expressly foreshadow” the exclusion of the Commission from the scope of the FSI Act.

62    This conclusion coheres with those other aspects of the ALRC Report referred to above dealing with the exclusion of reinstatement relief, where specific consideration was given to and account taken for the inclusion of proceedings of the kind heard before the Commission concerning unfair or wrongful dismissal.

63    Given my view that the Commission is a “court” within the meaning of the FSI Act, there is no need to consider whether the applicant is immune at common law.

Unfair dismissal claims fall within the s 12(1) exception to immunity (Ground two)

64    As an alternative to its first ground, the applicant contends, by ground two, that by reason of it being a diplomatic mission of a foreign State with the immunity conferred by s 9 of the FSI Act, the only way it could not be immune would be if the unfair dismissal claims fall within the scope of the s 12(1) employment contract exception of the FSI Act. The applicant propounded that the Full Bench erred by finding that claims fall within the scope of that section.

65    The text of ss 12(1) and (2) are in the following terms:

12  Contracts of employment

(1)     A foreign State, as employer, is not immune in a proceeding in so far as the proceeding concerns the employment of a person under a contract of employment that was made in Australia or was to be performed wholly or partly in Australia.

(2)     A reference in subsection (1) to a proceeding includes a reference to a proceeding concerning:

(a)     a right or obligation conferred or imposed by a law of Australia on a person as employer or employee; or

(b)     a payment the entitlement to which arises under a contract of employment.

66    The applicant contended that the Full Bench’s error, in construing the bounds of s 12(1), manifested in three main ways: First, when considering the text of ss 12(1) and 12(2), it erred in its rejection of the applicant’s submission that a “proceeding concerns” the subject matter in s 12(1) only when substantive rights meet the description of the subject matter in ss 12(1) and (2): at FB[45]–[62]. Secondly, the Full Bench erred by failing to construe the FSI Act and the FW Act harmoniously, given the operation of s 390(3)(a) of the FW Act and s 29(2) of the FSI Act: FB[54]. Thirdly, the Full Bench failed to construe the FSI Act consistently with international obligations and diplomatic privileges and immunity (s 6 of FSI Act): FB[69]-[80]. As a consequence, in support of the applicant’s construction, the applicant’s submission to this Court may be distilled in the following way:

(a)    Section 12(1) requires consideration of the connection between the relevant proceeding and the subject matter described in ss 12(1) and (2) of the FSI Act. Each of ss 11 to 16 of the FSI Act are “expressed in terms that a foreign State is not immune in a proceeding ‘in so far as the proceeding concerns’ one or more identified subject matters”. According to the applicant, the connecting phrase focuses on the substance of the issues in dispute in the proceedings, that is, the substantive rights sought to be vindicated by the proceeding: PT Garuda at [39]-[43]. The applicant submitted that the subject matter of s 12(1) extends no further than the extant legal rights of employees engaged pursuant to contracts of employment entered into in Australia (and where the “contracts of employment” are the primary source of such legal rights). It was submitted that the provision’s title and terms direct attention to the subject matter of the dispute being employment contractual disputes.

(b)    Such a construction was said to be supported also by the necessity to construe the FSI Act and the FW Act harmoniously with particular reference to the prohibition of reinstatement under s 29(2) of the FSI Act. Reliance was also placed upon aspects of the ALRC Report.

(c)    The Full Bench’s construction would be inconsistent with international obligations and diplomatic privileges and immunity afforded to the applicant as a foreign diplomatic mission (arising by operation of s 6 of the FSI Act): The FSI Act does not affect an immunity or privilege conferred by or under, inter alia, the DPI Act, which gives force of domestic law to certain of the articles within the VCDR.

67    I do not accept the applicant’s contentions; the Full Bench did not err in its construction. Properly construed, the exception to immunity in s 12(1) does extend to unfair dismissal proceedings.

68    As detailed above, ss 10-21 of the FSI Act set out exhaustively the circumstances in which the general rule of immunity is to be relaxed: Greylag Goose at [18]. By this the focus is on the identified subject matter. Indeed, the phrase “in so far as the proceeding concerns” and the connection between this phrase and the subject matter giving rise to relaxing the immunity has been broadly construed. In PT Garuda, the plurality held, contrary to the submission of Garuda, that the effect of s 11(1) was to extend the exception from immunity to proceedings concerning commercial transactions, which are not sounded in contract nor seek contractual remedies: at [39]-[43]:

39    Section 11(1) denies the immunity in a proceeding, otherwise conferred on an entity such as Garuda by ss 9 and 22, by stating that there is no immunity “in so far as” this proceeding “concerns” what is “a commercial transaction”. The term “concerns” is not further explicated by the text of the Act.

40     Garuda accepts that the proceeding may involve an investigation “at an evidentiary level” into contracts for carriage of freight by Garuda, from which to infer purpose or likely anti-competitive effect, or the giving effect to the impugned arrangement or understanding within the meaning of the provisions of the TPA. However, Garuda submits that it is critical for the operation of s 11(1) of the Act that the ACCC does not plead the terms of any such contract, nor seek any remedy by way of variation, rescission, compensation or otherwise with respect to any of the contracts for the carriage of freight by Garuda. Further, it is said to be critical that no party to any such contract, or person claiming to have suffered loss by reason thereof, joins in the proceeding.

41     In sum, the submission for Garuda is that the proceeding does not seek to vindicate any “private law right” in respect of any freight contract and that, absent this, s 11(1) of the Act does not apply to deny immunity. This postulated dichotomy between private and public law as controlling the meaning of “concerned” in s 11(1) should not be accepted.

42     The definition of “commercial transaction” fixes upon entry and engagement by the foreign State. It does not have any limiting terms which would restrict the immunity conferred by ss 9 and 22 to a proceeding instituted against the foreign State by a party to the commercial transaction in question. Further, it should be emphasised that the definition does not require that the activity be of a nature which the common law of Australia would characterise as contractual. The arrangements and understandings into which the ACCC alleges Garuda entered were dealings of a commercial, trading and business character, respecting the conduct of commercial airline freight services to Australia. The definition of a “commercial transaction” is satisfied.

43     The Federal Court proceeding “concerned” a commercial transaction, within the meaning of s 11(1), in an immediate sense. This is apparent from the relief sought. The ACCC seeks declarations that the arrangements and understandings contravene Australian law, pecuniary penalties, and injunctive relief against the giving of effect to the arrangements and understandings.

(Footnotes omitted).

69    Section 12(1) is the subject of carefully defined internal limitations. These limitations (and their interactions between one another) inform how s 12(1) is read. They reflect the balance to be struck between allowing local recourse for employment disputes and preserving immunity in cases where the employee does not truly have a connection to Australia or the nature of the employment role implicates sovereign functions (that is, the delineation between public or governmental activities and commercial activities). Central to how one construes the operation of s 12(1), is how it interplays with the internal limitations. For example, immunity is preserved where the employee was, at the time the contract was made, a national or habitual resident of the foreign State but not a permanent resident of Australia: FSI Act s 12(3). It is also preserved where the contract contains an “inconsistent provision” that is not rendered void or unlawful by a law of Australia: s 12(4). And likewise, where the employee falls within certain defined diplomatic or consular categories unless they are a “permanent resident of Australia” within the meaning of s 12(7): FSI Act ss 12(5)-(6). This provides the context for how to construe s 12(1): It is directed to a foreign State not being immune, as employer, in respect of proceedings concerning the employment of a person whose contract of employment “has a defined nexus”: Republic of Italy (Minister of Foreign Affairs and International Cooperation – Adelaide Consulate) v Benvenuto [2018] FCAFC 64; 261 FCR 19 at [8]-[9] per White J, with whom Besanko and White JJ agreed. As recognised, by Nettle and Gordon JJ in Firebird at [198]-[199]:

198. As may be discerned from the ALRC report, the purpose of each of the exceptions to immunity provided for in ss 12-16 is to deal specifically with the different considerations which apply to different kinds of cases. So, in the case of employment contracts which are provided for in s 12, the basis of the exception to immunity is that, where a foreign state enters into an employment contract in Australia or which is to be performed in Australia, the interest of Australia in providing a local forum outweighs the interest of the foreign state in exclusive jurisdiction…

…

199. Taken together, ss 12-16 thus reflect the idea that, although a foreign state is, generally speaking, immune to the jurisdiction of Australian courts, there are some acts and omissions and some forms of property which are so closely connected to Australia that it is appropriate that a foreign state be amenable to the jurisdiction of Australian courts in proceedings concerning such matters.

…

70    The applicant submitted that the subject matter of s 12(1) of the FSI Act extends no further than the extant legal rights of employees engaged pursuant to contracts of employment entered into in Australia for the following reasons. Firstly, the subject matter of s 12(1) (which refers to the “employment of a person under a contract of employment”) and s 12(2) (which refers to a proceeding concerning a right or obligation conferred or imposed by a law of Australia on a person in the capacity of employer or employee) are legal rights arising from the employment relationship. There is no aspect of that text which encapsulates any part of the employment relationship other than the sources of legal rights and duties of the employer and employee. Secondly, from the title of s 12 which forms part of the FSI Act: “contracts of employment” which are the primary source of such legal rights. Thirdly, by reliance to that part of the ALRC Report under a heading “Employment Contracts”. In that part, reference was made to the competing interests to be balanced when dealing with foreign State employment, including by diplomatic missions, was by reference to contracts of employment and jurisdictional rules that apply to contract disputes (ALRC Report at 55-7) with an extension recommended to protect an employee’s right to sue over “rights and duties imposed by law on an employer and employee…”: at ALRC Report [99], FB[61]. I reject this submission.

71    As adverted to above, and consistent with the holdings in PT Garuda at [68]-[69] and Firebird at [187]-[188] concerning other aspects of the statutory architecture, the language of s 12(1) is functional and purposive. The provision is directed to the “concerns of the employment of a person under a contract of employment”. It does not confine the exception to proceedings enforcing existing or statutory rights. The reference in s 12(1) to the contract of employment is to direct attention to the necessary connection with the forum – that there is a contract made in Australia or where the work under that contract is performed wholly or partly in Australia. It is also to ensure that the claim concerns an employment relationship not independent contracting.

72    Such a construction is supported by the expansive clarification in s 12(2), namely that such rights are not limited to a proceeding concerning “a right or obligation conferred or imposed by a law of Australia” or “a payment the entitlement to which arises under a contract of employment”. If s 12(1) were confined in the way that the applicant propounds, there would be no need for s 12(2). Rather, s 12(2) reinforces a construction that the immunity concerns claims arising under either contract or statute so long as there is the necessary connection, namely that the person is employed (as opposed to being an independent contractor). It is not concerned with an “extant” right but one “conferred or imposed” by a law of Australia. Such a construction ensures that arbitrary, illogical results do not occur. For example, it avoids a circumstance where the exception covers proceedings, arising from the same facts, for unlawful termination in breach of contract but not a claim of unfair dismissal or unlawful termination under the FW Act.

73    This construction is supported by the context. As referred to above, the ALRC Report acknowledged the sensitive nature of the employment relationship between a foreign State and its employees but nonetheless included the exception with the specific restriction upon reinstatement. The ALRC considered the competing considerations: The relationship between a state and its agents is closely linked to the functioning of the state but Australia has an interest in seeing that employees in Australia are able to use local forums to resolve disputes: ALRC Report at [94]. There was no apparent contemplation that the disputes be limited to those of a contractual nature. Further, the writers of the ALRC Report, at [95], noted the difficulty in isolating in “any satisfactory way particular elements within the entirety of the employment relationship” which comprise the dispute and thus excluded this particularity from consideration but contemplated proceedings involving dismissal and reinstatement. Footnote 46 to this paragraph is instructive:

But contrast draft art 13, proposed to the International Law Commission by its Special Rapporteur (Suchartikul (sic), Sixth Report, para 16). This preserves immunity where “the proceedings relate to non-employment or dismissal of an individual seeking employment or re-employment’. No other recent legislation contains such a limitation. However the ILC proposal does reveal a particular sensitivity about the choice of employees or reinstatement of unfairly dismissed employees. This is best reflected in an exclusion of remedies of reinstatement or similar orders, rather than an exclusion of jurisdiction altogether. See para 137. It should also be remembered that the act of state doctrine may apply in certain employment-related contexts: this is distinct from foreign state immunity. See para 2.

74    The substance of the ALRC Report reveals, contrary to the applicant’s thesis, that the ALRC did not embrace the (then) proposed position of the ILC. The ILC, in its draft art 13, had proposed specially excluding “proceedings [which] relate to failure to employ an individual or dismissal of an employee”: S Sucharitkul, Sixth report on jurisdictional immunities of States and their property, UN Doc A/CN.4/376 and Add.1 and 2 (31 January, 18 April 1984) paras 15–16. However, it is evident from the above portion of the ALRC Report (and fn 46) that the writers recommended the exclusion of the reinstatement remedy but not the jurisdiction. This conforms with the content of the subsequent statutory architecture of the FSI Act.

75    This provides a context, and informs the answer, to the applicant’s allegation that its construction ensures that the FSI Act operates harmoniously with the FW Act. The entitlement to relief under the FW Act for unfair dismissal, is a dual one: An entitlement to reinstatement and/or compensation. The applicant’s submission that s 390(3)(a) of the FW Act “operates as a limitation on the [Commission’s] power to make compensation orders” misconstrues its powers, evinced by its legislative history. The primary remedy for unfair dismissal is reinstatement; it is only where such a course is inappropriate that compensation is considered (although a reinstated employee may be entitled to backpay as well as reinstatement). It is not the case that if the Commission is satisfied that reinstatement of a dismissed employee of a foreign State was “appropriate” that the Commission would be prevented, by s 390(3) of the FW Act, from making a compensation order and also prevented from making an order for reinstatement by s 29(2) of the FSI Act: The operation of s 29(2) would form part of the Commission’s consideration of whether an order for reinstatement was appropriate, just like the operation of other laws which may inhibit or prohibit the reinstatement of an employee in other circumstances.

76    The fact that the exception from immunity is not limited to contractual provisions but includes statutory rights, is reinforced by the terms of s 12(4) of the FSI Act, which contemplate the existence of employment statutory rights which are protected by specific statutory provisions which ensure that they cannot be avoided by immunity. So much was contemplated by the ALRC, in its Report at [99]:

Legislatures have recognised the inequality of bargaining power between employer and employee. This inequality is not reduced where the employer is a foreign state. Where legislation avoids the operation of, or prohibits or renders unlawful the inclusion of, a particular provision ousting the jurisdiction of the courts in a contract of employment, such legislation should apply to contracts made by foreign state employees. (Footnotes omitted)

77    The applicant submitted that a construction of s 12(1), which included unfair dismissal proceedings, would offend s 6 of the FSI Act, namely that the operation of s 12 had to be consistent with international obligations and diplomatic privileges and immunity. Australia is a party to the VCDR but only certain of its provisions have force of domestic law. The VCDR is a schedule to the DPI Act and forms part of the Act: s 13 Acts Interpretation Act (1901) (Cth).

78    According to the applicant, the unfair dismissal proceedings would impinge upon a diplomatic mission’s privileges and immunities recognised under Australian and international law. The applicant’s argument can be distilled into four propositions. First, that ss 12(1) and (2) were to be construed in a manner which did not offend art 7 of the VCDR. The resultant enquiry (required of the Commission in unfair dismissal proceedings) is said to be against the privileges and immunities of the diplomatic mission of a foreign State and therefore offensive to Australia’s obligations under art 7 of the VCDR (which is not incorporated as part of Australian domestic law (s 7(1) of the DPI Act)). Secondly, these unfair dismissal claims would interfere with the mission’s immunities conferred by arts 22, 24, 27, 31(2) and 38(2), affirmed by the reasons of the Northern Territory Court of Appeal in United States of America v Williamson & Ors [2024] NTCA 6, together with the reasons of the Italian Court of Cassation in Norwegian Embassy v Quattri (Decision 12771/1991, Court of Cassation, 114 ILR 525). Thirdly, s 6 of the FSI Act then operates as Blokland J reasoned in Williamson, so that ss 12(1) and 12(2) are to be read down as not extending to the proceedings on those claims. Fourthly, that the ALRC’s report expressly contemplated that ss 12(5), (7) and the immunities of the FSI Act would continue to be supplemented by the protections under the VCDR.

79    Unquestionably, s 6 of the FSI Act preserves immunities conferred by the DPI Act and, in particular, those provisions of the VCDR that are given force by that Act under Australian law: s 7 DPI Act. However, an answer to all four propositions, is that the savings provision in s 6 is directed to the preservation of an immunity or privilege conferred by, inter alia, the DPI Act. It is not directed to immunity in a proceeding.

80    It may also be accepted that our common law system recognises the long-standing principle of statutory interpretation that statutes are to be interpreted, so far as possible, in a manner consistent with international law: Kingdom of Spain at [16]. However, international law, unless incorporated, does not form part of Australian domestic law, and must give way where the words of the statute are inconsistent with the implication: Polites v Commonwealth [1945] HCA 3; 70 CLR 60 at 68–9 per Latham CJ. Latham CJ recognised that “courts are bound by the statute law of their country, even if that law should violate a rule of international law”. This reasoning was taken up by McHugh J at [63] in Al-Kateb v Godwin [2004] HCA 37; 219 CLR 562, where his Honour said “as Polites decided, the implication must give way where the words of the statute are inconsistent with the implication”. As French CJ stated in Tajjour v New South Wales [2014] HCA 35; 254 CLR 508 at [48]: “Absent such incorporation, the existence of the Convention obligation is relevant to the interpretation of State laws, analogously to the principle of legality”. These principles inform the first proposition: Art 7 has not been incorporated into Australian law.

81    In any event, art 7 (which provides that the sending state may freely appoint staff of the mission) is not undermined by a court or tribunal awarding compensation: The Court is not interfering with the appointment of staff by requiring employment or reinstatement but rather adjusting the financial consequences of (unlawful) dismissal by awarding compensation. As observed by Lord Sumption in Benkharbouche at [70]:

[A] claim for damages for wrongful dismissal does not require the foreign state to employ any one. It merely adjusts the financial consequences of dismissal. No right of the foreign state under the Vienna Convention is infringed by the assertion of jurisdiction in the forum state to carry out that adjustment. Therefore, no right under the Vienna Convention would be prejudiced by the refusal of the forum state to recognise the immunity of the foreign state as regards a claim for damage.

82    The applicant’s second proposition was to the effect that these unfair dismissal claims would interfere with the mission’s immunities conferred by arts 22, 24, 27, 31(2) and 38(2), affirmed by Williamson and Norwegian Embassy. For example, it was submitted that the Commission could not exercise any power under Part 3-4 of the FW Act relating to the entry of premises in violation of the absolute immunity afforded under art 22 of the VCDR. Here, application of the FW Act operates to subject the diplomatic mission of a foreign State, without the express consent of the foreign State or the head of the mission, to a proceeding by Australian permanent residents for unfair dismissal orders in which a part of the executive of the receiving state must enquire into whether the dismissal was harsh, unjust, or unreasonable which necessarily requires an inquiry into the reasons of the foreign State for the dismissal. Unless satisfied of a valid reason, it is likely the foreign State will be found to have unfairly dismissed the employees, and the Commission must then address whether reinstatement is inappropriate. At that point the claimant is not an employee. It is an inquiry as to whether it is appropriate for the diplomatic mission of a foreign State to reappoint the employee.

83    This was said to be so because Australia, by subjecting a foreign State to unfair dismissal proceedings in which the state risks an unfair dismissal order being made against it if it does not give evidence of its reasons, is said to intrude into the privacy of the state’s diplomatic functions inconsistently with the VCDR (contra FB[68]). By way of example, the Court’s attention was drawn to the content of art 27(2) and the inviolability of the official correspondence of the diplomatic mission and to the meaning of “inviolability”. A note and summary of the applicant’s documents, correspondence and private conversations at the premises said to be the subject of potential scrutiny from the content of the relevant employees’ claims was provided to the Court. It was submitted that art 27(2) protected the free communications of the mission and that any litigation would necessarily result in discovery or require material which would offend the protections bestowed on the mission by this article. It was submitted that that inconsistency with Australia’s international obligations and the immunities and privileges afforded to diplomatic missions is avoided by the applicant’s narrow construction of s 12(1).

84    I do not accept that the purported “interference” is of a kind that goes to jurisdiction, but rather to procedure. The relevant articles relied upon concern the inviolability of the mission, its archives and documents and correspondence: arts 22, 24 and 27. They also concern a diplomatic agent not being obliged to give evidence as a witness (art 31(2)) and the privileges and immunities of other members of staff of the mission (art 38(2)). Those immunities and privileges may curtail the ability of the Commission to compel the provision of documents and evidence but do not go to jurisdiction.

85    Neither of the authorities relied upon by the applicant assist in the construction of s 12 of the FSI Act. Williamson arises in a different factual and legal context: The matter concerned whether the United States of America was immune from Mr Williamson’s claim (a United States marine who suffered personal injury whilst posted in Darwin). The determination of whether there was immunity involved the construction of ss 6 and 13 of the FSI Act as well as s 13 of the Defence (Visiting Forces) Act 1963 (Cth). The Norwegian Embassy decision was that of the Italian Court of Cassation, arising in inquisitorial as opposed to adversarial proceedings. It concerned the operation of customary international law (as applicable in Italy in 1991), European Convention of State Immunity (Basle), opened for signature on 16 May 1972, ETS No. 74 (entered into force 11 June 1976) and then applicable Italian authority. Furthermore, the decision in Commissioner of Police for New South Wales v Eaton [2013] HCA 2; 252 CLR 1 concerned the purported incoherence between the ability of the Police Commissioner to dismiss without reasons under the Police Act 1990 (NSW) and the State unfair dismissal regime. No persuasive submission was made by the applicant as to any like purported inconsistency between s 12 and the identified articles in the VCDR.

86    For the same reasons, the applicant’s third proposition is rejected. The dicta in Williamson cannot be applied by analogy to read down ss 12(1) and (2). The presumption that legislation is intended to conform with international law cannot displace the enacted text of s 12(1). Section 12(1) expressly provides that there is no immunity for employment-related claims subject to specifically enumerated exceptions. It is not open to imply further limitations based on unincorporated provisions of the VCDR or general principles of international law. This would be contrary to the evident purpose of the FSI Act, as referred to by the High Court, namely to set out “in clear and accessible form the law relating to the jurisdiction of Australian courts over foreign States, their agencies and instrumentalities”: Greylag Goose at [15] per Gageler CJ, Gleeson, Jagot and Beech-Jones JJ. Furthermore, the applicant’s argument as to offence to the mission, by operation of the VCDR, would likely apply to any proceedings including of a contractual kind. This likely consequence of the applicant’s argument was acknowledged by the Full Bench, at FB[71].

87    Indeed, it is evident, that Parliament was aware of the peculiarities of (including protections afforded to) diplomatic missions, by reason of the reference to the VCDR in ss 12(5) and (6). By operation of s 12(6), the FSI Act specifically contemplates that a proceeding may be brought by a member of the administrative and technical staff of the mission if the member or employee was, at the time the employment contract was made, a permanent resident of Australia. I reject the applicant’s claim that ss 12(5) and (6) only operate to provide an exception to s 12(1) and their presence does not assist in identifying the scope of s 12(1).

88    Lastly, the applicant’s fourth proposition said to support its construction, is the purported express contemplation in the ALRC’s report that the equivalents of ss 12(5) and 12(7) were to operate in tandem with other immunities’ regimes, that is, be supplemented by the protections under the VCDR. Reliance was placed on para [100] of the ALRC’s Report, fn 60. I do not accept that this aspect of the Report aids the applicant’s construction, rather it has the opposite effect. Paragraph 100 was, as follows:

100. Employees of Diplomatic and Consular Missions. The State Immunity Act 1978 (UK) s 16(l)(a) specifically excludes from the operation of its employment provision any proceedings concerning the employment of members of a diplomatic mission or consular post. It is recommended that the proposed legislation contain a provision to similar effect, but more restricted in scope. Diplomatic and consular law does not expressly address the issue of such employees suing their employer, but it does not require a total bar on such suits. In practice, the provisions so far recommended on employment would prevent most nationals of the foreign state recruited abroad from suing. But in recognition of the particularly sensitive relationship between foreign states and their diplomatic and consular personnel, some formal reservation of such employment contracts is desirable. On the other hand there seems no reason why locally recruited staff employed on routine administrative, clerical or maintenance functions should not be able to sue their foreign state employer. The appropriate balance should be struck at two levels. First it is desirable to exclude entirely from local jurisdiction the employment of members of the diplomatic staff of a mission, and of consular officers, as defined in the relevant international conventions. Secondly, employment contracts with members of the administrative and technical staff of a mission and consular employees, as so defined, should also be excluded unless the employee was, when the contract of employment was entered into, a national or a permanent resident of Australia. This would leave the general rule to apply to the least sensitive categories of employees (‘members of the service staff or ‘members of the private staff), who are also, perhaps, most in need of protection. (Footnotes omitted).

89    Notably, the Report referred to the fact that “diplomatic and consular law does not expressly address the issue of such employees suing their employer, but it does not require a total bar on such suits” (emphasis added). It is in this context that reference is made to the concurrent “immunities” accorded under the VCDR (fn 60). However, what is clear from the remainder of the paragraph, is that despite such immunities under the VCDR, no such exclusion should apply to members of the administrative and technical staff of the mission if the contract was entered into in Australia and the person is a national or permanent resident of Australia.

Art 21 of the employees’ contracts is not an inconsistent term within the meaning of s 12(4)(a) (Ground three)

90    As an alternative to grounds one and two, the applicant contends, even if it is not immune from unfair dismissal proceedings by operation of s 12(1), the exception to that exception under s 12(4) applies. Sections 12(1) and (4) are in the following terms:

12 Contracts of employment

(1)    A foreign State, as employer, is not immune in a proceeding in so far as the proceeding concerns the employment of a person under a contract of employment that was made in Australia or was to be performed wholly or partly in Australia.

…..

(4)     Subsection (1) does not apply where:

(a)     an inconsistent provision is included in the contract of employment; and

(b)     a law of Australia does not avoid the operation of, or prohibit or render unlawful the inclusion of, the provision.

91    The applicant submitted that each of the first to the thirteenth respondents entered into a written contract with the applicant in substantially the same terms. Each of the contracts provided for the contract’s term, ways in which the contract could or would end and the applicable payments to be made when the contract ends (arts 2, 15, 16, 17, 18 and 19). The purported “inconsistent provision”, within the meaning of s 12(4)(a), was identified to be art 21 (read in the context of art 20). The agreed translation of those clauses is as follows:

Article (20)

Signing of this contract by both parties shall establish their obligation to commit to content hereof. The SP's signature on this contract shall be conclusive. The SP shall have no right to claim what is not contained in the contract.

Article (21)

The Arabic version of this contract is the original. Any dispute arises between the parties hereto in respect of any article of this contract shall be referred to the Ministry of Civil Service in Saudi Arabia a decision of which shall be conclusive.

92    The applicant submitted that art 21 (when read with art 20) is clearly an exclusive jurisdiction clause and an “inconsistent provision” within the meaning of s 12(4)(a). The applicant submitted that the Full Bench had erred in finding, at FB[92]-[99], that the effect of art 21 did not extend to an unfair dismissal claim, and that, in any event, the FW Act avoided the operation of art 21. The applicant submitted that each of the respondents’ claims is for the payment of money based upon a claim that the engagement should not have ended and one for which the contract did not provide (contrary to art 20). The applicant submitted that by art 21 the parties agreed that any dispute concerning such a claim would be referred to the relevant Saudi Arabian authority, because it was “in respect of” an article of the contract.

93    I reject the applicant’s submission: Art 21 of the employment contract is not an “inconsistent provision” within the meaning of s 12(4)(a). Given my view in this regard, there is no need to determine whether the FW Act avoided the operation of art 21.

94    The applicant’s argument is premised on the basis that art 21 comprises an exclusive jurisdiction clause. This involves determining whether art 21, on its true construction, obliges the parties to resort to the relevant jurisdiction irrespective of whether the word “exclusive” is used: Akai Pty Ltd v People’s Insurance Co Ltd [1996] HCA 39; 188 CLR 418 at 424–5 per Dawson and McHugh JJ. In Akai, the plurality identified the relevant inquiry in construing choice of forum clauses to be as follows: Whether there exists a choice of courts clause, and if so, whether “it constitutes a submission to the exclusive jurisdiction of the courts which it specifies”. A real distinction is drawn between the existence of a choice of courts clause and whether it is intended to have exclusive operation.

95    This reasoning runs contrary to the submission of the applicant: When the Court construes a choice of forum clause, it does not accept as a matter of necessity that the particular forum should have exclusive jurisdiction. Rather, as is the case before this Court, the question may arise as to whether “the relevant dispute fell within that clause” and “whether or not what had been put in place… was an exclusive or a non-exclusive jurisdiction clause”: Incitec Ltd v Alkimos Shipping Corporation [2004] FCA 698; 138 FCR 496 at [24]–[25] per Allsop J.

96    Properly construed, art 21 concerns the choice by the parties for the referral of any dispute to the Minister of Civil Service in Saudia Arabia, in respect of any article of [the] contract. The question of whether s 12(4)(a) is engaged, is answered by whether the contract contains a provision which is inconsistent with the local forum having jurisdiction: Benvenuto at [54]-[65]. As the respondents submitted, the bar is not whether a claim exceeds the contract, but whether the parties have agreed to exclude the jurisdiction of the local forum. It is my view that art 21 limits the choice of forum to disputes with respect to the contract only. I do not accept the applicant’s characterisation of the dispute as being claims for payment of money are “in respect of” an article of the contract. A claim for unfair dismissal concerns statutory not contractual entitlements. Such a claim requires the determination of whether the dismissal was harsh, unjust or unreasonable, within the meaning of s 385 of the FW Act, taking into account the criteria under s 387 of the FW Act. It does not require nor could involve the determination of any dispute as to the terms of the contract.

A foreign State can be a “national system employer” within the meaning of s 14(1)(f) of the FW Act (Ground four)

97    By the fourth ground, the applicant submitted that the unfair dismissal provisions of the FW Act only apply to “national system employers”, as defined in s 14 of the FW Act. The applicant submitted that a foreign State does not comprise any of the bodies or persons to which s 14 applies. Section 14 is in the following terms:

14     Meaning of national system employer

(1)     A national system employer is:

(a)     a constitutional corporation, so far as it employs, or usually employs, an individual; or

(b)     the Commonwealth, so far as it employs, or usually employs, an individual; or

(c)     a Commonwealth authority, so far as it employs, or usually employs, an individual; or

(d)     a person so far as the person, in connection with constitutional trade or commerce, employs, or usually employs, an individual as:

(i)     a flight crew officer; or

(ii)     a maritime employee; or

(iii)     a waterside worker; or

(e)     a body corporate incorporated in a Territory, so far as the body employs, or usually employs, an individual; or

(f)     a person who carries on an activity (whether of a commercial, governmental or other nature) in a Territory in Australia, so far as the person employs, or usually employs, an individual in connection with the activity carried on in the Territory.

Note 1:     In this context, Australia includes Norfolk Island, the Territory of Christmas Island and the Territory of Cocos (Keeling) Islands (see the definition of Australia in section 12).

Note 2:     Sections 30D and 30N extend the meaning of national system employer in relation to a referring State.

98    The applicant made passing reference to the Full Bench’s reasoning that the applicant was a “national system employer” within the meaning of s 14 of the FW Act: FB[112]-[122]. There was no clear articulation of the purported error by reference to the Full Bench’s decision.

99    Rather the applicant made a broad submission that foreign States do not form part of this detailed and prescriptive provision. This construction was said to be aided by the text of the provision as well as its context, as summarised in the following way:

(a)    Section 14 should be construed as not including a foreign State. It was submitted that the insertion of the definition of “national system employer” was concerned with extending the reach of the FW Act to the limits of Commonwealth power by regulating the private sector (by use of the corporations power) but importantly did not include the regulation of governmental employees of the States and Territories. Section 14(1)(f) was not intended by Parliament to capture body politics (including foreign States) in the meaning of “persons”, because the Commonwealth and its instrumentalities are expressly identified in s 14(1)(b) and (c). It was submitted that it would be absurd if s 14(1)(f) included foreign States and therefore extends to the employment of every Ministry of Foreign Affairs working at an Australian desk in Canberra when the FW Act does not apply to the State or Territory government employees (unless by referral).

(b)    Furthermore, if foreign States were construed to be national system employers, they would be exposed to criminal liability for any conduct contravening an unfair dismissal order (s 675). The imposition of criminal liability would run contrary to the protections of the DPI Act.

(c)    The reasoning of the High Court in Bass v Permanent Trustee Co [1999] HCA 9; 198 CLR 334 counters the claim that by operation of (the former) s 22(1)(a) of the Acts Interpretation Act 1901 (Cth) a “person”, in s 14(1)(f) of the FW Act includes a “body politic”.

100    For the reasons which follow, I am of the view that the definition of national system employer extends to a foreign State. As a matter of construction, the interpretative starting point is that the reference in s 14(1)(f) to a “person”, by operation of the former s 22(1)(a) of the Acts Interpretation Act 1901 (Cth), includes a “body politic”. Such an intention is only displaced if a contrary intention is exposed by statutory construction. I do not accept that a contrary intention arises from the text nor the context.

101    As conceded by the applicant at hearing, s 14 must be construed not only by its terms but by reference to the legislative scheme. It is clear that the definitions of “national system employee” and “national system employer” operate to provide constitutional support for most parts of the FW Act. Other aspects of the FW Act do not apply to this form of employer but to an “employer” that has its ordinary meaning, because the underpinning constitutional power is different, for example the external affairs power (see for example Part 6-4, Div 2 – Termination of Employment). It may be accepted, as submitted by the applicant, that there was a seismic shift in the scope of operation of the FW Act, made possible by the deployment of the corporations power (s 51(xx)) as well as reliance on other constitutional powers, including the conciliation and arbitration power (s 51(xxxv)), the interstate and overseas trade and commerce power (s 51(i)) and the external affairs powers (s 51(xxix)).

102    However, it is my view, that understanding this seismic shift, together with considering other relevant parts of the FW Act that provide for how the Act is to have application (including over the States), aids a construction of s 14(1)(f) that covers foreign States rather than the contrary. This is because it is clear that the reach of s 14 and those other parts seeks to ensure that as far as possible all employees in Australia are covered by industrial laws at a Federal or State level. The fact that the States (as employers) are not included in the definition of national system employer arises because those States all had, and continue to have, their own forms of State industrial regulation and because of the Melbourne corporation principle which renders Commonwealth legislation which interferes with the operation of the States constitutionally invalid: Melbourne Corporation v Commonwealth [1947] HCA 26; 74 CLR 31 at 60-61, 66, 75, 79-81, 99-100. This latter concern is picked up by s 14(2) of the FW Act, which expressly carves out from national systems employers certain State employees. This was acknowledged in the Explanatory Memorandum to the FW Act (Australia, House of Representatives, Fair Work Bill 2009, Explanatory Memorandum) at [28]: “National system employers and national system employees are employers and employees (at common law) who are within the constitutional limitations set out in clauses 13 and 14.”

103    The mischief the FW Act, by operation of s 14 and the other application provisions within the Act, was seeking to confront was to include as many employers (that were the subject of legislated minimum employment standards, and modern awards) as the constitution permitted, not, as the applicant sought to suggest, to leave to the States a choice (and therefore body politics out of the fray). Rather as the Explanatory Memorandum stated at r.7-8:

Pending the development of a national workplace relations system, the Department estimates that up to approximately 85 per cent of Australian employees will be covered by the federal workplace relations system. The remaining employees will be covered by a state industrial relations system in New South Wales, Queensland, Western Australia, South Australia or Tasmania.

The Government’s policy is to enter into new arrangements with state governments to ensure a uniform workplace relations system for private sector employers and employees.

104    The way that the FW Act then covers the field, to the extent that the constitution permitted, was by virtue of the inclusion of all constitutional corporations (s 14(1)(a)) (therefore the overwhelming majority of employers in States or Territories throughout Australia), not only the Commonwealth (s 14(1)(b)) but Commonwealth authorities (s 14(1)(c)), persons, in connection with constitutional trade or commerce, who employ, or usually employ, an individual as a flight crew officer, a maritime employee or waterside worker (s 14(1)(d)), a body corporate incorporated in a Territory so far as the body employs or usually employs an individual (s 14(1)(e)) and a person who carries out an activity (whether of a commercial, governmental or other nature) in a Territory, so far as the person employs, or usually employs, an individual in connection with the activity carried on in the Territory (s 14(1)(f)). This reading coheres with the explanation for the provision in the Explanatory Memorandum where it states that “the definitions of national system employee and national system employer in these clauses operate together to provide the constitutional support for most parts of the Bill”, and that the subsections of s 14 are described as the “links to these heads of power”: at [63] and [65].

105    For this reason, the applicant misconstrues how one should read the content and purpose of s 14. The argument that s 14(1)(f) was not intended by Parliament to capture body politics (including foreign States in the meaning of “persons”), because the Commonwealth and its instrumentalities are expressly identified in s 14(1)(b), (c) is rejected. Indeed, the applicant omitted to refer to the fact that the Explanatory Memorandum stated the contrary:

69. A reference to a person in the definition of national system employer includes a body politic or body corporate as well as an individual (section 22 of the Acts Interpretation Act 1901 ).  Only legal persons can enter into contracts of employment with employees.  In the case of a partnership, an employee’s contract of employment is with each and every partner.  In the case of an unincorporated body, an employee’s contract of employment is with an individual member or individual members of that body.

106    The content and interaction between s 14(1)(e) and (f) is also significant. The provisions confront the mischief identified above, that Parliament intended the FW Act to cover as many employees and employers as possible in a uniform national system. This is why the FW Act states that it is intended that this Act will apply to the exclusion of all State or Territory industrial laws so far as they would otherwise apply in relation to a national system employee or employer: s 26. It allowed for the State government employers (and in certain instances Territory government employers) to remain under their independent systems (or as regulated by statute) but where it was envisaged that that those State or Territory government employers would all come into the fold eventually by referral. This is why the Act included Divisions 2A and 2B which concerned the application of the FW Act in States that refer matters before and after 1 July 2009 (but before 1 January 2010).

107    The applicant submitted that if the diplomatic missions of foreign States fell within the meaning of “person” in s 14(1)(f), an absurd result would occur: The FW Act would purport to regulate the employment “of all those public servants in Riyadh whose duties included assisting the Australian mission”. No such absurd result may occur. Section 14(1)(f) contains qualifications, namely that the person must employ, or usually employ, an individual in connection with the activity carried on in that Territory. Furthermore, the breadth of the section is informed by other provisions in the FW Act, in particular, Div 3 of Pt 1-3 of Ch 1 of the FW Act. This Division addresses the geographic application of the FW Act. Section 31 makes provision for the “[e]xclusion of persons etc. insufficiently connected with Australia”. As Barker J observed in Fair Work Ombudsman v Pocomwell Ltd (No 2) [2013] FCA 1139; 218 FCR 94 at [27], “when regard is had to Div 3, its heading and s 31(1), in particular, it appears the FW Act is intended to apply in Australia in a geographical sense”. His Honour observed, though in obiter, that this would include “those places, such as the [Exclusive Economic Zone], where the FW Act may have permissible reach”: at [262]. A person, who is caught by s 14(1)(f), must be a person performing the activities described in the section and by the geographical limits otherwise imposed by the FW Act. I reject the applicant’s submission that a necessary consequence of accepting a construction of s 14(1)(f) that includes foreign States means that the FW Act has what is effectively unlimited geographic operation.

108    Indeed, there has been prior recognition in this Court of the need to construe the limits of s 14 by reference to its geographical limits: Fair Work Ombudsman v Valuair Limited (No 2) [2014] FCA 759; 224 FCR 415 per Buchanan J. This case concerned whether two foreign incorporated companies, which operated as airlines, were the national system employers because they were “foreign corporations” and were caught by s 14(1)(a) of the FW Act: [67]. His Honour made clear that the operation of s 14(1)(a) could not “render every foreign corporation throughout the world a national system employer, regardless of any connection at all with Australia” at [68]. Rather, “[s]ome sufficient connection must therefore be made with Australia, either so far as the constitutional corporation is concerned, or so far as its employees are concerned” (emphasis added) at [68].

109    Contrary to the applicant’s submission, the potential for s 675 of the FW Act to apply does not justify reading down s 14(1)(f). The applicant submitted that the extension of “national system employers” to foreign States would have the effect of them being exposed to criminal liability for any conduct contravening an unfair dismissal order: s 675 FW Act. This was said to be by contrast to the Commonwealth and the States or Territories who are immune from liability for being prosecuted for an offence: s 37(2). It was submitted that the imposition of criminal liability on a diplomatic mission of a foreign State would run completely contrary to the protections under the DPI Act. However, contrary to the applicant’s submission, the Crown can be liable for prosecution of an offence in certain circumstances (s 37(3)) and for a contravention of a civil remedy provision (s 37(4)). It is apparent that specific consideration was given to excluding the Crown in certain circumstances (and not other entities). The content of this provision does not assist the applicant’s construction.

110    Furthermore, s 675 only applies where an employer fails to comply with a binding order of the Commission. I accept the submission of the respondents that the existence of diplomatic immunities under the DPI Act and the VCDR may be relevant to enforcement (and the reading down of that provision) but does not prevent the valid conferral of jurisdiction.

111    Lastly, the applicant contends that the reasoning of the High Court in Bass counters the claim that a “person”, in s 14(1)(f) of the FW Act, includes a “body politic” and in particular a foreign State. This was said to be so, by the adoption of an analogous analysis, to be applied to the FW Act in the way that it was undertaken by the High Court in Bass to the (then) Trade Practices Act 1974 (Cth). In that case the issue was whether the State of New South Wales could be sued for contraventions of ss 51AB and 52 of that Act with respect to a State-run housing assistance scheme. Of relevance to the applicant’s argument, it was held, inter alia, that the State was not a person within the meaning of ss 6(3) or 75B(1) of that Act and that Act evinced an intention that, contrary to s 22(1)(a) of the Acts Interpretation Act, a State was not a “person” for the purpose of those sections. I do not accept that the analysis in Bass leads to a result in this case that a contrary intention has displaced the default rule in s 22(1)(a). The holding in Bass arose from a different statutory scheme. In that case, much was made of the fact that s 2A of the Trade Practices Act expressly addressed the position of the Commonwealth and limited its liability to business activities, but was silent as to the position of the States: Bass at [22]-[24]. By contrast, there is no such “silence”, in the FW Act with respect to the position of the States (both from the perspective of application and limits on liability). They are dealt with. However, the applicant argued that there was comparative silence as between account taken for the States and no purported account for foreign States. Or alternatively, the applicant appeared to be submitting that because, by operation of other aspects of the FW Act, a “person” in s 14(1)(f) could not include a “State or Territory” and could not be taken to mean a “person” including body politic in the broad sense. For the reasons already given above, I do not accept that the fact that State and Territory governmental employers are, in certain respects, beyond the reach of the FW Act means that a contrary intention is inferred (that the inclusive formulation of “person” does not include a foreign State in s 14(1)(f)). Unlike in Bass, the extension of the operation of the FW Act to foreign States is entirely consistent with the FW Act’s structure and purpose.

112    A compelling coherence exists between the FSI Act bringing into existence a codification of the then developing doctrine of restrictive foreign State immunity, and the FW Act making provision for foreign States to be covered as national systems employers and susceptible to certain employment claims. In addition to the above, I accept that s 14(1)(f) should incorporate foreign States as persons within the meaning of national systems employers, as it coheres with the exception to immunity in s 12 for employment relationships, and in particular the exception for rights or obligations under laws of Australia: s 12(2); that employees within the exception should have the benefit of making claims for rights under the FW Act. It might be described as an interpretation which coheres with the principle of statutory interpretation of in pari materia: That Acts upon the same subject are generally to be read harmoniously. Here, it was contemplated by Parliament in s 14(1)(f) of the FW Act that “persons” in the meaning of national systems employer would include “bodies politic”. It was also contemplated by Parliament in the FSI Act that certain employment claims (including under Australian law) by certain persons would be permitted against bodies politic. The principle stands to accept that there is a coherence in accepting the overlap which exists.

The employees were permanent residents within the meaning of ss 12(6) and (7) of the FSI Act (Ground five)

113    Ground five concerns whether the second, eighth and ninth respondents were “permanent residents” within the meaning of ss 12(6) and (7) of the FSI Act such that s 12(1) applied and the applicant was not immune from the claims made by them. Sections 12(6) and (7) are in the following terms:

(6) Subsection (1) does not apply in relation to the employment of:

(a) a member of the administrative and technical staff of a mission as defined by the Convention referred to in paragraph (5)(a); or

(b) a consular employee as defined by the Convention referred to in paragraph (5)(b);

unless the member or employee was, at the time when the contract of employment was made, a permanent resident of Australia.

(7) In this section, permanent resident of Australia means:

(a) an Australian citizen; or

(b) a person resident in Australia whose continued presence in Australia is not subject to a limitation as to time imposed by or under a law of Australia.

114    Accordingly, as to whether a person is a “permanent resident” of Australia involves two concepts, citizenship and residency without limitation of time imposed by or under a law of Australia.

115    The applicant submitted that the Full Bench impermissibly, at FB[146], expanded the inquiry into one of fact (or effect of foreign law): Whether New Zealand citizenship was held by each relevant respondent indefinitely. The Commission found that the relevant employees held sub-class 444 visas at the time their contracts of employment with the applicant were made. With the aid of the applicant’s chronology, the applicant submitted that at all times since the visa system was introduced, the Migration Regulations have prescribed conditions for the 444 visa. They include that the applicant is not the holder of a permanent visa: Migration Regulations sch 1 item 1219; and identify the 444 visa as a temporary visa. The conditions on a 444 visa when granted have also been the subject of regulations at all times. Those conditions include that the visa is a “temporary visa permitting the holder to remain in Australia while the holder is a New Zealand citizen”: Migration Regulations sch 2, item 444.511. A 444 visa ceases upon a person’s departure from Australia: at FB[144].

116    The essential gravamen of the applicant’s submission was that the conditions of the 444 visa impose a limitation as to time: The visa could not be in force for any longer than the visa holder held New Zealand citizenship or remained in Australia such that the relevant employees were not permanent residents within the meaning of ss 12(6) and (7). That construction was said to be supported by the reasoning in Li v So [2019] VSC 515; 349 FLR 352 at [93] per Croft J (footnotes omitted):

93    The defendant relies exclusively on the plaintiff's pleaded position that she “resided in Australia on a temporary resident visa until January 2013 when she was granted a permanent resident visa”.

117    This submission is rejected. It is premised on a construction of “permanent resident” which is referrable to the scheme of permanent and temporary visas under the Migration Act. The expression “permanent resident” is defined by s 12(7) which involves two concepts: citizenship and residency without limitation of time imposed by or under a law of Australia. Those concepts do not both arise under the Migration Act; citizenship is dealt with under a different legislative scheme. There is no reference in s 12(7) to either Act. The correct approach is to construe the expression, by its ordinary meaning, giving consideration to the text, context and purpose of the FSI Act.

118    A person who has been granted a 444 visa is not the subject of a limitation as to the time he or she can continue to be present in Australia. Rather, the grant permits indefinite residence in Australia so long as the person remains a New Zealand citizen and does not leave Australia. The Migration Regulations, as they existed in 2011, provided that the only criteria for the grant of a 444 visa were those set out in s 32(2)(a) of the Migration Act 1958, as it then existed, and in reg 5.15A. The visa conditions required that the visa applicant was a New Zealand citizen; that he or she held, and had presented to an officer or an authorised system, a New Zealand passport that was in force; and that the applicant was neither a behaviour concern non-citizen nor a health concern non-citizen: s 32(2)(a). The 444 visa was described as a temporary visa permitting the holder to remain in Australia while they were a New Zealand citizen: cl 444.5 of sch 2 of the Migration Regulations. Therefore, the visa did not have a temporal but a status limit.

119    As to the import of the reasoning in Li v So, it concerned the distinct statutory context of the Foreign Acquisitions and Takeovers Act 1975 (Cth). In Li v So, Croft J broadly construed the relevant provision of that Act such that a person was deemed to not be ordinarily resident in Australia if the person had a conditional visa (including a status limit) that was not necessarily constrained by time: at [96]. However, the relevant reasoning was obiter, involved the construction of different legislative language (“subject to a time limit imposed by law”) and where that legislation necessarily serves a distinct and different policy objective (the regulation of foreign ownership).

120    The statutory limitation in s 12(7) is one as to time. Accordingly, I accept the respondents’ submission that it is not enough that a person’s right to remain is conditional in some respect, rather the focus is whether that right is constrained by reference to a finite or ascertainable duration.

121    Further, the applicant alleged that there was no “direct evidence” that any of the second, eighth and ninth respondents held 444 visas as at the date of the contract (and in the case of the eighth respondent, at any time). The Deputy President had been satisfied that each of the relevant employees had held 444 visas at the time the employment contracts had been made. The Full Bench was of the view that the applicant did not challenge this finding before the Full Bench: FB[142]. The relevant ground relied upon by the applicant (ground four) before the Full Bench was in general terms. I reject the submission that there was no “direct evidence” before the Full Bench regarding whether the three employees held 444 visas at the date their employment contracts were made. Particular care also needs to be given to the application of the underlying common law “no evidence” principle when reviewing the decision of a tribunal not bound by the rules of evidence. It concerns the identification of an error of law where a factual finding has been made in the absence of any evidence or material whatsoever. The principle applies to both “evidence” and “material” where the case involves judicial review of decisions of a tribunal which is not bound by the rules of evidence. The Commission is not so bound: s 591 of the FW Act. The cases recognise that a tribunal may inform themselves as they think appropriate and therefore to consider their conclusions through an admissibility lens is misconceived: Construction, Forestry, Maritime, Mining and Energy Union v Anglo American Australia Limited [2019] FCAFC 109; 271 FCR 22 at [126] per Kerr and O’Callaghan JJ.

122    The second and nineth respondents stated that they held their 444 visas at or before the date of the employment contracts. As to the eighth, Mr Belkamel stated that he had held a 444 visa since early 2011 and that he commenced employment with the applicant on 11 October 2011. As adverted to by the respondents, to make out a claim that there was “no evidence” requires that there was “… no evidence capable of satisfying [the tribunal] on the issues in question”: KEPCO Bylong Aust Pty Ltd v Bylong Valley Protection Alliance Inc [2021] NSWCA 216, [79], citing A v Minister for Immigration & Multicultural Affairs [1999] FCA 227, [1] (Burchett and Lee JJ) Frugtniet v Australian Securities and Investments Commission [2023] FCAFC 14; 296 FCR 77 at [111] citing Rawson Finances Pty Ltd v Commissioner of Taxation [2013] FCAFC 26; 296 ALR 307 at [84] per Jagot J (with whom Nicholas J agreed). In this case there were some findings of fact supported by some probative material: Australian Broadcasting Tribunal v Bond (1990) 170 CLR 321, 367-8 (Deane J).

123    For these reasons, it is my view that the application must fail and that an order be entered that the application be dismissed.

124    Finally, I wish to acknowledge the very able assistance afforded to the Court by Senior and Junior Counsel and instructing solicitors for the first to thirteenth respondents who accepted a Court referral to appear on a pro bono basis.

Associate:

Dated:    15 December 2025

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