The Federal Court of Australia recently decided in favour of a representative proceeding (more commonly known as a ‘class action’) brought on behalf of approximately 150 workers, and backed by the Construction, Forestry, Mining, and Maritime Employees Union against Thiess Pty Ltd, on the question of payment for travel time at the end of a worker’s shift.[1] The case is part of the growing trend of class actions in the employment sphere.

Facts

In 2012 Thiess was subcontracted to undertake part of the construction work for Chevron’s Wheatstone LNG Project near Onslow in remote northern Western Australia (the Project). The Project site stretched over 10 square kilometres. Thiess’ employees were engaged for a 16 month period on a fly-in fly-out basis. A dispute later arose over the interpretation of the Thiess Pty Ltd Wheatstone Project Agreement 2012 (the Agreement), specifically, whether the workers were entitled to be paid for the time taken to travel from the ‘crib huts’ on site to the security gate at the end of each work day. Frank Sheehan was one of Thiess’ workers.

At the end of each work day, the workers assembled at the crib huts near where they were working on site and were then transported by bus to their accommodation which was situated near the site. The bus passed through a security gate on the boundary of the site. The Agreement stated:

“An Employee’s Project Working Hours shall start at the Employee’s prestart and finish at the inside of the Site Employee access gates.”

Mr Sheehan argued his hours of work finished when he reached the access gate, being the security gate on the boundary of the Project. It took 20 minutes to travel from the crib hut to the access gates and he was therefore entitled to be paid for an additional 20 minutes of each work day. Other payments linked to working hours would also need to be adjusted.

In contrast, Thiess argued:

  • the purpose of the clause was purely to provide a limit on the activities that qualified as ‘work’, namely, activities undertaken within the access gates, and that any activities outside the access gates were not ‘work’;
  • time spent on the bus from the crib hut to the access gates was not work and therefore not part of Mr Sheehan’s working hours; and
  • there was no underpayment.

Outcome

The Court rejected Thiess’ interpretation of the clause and found it should have paid Mr Sheehan for the 20 minute bus drive because, under the Agreement, his working hours finished at the point immediately inside the Site Employee access gates.

The case will now be programmed to determine the quantum of the underpayment (for up to 150 employees over a 16 month period) and the penalty to be imposed on Thiess for breaching the Agreement.

Significance

Class actions in Australia are a relatively recent and emerging trend, compared with other jurisdictions around the world. The primary aim of class actions is to enable groups of people with similar claims, who have suffered loss or damage, to pursue their remedies more cheaply and efficiently than if they each brought an individual claim.

Although this case concerns the interpretation of a specific clause in one particular industrial agreement that no longer operates, it is part of a growing trend for employees in Australia who allege they have been underpaid, whether inadvertently or deliberately, to bring a class action. In 2018 we saw employees claiming they were misclassified as ‘casuals’ and should have received various entitlements such as paid annual leave.[2]  Given the current focus on ‘wage theft’ in Australia, we expect to see more claims like this in the near future.

For this reason, it is imperative that employers:

  • fully understand their pay-related obligations under relevant modern awards and industrial agreements;
  • keep and maintain all required pay-related records; and
  • periodically review/audit payroll compliance, particularly if there is a change in workplace practices or policy.

[1] Sheehan v Thiess Pty Ltd [2019] FCA 1762

[2] See, for example, WorkPac Pty Ltd v Skene [2018] FCAFC 131, reported in https://www.globalworkplaceinsider.com/2018/09/workpac