Are overseas employees of Australian companies protected by the Fair Work Act?

Unsure if the Fair Work Act applies to overseas employees? Learn how Australia’s employment legislation affects staff working abroad and what your obligations are under the Fair Work Act.

As more and more employers turn to outsourcing to overseas countries to complement their workforce, it’s a question that’s becoming increasingly relevant as Australian businesses expand globally or engage remote workers from abroad.

Australia is well known for its robust employee protections. From minimum wage guarantees to unfair dismissal rights, the Fair Work Act 2009 (Cth) (FW Act) provides a comprehensive framework that supports lawful treatment of workers. 

What happens when an Australian company employs someone who lives and works overseas? Are those employees also covered by the Fair Work Act?

While the answer isn’t always straightforward, recent decisions from the Fair Work Commission (FWC) are beginning to shed light on how far Australia’s workplace laws can reach.

Does the fair work act apply to overseas employees 

The Fair Work Act is designed to apply primarily within Australia. However, it does have some extraterritorial reach. Section 34 of the Act allows for its application beyond Australia’s borders, and Regulation 1.15F of the Fair Work Regulations 2009 extends certain protections, like the National Employment Standards (NES) – to “Australian-based employees.”

The Legal Framework: who’s covered?

So, who qualifies as an “Australian-based employee”? According to section 35(2) of the FW Act, it includes anyone employed by an Australian employer, regardless of where they are physically located. But there’s a catch: section 35(3) excludes employees who were engaged outside Australia to perform duties outside Australia.

This means the key question becomes: Where was the employment contract formed?

Real Case Examples: Australian Employees Working Overseas

Let’s look at how this plays out in real life.

In Gautam Parimoo v Lake Resources N.L. [2023] FWC 2543, Mr Parimoo, a U.S. citizen, was employed by an Australian company to work in Argentina. Despite never working in Australia, he was allowed to pursue a general protections claim under the Fair Work Act. Why? Because he signed and returned his employment contract to the employer in Australia. Under electronic transactions law and contract formation principles, this meant the contract was formed in Australia, so he wasn’t “engaged outside Australia.”

A similar situation arose in Joanna Pascua v [2024] FWC 2669, where a Filipino employee of an Australian company, who had never set foot in Australia, was permitted to bring an unfair dismissal claim. Although the legal point wasn’t challenged on appeal, the case suggests that the location of contract formation can be more important than the employee’s physical location.

Contrast that with Amit Singhal v National Australia Bank Limited [2024] FWC 2675, where Mr Singhal was employed by NAB’s Indian subsidiary. His contract was formed and executed in India, and all work was performed there. The Fair Work Commission ruled that he was not covered by the Fair Work Act, even though his work ultimately benefited the Australian parent company.

Why Does It Matter?

These cases highlight a critical point: the place where the employment contract is formed can determine whether the Fair Work Act applies.

For employers, this means that if you don’t want overseas employees to be covered by Australian employment law, you should:

• Ensure employment contracts are not sent from or returned to Australia.
• Make it clear that the contract is governed by the local law of the employee’s country.
• Use a local entity to employ the worker, where possible.

Beyond Dismissal: Understand the Broader Implications

The reach of the Fair Work Act isn’t limited to unfair dismissal or general protections claims. If an overseas employee is deemed “Australian-based,” they may also be entitled to:

• Minimum wages and leave entitlements under the NES.
• Coverage under Modern Awards.
• Protection from adverse action or discrimination.

However, there are exceptions. One notable area is long service leave, which, although part of the NES, is still largely governed by state legislation.

Long Service Leave: An Example in Queensland

In Fox v Infosys Technologies Ltd [2024] QIRC 109, the Queensland Industrial Relations Commission (QIRC) clarified how long service leave applies to overseas employees. The employee in question had worked mostly overseas but had spent just 18 days working in Queensland. That was enough for the QIRC to find that the employee was entitled to long service leave under Queensland law.

The Full Bench noted that while service must be “partly in the State,” even a short period could be sufficient, though this would depend on the facts of each case. Other states may take a different approach, so it’s wise to seek legal advice if long service leave is in question.

Practical Tips for Employers

If your business employs staff overseas, or is considering doing so, here are some practical steps to reduce legal risk:

1. Review your employment contracts. Where employees are not based in Australia, ensure their contracts are clearly governed by local law.
2. Use local entities where possible. Employing staff through a local subsidiary can help clarify which legal system applies.
3. Be consistent with documentation. Where possible, avoid sending contracts from Australia or having them returned to an Australian office.
4. Train your HR team. Make sure those who manage your HR requirements understand the implications of contract formation and jurisdiction.
5. Get advice. Especially when seconding employees overseas or hiring remote international workers.

Key Takeaways

While the Fair Work Commission has provided some guidance, the issue hasn’t yet been fully tested by a Full Bench. Until then, the safest approach is to assume that contract formation matters, and that even remote or overseas employees may be able to access Australian employment protections if their contracts are formed in Australia.

As the global workforce becomes more mobile and remote work more common, this area of law will likely continue to evolve. For now, employers should tread carefully and seek advice when navigating cross-border employment relationships.