Industrial Relations Act 1979 (WA), s 3, s 7, s 23(1), s 29(1), s 90(3)

Colin Harris v Brandrill Ltd (2000) 80 WAIG 2456

Fitzgerald v Oil Drilling & Exploration (International) Pty Ltd (2000) 80 WAIG 4981

Lorimer v Smail [1911] HCA 44; (1911) 12 CLR 504

Mersey Docks & Harbour Board v Henderson Bros (1888) 13 AC 595

Ross v The Queen [1979] HCA 29; (1979) 25 ALR 137

1 KENNEDY J (Presiding Judge): I have had the benefit of reading in draft the reasons to be published by McKechnie J and Hasluck J, with which I am generally in agreement. It is abundantly clear that the proper law of the contract of service was the law of Western Australia, and that there was a very real and substantial connection with Western Australia, which was more than sufficient to confer jurisdiction on the Commission. I would dismiss the appeal, subject, however, to an adjustment in the damages in accordance with the agreement which has been reached between the parties.

2 This appeal raises for consideration whether the employer of a person who is engaged to work overseas is nevertheless amenable to the jurisdiction of the Western Australian Industrial Relations Commission when an action is taken for unfair dismissal.

3 The appellant Mr Parker carries on the business of the survey and commissioning of marine vessels under the business name "Marine Offshore Survey & Commissioning".

4 On 18 September 1998 he employed the respondent Mr Tranfield as an oil rig surveyor. Mr Tranfield was dismissed from his employment on 14 December 1999.

5 On 7 January 2000 he filed an application under the Industrial Relations Act 1979 s 29 claiming that he had been unfairly dismissed by Mr Parker.

6 Mr Parker did not appear at the hearing, although he did write to the Commission challenging its jurisdiction and otherwise disputing the merits of the claim.

7 At first instance the Senior Commissioner held that the Commission did not have jurisdiction.

8 Nevertheless he went on to determine compensation in the sum of $US23,790 with a further sum of $7000 as and by way of benefit denied to Mr Tranfield under his contract of employment. This was a convenient course, should he have erred in his decision on jurisdiction.

9 Mr Tranfield appealed to the Full Bench who unanimously upheld the appeal.

10 From that decision Mr Parker appealed to this Court on the following particularised grounds:

"1. The ground on which this appeal is made is that the Full Bench erred in law in holding that the Respondent (Applicant) was employed in an industry as defined in section 7 of the Industrial Relations Act 1979 'the Act' and that the Commission thereby had jurisdiction to hear and determine the Respondent's (Applicant's) claim pursuant to section 29 of the Act.

PARTICULARS

The Full Bench erred in law in holding that the Appellant (Respondent) carried on a business, trade, manufacture, undertaking or calling within Western Australia given that:

(a) There was no or insufficient evidence that the Appellant (Respondent) carried on any business, trade, manufacture, undertaking or calling within Western Australia.

(b) The Respondent (Applicant) was dismissed from an industry in France.

(c) The Respondent (Applicant) was not employed to perform any work in Western Australia, nor did he do so.

(d) Contrary to the finding of the Full Bench there was no evidence that the respondent (Applicant) could, or would have been required to work in Western Australia.

(e) All the work performed by the Respondent (Applicant) was in fact performed outside Western Australia, firstly in Singapore and then in France.

(f) There was no evidence that the Appellant's (Respondent's) office in Western Australia was its 'head office', and the centre of the industry, there being no evidence where the offer of employment and terms and conditions of employment emanated from, the only evidence being that the letter terminating the Respondent's (Applicant's) employment emanated from Canada, nor was there any evidence as to the extent of, and the nature of the activities conducted by the appellant (Respondent) from its offices in Western Australia in comparison with its offices in the United States of America, Singapore, the United Kingdom and South Africa.

(g) There was no evidence from where the payment by the Appellant (Respondent) to the Respondent (Applicant) emanated."

11 Although the Commission is said in the grounds to have erred in law, in my opinion the resolution of this case depends on the facts. This is consistent with the particulars set out above which look more like allegations of factual error than legal mistake.

12 It is not disputed that the Western Australian Parliament may make laws for the peace, order and good government of Western Australia and that pursuant to this power its laws may have extra-territorial effect.

13 In R v Foster; Ex parte Eastern and Australian Steamship Co Ltd [1959] HCA 10; (1959) 103 CLR 256 the High Court held that the Commonwealth Conciliation and Arbitration Commission had jurisdiction to make a binding award in respect of a log of claims served on a shipping company whose ships, registered in London, traded between South Australia and Japan. Dixon CJ was of the view that there was sufficient connection with Australia because the disputants were, for the most part, connected by residence, or the likes, with Australia and the demands were made with respect to employment for which masters, officers, and engineers were engaged in Australia.

14 Taylor J at 289 took the view that it was necessary for there to be a substantial connection with Australia.

15 Windeyer J, although in dissent on the overall decision, on this point expressed the position as follows at 311:

"Prima facie Commonwealth statutes ought not to be so construed as authorising any subordinate law-making body to deal with matters which have no real and substantial connexion with Australia or to make any rules except such as can be directly or indirectly enforced by the authority of Australian courts."

16 Later decisions of the High Court appear to have moved from the requirement of a "real and substantial connexion" to a less substantial connection.

17 In Pearce v Florenca [1976] HCA 26; (1975-76) 135 CLR 507 the High Court considered the validity of the Western Australian Fisheries Act.

18 After discussing the rule requiring a relevant connection between the personal circumstances on which the legislation operates and the State, Gibbs J said:

"For that reason it is obviously in the public interest that the test should be liberally applied, and that legislation should be held valid if there is any real connexion - even a remote or general connexion - between the subject matter of the legislation and the State. And it has been established by a series of well-known decisions, which are collected in Cobb & Co Ltd v Kropp [1967] 1 AC 141, at pp 154-156, that within their limits the legislatures of the States have powers 'as plenary and as ample' as those of the Imperial Legislature itself. It would seem anomalous and unfitting that the enactments of such a legislature should be held invalid on narrow or technical grounds."

This test was followed by the High Court in the Union Steamship Co of Australia Pty Ltd v King [1988] HCA 55; (1988) 166 CLR 1 by the Court at 14.

19 The cases are not precisely analogous in that the appellant does not dispute that the Industrial Relations Act 1979 might have extra-territorial effect in a proper case. Instead it is contended that the particular facts have no sufficient connection with the State. However, I consider the principles expressed in Pearce v Florenca and confirmed in Union Steamship v King are generally applicable to resolve factual questions about the extra-territorial effect of the Industrial Relations Act in particular circumstances.

20 As a result it may be that the nexus between the factual circumstances and Western Australia may not be so substantial as the Commission considered necessary to ground jurisdiction. A real, even though a remote, or general connection with Western Australia is sufficient.

21 The Commission set out the factual circumstances between par 36 and par 40:

"36 The facts are quite clear. Mr Tranfield entered into a written contract of employment in Western Australia. Clause (1) of the written contract describes the 'Point of Origin' in Western Australia (see exhibit 5 (page 43-48 of the appeal book (hereinafter referred to as 'AB'))). At the time, Mr Tranfield resided in Western Australia and continued to do so until the time of his dismissal, at least, and so did the respondent.

37 At all material times, the respondent's head office of his business was situated in Bunbury in this State, although it had a branch office in Houston, Texas in the United States of America. The address is described as the principal place of business in the extract from the Business Names Register (see exhibit 1, pages 30-33(AB)). The nature of the respondent's business was a worldwide one involving providing services to the oil drilling industry (see the assertion in the advertisement for the position (exhibit 2, page 34(AB)) which is conducted in many part of the world, a fact of some notoriety. The contract of employment was entered into in this State and within the jurisdiction of this Commission.

38 Mr Tranfield carried out his actual employment (ie performed his employment duties) in Singapore and France. He did not, at any time, carry out such duties in Western Australia, although he continued to reside here. He was paid here by the respondent and he was paid to travel overseas to work. Further, he was, and one assumes, placed in paid accommodation overseas and paid an accommodation allowance. At least, he was entitled to those benefits under the contract of employment. He was paid his wages in this State within the jurisdiction by the respondent from its head office, one infers. He also travelled backwards and forwards from Western Australia to Singapore and France respectively.

39 Notably, the written contract of employment called a 'Letter of Understanding' (see exhibit 5, pages 43-48(AB)) contains no specific reference to work occurring in or off Western Australia, but there is no exclusion of such employment and Mr Schapper's submission that the employer could have deployed Mr Tranfield in Western Australia (including off the Western Australia coast) we accept.

40 The dismissal was effected by a letter (exhibit 6, page 49(AB)) dated 14 December 1999. Mr Tranfield received that letter at his home in this State. (The Senior Commissioner found that the notification of dismissal occurred in this State.) After the dismissal, he was paid about $US15,000.00, being wages owing. He said, however, that he was still owed $US7,168.00 for wages."

22 The term "industry" is defined in the Industrial Relations Act 1979 to include any business of employers.

23 In the appellant's general contention, as expressed in the grounds of appeal, there was no significant evidence that the appellant carried on business within Western Australia.

24 Counsel for the appellant argued that the business was in reality a business for the hire of labour to others. The respondent was not engaged in that business as he acted for others as a marine surveyor, having been engaged through the medium only of the appellant's business.

25 However, the facts do not support this contention.

26 The business name extract for Marine Offshore Survey and Commissioning described the nature of the business as "Survey & Commissioning of Marine Vessels" carried on principally in Bunbury. The advertisement which Mr Tranfield answered commenced:

"OIL RIG SURVEYORS

require

RIG CHIEF ENGINEER

RIG MECHANIC

RIG SUB C ENGINEER

RIG ELECTRICIAN"

27 In the course of the advertisement it was stated:

"We req the above positions for current & future projects at locations world wide in ship yards for oil drilling vessels being upgraded or new build projects."

28 The letter of engagement dated 22 August 1998 commences:

"This is to confirm your employment with our company..."

29 Guidelines were enclosed. The guidelines entitled "PRE COMMISSIONING & COMMISSIONING GUIDE LINES" commence:

"Pre commissioning and final acceptance commissioning is our business and therefor we must carry out our inspections at the highest possible professional standard, we must be alert to any possible defects, our inspections must be EXACT AND COMPLETE."

"Our clients wants (sic) our opinion, we don't rely on other opinions, we are there to inspect the equipment condition and we have the engineering expertise to do this."

31 Also attached was a "TIME SHEETS GUIDE" which gave details of time sheets and invoices, accommodation and expenses. Under expenses it is stated:

"Careful consideration should be given to items purchased that they can be usefully used and that discretion is used at the cost of the item, and what we can do with it at the end of the project, in other wise (sic) don't pay high prices for things that we can't take with us, and are going to be disposed of, thrown out.

...

OVERALLS

The company will provide overalls with the company logo and surveyors name on the front pocket, and also provide a casual dress shirt with company logo on front pocket."

32 A letter of understanding, also described as a contract of employment, set out further details of the employment arrangements.

33 The documentation does not support particular (a) or particular (b) of the grounds of appeal. Whether or not the respondent was dismissed in France or in Western Australia matters little because the industry in which he was employed was the employer's business of survey and commissioning of ships.

34 As to grounds (c), (d) and (e), there was a real connection with Western Australia. The employer's business was in Western Australia. The contract of employment was made in Western Australia. Payment of the employee's salary was made in Western Australia. Repatriation on completion of a project was made to Western Australia. The fact that the employee was required to work entirely overseas for a Western Australian business does not prevent the conclusion that there was a real connection with Western Australia.

35 Particular (f) of the particulars is misconceived. Mr Tranfield's undisputed evidence to the Senior Commissioner was that he was employed in Western Australia. His evidence was that he saw the advertisement, faxed the address on the advertisement, received a telephone call from Mr Parker's daughter asking him to re-fax the information because she looked after the office here. He then received a telephone call from Mr Parker a month or so after and was offered a job over the telephone. He wanted to go over a few items so he travelled down to Bunbury and was further interviewed at the Lockwood Crescent address, following which Mr Parker wrote the letter of 22 August 1998 to which I have referred.

36 In short, the factual circumstances alleged by the appellant are not sustainable. The evidence is to the contrary. The Full Bench correctly found on the facts that there was a sufficient connection with Western Australia to found the jurisdiction of the Commission.

37 The parties have agreed that in the event the appeal on ground 1 is dismissed, the amount awarded by way of damages should nevertheless be reduced to $US20,185. In light of the agreement, I would reduce the amount of damages accordingly and allow the appeal to the extent necessary to reflect the agreement between the parties.

38 HASLUCK J: The appellant, Ray Douglas Parker, appeals against a decision of the Full Bench of the Western Australian Industrial Relations Commission. He seeks an order quashing the decision of the Full Bench on the ground that the Full Bench erred in law in holding that the respondent, Mark Anthony Tranfield, was employed in an industry as defined in s 7 of the Industrial Relations Act 1979 and that the Industrial Relations Commission thereby had jurisdiction to hear and determine the respondent's claim for relief in respect of an alleged unfair dismissal.

39 The appellant is a firm registered under the Business Names Act 1962 (WA). The firm trades as Marine Offshore Survey and Commissioning, the nature of its business being the survey and commissioning of marine vessels. The firm provides surveying and commissioning services to the offshore oil industry throughout the world.

40 It is apparent from the relevant business names extract that the principal place of business of the appellant firm is 49 Lockwood Crescent, Bunbury in the State of Western Australia. It seems that the firm also has an office in the United States of America.

41 The respondent came to be employed by the appellant after answering an advertisement published in The West Australian calling for oil rig surveyors, including a rig mechanic. The respondent was interviewed in Bunbury by the registered proprietor of the appellant firm and was subsequently offered employment, which he accepted.

42 The respondent was employed under the terms of a written contract entered into in this State. The employment commenced on 18 September 1998. It was a term of the contract that the respondent's "point of origin" was to be Perth, Western Australia "from and to which travel provisions

to the assignments will be provided by the company". It was also a term of the contract that the employer was to reimburse the respondent for any costs associated with obtaining visas as required for any project. Further, the employer firm was to provide living accommodation, together with an accommodation allowance. The contract was terminable by either party giving a minimum of 14 days' notice.

43 The respondent was sent to work as an oil rigger in Singapore, where he remained until the end of August 1999, when he was sent to work in France. On or about 14 December 1999, whilst in France, he was told by the proprietor of the appellant firm that he was being sent on leave, but a short time later he was told by the proprietor's son that he was to be dismissed. He subsequently received from the proprietor of the appellant firm a letter dated 14 December 1999, advising that his employment was terminated, allegedly for copying material owned by the appellant, in breach of his contract of employment. The letter effecting the dismissal was received by the respondent while he was at home in this State.

44 I note in passing that the respondent did not carry out any duties in Western Australia, although he continued to reside in this State. He was paid in this State by the appellant firm and was paid to travel overseas to work. It is apparent from this summary that the employment ran from 18 September 1998 until on or about 14 December 1999.

45 The respondent alleged that his dismissal was harsh, oppressive or unfair and sought relief in the form of compensation for loss of potential earnings and benefits due under the contract of employment.

46 Section 29(1) of the Industrial Relations Act provides that an industrial matter may be referred to the Commission by an employee in the case of a claim by an employee that he has been harshly, oppressively or unfairly dismissed from his employment, or that he has not been allowed a benefit to which he is entitled under his contract of service. By s 7 of the Act, an "industrial matter" means any matter affecting or relating to the work, privileges, rights or duties of employers or employees in any industry or of any employer or employee therein and, without limiting the generality of that meaning, includes issues relating to the various matters specified in the relevant provision. Reference is made in that regard to matters such as wages, hours of employment and many of the other usual incidents of a contract of employment.

47 Section 23(1) of the Industrial Relations Act provides that the Commission has cognisance of and authority to enquire into and deal with any industrial matter. By s 23A, on a claim of harsh, oppressive or unfair dismissal, the Commission may provide various forms of relief, including an order for the payment to the claimant of any amount to which the claimant is entitled.

48 It follows from these provisions that the claim being advanced by the respondent was brought before the Commission as an industrial matter. It seems that the appellant did not file a notice of answer to the claim, but wrote to the Commission challenging the jurisdiction to entertain the application and otherwise disputing the merits of the claim. The appellant did not appear at the hearing.

49 It was against this background that the matter came before Senior Commissioner G L Fielding. He dismissed the application on 29 August 2000 on the grounds that he did not have jurisdiction to deal with the matter. Commissioner Fielding went on to find that, but for the absence of jurisdiction, the respondent would have been entitled to a declaration that he was unfairly dismissed. The respondent was also found to be entitled to compensation in the sum of US$30,970 consisting of US$23,970 in respect of lost earnings and the further sum of US$7000 as and by way of benefits denied him under his contract of employment.

50 Commissioner Fielding accepted that the proper law of the contract of employment was the law of Western Australia. He concluded, however, having regard to a number of previously decided cases, that the jurisdiction of the Commission was attracted not by the proper law of the contract or by the residency of the parties, but by the location of the industry in which the aggrieved employee worked. The industry in the present case did not have a sufficient connection with Western Australia because the work under the contract was performed in either Singapore or France.

51 The Full Bench took a different view of the matter. The Full Bench held that the claim was within jurisdiction. It was a matter concerning the rights and obligations of employers and employees in an "industry" as defined by s 7 of the Act because a business can be said to be carried on in the place where it is managed.

52 The appellant submits that the Commission did not have jurisdiction to deal with the matter brought before it and thereby seeks to affirm the reasoning to that effect of Commissioner Fielding. On this view of the matter, the Industrial Relations Act should be read as being restricted in its operation within territorial limits, and thus, in the present case, to work performed in the State of Western Australia, or to activities having a sufficient connection to the State.

53 "Industry" is defined in s 7 of the Act to include any business, trade, manufacture, undertaking, or calling of employers or any calling, service, employment, handicraft, or occupation or vocation of employees. The term "calling" means any trade, craft, occupation, or classification of an employee. The other terms mentioned in the definition of "industry" are undefined.

54 On the appellant's case, the respondent was dismissed from an industry being carried on outside Western Australia, because the work of the respondent as an oil rig mechanical surveyor was being performed in France. The jurisdiction of the Commission is confined to dealing with any "industrial matter". The meaning attributed to that term by the Industrial Relations Act, properly construed, is any matter affecting the work of employers or employees in any industry to which the Act applies, that is to say, an industry with a real and sufficient connection to the State of Western Australia. The Commission did not have jurisdiction in the present case because a dispute concerning work being performed in France could not be said to arise in an industry having a sufficient connection to this State.

55 The appellant supported this submission by drawing attention to s 3 of the Industrial Relations Act. The effect of that provision is to extend the application of the Act to certain offshore areas specified in s 3(3) of the Act, namely, the Australian Fishing Zone and the Continental Shelf.

56 A requirement in s 3(1)(b)(ii) for the application of the Act to the specially designated offshore areas is that the employer concerned be connected with the State. By s 3(2), an employer is said to be connected with the State for the purpose of the offshore provision if that employer is domiciled in the State, is resident in the State, is registered or incorporated under a law of the State in the case of a company, has an office or a place of business in the State in connection with the industry concerned, or is the holder of a licence, lease, tenement, permit, or other authority granted under a law of the State by virtue of which the industry is carried on.

57 These provisions, counsel for the appellant contended, strongly suggest that the Industrial Relations Act is restricted in its operation within territorial limits, save for the offshore areas designated by the Act itself. Counsel relied also upon the reasoning of Burnside J in Metropolitan Shop Assistants & Warehouse Employees' Industrial Union of Workers v Foy & Gibson Pty Ltd & Ors (1921) 23 WALR (I) 13 at 21 in which the learned Judge concluded that "industry" meant "that branch of art where labour is employed for the production of wealth or value, and in which capital is employed".

58 In the present case, counsel argued, as the work the subject of the contract of employment was performed in France, being a place situated outside Western Australia and not lying within the specially designated offshore areas, the work could not be regarded as forming part of an industry to which the Act applied.

59 It is apparent from this overview of the controversy that the crucial question is whether the term "industry" should be confined to any industry situated or being carried on within Western Australia, including the specially designated offshore areas, or whether it has a broader meaning.

60 It is important that rules of statutory interpretation bearing upon an issue of this kind should not be confused with the question whether or not a State is able to legislate extra-territorially.

61 In Union Steamship Co of Australia Pty Ltd v King [1988] HCA 55; (1988) 166 CLR 1, the High Court recognised that, within the limits of the grant, a power to make laws for the peace, order and good government of a territory is as ample and plenary as the power possessed by the Imperial Parliament itself; that is, the words "for the peace, order and good government" are not words of limitation. They did not confer on the courts of a colony, just as they do not confer on the courts of a State, jurisdiction to strike down legislation on the ground that, in the opinion of a court, the legislation does not promote or secure the peace, order and good government of the colony.

62 When it came to legislation having an extra-territorial operation, it was thought initially that colonial legislatures were incompetent to enact such legislation. However, as the High Court noted in the Union Steamship case at 12, it was eventually accepted beyond any question that colonial legislatures had powers to make laws which operate extra-territorially, and this view applied with equal force to the parliaments of the Australian States, including the State of Western Australia.

63 The High Court went on to say, however, that the 19th century decisions did not deny that the words "peace, order and good government" might be a source of territorial limitation. As each State parliament in the Australian federation has power to enact laws for its State, it is appropriate to maintain the need for some territorial limitation in conformity with the terms of the grant, notwithstanding the recent constitutional rearrangements for Australia effected by the Australia Act 1986 (Cth) whereby State parliaments have power to enact laws having an extra-territorial operation.

"The new dispensation is, of course, subject to the provisions of the Constitution (see s 5(a) of each Act) and cannot affect territorial limitations of State legislative powers inter se which are expressed or implied in the Constitution. That being so, the new dispensation may do no more than recognize what has already been achieved in the course of judicial decisions. Be that as it may, it is sufficient for present purposes to express our agreement with the comments of Gibbs J in Pearce where his Honour stated that the requirement for a relevant connexion between the circumstances on which the legislation operates and the State should be liberally applied and that even a remote and general connexion between the subject matter of the legislation and the State will suffice."

65 This approach is reflected in the reasoning of various members of the High Court in an earlier case, namely, R v Foster; Ex parte Eastern and Australian Steamship Co Ltd [1959] HCA 10; (1959) 103 CLR 256. Dixon CJ said this at 275:

"It does not follow from the adoption of the Statute of Westminster that Commonwealth legislation should be construed as if there were no territorial considerations affecting its interpretation. Indeed it may be fairly said that when the consequence of invalidity is removed from extra-territorial legislation it becomes more important to give effect to the presumption governing the interpretation of English legislation. That is a presumption which assumes that the legislature is expressing itself only with respect to things which internationally considered are subject to its own sovereign powers."

"It is, however, one thing to say that the Commonwealth Parliament has a constitutional power to make a law having a wide extra-territorial operation. It is quite another thing to say that it has confided the exercise of such a power to a subordinate law-making authority. The Parliament might, as a matter of law, exercise its powers in defiance of international comity and heedless of whether or not its laws could be enforced. It does not follow that it has authorised its industrial tribunals to do so. Prima facie Commonwealth statutes ought not to be so construed as authorizing any subordinate law-making body to deal with matters which have no real and substantial connexion with Australia or to make any rules except such as can be directly or indirectly enforced by the authority of Australian courts."

67 One of the clearest statements that legislation is presumed not to have extra-territorial effect appears in Jumbunna Coal Mine NL v Victorian Coal Miners' Association (1908) 6 CLR 309 at 363. O'Connor J said:

"In the interpretation of general words in a Statute there is always a presumption that the legislature does not intend to exceed its jurisdiction. Most Statutes, if their general words were to be taken literally in their widest sense, would apply to the whole world, but they are always read as being prima facie restricted in their operation within territorial limits. Under the same general presumption every Statute is to be so interpreted and applied as far as its language admits as not to be inconsistent with the comity of nations or with the established rules of international law."

68 Nonetheless, it is now apparent from the reasoning of the High Court in the Union Steamship case, that it is within the competence of the State legislature to make any fact, circumstance, occurrence or thing in or connected with the territory the occasion of the imposition upon any person of rights and obligations. It is also within the competence of the legislature to base the imposition of liability on no more than the relation of the person to the territory. The relation may consist in presence within the territory, residence, domicile, carrying on business there, or even remoter connections. If a connection exists, it is for the legislature to decide how far it should go in the exercise of its powers.

69 The appellant submits, as I have already noted, that s 3 of the Industrial Relations Act concerning the application of the Act to offshore areas should be regarded as an indication by the legislature that the Act is not to have an extra-territorial operation save for its application to the specially designated offshore areas. Section 3 of the Act and, in particular, s 3(2)(d) would be otiose, the appellant contends, if the Act was intended to apply to any employee anywhere in the world simply because of some slight connection to the State of Western Australia, such as the employer having a place of business within the State.

70 It is important to note, however, that the application of the Act to the specially designated offshore areas under and by virtue of s 3 is expressly made subject to subs (6) which reads as follows:

"Effect shall be given to subsections (1), (2) and (3) only where this Act or any provision of this Act would not otherwise apply as a law of the State, or be applied as a law of the Commonwealth, to or in relation to any person, circumstance, thing, or place."

71 In my view, the effect of s 3(6) is to affirm the general precept reflected in the previously decided cases that the State legislature has power to enact legislation having an extra-territorial operation. The precept is qualified by the rule of interpretation that legislation is presumed not to have extra-territorial effect. There must be a real and substantial connection between the circumstances on which the legislation operates and the State of Western Australia. It follows from the Union Steamship case, however, that this requirement will be liberally applied with the result that in certain circumstances activities taking place outside the State may be subject to the provisions of the Industrial Relations Act.

72 On this view of the legislation, s 3 has been introduced as a precautionary measure in order to remove any ambiguity that might arise concerning the application of the statute in the offshore areas. In the words of s 3(6), effect shall be given to the special rules concerning offshore areas only where the Act "would not otherwise apply as a law of the State". A provision formulated in this way clearly contemplates that activities taking place outside the State, in the offshore areas or in other areas outside the State, may be affected by the Industrial Relations Act. In a case of doubt, however, as to whether an industry being conducted wholly or partly in the offshore areas can be regarded as having a sufficient connection with the State, the relevant criteria for resolving that issue are set out explicitly.

73 Put shortly, there would be no need for subpar (6) of s 3 if the operation of the Act was limited to activities taking place within the State, but with special provision being made for the operation of the Act to be extended to the offshore areas. The presence of subpar (6) suggests that the Act generally has the potential to apply to activities outside the State (provided there is a real and substantial connection with the State) with the result that subpars (1) to (4) will only be brought into play in exceptional circumstances where the Act would not "otherwise" apply. Proper weight must be given to the word "otherwise".

74 In the present case, the subject matter of the respondent employee's application for relief had to satisfy the requirement prescribed by s 23(1) of the Act; that is to say, that it be an "industrial matter". The jurisdiction of the Commission is confined to matters of that kind. An industrial matter could only arise in respect of an "industry" as that term is defined in the Act. One must keep in mind that the term in question includes reference not only to the calling or employment of employees, but embraces any business or calling of employers. Put shortly, the nature of the business in the present case is not to be determined exclusively by reference to the physical activities of the employee. One must take account of the administrative and financial functions being performed by the employer.

75 It is apparent from the reasoning of the Full Bench that the approach reflected in Foster's case and the Jumbunna Coal Mine case was applied to the circumstances of the present case. The Full Bench examined the facts of the matter with a view to ascertaining whether there was a real and substantial connection between the appellant's business and the respondent's employment in that business and the State of Western Australia. In my view, this approach is consistent with the reasoning of the High Court in the previously decided cases and it cannot be said that the Full Bench fell into error.

76 When one turns to the details of the matter, I consider that the Full Bench was correct in holding that the location of the physical activities undertaken by the employee should not be regarded as the decisive factor. The industry or calling of the employer was essentially the provision of services to other industries operating in the general field of offshore marine projects. There were various features of the relationship between the parties which point to a real and substantial connection with this State. There was evidence before the Commission that the employer's principal place of business was at Bunbury and that managerial functions relating to the supply of labour services were performed at that place of business, including negotiation of the relevant contract of employment and the payment of remuneration pursuant to the contract.

77 The terms of the contract of employment are consistent with this view of the matter in that in cl 2 the point of origin is described as Perth, Western Australia "from and to which travel provisions to the assignments will be provided by the company". The Commission did not conclude that the appellant was in an industry within the meaning of s 7 simply because it had its principal place of business within Western Australia. That fact was simply one of various circumstances that were taken into account by the Full Bench in determining whether there was a real and substantial connection with Western Australia.

78 The Full Bench clearly took account of Commissioner Fielding's findings that the contract was entered into in the jurisdiction, the wages and other benefits, save and except accommodation, were paid and payable within the jurisdiction, the notice of termination was received within the jurisdiction and the extent of the conduct of the head office of the business was significant. Against that background, although the actual work was performed outside the jurisdiction, a finding could be made that the work the subject of the contract of employment was performed by an employee in an industry having a real and substantial connection with the jurisdiction.

79 It follows that, in my view, the Full Bench did not fall into error in holding that the respondent was employed in an industry as defined in s 7 of the Industrial Relations Act. The Full Bench correctly held that the Commission had jurisdiction to hear and determine the respondent's claim for relief arising out of the alleged unfair dismissal. Accordingly, I conclude that the appeal should be dismissed.

80 The appellant submitted also, in the alternative, that the Full Bench erred in law in awarding damages based on the respondent's calculation when those calculations had no rational basis and could not be explained by the respondent himself.

81 Submissions bearing upon this issue were canvassed at the hearing before the Industrial Appeal Court by counsel for the respective parties.

82 The matter was left on the basis that counsel for the parties would endeavour to agree the amount in question. The parties then agreed that in the event the appeal on ground 1 is dismissed, the amount awarded by way of damages should, nevertheless, be reduced to $US20,185. It follows that the amount of damages must be reduced accordingly. I would allow the appeal to the extent necessary to reflect the agreement between the parties.