Fair Work Commission Rejects Inpex Claims on Economic Damage from Strikes

The Fair Work Commission (FWC) has rejected claims from one of Australia's biggest gas producers that continued industrial action would significantly damage the nation's economy and threaten Australia's relationships with its Asian partners amid the ongoing global fuel crisis.

More than 400 workers at energy giant Inpex have been escalating industrial action since the start of June, as they push for improved conditions and a 3 per cent annual pay increase.

Unions representing the workers, the Offshore Alliance, had been threatening eight-hour strikes and a series of disruptive work bans that could shut down the company's operations in the Northern Territory.

In response, Inpex applied for urgent orders from the FWC late last week to stop the strikes at its Ichthys onshore and offshore facilities in Darwin.

In an expedited hearing on Saturday, the commission heard union members had overnight rejected a new offer from Inpex and scaled back earlier plans for rolling eight-hour strikes, instead proposing two separate, two-hour stoppages each day.

But despite the de-escalation, lawyers for Inpex told the commission the extensive list of potential industrial actions posed a "serious risk" of shutting down the facilities within days.

Richard Dalton KC told the FWC a shutdown "threatens to cause significant damage to an important part of the economy, being the export LNG market".

Mr Dalton said Australia's LNG export sector made up a significant portion of Australia's economy and carried geopolitical strategic importance, particularly in a tight global fuel market.

In handing down his decision this afternoon, FWC deputy president Michael Easton said he was satisfied the strikes and worker bans — particularly on loading and offloading LNG — "threaten to cause a full production stoppage" for at least a week from Tuesday.

However, he said Inpex's evidence that any such loss of production would damage the Australian economy was "not compelling".

He said as the company had made a "forensic evidentiary decision" not to disclose the value of its gas production, he would work on the assumption it was "in the vicinity of $15 million to $22 million per day".

"However, I am not satisfied on the evidence that a full stoppage of production would damage the Australian or the Northern Territory economy, at least not to the magnitude claimed by Inpex," he said.

"Planned and unplanned production stoppages occur relatively frequently, and it was not said by any of Inpex's witnesses that lost production time cannot ever be made up.

No 'real threat' to public safety

The company's lawyers also pointed to "significant threats of endangerment" to the safety and welfare of Darwin residents "as a result of the complete curtailment of Inpex gas supply" to the NT's Power and Water Corporation.

Mr Dalton said the disruption would threaten the "reliable delivery of power to hospitals, aged care facilities and health and other essential services".

But Mr Easton said he was also not satisfied there was a "real threat" to public safety from any potential power outages.

He said evidence heard behind closed doors revealed Power and Water Corporation had already begun deploying contingency measures in anticipation of a disruption to its gas supply.

"History shows that these contingency measures are likely to be effective," he said.

The commission heard the parties had made significant advances towards resolving the dispute, including settling on a pay deal.

In a statement posted to social media today, the Offshore Alliance said protected industrial action would continue on all three Inpex facilities until workers were offered a "benchmark industry standard EBA [Enterprise Bargaining Agreement]".