McDermott in the clear

Marine building contractor McDermott Industries Australia has been cleared of allegations relating to unlawfully underpaying foreign workers on a gas pipeline project 130 kilometres off the coast of Karratha.

The Workplace Ombudsman found there was no evidence to substantiate allegations made from the Australian Workers' Union that up to 16 workers had not received their full entitlements.

The investigation found that the workers all held 456 Australian short-stay visas, which do not attract a minimum wage.

Workplace inspectors boarded McDermott's barge, the DB30, in April and found that 16 workers from Indonesia, Malaysia, India and the Philippines - who were paid as little as $4.20 an hour working 12-hour shifts on a 60 days on, 30 days off roster - were not underpaid. The current federal minimum wage is $13.74 an hour.

The workers' pay rates were established under employment contracts constructed in their country of origin.

Workplace Ombudsman executive director Michael Campbell said that all 16 held subclass 456 visas and as a consequence, the minimum wage rules did not apply.

"Our investigation determined that because of the nature of the employment and visa arrangements of the foreign workers, we were unable to enforce a minimum wage for these workers," Mr Campbell said.

The AWU said the "cowboy culture" on the north-west gas fields exposed a loophole in the state's workplace laws.

"They told the Houston-based giant how to get around the Howard government's controversial 457 visa scheme," AWU national secretary Paul Howes said.

The Workplace Ombudsman sought external legal advice from a specialist senior counsel that states when the gas pipeline being laid by the DB30 touched the seabed, workers aboard the barge would be considered to be within the migration zone and therefore would require a 457 visa, rather than a 456 visa.

Mr Campbell said in the McDermott's case, his office would have had the power to further pursue matters that fell within the scope of the legislation, including a minimum wage, had 457 visas been required