What is a 'constitutional corporation' in the context of workplace laws?

In Plain English

A "constitutional corporation" is a company that falls under the Australian Parliament's power to make laws about corporations. This generally includes: * Foreign companies * Companies that operate across different states in Australia * Companies that are trading or financial corporations

Detailed Explanation

The term "constitutional corporation" is significant in Australian workplace laws because the Australian Constitution grants the Commonwealth (federal) Parliament the power to legislate with respect to certain types of corporations. This power is primarily found in paragraph 51(xx) of the Constitution.

Several pieces of legislation define or use the term "constitutional corporation":

  • Fair Work Act 2009: This Act uses the term in the definition of "national system employer" (section 14 of the Fair Work Act), which determines the scope of the federal workplace relations system.
  • Fair Work (Registered Organisations) Act 2009: This Act refers to "constitutional corporation" in the context of registration of employer and employee associations. Specifically, sections 18D(2), 18D(4) and 18D(5) state that if the Parliament would only have sufficient legislative power to provide for the registration of a particular association of employers, employees, or an enterprise association if the membership of the association were entirely made up of certain entities, then the association is not federally registrable unless it is either a constitutional corporation or made up in that way.
  • Independent Contractors Act 2006: Section 5 defines a "services contract" partly based on whether at least one party to the contract is a constitutional corporation.
  • Fair Work Legislation Amendment (Closing Loopholes) Act 2023: This Act amends the Work Health and Safety Act 2011 and defines "officer" of an entity, meaning if the entity is not the Commonwealth or a public authority, an officer of the entity within the meaning of section 9 of the Corporations Act 2001.
  • Fair Work Legislation Amendment (Closing Loopholes No. 2) Act 2024: This Act amends the Fair Work Act 2009 and defines a "services contract" partly based on whether at least one party to the contract is a constitutional corporation.

The definition of "constitutional corporation" is not explicitly provided in the supplied context, but it is implied that it refers to a corporation to which paragraph 51(xx) of the Constitution applies. This paragraph grants the Commonwealth Parliament the power to make laws with respect to:

  • Foreign corporations
  • Trading or financial corporations formed within the limits of the Commonwealth

In practice, this means that most companies operating in Australia, particularly those involved in interstate or international trade or financial activities, will be considered constitutional corporations.