## Facts

- The Commonwealth enacted the Workplace Relations Amendment (Work Choices) Act 2005 (Cth), substantially restructuring federal workplace regulation.
- The legislation shifted the primary constitutional basis for workplace regulation from the conciliation and arbitration power to the corporations power, targeting “constitutional corporations.”
- Several States and other plaintiffs challenged substantial parts of the legislation in the High Court’s original jurisdiction, seeking declarations of invalidity.
- The challenge asserted that the Act exceeded Commonwealth power and impermissibly displaced State industrial relations systems.
- The case was heard by seven justices; a joint majority judgment upheld the legislation, with two separate dissents.

## Issues

1. Whether the Work Choices scheme was a law “with respect to” constitutional corporations within the corporations power.
2. Whether the existence of the conciliation and arbitration power impliedly limited the Commonwealth’s ability to regulate industrial relations through other powers, including the corporations power.
3. Whether the scheme was invalid because it impermissibly impaired State autonomy or violated implied limits associated with the Melbourne Corporation principle.

## Decision

- The High Court (5–2) dismissed the challenge and upheld the constitutional validity of the Work Choices legislation.
- The majority held the corporations power supported a comprehensive regime regulating workplace relations of constitutional corporations, including employment relationships.
- The majority rejected the argument that the conciliation and arbitration power confined the scope of other heads of power in the industrial relations field.
- The majority held the scheme did not breach implied federalism-based limits and did not invalidate the Act under the Melbourne Corporation principle.
- Kirby J and Callinan J dissented, concluding the corporations power should not be construed to permit an effectively national industrial relations system that substantially supplants State regulation.

## Legal Principles

- A law is supported by the corporations power where it has a sufficient connection to constitutional corporations, including regulation of their activities and relationships, such as employment.
- The presence of a specific head of power directed to a subject matter does not, without textual basis, impliedly preclude reliance on other heads of power to legislate in that field.
- Displacement of State regulatory schemes by a valid Commonwealth law does not itself establish constitutional invalidity.
- Implied limits protecting State functioning are engaged only where a Commonwealth law discriminates against States as States or substantially impairs their capacity to function as governments; broad policy impact on State regulatory domains is not enough.

## Conclusion

The Court upheld the Work Choices reforms as valid under the corporations power, confirming that Parliament may enact wide-ranging workplace regulation for constitutional corporations and limiting the role of implied federalism constraints where the law falls within an enumerated Commonwealth head of power.


New South Wales v. Commonwealth (Austl. 2006)