Hundreds of foreign workers employed in Australia’s $200 billion offshore oil and gas sector have had their work arrangements deemed invalid by the Federal Court in a ruling delivered yesterday.

In 2014, the Assistant Minister for Immigration, Senator Michaelia Cash changed visa regulations to override the Senate and to make it easier to employ overseas workers on offshore oil and gas projects. Her ministerial directions were quickly challenged by the Maritime Union who having lost in their first court action, appealed to the Federal Court which, yesterday, overturned the initial ruling.

A three-judge panel has allowed the appeal and agreed that the legislation could not be used in the way that it had been.

It said the determination by Assistant Immigration Minister Michaelia Cash "is not authorised ... and is invalid."

The judgment read:

The Parliament's intention was to confer upon the Minister a power to except or exempt particular activities or operations carried out under the Offshore Petroleum Act or Offshore Minerals Act, not to reverse the Parliament's desire and intention to bring within the [Migration] Act non-citizens who are engaged in operations and activities under the Offshore Petroleum Act or the Offshore Minerals ACT.

The previous Labor government had amended the Migration Act to extend the migration zone so that foreign workers needed a permanent visa to work on offshore oil and gas platforms.

In May 2014, the Abbott Government introduced a new regulation which would have allowed three existing temporary visas to conform with the amended act and negated the need for a permanent visa.

However, that regulation was disallowed by the Senate.

The MUA said the changes would have opened the door to cheap foreign labour.

The ABC report that MUA deputy national secretary Mick Doleman said there were more than 400 foreign workers on offshore oil and gas projects and they were potentially employed illegally and potentially underpaid.

He said the union did not necessarily want the workers removed from Australia but there was a need to make sure they were being paid Australian wages and were legitimately filling a skills shortage.

The Federal Government can appeal yesterday’s court decision to the High Court.