Agriculture Minister Murray Watt says multi-billion-dollar exports could be disrupted if a tugboat operator forges ahead with a planned indefinite lockout of its workers.
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Svitzer says it will lock out more than 580 workers indefinitely from Friday, from 17 ports in NSW, Victoria, Queensland, Western Australia and South Australia.
The lockout, which has raised concerns of major disruptions to supply chains, is being challenged by the industrial umpire.
Senator Watt said the government was "far from happy" with the company, and said it was realistic to expect an impact on freight networks.
"If we want to be able to get grain or other agricultural exports out of the country, we need those tugboats operating," he told ABC radio on Thursday.
"It's really unfortunate that this dispute has got to the point that Svitzer has decided to lock out its workforce, and I'm hoping that the Fair Work Commission can play a really constructive role."
The Fair Work Commission held a brief hearing on Wednesday, before later listing another hearing before the full bench in Sydney on Thursday at 1pm.
A further hearing will be held on Friday morning if necessary.
The commission will consider whether "the indefinite lockout of employees ... is protected industrial action for a proposed enterprise agreement that is threatened, impending or probable".
It acted on its own initiative to intervene as the lockout had the potential to "cause significant damage to the Australian economy".
Workplace Relations Minister Tony Burke said the government was arguing in the case the lockout should not go ahead.
"That is why we have intervened in the Fair Work Commission's case to argue this action should be terminated," he said.
"The commonwealth will be providing economic evidence to the commission to demonstrate the significant harm to the national economy that would result if the company's industrial action went ahead."
Mr Burke said the dispute reaffirmed the need for the government's industrial relations bill to urgently pass, as the current threshold allowing the commission's intervention was too high.
"The commission shouldn't need to find that an action is going to wreck the Australian economy or endanger someone's life before it is allowed to act," he said.
"Australians are sick of the disputes that go on forever and the commission should have a general power to intervene when a dispute has become intractable."
Under the new legislation, to be debated over the coming fortnight in the Senate, the industrial umpire could intervene and arbitrate "intractable disputes".
Australian Associated Press
