Australian Building and Construction Commissioner v Communications Electrical Electronic Energy Information Postal Plumbing and Allied Services Union of Australia (No 2)
[2022] FedCFamC2G 475
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 2)
Australian Building and Construction Commissioner v Communications Electrical Electronic Energy Information Postal Plumbing and Allied Services Union Of Australia (No 2) [2022] FedCFamC2G 475
File number(s): BRG 344 of 2021 Judgment of: JUDGE VASTA Date of judgment: 17 June 2022 Catchwords: INDUSTRIAL LAW – Declarations – pecuniary penalties – need for deterrence – specific deterrence – general deterrence Legislation: Fair Work Act 2009 (Cth): s 499, s 500, s 795
Work Health and Safety Act (Qld): s 117
Cases cited: Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union [2018] HCA 3
Australian Building and Construction Commissioner v Pattinson & Anor [2022] HCA 13
Commonwealth of Australia v Director, Fair Work Building Industry Inspectorate [2015] HCA 46
Mason v Harrington Corporation Proprietary Limited t/as Pangaea Restaurant & Bar [2007] FMCA 7
Division: Division 2 General Federal Law Number of paragraphs: 33 Date of last submission/s: 16 June 2022 Date of hearing: 16 June 2022 Place: Brisbane Counsel for the Applicant: Mr Follet Solicitor for the Applicant: Minter Ellison Counsel for the Respondents: Mr White Solicitor for the Respondents: Hall Payne Lawyers ORDERS
BRG 344 of 2021 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)
BETWEEN: AUSTRALIAN BUILDING AND CONSTRUCTION COMMISSIONER
Applicant
AND: COMMUNICATIONS ELECTRICAL ELECTRONIC ENERGY INFORMATION POSTAL PLUMBING AND ALLIED SERVICES UNION OF AUSTRALIA
First Respondent
DANIEL BESSELL
Second Respondent
ORDER MADE BY:
JUDGE VASTA
DATE OF ORDER:
17 JUNE 2022
In these orders:
(i)“FW Act” means the Fair Work Act 2009 (Cth).
(ii)“Site” means the construction site area of the RGD Hedge Project, which involved the construction of a six level residential and commercial development consisting of 95 residential apartments and 5 commercial shop tenancies, located at 1-5 Bermagui Crescent, Buddina in the State of Queensland.
(iii)“State or Territory OHS right” means a right to enter premises under section 117(1) of the Work Health and Safety Act 2011 (Qld) (WHS Act), being a State or Territory OHS right within the meaning of section 494(2) of the FW Act.
THE COURT DECLARES THAT:
1.On 3 July 2018, the Second Respondent, an employee of the First Respondent acting on its behalf and within the scope of his authority within the meaning of section 793(1) of the FW Act, contravened section 499 of that Act when he exercised a State or Territory OHS right by walking off unescorted to an electrical distribution board known as Temp DB1 after failing to comply with three reasonable requests of the occupier of the Site to comply with an occupational health and safety requirement that applied to the Site, namely, a requirement to be escorted by an inducted person at all times whilst on the Site.
2.On 3 July 2018, the Second Respondent, an employee of the First Respondent acting on its behalf and within the scope of his authority within the meaning of section 793(1) of the FW Act, contravened section 499 of that Act when he exercised a State or Territory OHS right by walking off unescorted to an electrical distribution board known as Temp DB3 after failing to comply with three reasonable requests of the occupier of the Site to comply with an occupational health and safety requirement that applied to the Site, namely, a requirement to be escorted by an inducted person at all times whilst on the Site.
3.On 3 July 2018, the Second Respondent, an employee of the First Respondent acting on its behalf and within the scope of his authority within the meaning of section 793(1) of the FW Act, contravened section 500 of the FW Act when seeking to exercise a State or Territory OHS right when on the Site, by acting in an improper manner by:
(a)refusing three reasonable requests of the occupier of the Site to comply with an occupational health and safety requirement that applied to the Site, namely, a requirement to be escorted by an inducted person at all times whilst on the Site, including when inspecting an electrical distribution board known as Temp DB1;
(b)refusing a request of the occupier of the Site to return to the muster point after walking off unescorted to inspect an electrical distribution board known as Temp DB1;
(c)refusing three reasonable requests of the occupier of the Site to comply with an occupational health and safety requirement that applied to the Site, namely, a requirement to be escorted by an inducted person at all times whilst on the Site, including when inspecting an electrical distribution board known as Temp DB3; and
(d)failing to comply with requests from officers of Queensland Police to leave the Site.
4.In respect of the contraventions of sections 499 and 500 of the FW Act referred to in declarations 1-3 above, the First Respondent:
(a)is taken by operation of section 793(1) of the FW Act to have engaged in the conduct of the Second Respondent, thereby participating in each contravention in each case;
(b)is taken by operation of section 793(2) of the FW Act to have known of all of the essential facts constituting each contravention in each case;
(c)was accordingly knowing concerned in each contravention within the meaning of section 550 of that Act; and
(d)thereby itself contravened sections 499 and 500 of the FW Act on each occasion.
THE COURT ORDERS THAT:
1.The First Respondent pay a pecuniary penalty of $60,000 in respect of its contravention of section 500 of the FW Act as declared in declaration 4 above.
2.The Second Respondent pay a pecuniary penalty of $12,000 in respect of his contravention of section 500 of the FW Act as declared in declaration 3 above.
3.The pecuniary penalties referred to in paragraphs 1-2 above be paid to the Commonwealth of Australia within 28 days.
4.There be no order as to costs.
Note: The form of the order is subject to the entry in the Court’s records.
Note: The Court may vary or set aside a judgment or order to remedy minor typographical or grammatical errors (r 17.05(2)(g) Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 17.05 Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth).
REASONS FOR JUDGMENT
JUDGE VASTA
INTRODUCTION
On 17 May 2022, I made findings that the Second Respondent had contravened s 499 of the Fair Work Act (“the FW Act”) on two occasions and had also contravened s 500 of the FW Act. I also made findings that the First Respondent was involved in those contraventions pursuant to s 793 of the FW Act.
I had adjourned the matter so that the parties could have the opportunity of reading the decision and drafting appropriate declarations together. Unfortunately, the parties were not able to agree on the form of declarations and so it is left to me to formulate such declarations. I have had the advantage of being assisted by very helpful submissions by both parties.
I also have the task of assessing and imposing pecuniary penalties for the contraventions. Notwithstanding that there are three contraventions, the behaviour in the contraventions relating to s 499 of the FW Act are subsumed in the contravention relating to s 500 of the FW Act. Because of the provisions of s 556 of the FW Act, I will impose only one penalty and that being for the contravention of s 500 of the FW Act.
Declarations
A declaration is a form of relief that can be sought by a party and, as the Applicant has submitted, is an available remedy to formally record the basis upon which the proceeding has been resolved. It is important when making a declaration that the Court fully particularises its findings. This is especially so when, as I’ve said, I will only be imposing a pecuniary penalty for the contravention of s 500 of the FW Act.
In this case, the contravention of s 499 of the FW Act occurs when a permit holder fails to comply with any reasonable request by the occupier of premises to comply with an Occupational Health and Safety requirement that applies to the premises. It is incumbent upon the Court to detail in what way there was non-compliance with a reasonable request.
In the present matter, the failure to comply was constituted by walking off unescorted to DB1 after failing to comply with three reasonable requests made by Mr Waters and Mr Mullins. This needs to be part of the declaration.
The contravention of s 500 of the FW Act occurs when a permit holder is exercising, or seeking to exercise, rights. In doing that, a permit holder must not act in an improper manner.
In this case, the Second Respondent was seeking to exercise his rights pursuant to s 117 of the Work Health and Safety Act 2011 (Qld) (“the WHS Act”). As was made clear in my reasons, I found that the Second Respondent could not exercise his rights under s 117 of the WHS Act unless he complied with the requests that were made. For this reason, the Second Respondent “was seeking to exercise” his rights rather than was “exercising” his rights. This should be reflected in the declaration.
I found that the First Respondent was directly, or indirectly, knowingly concerned in the contraventions committed by the Second Respondent. This finding was possible because of the provisions of s 793(1) and s 793(2) of the FW Act. The second subsection states that if it is necessary to establish the state of mind of a body corporate in relation to particular conduct, it was enough to show that the conduct was engaged in by a person referred to in subsection (1).
For a finding pursuant to s 550 of the FW Act that the First Respondent was knowingly concerned in the contraventions, it is necessary to establish the state of mind. This is achieved by virtue of s 793(2). This should be reflected in the declaration.
Accordingly, I will make the declarations that reflect these matters of which I’ve just spoken.
I will now turn to assessing what the appropriate pecuniary penalty should be. In doing so I acknowledge that there is a form of penalty imposed by the Court by simply making the declarations themselves.
The Law regarding assessment of pecuniary penalties
When assessing the quantum of pecuniary penalties in the past, much of what the Court had done was a reflection of sentencing principles that applied in criminal law.
The decision of the High Court in Australian Building and Construction Commissioner v Pattinson & Anor [2022] HCA 13 has been called a “game changer”. This is because the High Court ruled that the notion of “proportionality” is so closely connected to the central role of retribution in criminal sentencing that it could not be translated coherently into the civil penalty context of the FW Act. The proposition of the criminal law, that a sentence must not be disproportionate to the seriousness of the offending for which the offender is being sentenced, is part of the retributive aspect of sentencing which has no part to play in the civil penalty regime of the FW Act.
It is instructive to reiterate what the High Court had earlier said in Commonwealth of Australia v Director, Fair Work Building Industry Inspectorate [2015] HCA 46 at paragraph 55 of that judgment,
No less importantly, whereas criminal penalties import notions of retribution and rehabilitation, the purpose of a civil penalty, as French J explained in Trade Practices Commission v CSR Ltd, is primarily if not wholly protective in promoting the public interest in compliance:
“Punishment for breaches of the criminal law traditionally involves three elements: deterrence, both general and individual, retribution and rehabilitation. Neither retribution nor rehabilitation, within the sense of the Old and New Testament moralities that imbue much of our criminal law, have any part to play in economic regulation of the kind contemplated by Pt IV [of the Trade Practices Act]. ... The principal, and I think probably the only, object of the penalties imposed by s 76 is to attempt to put a price on contravention that is sufficiently high to deter repetition by the contravenor and by others who might be tempted to contravene the Act.”
The High Court had also earlier said in Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union [2018] HCA 3, at paragraph 116 of that judgment:
As has been observed, the principal object of an order that a person pay a pecuniary penalty under s 546 is deterrence: specific deterrence of the contravener and, by his or her example, general deterrence of other would-be contraveners. According to orthodox sentencing conceptions as they apply to the imposition of civil pecuniary penalties, specific deterrence inheres in the sting or burden which the penalty imposes on the contravener. Other things being equal, it is assumed that the greater the sting or burden of the penalty, the more likely it will be that the contravener will seek to avoid the risk of subjection to further penalties and thus the more likely it will be that the contravener is deterred from further contraventions; likewise, the more potent will be the example that the penalty sets for other would-be contraveners and therefore the greater the penalty's general deterrent effect. Conversely, the less the sting or burden that a penalty imposes on a contravener, the less likely it will be that the contravener is deterred from further contraventions and the less the general deterrent effect of the penalty. Ultimately, if a penalty is devoid of sting or burden, it may not have much, if any, specific or general deterrent effect, and so it will be unlikely, or at least less likely, to achieve the specific and general deterrent effects that are the raison d'être of its imposition.
A paragraph 46 of Pattinson (Supra), the High Court said:
[46]It is important to recall that an “appropriate” penalty is one that strikes a reasonable balance between oppressive severity and the need for deterrence in respect of the particular case. …
[47]The penalty that is appropriate to protect the public interest by deterring future contraventions of the Act may also be moderated by taking into account other factors … where those responsible for a contravention of the Act express genuine remorse for the contravention, it might be considered appropriate to impose only a moderate penalty because no more would be necessary to incentivise the contravenors to remain mindful of their remorse and their public expressions of that remorse to the court. Similarly, where the occasion in which a contravention occurred is unlikely to arise in the future because of changes in the membership of an industrial organisation, a modest penalty may be appropriate having regard to the reduced risk of future contraventions.
[48]It is not necessary to multiply examples further. It is sufficient to say that a court empowered by section 546 to impose an “appropriate” penalty must act fairly and reasonably for the purpose of protecting the public interest by deterring future contraventions of the Act.
In Mason v Harrington Corporation Proprietary Limited t/as Pangaea Restaurant & Bar [2007] FMCA 7, which is known as the Pangaea case, the Court went through, in effect, a number of factors the Court should be mindful of when imposing pecuniary penalties. One must be careful, though, in looking at the Pangaea case (Supra), that one does not simply look at those matters as some form of checklist to see whether or not the facts of the case with the particular factors either aggravate or mitigate the penalty. As such, the list compiled in Pangaea (Supra) is extremely useful, but it should not be a formula used by the Court to slavishly come up with some sort of almost mathematical guide for the imposition of penalties. Notwithstanding what has now been said in Pattinson (Supra), there is still a place for a Court to consider these aspects.
Seriousness and the need for deterrence
In this matter, there were clear OHS requirements that were spelled out to the Second Respondent as well as Mr Gould and Mr Davis. These requirements were not established to hamper any individual on the worksite. These requirements were established to ensure the safety of all individuals, especially visitors, on the worksite.
To totally disregard these requirements and to venture off at one’s own win is extremely dangerous conduct on a construction worksite. To try and justify such behaviour by attempting to portray an urgent, life-threatening situation is simply laughable especially when one considers the collateral evidence of what was actually done by the Second Respondent on the worksite. It would be extremely ironic if the Second Respondent were truly attempting to act in the name of safety by totally “trashing” the safety measures that were in place.
To ignore the request of the police is behaviour that must be deterred in the strongest possible terms. It matters not whether the Second Respondent truly believed that he was “in the right” and the police were wrong; the maintenance of law and order is sacrosanct. There were other avenues for the Second Respondent to challenge what the police were saying rather than maintaining the belligerent stand that he did.
Specific deterrence
There are other matters to consider. However bad the behaviour of the Second Respondent was on 3 July 2018, it can be seen as an aberration. The Second Respondent has been an organiser since 2009. This is the first time that he has contravened the FW Act in the exercise of his s 117 powers. He has not contravened the FW Act since this date either.
As was said during the course of the hearing yesterday, it can be easily inferred by this Court that a major factor in the behaviour of the Second Respondent on this particular day was the presence of Mr Davis. As was noted in my reasons, Mr Davis had no right to be there on that day and his attitude and behaviour could only be described as thuggish. The Second Respondent and Mr Gould visited the site on four other occasions after 3 July 2018 and there was never any repetition of this sort of conduct.
When I remarked that this may very well be because the Construction, Forestry, Mining and Energy Union (“the CFMEU”) organiser was not present, the statement was not contradicted. In fact, at the beginning of the hearing, Counsel for the Respondent was very eager to ensure that the Second Respondent and Mr Gould were not seen to be associated in any way with the CFMEU.
The First Respondent is a responsible union and actions against it for contravention of the FW Act have been few and far between. It would seem that the last time they were before the Court was in a matter before me. In that matter, they impressed me with the lengths to which they had gone to ensure that there was no repetition of that particular behaviour. Whilst there has been no evidence (or even any suggestion during submissions) that the particular remedial behaviour in that previous case would occur in relation to the present matter, I do take it as an illustration of corporate good character.
If the Court were looking solely at the aspect of specific deterrence, the penalties would be tempered because of these aspects.
General deterrence
But the Court must look not just at specific deterrence, but general deterrence. Whilst this was acknowledged by Counsel for the Respondents, he submitted that the Respondents should not be punished because of the sins of other unions and their organisers. This submission seemed to mirror the first paragraph of the dissenting judgment of Justice Edelman in Pattinson (Supra) (which is paragraph 75 of the judgement) where His Honour said that the statement “it is sometimes just to hang an innocent person” is where the logic of general deterrence leads.
Despite this sentiment, the majority of the Court were very clear that the real task of a Court is to fix the penalty which it considers fairly and reasonably to be appropriate to protect the public interest from future contraventions of the FW Act.
In other words, the Court must also impose a penalty that would deter any other organiser from flouting their OHS obligations when attempting to exercise their State WHS rights and to deter any other organiser from behaving improperly when seeking to exercise those rights.
The penalty must also deter an organisation, or union, from allowing its permit holders to behave in such a manner.
Conclusion
It seems to me that, unfortunately for the Respondents, a penalty that may deter them specifically would not be a penalty that would sufficiently deter like-minded others. The evidence before me is that the First Respondent has very deep pockets. The Court can infer that like-minded unions also have very deep pockets. Given that the maximum penalty is $63,000 for the First Respondent and $12,600 for the Second Respondent, the maximum penalty could never be described as oppressively severe.
The penalty “must be fixed with a view to ensuring that the penalty is not such as to be regarded by anyone as an acceptable cost of doing business”.
For this reason, I impose a pecuniary penalty upon the First Respondent of $60,000 and upon the Second Respondent of $12,000.
I certify that the preceding thirty-three (33) numbered paragraphs are a true copy of the Reasons for Judgment of Judge Vasta. Associate:
Dated: 17 June 2022
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