Australian Building and Construction Commissioner v Construction, Forestry, Maritime, Mining and Energy Union & Ors

[2021] HCATrans 115

[2021] HCATrans 115

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Melbourne  No M121 of 2020

B e t w e e n -

AUSTRALIAN BUILDING AND CONSTRUCTION COMMISSIONER

Applicant

and

CONSTRUCTION, FORESTRY, MARITIME, MINING AND ENERGY UNION

First Respondent

STEPHEN LONG

Second Respondent

GERARD BENSTEAD

Third Respondent

Application for special leave to appeal

KEANE J
EDELMAN J
GLEESON J

TRANSCRIPT OF PROCEEDINGS

AT CANBERRA ON FRIDAY, 25 JUNE 2021, AT 10.37 AM

Copyright in the High Court of Australia

MR J.L. BOURKE, QC:   If the Court pleases, I appear with my learned friend, MR A.D.H. DENTON, for the applicant.  (instructed by Clayton Utz)

MR B.W. WALKER, SC:   May it please your Honours, I appear with my learned friend, MR P.A. BONCARDO, for the respondents.  (instructed by CFMMEU)

KEANE J:   Yes, Mr Bourke.

MR BOURKE:   If the Court pleases.  The effect of the appeal court’s judgment is that a head contractor of a building project can be coerced by a stoppage of work because the head contractor did not comply with a union request.  The decision has this effect because, one, a stoppage of work which does not involve employees of the head contractor is said not to be industrial action; two, a refusal by an employer to comply with a union request is said not to involve industrial activity; and three, a head contractor is said not to be an independent contractor and therefore is not captured by the Fair Work Act.

The respondents do not contest that each of these three construction issues, which we have framed in our special leave questions, are important issues for the future scope and operation of the Fair Work Act.  Can we go first to the issue of engaging in industrial activity, section 347(b)(iv):

A person engages in industrial activity if the person:

. . . 

(b)      does, or does not:

. . . 

(iv)comply with a lawful request made by, or requirement of, an industrial association –

Now, the majority have read down “lawful request” to be confined to lawful request concerning participation in the industrial association.  They have accordingly also read down “requirement” ‑ ‑ ‑

EDELMAN J:   They have not quite read it down.  They have given the words their meaning, but they have confined the scope of their application.  So, the lawful request does not apply to any single request having no basis whatever to do with the purposes of the part.

MR BOURKE:   They have framed it that it is concerned with participation.  Where that limitation is not found in the limb, they have also read down the introductory words, “A person engages an industrial activity if the person”, by confining limb (iv) to people who could participate, in the case of a trade union would be employees, and thus would not include - the limb would not apply, to an employer, and would not apply to an independent contractor.

EDELMAN J:   The Chief Justice gives an example at paragraph 30 on page 106 of a lawful request relating to:

the terms of a proposed newspaper story about the association and its activities.

Would you say that that falls within section 347(b)(iv)?

MR BOURKE:   We say the limb should be given its plain meaning, and the industrial activity is the fact that the request is being made by an industrial association.  If there are going to be limitations, they should be on a case‑by‑case basis at the outer limits and not the way the majority have done it, by making it very confined and very restricted and, for example, making it very clear that any lawful request or requirement of an industrial association to a person does not capture any request or requirement about working conditions, which is front and ‑ ‑ ‑ 

KEANE J:   What force, or what weight do you give to lawful activities?  It seems to me that the view that you propound basically seeks to ignore the word “lawful” in relation to activities and say, well, no one is suggesting that the requests here were not lawful.  The provision plainly contemplates that lawful activities are activities, the lawfulness of which can be found elsewhere.

MR BOURKE:   In our submission, there was no contest that requests for, for example, better amenities on site is a lawful request.

KEANE J:   But why would we think that that is what “lawful request” means in this context?  It is a matter of context, is it not?

MR BOURKE:   In our submission, there are no limiting words to say that “lawful request” is confined to participation in the activities of industrial association, in our submission.  The effect of that approach, as the majority recognise, is that it cuts back the scope of the word “person”, and it cannot involve a request to an employer.  In our submission, that is a dramatic impact on the protection to employers in relation to this Act.

EDELMAN J:   Well, there are two separate questions that are bound up in that submission.  The first one is do you give the operation of the words, or the application of the words, a literal application so that they extend to every possible literal circumstance of a request that is not unlawful, in the sense of a request that is not to do something that is contrary to the law.  As I understand your submission, the answer to that is probably no, so it would not extend, for example, to the terms of a proposed newspaper story, although you say that is the outer limits.  Is that right?

MR BOURKE:   We would say yes, there has to be lawful – the outer limits, if there are, are yet to be decided, but it should not be confined to participation in an industrial association.

EDELMAN J:   But once you accept that there are outer limits, then you have to determine what are the boundaries, how does one work out the boundaries, and surely the best way to do it is the way that the majority have done, which is by reference to the scope and purposes of the part. 

MR BOURKE:   In our submission, the scope and purpose does not override the specific words used, the fact that the legislature has not used any limiting words in limb (iv) to say that the request or requirement other than being lawful is confined.  There is the other side of the coin in (d) in relation to “unlawful activity”, and also the legislature has – when the confinement is directed to participation‑type activity, the legislature has said so - (b)(iii), the word “participate” is expressly used; in (d) “participates in” is expressly used in relation to “unlawful activity”, but the majority read the words “participation in” in terms of operating in respect of a lawful request or requirement.  In our submission, that cuts back dramatically the protections in the Act particularly for employers, and we have seen it in this case in relation to a contractor who did not meet – did not comply with the request. 

Can I also say that, as we point out, this Court, on two separate occasions, although the issue was not in contest, has referred to that express limb in terms consistent with the way we see it should be constructed.  In Esso, it was seen to apply in relation to requests concerning an enterprise agreement and in ABCC v CFMEU in 2018 it was seen to apply to in relation to a request to have a union delegate on site – both times made to an employer.

So, it is, in our submission, out of step with the way the provision had been used in the past and its impact in terms of protection is significant.  Could we move to the second special leave question on industrial action, which is, of course, a pivotal provision in the Fair Work Act.  The appeal court has followed Auimatagi in 2018 in concluding that employee industrial action must be industrial action against the relevant employer. 

The respondents concede that that has never been a necessary element in predecessor legislation.  The respondents do not dispute that the ordinary meaning of “industrial action” is that it is not required to be against an employer.  The approach is also contrary to the Full Federal Court judgment in Adams in 2017, which found that a stoppage to attend a political rally would, and so thus not directed against an employer, still be captured by section 19.

EDELMAN J:   If you are wrong about the issues raised in the first special leave question, is there any room left for this issue?

MR BOURKE:   The first special leave question would still leave live the adverse action case under section 342. 

GLEESON J:   So, it would have to be either 1 and 2 or 2 and 3 at a minimum in your special leave questions?

MR BOURKE:   We would still be live regarding adverse action, relying on item 7(a).  In terms of a union taking industrial action against a person, we would also be live under item 7(c), which is the special leave question 3, union causing prejudice to an independent contractor, but the section 348 coercion case does rely on 347(b)(iv).

Could I go to section 19 - employee industrial action, when one looks at subsection (1), which is set out from (a) to (c), the limbs set out there all involve the content of the action of the employee in terms of:

the performance of work –

other than customarily performed:

(b)a ban, limitation or restriction . . . 

(c)a failure or refusal by employees to attend for work -

In our submission, the drafting is directed to the content of the action that will trigger employee industrial action, not who it will be against.  The respondents point to subsection (2)(a):

action by employees that is authorised or agreed to by the employer of the employees –

and of course, if an employer authorises an employee to do something, it cannot be industrial action.  That does not demonstrate that the intent of the legislature was that employee industrial action must be against the employer. 

Further, one looks at 19(1)(d), which refers to lockouts and a lockout could only be by an employer against their employees.  It is expressly clear that that is the intended scope, but there are no equivalent words regarding employee industrial action and the requirement beyond content to say it must be against the relevant employer.  Also, in our submission, the fact that employee industrial action does not need to be against the relevant employee is put beyond doubt when one goes to the adverse actions provisions, the table at 342, item 7:

an industrial association, or an officer or member . . . against a person –

Then one moves to column 2, (a):

organises or takes industrial action against the person -

Now, on the appeal court’s approach “person” must be confined to “employer”, it must be against your employer.  The drafter has been very careful choosing the word “person” and in contrast, for example, if one goes to item 5, there is a category of adverse action:

an employee against his or her employer –

and (b):

takes industrial action against the employer.

The legislature has been very clear who are the people being protected, who are the potential perpetrators and the effect of the appeal court below is at 7(a), a very important item of adverse action, the word “person” is now being read to be confined.

EDELMAN J:   But is that not because of 7(c), the expanded – the potential expansion from an employer to a person is because of the existence of 7(c).

MR BOURKE:   Well, in our submission, you have the discrete item (a), which is directly beside taking industrial action, and in our submission that demonstrates that industrial action is not contemplated to be solely in respect of an employer - against an employer.

EDELMAN J:   No, but the point that I am trying to make is that the word “person” in the left column of 7 needs to be a concept that picks up both (a) and (c).

MR BOURKE:   We would accept that but, in our submission, what makes good our point is when you go to the second column.  If the court below is correct, “against the person” should have said “against the employer”, and when you look through section 342 you will see that there is very careful drafting of when it will involve employee, employer, independent contractor, prospective employee, and the word chosen at column 2, item (a) is “person”.  In our submission, this is a matter that requires the Court’s attention because of the pivotal role of the meaning of the term “industrial action”.

Could I move to our third question regarding “independent contractor”.  Without the issue ever being in contest, either at first instance or on appeal, where at all times it was accepted that BPM was an independent contractor, the appeal court held that BPM was not an independent contractor and thus did not come within item 7(c) because it was a head contractor. 

Now, the respondents concede that that construction is wrong, that construction is also in direct conflict with Victoria v CFMEU, where the issue was squarely dealt with, in 2013.  The consequence of this is that head contractors do not come within Part 3‑1 where they are otherwise to be provided with protections because of their status as an independent contractor, and also it means that where they have obligations to abide by the regime under Part 3‑1 because they are an independent contractor, they are relieved of those obligations.  This has a profound effect on the operation of the Act and needs to be corrected. 

The only point put against us by the respondents is a pleading point that has no substance.  At paragraph 25 of our further amended statement of claim, application book 8, we make it very clear that we rely on item 7(c) of section 342.  We plead that the work stoppage constituted adverse action because it had the effect of directly or indirectly prejudicing BPM in relation to its contract of services with SL Excavations, so it was clearly in issue.

Then the respondents say we did not lead any evidence as to prejudice.  Not correct.  We called the senior site supervisor of BPM who gave unchallenged oral evidence that there was a half‑day loss of production due to this work stoppage.  That, in our submission, is clear prejudice.  Unless there are any other matters, if the Court pleases.

KEANE J:   Thanks, Mr Bourke.  Yes, Mr Walker.

MR WALKER:   Your Honours, as to the relation of the three points, they do all, of course, arise from what might be called a meaningful segment of the overall scheme, and this is a protective segment.  But with respect to protection against adverse action, 346, and with respect to 348, coercion, there is by reason of 347, which provides the content through a definition for each of them, picked up by paragraph (b) in 346 and necessarily invoked by the phrasing with which 348 concludes, the same critical question under 347(b)(iv) governs. 

Now, in terms of a grant of special leave, in our submission, it is therefore appropriate to focus upon the real prospects of success in an argument, either as to principle or outcome, of the way in which the interpretation exercise was carried out by three of the four judges below.  I say three because of the preferred view to which the first instance judge came. 

GLEESON J:   Does the majority judgment seek to do too much work with the objects clause? 

MR WALKER:   No.  I suppose the question of an objects clause doing too much work raises a fundamental question about the very nature and modern purpose of those who include objects clauses.  But one thing seems clear beyond dispute, and that is they are headlines for the use by judges and others who seek to interpret the law, to provide in particular more than clues – usually overt indications of purpose – and very often to provide essential context.  They are surrounding texts of a particular status.  Can one do too much – yes, because an object clause will not avail if, for example, there is no operative provision to carry out sensibly that which an object clause espouses. 

KEANE J:   It certainly cannot be doing too much to explain the structure of the provisions. 

MR WALKER:   No, no.  That is quite precisely our point when we, in particular, urge as unexceptionable, but also, with respect, correct, the way the Chief Justice proceeded at application book 106, paragraph 28.  It is not the only reference of course to the objects clause, but his Honour is proceeding in the very fashion that this Court has, I was about to say commended, probably change…..commanded, with respect to such parts of the enacted text of the statue.  It cannot be left behind, you have to start with an understanding.  What is the intent of all the words used?  In our submission, there is nothing surprising, nothing pushing at a margin, nothing non‑colloquial, unidiomatic about his Honour’s reference finally in landing to the central significance of the enhancement of participation, the protection of participation.

As against that there is, as his Honour, with respect, contemplated by the phrase with which he memorably concludes his paragraph 30 on page 107, namely:

Countless other examples flow from modest releases of the imagination -

and your Honours have already noted a couple of them.  They, in our submission, include such silly and, perhaps, solipsistic things as a union requesting a barrister to appear for it – a perfectly lawful request, I hope.  But the notion that somebody in my position would be engaging in industrial activity if I said “I’m jammed that day; we’ll have a conflict” is too silly for words, and that is why his Honour has not multiplied beyond some very modest examples, all property dealings which start with negotiations by industrial associations who correctly have to have a deal of property that will involve lawful requests.

The word “requirement”, which is in the collocation, rather suggests that we are not, however, talking straightforwardly about matters which are those things where a cat may look at a king.  A union may ask the State Government to sell Parliament House to it.  Yes, they may ask, but the notion that industrial activity is engaged in by the polity in saying “You’re joking” is again too silly for words.

Statutes can be too silly for words, no doubt, but it is not a common experience and it is not one to which one would ever likely come, and to be fair none of the contending arguments have proposed, in effect, though the heavens fall, literal meaning must be given to these words.  That is wrong, according to doctrine in this Court.

It is for those reasons, in our submission, that at the heart of the case that which makes the controversy about a fraction of a day on a worksite not one fit for special leave because it would involve, of necessity, overturning the purposive contextual and sensible reading by the majority for that which announces itself today to be characterised by what can only be described as unstable outer limits.

By that I mean this.  My learned friend urges – let future cases worry about themselves, case by case we will work out whether asking to buy Parliament House is or is not within the notion of request, lawful request, whether or not a brief to a barrister is, et cetera, et cetera.  That is not the way in which either by consequentialness reasoning or by simple understanding of words in context and according to their purpose in the legislative or statutory assemblage could ever be undertaken.  It is not sufficient, with respect, to shut one’s eyes to the implications of the reasoning and outcome of an interpretive exercise simply because the particular case is not raised for decision.

One way of testing the contextual and purposive meaning of statutory words, as selected by draughtsmen, and enacted by Parliament is, of course, by reference in particular to objects clauses but also to evident purpose to be gathered from the whole scheme to test whether or not they are persuasive meanings.

EDELMAN J:   I do not want to take you out of order but, given the limited time, do you have anything you want to say about item 7(c), which the applicant says that the respondent concedes error and defends it only on a pleading point that is not correct?

MR WALKER:   No, your Honour.  It is, in our submission, not anywhere near a main or determinative point in the case.  Your Honours have already heard that we contest that there was ever factual material, if you like a pleading point, fit to make that an appropriate question but those matters that have been said about the point not being raised are correct and, how should I put it modestly, the aptitude of independent contractors to include what, in another form of discourse would be head contractors and subcontractors, is obvious, but that, in our submission, is not in itself a special leave point.

If I could try and turn to advantage the regrettable failure of this to have been argued below, the point below, the matter of principle concerned this notion of lawful request and whether employers were able to invoke protective provisions, which on any view of it are about freedom of association. 

The only question is whether they are about anything else at all and, in our submission, it is for those reasons that this case simply does not present in the interests of the administration of justice a vehicle rendering it appropriate for this Court, as it were, to provide a first appeal on the independent contractor point.  Your Honours know that we will be saying that there are not facts pleaded to make out the concrete foundation for any such argument to have been engaged. 

Now, that does not mean that if there were special leave granted on that point, the concession that there are problems with the substantive outcome of that argument is something that we would not examine, adversarial argument sometimes requiring contradictions to be raised for what they are worth, but it is to say that that is simply not a special leave point, in our submission.

It is for those reasons that the basic approach urged against the majority conclusion comes down to an attempt, at least in writing, still to fix the majority’s reasoning with the well‑known vice of reading words in.  That goes nowhere for the reasons that the Chief Justice below has clearly identified.  It is a contextual reading and today my learned friend has framed it, as indeed they have in writing, as something which is not so much a vice, but which can go too far ‑ namely, so‑called reading down.

Now, your Honours appreciate that the notion of reading down is about as familiar a way of considering so‑called literal meanings or first or primary, obvious, idiomatic understanding of a word or phrase, when it comes to the interpretation of a statute, which it need hardly be said is not ordinarily regarded as an example of colloquial or idiomatic English.

EDELMAN J:   Well, it is not even reading down in the traditional sense.

MR WALKER:   Exactly.  Just reading.

EDELMAN J:   It is just constraining the application.

MR WALKER:   Yes, because it must be understood, and I apologise for descending to rudiments, that so‑called literal meaning for very few words produces a sole or unique denotation.  It is for those reasons that, among the range of possible meanings that a word may bear, because there is the limit, enacted words do provide a limit to what their meaning can be, there have to be selections and choices made. 

Now, this Court has made it crystal clear that the method adopted by the Chief Justice below is entirely orthodox and is the one best calculated to serve the purpose of judicial interpretation of legislative intention, in the fictitious sense that that word bears.  It is for those reasons that when one notices that there is no substantive or principled answer offered by our friends to where is the limit, what, any request - well, not any request; well, how do I know which ones are in and which ones are out, nothing is offered except that case by case, there will be, presumably, some kind of taste test involved.  That is too silly for words, or that is approaching the limit but has not crossed it, et cetera. 

That is not the stuff of statutory interpretation whereas, with great respect, the way the Chief Justice proceeded below is.  It is for those reasons, in our submission, that this case is neither an appropriate vehicle with respect to the independent contractor point, nor does it portend sufficient prospects of success on the 347 point.  May it please, your Honours.

KEANE J:   Thanks, Mr Walker.  Yes, Mr Bourke.

MR BOURKE:   If the Court pleases.  The safety check in relation to the scope of the words “lawful request” is the fact that if you come within the scope of those words it does not trigger a contravention.  The check is you must, as a result of, for example, a refusal to comply, you must meet the requirements of the table under 342 of adverse action, or you must have been then engaged in coercive action to seek compliance with the request. 

So, in our submission, our construction is about protection, and when you really look at the purpose of Part 3‑1, it is about protection in the industrial environment.  Picking up the observation, with respect, of her Honour Justice Gleeson, the majority gave great weight to section 336(1) in terms of the objects, but ignore subsection (2) where it says:

The protections referred to in subsection (1) are provided to a person (whether an employee, an employer or otherwise).

Now, the majority have cut back the protections regarding 347(b)(iv), away from employers, we would say, also, independent contractors, and they have cut back the protections regarding industrial action if the industrial action is not taken – does not involve employees of that employer.  Second, we have heard nothing by way of construction or analysis of the Act by our learned friends defending industrial action and how it is now confined to having to be against the employees’ employer, pointing to nothing in section 19 that supports that, and then, when we come to independent contractor, there is no dispute.

You take out of the protections and obligations a head contractor, that is going to have a profound effect on the Act, and all we hear is will there be evidentiary disputes here but no dispute that we gave unchallenged evidence, that we came completely within item 7(c) because we said there was half a day’s loss of production, clear prejudice, unchallenged, and still not disputed. 

We clearly, otherwise, at an evidentiary basis, came within 7(c), but we were shut out by the profound error without argument that independent contractors do not include head contractors.  That has to be corrected, for the sake of the further operation of Part 3‑1.  If the Court pleases.

KEANE J:   The appeal foreshadowed by this application for special leave to appeal does not enjoy sufficient prospects of success to warrant the grant of special leave to appeal and is otherwise not an appropriate vehicle to agitate the third question sought to be raised by the application.  The application should be dismissed with costs.

AT 11.14 AM THE MATTER WAS CONCLUDED