Australian Building and Construction Commissioner v Hanna
[2017] FCCA 1257
•25 May 2017
FEDERAL CIRCUIT COURT OF AUSTRALIA
| AUSTRALIAN BUILDING AND CONSTRUCTION COMMISSIONER v HANNA & ANOR | [2017] FCCA 1257 |
| Catchwords: INDUSTRIAL LAW – Penalty hearing – unlawful industrial action under the Fair Work Act 2009 (Cth) – First Respondent admitted contravention – imposition of appropriate penalty – relevant factors. |
| Legislation: Fair Work Act 2009 (Cth), ss.487, 500, 512, 546, 557 |
| Finance Sector Union of Australia v Commonwealth Bank of Australia [2005] FCA 1847 |
| Applicant: | AUSTRALIAN BUILDING AND CONSTRUCTION COMMISSIONER |
| First Respondent: | DAVID HANNA |
| Second Respondent: | CONSTRUCTION FORESTRY MINING AND ENERGY UNION |
| File Number: | BRG 98 of 2016 |
| Judgment of: | Judge Vasta |
| Hearing date: | 25 May 2017 |
| Date of Last Submission: | 25 May 2017 |
| Delivered at: | Brisbane |
| Delivered on: | 25 May 2017 |
REPRESENTATION
| Counsel for the Applicant: | Mr Mackie |
| Solicitors for the Applicant: | K & L GATES |
| Counsel for the First Respondent: | Mr McCarthy |
| Solicitors for the First Respondent: | FISHER DORE LAWYERS |
| Solicitors for the Second Respondent: | HALL PAYNE LAWYERS |
ORDERS
THE COURT DECLARES:
That in contravention of s.500 of the FW Act, on 10 February 2015 at the "Broadway on Ann" Project (Project), the First Respondent, Mr David Hanna, while the holder of an entry permit issued under s.512 of the Fair Work Act 2009 (Cth) (FW Act):
(a)exercised, or attempted to exercise, his rights as a permit holder under Part 3-4 of the FW Act by entering the Project site for the purpose of having discussions under s.484 of the FW Act by holding discussions with one or more employees (Employees) who:
(i)performed work on the premises;
(ii)whose industrial interests Mr Hanna's organisation, the Construction Forestry Mining and Energy Union, was entitled to represent; and
(iii)who wished to participate in those discussions;
That in the exercise or attempted exercise of those rights Mr Hanna engaged in an improper manner by:
(a)entering the Project without having given a notice of entry under s.487 of the FW Act;
(b)remaining on the premises despite requests to leave;
(c)when asked if he had a right of entry permit, responded by raising his hand with his middle finger extended and saying that he did not need one;
(d)squirted water at a person validly engaged to work on the Project, which struck the person's face, shirt and mobile phone;
(e)stating "Take that phone away or I'll fucking bury it down your throat, you ask me if you want to take a picture of me, you ask me"; and
(f)using an employee's swipe card to swipe out a number of employees engaged on the Project, the effect of which was that the occupier of the premises did not have a record of which employees had left the premises and which had not.
ON A FINAL BASIS THE COURT ORDERS:
That pursuant to section 546(1) of the FW Act that, by 1 January 2020, the First Respondent pay pecuniary penalties fixed in the sum of $10,200.00 (inclusive of GST) for his contraventions set out in paragraphs 1-2 above.
That pursuant to section 546(3)(a) of the FW Act that any penalties imposed on the First Respondent be paid to the Commonwealth.
BY CONSENT UNTIL FURTHER ORDER THE COURT ORDERS:
That the Second Respondent file and serve and outline of submissions as to the liability of the Second Respondent by no later than 4:00pm on 9 June 2017.
That the Applicant file and serve and outline of submissions as to the liability of the Second Respondent by no later than 4:00pm on 16 June 2017.
That the matter be adjourned for hearing to 10:00am on 9 August 2017 in the Federal Circuit Court of Australia at Brisbane.
That the parties have liberty to apply on three days’ notice.
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT BRISBANE |
BRG 98 of 2016
| AUSTRALIAN BUILDING AND CONSTRUCTION COMMISSIONER |
Applicant
And
| DAVID HANNA |
First Respondent
| CONSTRUCTION FORESTRY MINING AND ENERGY UNION |
Second Respondent
REASONS FOR JUDGMENT
(Ex tempore)
By application that was filed on 4 February 2016, the then Director of the Fair Work Building Industry Inspectorate, now Australian Building and Construction Commissioner (“ABCC”), asked this Court to find that the First Respondent had contravened s. 500 of the Fair Work Act 2009 (Cth) (“the FW Act”)and therefore was liable to pecuniary penalties.
This matter has had somewhat of a chequered history. The Applicant had also joined a Second Respondent to this matter. The proceedings against the Second Respondent are not finalised, and I have set those matters down earlier today for hearing later in the year.
However, what has occurred is that, because of certain communications that had been made, the Applicant amended their pleading on 11 May 2017, and, on 12 May, the First Respondent amended his defence and admitted all of the matters in that statement of claim.
The First Respondent was, as at 10 February 2015, the divisional president of the CFMEU, who are the Second Respondent. At that time, Hindmarsh Construction Australia Proprietary Limited was the head contractor for a project known as “Broadway on Ann”.
That project was located at the corner of Commercial Road and Ann Street, Fortitude Valley. It was a fairly major construction because there were quite a number of subcontractors as well that were needed to help construct this 15 storey residential apartment complex.
On 10 February 2015, not only was the head contractor there, but there were workers from VTS Redding Proprietary Limited, Pacific Formwork (QLD) Pty Ltd, Top Deck Steelfixing Pty Ltd and Australian Prestressing Structures Pty Ltd.
Three of those subcontractors had separate enterprise agreements that had been made under the FW Act and the CFMEU had been covered by those enterprise bargaining agreements and the employees of Top Deck were eligible for membership under the CFMEU
Mr Hanna, the First Respondent, held a permit that had been issued under s.512 of the FW Act. That permit allowed him entry to premises. However, an entry permit does not mean that one can simply enter a building site whenever one likes.
According to s.487 of the FW Act, there must be a notice given by the permit holder to the head contractor that a person intended to enter the premises. As at 10 February 2015, the First Respondent, Mr Hanna, had not given Hindmarsh an entry notice under that section of the FW Act, and so therefore did not have the permission of Hindmarsh to enter the premises. On that day, shortly after 11.30 am, both John Livingston, the project manager of the project, and Garry Gough, who was the site manager of the project, saw Mr Hanna on that site.
They told him that he was on site illegally and he must return to the site office immediately. Mr Hanna ignored what both Mr Livingston and Mr Gough had asked him. He remained on the premises and he descended down the stairs to the basement level of the project. A person by the name of David Libke, who was the site supervisor of the project, then asked Mr Hanna what he was doing on site, and Mr Hanna said, “I’m having a meeting with my workers.” Mr Libke asked Mr Hanna if he had a right of entry permit and he raised his hand to Mr Libke with his middle finger extended and said that he did not need an entry permit.
Mr Libke asked Mr Hanna to then leave the premises. However, notwithstanding this, Mr Hanna remained on the premises, walked away from Mr Libke and called some of the employees that were there from these four different subcontractors, towards him and he told them that they were going to have a meeting. Mr Gough approached Mr Hanna on the basement level of the project and said, “You are trespassing. Why don’t we go upstairs and talk about this,” and Mr Hanna replied to the effect that he had come to meet with his members.
Mr Gough said, “What are you doing here? You are here illegally. Why don’t you go through the right channels,” and Mr Hanna replied, “I can do what I like.” Thomas Neylan, who was the contracts manager for the project, then approached Mr Hanna with Mr Livingston. Mr Livingston again said to Mr Hanna that he was to leave the site as he did not have permission to be there and that no entry permit had been sent to Hindmarsh. Mr Hanna’s response was to the effect that he did not need to get permission to enter a building site to talk to the men with whom he had an enterprise bargaining agreement.
So during this discussion between Mr Livingston and Mr Hanna, Mr Neylan activated the video recorder function on his mobile phone. Mr Hanna, seeing this, then moved towards Mr Neylan and Mr Hanna, who had in his hand a plastic water bottle, squirted water from the plastic water bottle at Mr Neylan, which hit him in the face, went over his shirt and went over his mobile phone. Mr Hanna then moved to Mr Neylan and said, “Take that phone away or I’ll fucking bury it down your throat. You ask me if you want to take a picture of me. You ask me.”
Mr Hanna then spoke to some of the employees that were there in the basement level of the project and this conversation was not heard by any of the persons in authority for Hindmarsh. But at about 12 noon, Mr Hanna and a number of the employees left the basement level of the project and made their way out of the premises. Mr Hanna used one of those employees’ swipe cards to swipe out a number of the employees through the turnstiles at the exit of the premises. That had the effect of a number of employees leaving under the one swipe card which meant that Hindmarsh did not have a record of which employees had left the premises and which employees had not.
Notwithstanding the submissions that Mr McCarthy made to me, the employees were all similarly dressed and there was no evidence that any employee of Hindmarsh, who was in a position of authority, was in any way then able to check who it was that was going and where they were. The safety aspects of such an action should be quite obvious. Those employees were away for about 30 minutes and then they returned to the premises and recommenced work.
Section 500 of the FW Act reads as such:
“A permit holder exercising, or seeking to exercise, rights in accordance with this Part must not intentionally hinder or obstruct any person, or otherwise act in an improper manner.”
What is obvious here, and is not contested by Mr Hanna, is that he has acted improperly. He has obstructed persons, and he has hindered persons and therefore he has breached s.500. Those contraventions are pleaded in the Statement of Claim and admitted by Mr Hanna.
The first contravention is that, by being in the premises without invitation and without having given a notice of entry, he has acted in an improper manner.
The second contravention is that Mr Hanna ignored the requests of Mr Livingston, Mr Gough and Mr Libke to leave the premises.
The third contravention was behaving improperly by the squirting of water at Mr Neylan.
The fourth contravention is the verbal abuse to Mr Neylan when he, in effect, said to Mr Neylan that he would “fucking bury the phone” down Mr Neylan’s throat.
The fifth contravention was the raising of his middle finger when asked by Mr Libke to give him the permission notice that he had from Hindmarsh.
The sixth contravention was that he used the swipe card in such a manner that Hindmarsh did not have a proper record of who was in the construction site and who was not.
Much of this hearing has revolved around the question that I have posed as to how I should treat these six contraventions of s.500 that the First Respondent, Mr Hanna, has admitted. Each of those contraventions is a contravention in and of itself.
In finding that a contravention has occurred, a person is then liable for a penalty. As six contraventions have occurred, a person is liable for six separate penalties. In looking at whether the contraventions can be seen as one course of conduct, one has to look at what does the FW Act itself allows.
Section 557 of the FW Act allows multiple contraventions to be, as it were, bundled up and treated as one contravention. This often occurs in matters in which the Fair Work Ombudsman applies to this Court for pecuniary penalties in respect of employers who have breached the conditions of the modern Award.
During the course of argument, I gave the example of an employee who may have seven employees and has, in regard of all seven employees, breached the modern Award by simply ignoring the penalty provisions. That is, that they have not paid overtime, have not paid Saturday penalty rates, have not paid Sunday penalty rates, have not paid public holiday penalty rates.
Often what will happen is that rather than look at that matter as 28 separate contraventions, all the contraventions relating to a particular aspect, whether that be the Saturday penalty rates or the Sunday penalty rates, are bundled up as one, so that the person faces pecuniary penalties based on four contraventions of the Act, rather than 28 contraventions.
Section 557 does not apply to breaches of s.500. Therefore, it would seem to me that the pleading that each of these six contraventions has been proven makes the First Respondent liable to six separate penalties. This was submitted to me by the Counsel for the First Respondent to not be the basis upon which the First Respondent entered into the pleading, or amended defence, that was filed in this Court on 12 May. It was always the First Respondent’s belief that he was making himself liable to the one penalty.
It was obvious that my raising this issue caught both Counsel for the ABCC and Counsel for the First Respondent completely off guard. Counsel for the ABCC, after receiving instructions, has requested that this Court only proceed as if the maximum penalty for this is $10,200.00, and asks me, in effect, to use the discretion that I would have pursuant to the common law, to look at these six contraventions as one course of conduct.
But there is no discretion at common law for me to exercise. The legislation has stated that I can only “bundle up” contraventions into one course of conduct under s,557. If the conduct is not covered under s,557, then I cannot “bundle” them together. Nevertheless, I have decided to accede to the request by both Counsel. It seems to me that, given all the circumstances, it would have been unfair for me to proceed otherwise.
Notwithstanding that I had offered an adjournment to the parties so that they could research the matter or make further submissions, they have both implored me to use the $10,200.00 maximum as the maximum penalty that I would impose in any event, even if I were not to look at the matter as being able to be looked at as one course of conduct, and to give the decision today. As I say, I have acceded to that request, even though the only proper path is to deal with this matter as six separate contraventions, but it is only because of the peculiar circumstances as to how this question arose.
Now, having decided to look at the matter as one course of conduct, the Applicant has brought to my attention many of the usual principles that pertain when looking at the way in which I ought fashion the penalty. There have been a number of authorities where the Court has fashioned a list of non-exhaustive factors which may or may not be relevant to the circumstances of a particular case when assessing the appropriate penalty.
Whilst that may be a very attractive way of looking at matters, it is also a matter where a court should not follow slavishly, how things are on a particular checklist.
It is a matter of understanding the principles that apply in these matters and giving effect to those, rather than going through a particular checklist of factors.
I also take note of what Merkel J said in Finance Sector Union of Australia v Commonwealth Bank of Australia [2005] FCA 1847, when he said:
“72. It may be that breaches by unions and employers of industrial legislation from time to time have been accepted as part of the give and take of industrial disputation. However, in recent years industrial legislation has increasingly codified and prescribed what is acceptable, and what is unacceptable, industrial conduct. The legislature has, over time, also moved to increase the penalties that may be imposed in respect of unlawful industrial conduct. In my view, any light handed approach that might have been taken in the past to serious, wilful and ongoing breaches of the industrial laws should no longer be applicable. As is apparent from the penalties that I have imposed, I have not accepted that such an approach, which was urged by CBA (which contended that either no penalty or only a nominal penalty was appropriate), is applicable in the present case.”
I must look at whether the punishment factor of the civil penalty is proportionate to the offence and in accordance with prevailing standards of punishment. I must look at the issues of specific, that is personal, deterrence and general deterrence, and look at rehabilitation.
I must also look at whether there had been similar previous conduct by the Respondent. I should look at the size of the business enterprise involved, and whether the party committing the contravention had exhibited contrition and whether they had cooperated with enforcement authorities.
It is obvious that the project itself was a very large project, needing quite a number of subcontractors. It is apparent from the pleadings that the executives of Hindmarsh took safety within the project extremely seriously and it is apparent as well that this interruption to work was something that was not in the contemplation of the project managers at any part of the day. I also take into account the arrogant manner in which Mr Hanna conducted himself that day. He was absolutely contemptuous of what the law prescribed that he could do.
Notwithstanding Mr McCarthy’s valiant attempts to try and tell me that Mr Hanna somehow had a mistaken belief that he was entitled to do what he did, I cannot accept that for one iota of a second.
What Mr Hanna did was flex his muscles and, as he said to Mr Libke, “I can do whatever I want to do.” The fact that his aura and his power extended to the workers who wanted to stay on site, who wanted to continue working but, in my view, felt compelled to leave the site unlawfully and follow Mr Hanna, really shows the arrogance in which he conducted himself.
It is conduct that must be seen in the worst category. As I have previously said in a number of other matters, the FW Act exists because there will always be tension between employees and employers. To ensure that, as best we can, that there is a regime that is fair to both, the FW Act has been set up. The FW Act gives and codifies a set of rules and conduct by which this country is to achieve industrial peace.
It can only achieve that industrial peace if each person under that FW Act does what they are supposed to; that is, that employees do their duties as they have been either contracted to or agreed to; that employers live up to the standards of the National Employment Standards, the standards of the modern Award, and the standards of the particular enterprise bargaining agreements; and that union representatives use their power wisely and use their powers in the best interests of their members and in accordance with what the FW Act allows them to do.
If that does not happen, there will be anarchy. The industrial relations regime will disintegrate to a point where, not just within this country but internationally, it will be deleterious to our standing as an industrialised nation. The Rule of Law is such that each person who plays a part in the industrial regime that we have, has to play their part, and when they do not, and when they blatantly disregard this FW Act, it is the Court’s duty to give appropriate and condign punishment to reflect the abhorrence of society with persons who do not believe that the law applies to them.
That is how Mr Hanna acted on this day. The law did not apply to him. He was the law. He was a law unto himself and despite the lawful and proper actions of the three or four employees of Hindmarsh, Mr Hanna treated them with contempt.
The Court must show its disapproval to this sort of conduct. There has been absolutely no remorse. There has been no act of contrition. There has been no apology given to any of the persons involved here today. Mr Hanna acts as if being brought to this Court is just an occupational hazard of his doing business as president of the CFMEU.
It has been submitted to me that he is no longer with the CFMEU. He left. He left in a quite humiliating way and he was unemployed for quite some time. He has now had to go back to being a labourer and he grosses only $1,000.00 a week, and therefore I should take that into account in looking at whether he has the capacity to pay.
Of course, none of this is actually before me in the form of the admissible evidence. It is just evidence that is given from the Bar table. I have been told that his capacity to pay is somewhat diminished because he does have other pecuniary penalties that have been given, most notably one of $2,500.00 by Judge Jarrett where he is still paying that off at about $100 a week. It has been submitted that I should not give a penalty that would be crushing.
I have been told that his property and assets have been frozen under the Confiscation of Profits of Crime Act, and he has no immediate prospect of retrieving any of those funds. However, as I remarked, his impecuniosity, if it could be termed that, has been all of his own making.
Whilst I do take all of that into consideration, it is outweighed by the need for me to hand out a penalty that is one that shows general deterrence. The submission has also been made that he has cooperated by his not taking this matter to a hearing and wanting to admit the breaches.
However, as I have already remarked, he has obtained a substantial benefit already from that because the ABCC has prevailed upon me that he should be punished as if this were a matter of one course of conduct and one alone.
If he had taken this matter to a full hearing and not admitted the matters, there would have been absolutely no question that if these matters were proven (and it does seem to me as though there was no way that they would not have been proven) that he was going to open himself up to penalties for each contravention that was proven.
So whilst I do take into account that aspect, to my mind, Mr Hanna has already received an extremely generous concession by the ABCC. Mr Hanna does have previous findings against him in this Court and I do not need to go through those. But what it does show is that he is a person who knew that he would be punished for breaching the FW Act and, as I say, simply saw it as an occupational hazard. I have already averted to the $2,500.00 fine by Judge Jarrett and a previous fine of $7,750.00 back in 2012.
I do acknowledge that neither of those matters involved breaches of s.500 of the FW Act but, in my view, that does not really matter in any great way.
I have had regard to all of the comparable decisions that have been given to me. However, I do not see that any of those really matches the facts here.
This man was the president, the leader of the CFMEU and he behaved in a most disgraceful manner on this occasion. In my view, notwithstanding all of the mitigating circumstances that I have mentioned, I am unable to find that I should, in the proper exercise of my duty here, impose anything less than the maximum of $10,200.00.
I certify that the preceding fifty-six (56) paragraphs are a true copy of the reasons for judgment of Judge Vasta
Date: 26 June 2017
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