Australian Building and Construction Commissioner v Hanna and Anor (No.3)
[2017] FCCA 2519
•19 October 2017
FEDERAL CIRCUIT COURT OF AUSTRALIA
| AUSTRALIAN BUILDING AND CONSTRUCTION COMMISSIONER v HANNA & ANOR (No.3) | [2017] FCCA 2519 |
| Catchwords: INDUSTRIAL LAW – Assessment of pecuniary penalties – groupings – maximum penalty awarded. |
| Legislation: Fair Work Act 2009 (Cth), ss.487, 500, 512, 550, 557 |
| Cases cited: Australian Building and Construction Commissioner v Hanna & Anor [2017] FCCA 1257 FWO v Samurais Paradise Pty Ltd & Anor [2017] FCCA 2013 |
| 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: | In Chambers |
| Date of Last Submission: | 25 September 2017 |
| Delivered at: | Brisbane |
| Delivered on: | 19 October 2017 |
REPRESENTATION
| Counsel for the Applicant: | Mr C J Murdoch QC and Mr S Mackie |
| Solicitors for the Applicant: | K +L Gates |
| Counsel for the Respondents: | Mr C A Massy |
| Solicitors for the Respondents: | Hall Payne |
ORDERS
That pursuant to section 546(1) of the FW Act that, within 28 days, the Second Respondent pay pecuniary penalties fixed in the sum of $306,000.00 (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 Second Respondent be paid to the Commonwealth.
| 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
Introduction
On 25 May 2017, the First Respondent, David Hanna accepted liability for 6 contraventions of the Fair Work Act 2009 (Cth) (“the FW Act”). On that date, I imposed a pecuniary penalty of $10,200.00.
On 9 August 2017, the Second Respondent, the Construction, Forestry, Mining and Energy Union (“the CFMEU”), argued that they were not liable for the contraventions made by the First Respondent. On 11 August 2017, I ruled that, pursuant to s.550 of the FW Act, the Second Respondent was liable for the contraventions of the First Respondent. I then made declarations against the CFMEU.
The parties have now given me written submissions on the question of the quantum of the pecuniary penalties that I should impose.
The Factual Matrix
It is important to understand the factual matrix that underpins these 6 contraventions.
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 and there were quite a number of subcontractors that were needed to help construct this 15 storey residential apartment complex.
On 10 February 2015, not only was the head contractor present at the site, 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 that 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 then asked Mr Hanna to leave the premises. However, notwithstanding this, Mr Hanna remained on the premises, walked away from Mr Libke and called some of the employees, who 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.
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. 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, wet 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. 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.
The employees were all similarly dressed and there was no evidence that any employee in a position of authority for Hindmarsh, was in any way then able to check who it was that had left the site 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:
“500 Permit holder must not hinder or obstruct
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.
Note 1: This section is a civil remedy provision (see Part 4 1).
Note 2: A permit holder, or the organisation to which the permit holder belongs, may also be subject to an order by the FWC under section 508 if rights under this Part are misused.
Note 3: A person must not intentionally hinder or obstruct a permit holder, exercising rights under this Part (see section 502).”
What is obvious is that Mr Hanna has acted improperly. He has obstructed persons, and he has hindered persons and therefore he has breached s.500. His actions are the actions of the CFMEU, the Second Respondent.
The first contravention is that, by being in the premises without invitation and without having given a notice of entry, the CFMEU has acted in an improper manner.
The second contravention is that the CFMEU ignored the requests of Mr Livingston, Mr Gough and Mr Libke to leave the premises.
The third contravention is constituted by the CFMEU behaving improperly by the squirting of water at Mr Neylan.
The fourth contravention is the verbal abuse by the CFMEU to Mr Neylan when the CFMEU said to Mr Neylan that the CFMEU would “fucking bury the phone” down Mr Neylan’s throat.
The fifth contravention was the CFMEU, through Mr Hanna, raising the middle finger in an obscene gesture when asked by Mr Libke to give him the permission notice that he had from Hindmarsh.
The sixth contravention was that the CFMEU using 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.
Course of conduct
In Australian Building and Construction Commissioner v Hanna & Anor [2017] FCCA 1257, I dealt with the matter as if it were one contravention. This was because of the very unusual circumstances that had applied in that hearing. Such is evident from paragraphs 24 to 32 of that judgement. I concluded discussion on that matter by saying this:
“I have acceded to that request (to treat the matter as one contravention) even though the only proper path is to deal with this matter as 6 separate contraventions, but it is only because of the peculiar circumstances as to how this question arose.”
Those peculiar circumstances do not arise in this case. When the liability hearing commenced on 9 August 2017, I made it very clear that those circumstances that applied in the penalty hearing involving the First Respondent, did not apply to this hearing.
Section 557 of the FW Act reads as follows:
“Course of conduct
(1) For the purposes of this Part, 2 or more contraventions of a civil remedy provision referred to in subsection (2) are, subject to subsection (3), taken to constitute a single contravention if:
(a) the contraventions are committed by the same person; and
(b) the contraventions arose out of a course of conduct by the person.
(2) The civil remedy provisions are the following:
(a) subsection 44(1) (which deals with contraventions of the National Employment Standards);
(b) section 45 (which deals with contraventions of modern awards);
(c) section 50 (which deals with contraventions of enterprise agreements);
(d) section 280 (which deals with contraventions of workplace determinations);
(e) section 293 (which deals with contraventions of national minimum wage orders);
(f) section 305 (which deals with contraventions of equal remuneration orders);
(g) subsection 323(1) (which deals with methods and frequency of payment);
(h) subsection 323(3) (which deals with methods of payment specified in modern awards or enterprise agreements);
(i) subsection 325(1) (which deals with unreasonable requirements on employees to spend or pay amounts);
(ia) subsection 325(1A) (which deals with unreasonable requirements on prospective employees to spend or pay amounts);
(j) subsection 417(1) (which deals with industrial action before the nominal expiry date of an enterprise agreement etc.);
(k) subsection 421(1) (which deals with contraventions of orders in relation to industrial action);
(l) section 434 (which deals with contraventions of Ministerial directions in relation to industrial action);
(m) subsection 530(4) (which deals with notifying Centrelink of certain proposed dismissals);
(n) subsections 535(1), (2) and (4) (which deal with employer obligations in relation to employee records);
(o) subsections 536(1), (2) and (3) (which deal with employer obligations in relation to pay slips);
(p) subsection 745(1) (which deals with contraventions of the extended parental leave provisions);
(q) section 760 (which deals with contraventions of the extended notice of termination provisions);
(r) subsection 785(4) (which deals with notifying Centrelink of certain proposed terminations);
(s) any other civil remedy provisions prescribed by the regulations.
(3) Subsection (1) does not apply to a contravention of a civil remedy provision that is committed by a person after a court has imposed a pecuniary penalty on the person for an earlier contravention of the provision.”
What is obvious from this section is that contraventions of s.500 are not included in s.557. Therefore any contraventions of that section cannot be dealt with as if they were a single contravention.
Both the ABCC and the CFMEU have made submissions about what constitutes “course of conduct” and how this Court should approach this topic. Most of those submissions rely on the common law.
But the FW Act is akin to a Code. The rules of statutory interpretation must be applied to the interpretation of the Code. It is only when those rules do not afford a conclusion, that recourse should be had to the common law.
In this case, the rules of statutory interpretation provide a clear and unequivocal answer. Because the Parliament has enacted s557, it has prescribed what constitutes a course of conduct in matters involving contraventions of the FW Act.
An analogy can be properly made as to sections of the Migration Act that established the jurisdiction of the Administrative Appeals Tribunal (“the AAT”) and the Immigration Assessment Authority (“the IAA”). With respect to both of those bodies, the Migration Act 1958 (Cth) has legislated what are the boundaries of “procedural fairness” in hearings before both those bodies.
Because of the codification of these principles within the Migration Act, the common law principles of “procedural fairness” do not apply to hearings before either of those bodies; the Law deems there to have been procedural fairness as long as both bodies have complied with the statutory obligations contained in the Migration Act 1958 (Cth). (see BTB15 v Minister for Immigration and Border Protection [2016] FCCA 2629)
Similarly in this case, the legislature has set forth the boundaries of how a Court will construe a “course of conduct” in matters involving the FW Act. Unless the contraventions comply with s.557, then they cannot be taken by this Court as being considered as a single course of conduct.
Such a view is consistent with the maxim “expressio unius est exclusio alterius”. This is because Parliament, in listing each of the sections to which s.557 does apply, is specifically excluding multiple contraventions of s.500 from being considered as forming a single contravention.
Differences in Approach
There are two main independent statutory bodies that monitor compliance with the FW Act; the ABCC and the Fair Work Ombudsman (“the FWO”). Often these two agencies differ in their approach to the imposition of pecuniary penalties.
It is important though for the Court to maintain a consistent approach to contraventions of the FW Act and the imposition of pecuniary penalties.
In FWO v Samurais Paradise Pty Ltd & Anor [2017] FCCA 2013, I said when talking about grouping contraventions:
“21. In deciding what I ought do as far as making orders for pecuniary penalties, the first thing I should do is look at whether these offences can be grouped. The Fair Work Ombudsman has submitted to me that I ought group these offences into 15 categories. Such categories would be in accordance with the principles in groupings of matters pursuant to s.557 of the FW Act.
22. The Respondents asked me to make even further groupings by grouping the offences of not paying Saturday, Sunday and public holiday loadings as one group, not paying the late night and early morning loadings as another group, making the false records on two occasions as one group and the two occasions of producing a false record as another group.
23. Whilst there may be some merit in what the Respondents have said, it is my view that the failure to do what is required under the FW Act creates separate and distinct offences in, and of, themselves. Though it is recognised that the contravention involving one particular behaviour as opposed to another particular behaviour is still a breach of the same provision of the FW Act, that does not automatically mean that those offences should be grouped together.
24. In the case of the Saturday, Sunday and public holiday loading, those three are three separate loadings and have different calculations. The late night and the early morning allowances also have different calculations.
25. So whilst they may all be within the same sort of offending, to my mind they are separate and distinct matters and ought not be grouped any more than they have.
26. As far as the making of the false records are concerned, it is my view that there were two different forms of making false records; the first being falsifying a rate and hours of five employees, and the second being the falsifying of other records with the a covering letter saying that all employees were paid properly. That second type included the provision of a pay slip and a form to say that superannuation had been paid which it hadn’t. Those records are separate and distinct to each other and ought not be grouped.
27. The provision of those false records were done on two different occasions, which makes it a more aggravating factor and ought not be grouped in, and of itself, as one offence.
28. Therefore, I am content to accept the submission of the Fair Work Ombudsman as to the groupings that I ought make as it really is the only proper means by which the enormity of the wrongfulness of the Respondents can be recognised.”
It may be thought that each of these contraventions could easily be described as a course of conduct in which Mr Hanna (and therefore the CFMEU) was behaving in a haughty and belligerent manner. But each of the contraventions were deliberate independent actions which were totally unnecessary and were not corollaries of each other.
To group any of the contraventions together (even if I had the power to actually do such a thing, which I have already said that I do not) would be to minimise the appalling conduct of both Mr Hanna and the CFMEU.
These six contraventions are deserving of separate punishments so that the full context of what Mr Hanna and the CFMEU have done is both known to the general public and denounced by this Court.
Maintaining the consistent approach of the administration of the FW Act, leads me to the conclusion that all six contraventions must be looked at separately and given their own separate penalty.
This means that the maximum penalty available to the Court is one of $306,000.00.
The Factors to be Taken Into Account
I have had regard to the authorities, especially what was said in the Mason & Harrington Corporation Pty Ltd t/as Pangea Restaurant & Bar [2007] FMCA 7. While that case enumerated a number of factors, such should never be used as a checklist or a comparative scale with the other matters so as to arrive at a form of mathematical penalty. I have had regard to all such factors and also the way in which this matter has been litigated.
While it has been submitted by the CFMEU that Mr Hanna, as President, did not hold the reins of the union, because the CFMEU rules vest that power in the secretary, Mr Hanna was certainly the public face of the CFMEU in Queensland.
For any of the persons at the “Broadway on Ann” site that day, it would be easy to surmise that the appearance of Mr Hanna had the full and unequivocal support of the CFMEU behind it. For those people, it is easily surmised that they would think that there was no one higher in the CFMEU than Mr Hanna.
For Mr Hanna to have acted in this most abhorrent way, would have been very concerning to those affected. To them, these were not the actions of some over-exuberant maverick from the CFMEU; these were the actions of the President himself. And even though Mr Hanna is no longer associated with the CFMEU, there has been no condemnation, or even apology, for the actions of Mr Hanna on this day from the CFMEU.
It can only be inferred that the CFMEU condone such actions and approach the imposition of pecuniary penalties as occupational hazards in the performance of their business plan (whatever plan that may be).
The past history of contraventions of the FW Act by the CFMEU is astounding. It is no understatement to describe the CFMEU as the most recidivist corporate offender in Australian history. Such a description is apt when all of the matters annexed to the submissions of the ABCC are examined. That annexure reveals approximately 120 occasions that Courts have sanctioned the CFMEU for breaches of industrial law over the past 10 years. I have carefully considered all of those entries in the annexure.
Therefore, in assessing the gravamen of each contravention by the CFMEU, it must be borne in mind that the previous history of the CFMEU does put these contraventions into a category that defies easy comparison. While some may want to sanitize this behaviour as an unremarkable workplace contravention, it is far more than that.
R v Keenan [2009] QCA 236, was a case where the person who organised “gangland hit” on another person was charged with attempted murder and acquitted of that charge the convicted of malicious act with intent.
In that case, the victim was shot in the back and left for dead. The victim survived but his spinal cord was severed leaving him a quadriplegic. Keenan did not fire the weapon but was present when the weapon was fired.
Keenan had an unenviable criminal history including a previous conviction for manslaughter. Notwithstanding that Keenan was convicted of a lesser charge than attempted murder, the serious nature of the offence combined with his antecedents put the offending of Keenan into the worst category. Keenan was sentenced to life imprisonment.
When the Court of Appeal considered the issue of sentence, Keane JA (as His Honour then was) made the following salient observations at [62] and [63]:
“62. As to the suggestion that the learned sentencing judge placed undue weight on the applicant's criminal record, that record was relevant to the issue of community protection. In Veen v The Queen, Mason J, as he then was, accepted that life imprisonment should be imposed when it is necessary to protect the community from an offender who has a disposition to offences of personal violence likely to cause serious injury, and where the offence is itself so grave as to require a very long sentence.
63. It is apparent from the sentencing remarks of the learned sentencing judge that he did not, as the applicant argues, approach the sentencing of the applicant on the basis that his past offences warranted a fresh penalty, but regarded the applicant's antecedent criminal history as indicating that the applicant was, like the offender in R v Wilkie, disposed to have recourse to acts of violence to achieve his aims. The applicant's criminal history could legitimately be taken into account to show that the offence of present concern is not an uncharacteristic aberration on his part and that the applicant has manifested in his commission of this offence a continuing attitude of disobedience of the law so as to indicate the need for a more severe sentence in the interests of deterrence and protection of society.”
The submission was made that the offending behaviour of Mr Hanna (and the CFMEU), whilst serious, was of short duration and did not pose any actual safety concerns. It was submitted that there was no loss or damage afforded to the contractor, Hindmarsh. It was also submitted that there was co-operation afforded by the CFMEU.
The offending may have been of short duration but that does not derogate at all from how serious these contraventions are. I do consider that there was a safety concern because there had been no arrangements made for Mr Hanna to visit the construction site and, as such, there would necessarily have been a risk to safety posed. I have already mentioned how using the swipe card was a very big risk to safety. It was more good fortune than good management that there was no actual safety incident that occurred.
In the end, the contractor, Hindmarsh, lost over 30 minutes of productivity when Mr Hanna (and the CFMEU) led the workers off the site. This is not a significant loss by any means, but it cannot be said that there was no loss. I could not find any true measure of co-operation on the part of the CFMEU.
The submission was made that, in essence, these contraventions were not in the category that would attract the larger pecuniary penalties. In summary, the submission was that these offences could have been worse.
In Keenan (supra), a similar submission was made. At [59], His Honour said:-
“59. It may be said that the criminality exhibited by the offender in this case might have been significantly worse if the applicant knew that one of his companions in the attack upon the complainant was carrying a gun. The possibility that a gun might be used heightens the probability of serious harm to the intended victim, and raises the possibility of serious injury to innocent bystanders. The first point to be made here was made by Mason CJ, Brennan, Dawson and Toohey JJ in Veen v The Queen [No 2]:
‘ that the maximum penalty prescribed for an offence is intended for cases falling within the worst category of cases for which that penalty is prescribed: Ibbs v The Queen ((1987) 163 CLR 447, at pp 451-452). That does not mean that a lesser penalty must be imposed if it be possible to envisage a worse case; ingenuity can always conjure up a case of greater heinousness. A sentence which imposes the maximum penalty offends this principle only if the case is recognizably outside the worst category.’”
In R v Manson [1974] Qld R 191, Wanstall SPJ (as His Honour then was) said at 202:-
“202. It would … be difficult to imagine a worse case … I am not in the least attracted by the argument that the maximum penalty should never be imposed because the sentencing court cannot be sure that some day there will not be a worse case. Though that may be true, it is irrelevant. This case is bad enough to justify the imposition of the maximum penalty – its evil is sufficient unto this day; let the morrow take thought for the things of itself. If its case should be even more evil the precedent of this case will be relevant and helpful.”
It is trite to note that the presence of Mr Hanna at that site did compromise the safety of the very workers he is supposedly trying to protect.
It may have been expected that there would be righteous condemnation of any person compromising safety on the work site coming from a union that purportedly exists to ensure safety on worksites. The silence from the CFMEU, however, has been deafening.
There has been no remorse from the CFMEU. There has been no evidence of the CFMEU training any of its officers as to the provisions of the FW Act to ensure that such abominable behaviour is not undertaken by any of its representatives ever again.
Given the nature of the contraventions, the recidivist nature of the CFMEU, the lack of acknowledgement of any wrong doing, the lack of any remedial action and the need to deter this kind of behaviour, I can see no reason to ameliorate any of the penalties that I will impose on the CFMEU.
The Contraventions and how they should be Categorised
For the President of the CFMEU to simply walk on to a construction site without notice is a blatant disregard for the provisions of the FW Act and an obvious hazard for safety. To my mind, in all the circumstances, this contravention is in the worst category.
For Mr Hanna to refuse the authorised direction to leave the area and report to this site office displays flagrant disregard for the proper running of a construction site. To my mind, in all the circumstances, this contravention is also in the worst category.
When Mr Hanna was asked to show his authorisation, he extended his middle finger in an obscene gesture and ignored the request explaining that he did not have to comply with the law. For someone in his position to act in such an atrocious manner puts this contravention, in all the circumstances, also in the worst category.
When Mr Hanna saw that one of the officials have the “audacity” to film him, the reaction of Mr Hanna was to squirt water at him. Such conduct amounts to an assault under s.245 of the Queensland Criminal Code. Given the horrendous way in in which Mr Hanna was conducting himself, it is unsurprising that an officer wished to film the actions of Mr Hanna. For Mr Hanna to react by assaulting this officer, in all the circumstances, puts this contravention also into the worst category.
The threat that Mr Hanna made to that official could also constitute a criminal offence pursuant to s.359 of the Queensland Criminal Code. That officer was lawfully entitled to do what he was doing and for Mr Hanna to make the very vile threat that he did, in all the circumstances, puts this contravention also into the worst category.
The using of one person’s “swipe card” to have a large number of workers leave the site compromises safety as I have previously described in these reasons. For the President of a union, that supposedly exists to protect workers on a construction site, to behave in such an irresponsible and dangerous manner, in all the circumstances, also puts this contravention into the worst category.
The Penalty
For each of the six contraventions, I impose a pecuniary penalty of $51,000 which is the maximum I can impose. This means that the total pecuniary penalty that I have imposed is $306,000.00.
Both the ABCC and the CFMEU have made submissions about the totality principle. Such a principle exists so as to ensure that any overall penalty does not exceed the boundaries of what is reasonable in all the circumstances.
I do not see that there is any need to discount the penalty I have imposed because of totality.
The purpose of pecuniary penalties was discussed by the High Court in Commonwealth of Australia v Director, Fair Work Building IndustryInspectorate [2015] HCA 46. At paragraph 55 of that judgment the Court said:
“55. 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.’”
In this matter, both specific and general deterrence is of the utmost importance. As I have noted, the approach of the CFMEU has been that the imposition of pecuniary penalties are nothing more than an occupational hazard.
This Court has been asked to ensure that the industrial relations regime as created by Parliament is observed and complied with. The Parliament has given the Court only one weapon to ensure such compliance, and that is the ability to impose pecuniary penalties.
In the main, this weapon has been of great value. If a Court has dealt with an employer who has contravened the FW Act in an appropriate manner, the use of the pecuniary penalty has deterred that employer from breaching the FW Act again. Very rarely has the FWO, or a union, had to bring a recalcitrant employer back to the Court for breaching the FW Act a second time.
But this cannot be said of the CFMEU. The deterrent aspect of the pecuniary penalty system is not having the desired effect. The CFMEU has not changed its attitude in any meaningful way. The Court can only impose the maximum penalty in an attempt to fulfil its duty and deter the CFMEU from acting in the nefarious way in which it does.
If I could have imposed a greater penalty for these contraventions, I most certainly would have done so.
The Court can do no more with the tools available to it to ensure compliance with the industrial relations regime. If the community at large are not satisfied with the actions of the Court to ensure compliance with the FW Act, then the next step is a matter for the Parliament.
I certify that the preceding eighty-one (81) paragraphs are a true copy of the reasons for judgment of Judge Vasta
Date: 19 October 2017
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