Australian Building and Construction Commissioner v Pattinson

The High Court of Australia considered an appeal by the Australian Building and Construction Commissioner against the Full Court of the Federal Court of Australia concerning the determination of pecuniary penalties for contraventions of the *Fair Work Act 2009* (Cth). The dispute arose from findings that a union officer and the union itself had contravened section 349(1) of the Act, which prohibits knowingly or recklessly making false or misleading representations about another person's obligation to engage in industrial activity. The union had a history of contravening the Act.

The central legal issues before the High Court were whether the discretion to impose a pecuniary penalty under section 546 of the Act was constrained by a notion of proportionality drawn from criminal law, and whether the statutory maximum penalty for a civil remedy provision could only be imposed for the most serious category of contravening conduct.

The High Court held that the discretion to impose an "appropriate" penalty under section 546 of the Act is informed by well-settled principles aimed at deterrence and does not require the imposition of a penalty proportionate to criminal offending. The Court reasoned that the object of civil penalties is deterrence, and where a contravention is part of an industrial strategy pursued without regard for the law, a court may reasonably conclude that no penalty short of the maximum would be appropriate to deter future non-compliance. The Full Court's interference with the penalties imposed by the primary judge was found to be based on an erroneous application of a "notion of proportionality" derived from criminal law, which distracted from the core question of whether the penalties were reasonably necessary to deter further contraventions, particularly in light of the union's history of non-compliance.

The High Court allowed the appeal, set aside the orders of the Full Court, and reinstated the penalties originally ordered by the primary judge.