Australian Rail, Tram and Bus Industry Union v Pacific National Executive Services Pty Ltd

Case •

[2025] NSWIC 3

•

12 March 2025

No judgment structure available for this case.

Industrial Court


New South Wales

  • Amendment notes
Medium Neutral Citation: Australian Rail, Tram and Bus Industry Union v Pacific National Executive Services Pty Ltd [2025] NSWIC 3
Hearing dates: 2-3 December 2024
Date of orders: 12 March 2025
Decision date: 12 March 2025
Before: Taylor J, President
Decision:

The application is dismissed.

Catchwords:

EMPLOYMENT AND INDUSTRIAL LAW — Claim for breach of contract pursued as a statutory remedy — Whether Fair Work Act 2009 (Cth), s 323(1) creates a civil penalty for a failure to pay a contractually obligated payment for work done — Statutory interpretation — Conflicting first instance authority — Truck Act provisions.

EMPLOYMENT AND INDUSTRIAL LAW — Industrial action — Whether employer industrial action was employer response action — Lockout notified to commence at the same time that employee industrial action was notified to commence — Interpretation of notice of industrial action — Whether employer industrial action as a matter of fact responded to employee industrial action — Notice requirement.

Legislation Cited:

Fair Work Act 1994 (SA), s 68

Fair Work Act 2009 (Cth), ss 3, 19, 61, 323, 408, 411, 414, 415, 416, 418, 471, 543, 545, 546, 604

Industrial Relations Act 1984 (Tas), s 51

Industrial Relations Act 1996 (NSW), ss 117-118

Industrial Relations Act 1999 (Qld), ss 391-393

Minimum Conditions of Employment Act 1993 (WA), ss 17B-17D

Truck Act 1900 (ACT), s 1

Victorian Workers’ Wages Protection Act 2007 (Vic), ss 6-7

Fair Work Regulations 2009 (Cth), reg 1.05

Cases Cited:

Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue (2009) 239 CLR 27; [2009] HCA 41

Association of Professional Engineers, Scientists and Managers, Australia v Wollongong Coal Ltd [2014] FCA 878

Association of Professional Engineers, Scientists and Managers, Australia v Bulga Underground Operations Pty Ltd [2019] FCA 1960

Augusta Ventures Ltd v Mt Arthur Coal Pty Ltd (2020) 283 FCR 123; [2020] FCAFC 194

Australian Education Union v Victoria (Department of Education and Early Childhood Development) (2015) 239 FCR 461; [2015] FCA 1196

Australian Manufacturing Workers’ Union v McCain Foods (Aust) Pty Ltd (2021) 310 IR 1; [2021] FWCFB 4804

Australian Rail, Tram and Bus Industry Union v Pacific National Executive Services Pty Ltd [2023] FWC 2771

Australian Rail, Tram and Bus Industry Union v Pacific National Executive Services Pty Ltd [2024] FWCFB 46

Communications, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union v Pinnacle Career Development Pty Ltd (2010) 190 FCR 581; 200 IR 467

Construction Forestry Mining & Energy Union v Mammoet Australia Pty Ltd (2013) 248 CLR 619; [2013] HCA 36

Coote v Mainline Access Pty Ltd (No 3) (2019) 344 FLR 1; [2019] FCCA 383

Dimkovski v Majorsite Property Group Pty Ltd [2024] FedCFamC2G 683

Esso Australia Pty Ltd v Australian Workers Union (2015) IR 304; [2015] FCA 758

Euro Car Parts Pty Ltd v Cannon (2024) 332 IR 456; [2024] FCA 828

Fair Work Ombudsman v Priority Matters Pty Ltd [2017] FCA 833

Masson v Parsons (2019) 266 CLR 554; [2019] HCA 21

Murrihy v Betezy.com.au Pty Ltd (2013) 238 IR 307; [2013] FCA 908

Qantas Airways Ltd v Flight Attendants’ Association of Australia (2020) 282 FCR 243; [2020] FCAFC 227

R v A2 (2019) 269 CLR 507; [2019] HCA 35

Sabapathy v Viveganantham [2024] FedCFamC2G 666

Stratton Finance Pty Ltd v Webb (2014) 245 IR 223; [2014] FCAFC 110

Wilkinson v Wilson Security Pty Ltd (No 3) (2024) 332 IR 387; [2024] FCA 705

Wollerman v Fortrend Securities Pty Ltd [2025] FCA 103

Texts Cited:

Creighton & Stewart's Labour Law (6th ed, 2016, Federation Press)

Explanatory Memorandum, Fair Work Bill 2009 (Cth)

Macquarie Dictionary, 9th ed (2023)

Category:Principal judgment
Parties: Australian Rail, Tram and Bus Industry Union (Applicant)
Pacific National Executive Services Pty Ltd (Respondent)
Representation:

Counsel:
L Saunders (Applicant)
V Bulut (Respondent)

Solicitors:
J Cooper (Industrial Officer RTBU) (Applicant)
Seyfarth Shaw (Respondent)
File Number(s): 2024/270493

Judgment

Introduction

  1. Railway workers were locked out by Pacific National Executive Services Pty Ltd (Pacific National) in October 2023. Their union, the applicant, claims they were entitled to be paid for the period they were locked out under their contracts of employment and can pursue such a claim before this Court as a contravention of the Fair Work Act 2009 (Cth). Whether that is so depends on four issues:

  1. Whether s 323 of the Fair Work Act creates a statutory obligation to pay wages due under a contract of employment where the employer’s obligation to make payment is disputed.

  2. Whether employer industrial action is employer response action as defined (which relieves the employer of the obligation to pay the employees during the period of that action) if it was notified to start at the exact same time as the industrial action notified to be taken by the union.

  3. Whether on the facts of this case the lockout commenced only in response to the commencement of industrial action by the employees or commenced regardless of whether they had commenced to take industrial action.

  4. Whether the employees who did not attend work did so in response to the employer response action, or because they were taking industrial action. If the latter, whether they are then entitled to be paid.

  1. On 23 July 2024, the Australian Rail, Tram and Bus Industry Union (RTBU) filed an Application for Recovery of Money and/or Civil Penalties against the respondent, Pacific National. It applies to this Court for an order under s 545(3) of the Fair Work Act against Pacific National to pay some of its employees compensation for wages that the RTBU contends they were entitled to but not paid.

  2. Under s 545(3), an “eligible State or Territory court” may order an employer to pay an amount to an employee if the court is satisfied that the employer was required to pay the amount under the Fair Work Act and the employer has contravened a civil remedy provision by failing to pay the amount. The Industrial Court of NSW is such an eligible State or Territory court. [1]

    1. Fair Work Regulations 2009 (Cth) reg 1.05.

  3. In addition to compensation, the RTBU applies to this Court for an order to impose a pecuniary penalty upon Pacific National for its contravention of s 323. Under s 546(1) of the Act, an “eligible State or Territory court” may order a person to pay a pecuniary penalty if it is satisfied that they have contravened a civil remedy provision.

  4. The RTBU’s claims for compensation and penalty rest on the submission that Pacific National was required to pay its employees’ wages pursuant to s 323(1) of the Fair Work Act, which is a civil remedy provision under Part 4-1.

Factual Background

  1. These proceedings fall to be determined on the basis of a statement of agreed facts, as well as a small number of additional facts led by Pacific National which were not put into dispute by the RTBU.

  2. On or around 12 July 2022, Pacific National began bargaining for a proposed enterprise agreement, known as the Pacific National Service Delivery and Planning Enterprise Agreement, New South Wales 2024 (Proposed Agreement). The RTBU was a bargaining representative for the Proposed Agreement.

  3. On 9, 10, 11 and 12 October 2023, the RTBU notified Pacific National that its members would take protected industrial action in support of their claims for the Proposed Agreement.

  1. On 9 October 2023, the RTBU notified Pacific National that its members would engage in an indefinite overtime ban, starting from 12.01am on 13 October 2023.

  2. On 10 October 2023, the RTBU notified Pacific National that its members would engage in four further indefinite bans, starting from 12.01am on 14 October 2023.

  3. On 11 October 2023, the RTBU notified Pacific National that its members would engage in eight further indefinite bans, starting from 12.01am on 17 October 2023.

  1. In response, Pacific National issued employees with notices via email, stating that employees who engaged in the partial work bans would not be entitled to any payment and that Pacific National refused to accept the performance of any work by employees unless they were prepared to perform all of their normal duties, pursuant to s 471(4) of the Fair Work Act.

  2. On 12 October 2023, the RTBU notified Pacific National that its members would take protected industrial action, through “stoppage of work in the form of 288 consecutive 15 minute stoppages” commencing on “0001hrs on 18 October 2023 until 0001hrs on 21 October 2023”. It did so following a protected action ballot which authorised “protected industrial action in the form of an unlimited number of stoppages of work of 1 minute to 72 hours in duration”. The RTBU contended that the notified consecutive 15-minute stoppages were a legitimate form of industrial action distinct from a single 72-hour stoppage. It contended that a single 72-hour stoppage notified to commence from 12.01am on 18 October until 12.01am on 21 October would have to commence exactly from 12.01am, whereas the notified consecutive 15-minute stoppages identified times at which each discrete stoppage could begin from 12.01am on 18 October until 12.01am on 21 October.

  3. On 17 October 2023, Pacific National gave written notice of a lockout of any employee who would be covered by the Proposed Agreement and who participated in the action notified on 12 October 2023. The exact text of Pacific National’s notice is of some importance. It read (with emphasis from the original):

“On 12 October 2023, the Australian Rail, Tram and Bus Union (RTBU) issued a notice to Pacific National of protected industrial action (PIA) by its members.

The nature of PIA notified by the RTBU is a stoppage of work, commencing at 0001hrs on Wednesday 18 October 2023 and concluding at 0001hrs on 21 October 2023, specifically as follows:

“Stoppage of work in the form of 288 consecutive 15 minutes stoppages.” (‘The Stoppage’).

Pacific National has considered the significant impact of The Stoppage on our operations and the current status of the negotiations for the proposed Pacific National Service Delivery and Planning New South Wales Enterprise Agreement 2023 (Agreement). As such, Pacific National has decided it must respond to The Stoppage.

Employer Response Action

Therefore, pursuant to section 414(5) of the Fair Work Act 2009 (Cth), Pacific National hereby gives notice that if any employee engages in The Stoppage, in response, Pacific National will be engaging in Employer Response Action, commencing at 0001hrs on Wednesday 18 October 2023 and concluding at 0001hrs on Wednesday 25 October 2023 (Period).

During that Period, each employee who engages in The Stoppage will not be permitted to perform any work (that is, they will be “locked out”). If this applies to you, you should not attend your place of work, and you will not be paid for the Period.

For clarity, if you do not engage in the Stoppage, you may continue to attend work during the Period.

This decision has not been taken lightly and has been taken due to the nature and the extent of The Stoppage, the flow on effect on operations and the current status of the negotiations for the Agreement. Our preferred option is and continues to be to focus on the negotiations for this Agreement and deliver what matters for our people, customers and shareholders.”

  1. It was an agreed fact that pursuant to this notice, Pacific National locked out various employees at various times from 12.01am on 18 October 2023 to 12.01am on 25 October 2023. Notably, the period of the lockout was 48 hours longer than the period of the RTBU notified action.

  2. Pacific National has identified 53 employees that it locked out. The RTBU’s claim for payment under s 545(3) is in respect of those 53 employees.

  3. In her affidavit, which was not challenged, Ms Sandra Deparis, Senior People & Culture Manager at Pacific National, gave evidence that she asked two employees on the evening of 17 October whether they were intending to participate in the stoppage notified by the RTBU on 12 October to commence at one minute after midnight. On being told that they would, she informed them that they if they did they would be locked out by Pacific National for 7 days as advised by a memo sent earlier that day. At about 12.01am she observed those two employees leave their desk. She asked both employees if they were leaving the office due to the RTBU’s notified protected industrial action and they both said they were. She then sent them a letter confirming that they would be subject to the lockout. She also stated that she called employees who had not attended their shifts after 12.01 am on 18 October and, if the employee confirmed that they were participating in the stoppage, sent them a letter confirming that they were subject to the lockout. Her evidence included copies of the letters sent by Pacific National and text messages that Pacific National had sent to employees who had not attended their shifts to ask whether they were absent because of the work stoppage.

  4. During the period that an employee was locked out, Pacific National did not accept performance of work by these employees and did not pay these employees the wages they would otherwise have earned, but for the lockout.

  5. On 23 October 2023, the RTBU applied to the Fair Work Commission under s 418, seeking that Pacific National stop and not engage in its industrial action.

  6. On 1 November 2023, in Australian Rail, Tram and Bus Industry Union v Pacific National Executive Services Pty Ltd,[2] Cross DP dismissed the application on the basis, amongst other matters, that he was not satisfied that the lockout was unprotected industrial action.

    2. [2023] FWC 2771.

  7. The RTBU applied for permission to appeal against this decision. On 5 February 2024, a Full Bench of the Fair Work Commission handed down its decision in Australian Rail, Tram and Bus Industry Union v Pacific National Executive Services Pty Ltd. [3] Permission to appeal was refused, on the basis that the appeal did not raise a question of importance and general application, because the issue raised by the RTBU that employer response action must be genuinely responsive to employee claim action had already been addressed in Australian Manufacturing Workers’ Union v McCain Foods (Aust) Pty Ltd (“McCain”). [4] It was therefore not in the public interest to allow an appeal of a decision of the Commission under s 604 of the Fair Work Act. The Full Bench did however consider that Cross DP’s decision could have been affected by error, but that this did not justify permission to appeal as the error arose from “the peculiar circumstances related to the case”. [5] In particular, the Full Bench held that Cross DP’s decision was contrary to the decision in McCain:

“It appears that the Deputy President focussed on the intention of Pacific National that its lock out be responsive to the employees’ intended industrial action, rather than focussing on whether the lock out actually was responsive to action taken by employees. As the lock out commenced at the same time that the employees’ action was due to commence, we do not see how it could be responsive to that action. The employees were unable to commence industrial action due to the lock out. The Deputy President’s approach is a departure from the approach taken by the Full Bench in McCain.” [6] (emphasis added)

3. [2024] FWCFB 46.

4. (2021) 310 IR 1; [2021] FWCFB 4804.

5. [2024] FWCFB 46 at [21].

6. [2024] FWCFB 46 at [20].

  1. The RTBU asks this Court seeks to similarly conclude that the employees were unable to commence industrial action because of the lockout, and that accordingly Pacific National’s industrial action was not in response to employee action.

  2. In addition to the agreed facts the RTBU sought to rely on an affidavit from Amanda Perkins, an organiser at the RTBU, filed on 4 October 2024. The affidavit stated that members had communicated to Ms Perkins, in respect of the employee claim action taken on 18 October 2023 to 21 October 2023, that teams were making their own arrangements as to what industrial action would be taken, with some teams planning to participate in all 288 stoppages and others only intending to participate in some. Following an objection from Pacific National, that evidence was rejected on the basis that it was hearsay evidence from unidentified persons.

Section 323

  1. This Court only has power to order the relief sought if the employer was required to pay the amount under the Fair Work Act or a fair work instrument. [7]

    7. Fair Work Act 2009 (Cth), s 545(3).

  2. These were not payments said to arise under a fair work instrument. Rather it was accepted that if payments were due, they arose pursuant to individual contracts of employment.

  3. The RTBU contends such contractual payments were required to be paid in full, in money, and at least monthly, pursuant to s 323(1) of the Fair Work Act.

  4. This Court’s power to grant the relief sought accordingly depends on whether the RTBU is right in its contention that s 323(1) of the Fair Work Act imposes a statutory obligation to pay the contractual sums claimed.

  5. Whether s 323(1) of the Fair Work Act imposes a statutory obligation to pay the contractual sums claimed (assuming they were in fact payable) depends on two related questions. First, whether s 323(1) itself imposes a statutory obligation to pay amounts within the meaning of s 545(3). Second, whether s 323(1), by requiring payment “in full” and “in money”, does more than proscribe “in kind” compensation, and by so doing creates a civil penalty for any failure to pay a contractually obligated payment for work done. [8]

    8. This is the issue identified by Buchanan J in Association of Professional Engineers, Scientists and Managers, Australia v Wollongong Coal Ltd [2014] FCA 878 at [29]-[30].

  6. As to the first issue, I am assisted by the decision of Halley J in Euro Car Parts Pty Ltd v Cannon (“Euro Car Parts”). [9] There the respondent contended that s 323(1) does not create a standalone payment obligation under the Fair Work Act for the purposes of s 545(3), and therefore there was no amount the company was required to pay under the Fair Work Act. Reliance was placed on the reasoning of the plurality in Qantas Airways Ltd v Flight Attendants’ Association of Australia [10] (“Qantas Airways”) at [67]-[68]. Halley J rejected that argument, coming to the conclusion that there was nothing in the reasoning of the plurality which contradicted the conclusion of Bromberg J in Australian Education Union v Victoria (Department of Education and Early Childhood Development) [11] (“Australian Education Union”) at [265], namely that while s 323(1) operates upon an existing obligation on an employer to pay, it itself imposes a statutory obligation to pay that requires the amount in question to be paid in full, in money and at least monthly. I agree with that conclusion and adopt it.

    9. (2024) 332 IR 456; [2024] FCA 82.

    10. (2020) 282 FCR 243; [2020] FCAFC 227.

    11. (2015) 239 FCR 461; [2015] FCA 1196.

  7. The second issue is not so easily addressed. There is conflicting first instance authority on the issue and as yet no considered appellate authority.

  8. Section 323(1) is in the following terms:

323   Method and frequency of payment

(1) An employer must pay an employee amounts payable to the employee in relation to the performance of work:

(a) in full (except as provided by section 324); and

(b) in money by one, or a combination, of the methods referred to in subsection (2); and

(c) at least monthly.

  1. Section 324, titled “Permitted deductions”, allows an employer to deduct an amount from an amount payable to an employee in accordance with s 323(1) in certain limited circumstances, for example, where the deduction is authorised in writing by the employee and is principally for the employee’s benefit.

  2. Pacific National contends that s 323(1) is only contravened where an employer fails to make payment for work done by the employee “in full” in the sense of without unauthorised deductions, applying Colvin J’s interpretation of s 323 in Wilkinson v Wilson Security Pty Ltd (No 3) (“Wilkinson”). [12]

    12. (2024) 332 IR 387; [2024] FCA 705.

  1. If I accept Pacific National’s interpretation of s 323 then the proceedings will be dismissed, regardless of the Court’s findings on the issues pertaining to employer response action. That is so, since this Court can only award the claimed relief pursuant to ss 545(3) and 546(1) if the wages which the RTBU contends its members were entitled to were required to be paid under the Fair Work Act and no provision of the Act is relied upon other than s 323(1). For completeness, this Court has no jurisdiction to determine the claims in the alternative as a breach of contract.

  2. In Construction Forestry Mining & Energy Union v Mammoet Australia Pty Ltd [13] (“Mammoet”) the High Court considered whether providing accommodation in accordance with an enterprise agreement was a “payment” to an employee within the meaning of s 470(1), which prohibits payments during a period of protected industrial action. The appellant relied in part on s 323 to support an argument that accommodation was not a “payment” because a payment had to be in money. In rejecting the contention that a payment can only be in money, and could not be provided in kind if authorised by s 323(2) and (3), the High Court examined the intent of s 323 and said:

“[Section] 323(1) addresses the same mischief addressed by “Truck Acts” as they had by then come to exist in each State, that is, that an employee’s entitlement to payment for work might be compromised by an employer requiring the employee to accept some form of payment in kind of less value than the payment of money forgone.” [14] (Footnotes omitted.)

13. (2013) 248 CLR 619; [2013] HCA 36.

14. (2013) 248 CLR 619; [2013] HCA 36 at [45].

  1. The State and Territory “Truck Act” statutes [15] to which the High Court referred obliged employers to pay their employees in full and in money, rather than “in kind” (eg at the company store); the word “truck” in this case being used in respect of its now rarely used alternative meaning, namely to exchange or barter. [16] While s 323(1), by requiring payment “in full” and “in money”, at least proscribes unauthorised deductions for in kind payments, there is divergent authority from the Federal Court as to whether it proscribes more generally any failure to make a required payment in relation to the performance of work, such that it can be used to bring contract underpayment claims.

    15. See Truck Act 1900 (ACT), s 1(1); Industrial Relations Act 1996 (NSW), ss 117-118; Industrial Relations Act 1999 (Qld), ss 391-393; Fair Work Act 1994 (SA), s 68; Industrial Relations Act 1984 (Tas), s 51; Minimum Conditions of Employment Act 1993 (WA), ss 17B-17D; Victorian Workers’ Wages Protection Act 2007 (Vic), ss 6-7.

    16. Macquarie Dictionary, 9th ed (2023).

  2. The first case to consider this question was Murrihy v Betezy.com.au Pty Ltd [17] (“Murrihy”). Jessup J determined that an employer’s non-payment of commission entitlements to its employee constituted a contravention of s 323.

    17. (2013) 238 IR 307; [2013] FCA 908.

  3. The commission agreement in that case stated that the employee’s commission ought to have been paid monthly, which corresponded with the least frequent basis of payment provided for at subsection 323(1)(c). Jessup J noted that the respondents had not put in issue whether the failure to pay commission entitlements gave rise to a contravention of s 323(1). His Honour then noted that “[it] clearly was such a contravention” and concluded that “there was, therefore, a contravention of the section at the end of every month during which a commission entitlement arose”. [18] While the application of s 323 to such underpayments was not put in issue, Jessup J nevertheless turned his mind to whether s 323 could be applied to ground a claim that was based on non-payment of a contractually promised bonus payment, concluding:

“A significant innovation introduced by the FW Act was the imposition of an obligation upon a ‘national system employer’ (such as each of the respondents was) to pay its employees amounts payable to them in relation to the performance of work in full at least monthly: s 323(1) of the FW Act. Thus the legislation picks up, amongst other things, entitlements arising under contracts of employment and gives statutory consequences to an employer’s failure to make good on them. In this respect, s 323(1) is a civil remedy provision.” [19]

18. (2013) 238 IR 307; [2013] FCA 908 at [119].

19. (2013) 238 IR 307; [2013] FCA 908 at [142].

  1. The issue was next considered in Association of Professional Engineers, Scientists and Managers, Australia v Wollongong Coal Ltd (“Wollongong Coal”). [20] Buchanan J determined an application to strike out a claim that rested on s 323 to claim non-payment of contractual entitlements. Consistently with the approach of Jessup J in Murrihy, his Honour held that s 323 provides “for the enforcement of, an obligation to pay amounts which have become payable, as well as the more specific obligation to pay such amounts in full, in money and at least monthly (subject to the statutory exemptions which accompany the obligation)” (emphasis added). [21]

    20. [2014] FCA 878.

    21. [2014] FCA 878 at [30].

  2. In Wollongong Coal, the respondents contended for a limited application of s 323(1), relying upon the above quoted passage from Mammoet. Buchanan J held a broader interpretation of the obligation in s 323 was open:

“[28] … It is certainly apparent, as the respondents contend, that ss 323 and 324 of the FW Act are intended to provide for matters dealt with in the Truck Acts – i.e. payment in money (not in kind), without unauthorised deductions, and with specific and reasonable periodicity.

[29] However, that conclusion does not suffice to exclude the possibility that s 323 of the FW Act has an additional role to play.

[30] The ordinary language of s 323 is apt to identify, and provide for the enforcement of, an obligation to pay amounts which have become payable, as well as the more specific obligation to pay such amounts in full, in money and at least monthly (subject to the statutory exemptions which accompany the obligation). It does so by permitting the imposition of a civil penalty for contravention of the obligation.”

  1. Both Murrihy and Wollongong Coal were subsequently cited with approval by Bromberg J in Australian Education Union:

“The right to receive monies deducted without authority will have vested with an employee as at the time that those monies were payable. In that situation, the employee would have a legal claim to the recovery of the underpayment. That claim may be statutory, contractual or both. Section 323(1) operates upon an existing obligation on the employer to pay. But it also imposes a further statutory obligation to pay in full, in money and at least monthly (except as provided for by s 324): Association of Professional Engineers, Scientists and Managers, Australia v Wollongong Coal Ltd [2014] FCA 878 at [28]-[33] (Buchanan J); and Murrihy v Betezy.com.au Pty Ltd (2013) 238 IR 307 at [142] (Jessup J).” [22]

22. Australian Education Union v Victoria (Department of Education and Early Childhood Development) (2015) 239 FCR 461; [2015] FCA 1196 at [265].

  1. While the question was not put in issue in Murrihy and Australian Education Union and was only determined at a threshold level in Wollongong Coal, all three decisions were made by judges with significant experience in industrial law.

  2. There is other Federal Court authority that either proceeds on the basis that a failure to pay an amount due is a contravention of s323(1) or is otherwise consistent with that view.

  3. In Stratton Finance Pty Ltd v Webb [23] a Full Court of the Federal Court effectively approved declarations of contraventions of s 323 that related to the failure by an employer to pay the full amount due to an employee in respect of accrued but untaken annual leave on termination of employment. The applicant contended that the plural in the word “amounts” in s 323(1) meant that it was necessary to group all breaches of the section as one breach. The Full Court rejected this argument, stating: “The simple and common sense reading of the provision is that the employer must pay any amount or amounts payable to the employee.” [24]

    23. (2014) 245 IR 223; [2014] FCAFC 110.

    24. (2014) 245 IR 223; [2014] FCAFC 110 at [47].

  4. In Association of Professional Engineers, Scientists and Managers, Australia v Bulga Underground Operations Pty Ltd,[25] Wigney J similarly proceeded on the basis that non-payment of a long service leave entitlement (which the employer contended was not payable) would, if it was indeed required to be paid, amount to a contravention of s 323(1). The respondent in that case did not put that in issue, an approach which Wigney J characterised as an “apparent concession [that] was properly made”. [26]

    25. [2019] FCA 1960.

    26. [2019] FCA 1960 at [117].

  5. In Qantas Airways Ltd v Flight Attendants’ Association of Australia (2020) 282 FCR 243; [2020] FCAFC 227 (“Qantas Airways”) the plurality (Jagot and Wheelahan JJ) considered the phrase “amounts payable to an employee in relation to the performance of work” in s 789GDA(2)(b) and held that it had the same meaning as the same phrase in s 323(1), stating: “It means the amounts which are required to be paid to the employee in accordance with the applicable contract or industrial instrument.” [27] Earlier the plurality noted that the various constructions of s 789GDA contended for in that case each correctly assumed that whatever amounts were payable to the employees were amounts required to be paid pursuant to s 323 “in full, in money and at least monthly”, stating it was “correct” that, pursuant to s 323, “the employer is subject to an obligation to pay the employee wages”. [28]

    27. Qantas Airways Ltd v Flight Attendants’ Association of Australia (2020) 282 FCR 243; [2020] FCAFC 227 at [67].

    28. (2020) 282 FCR 243; [2020] FCAFC 227 at [7].

  6. In Augusta Ventures Ltd v Mt Arthur Coal Pty Ltd, [29] White J proceeded on the basis that s 323 required the employer to pay an employee amounts otherwise payable in relation to the performance of work in full and at least monthly, and cited the authors of Creighton & Stewart's Labour Law (6th ed, 2016, Federation Press) at [15.59]:

“Once an employee has accrued wages, the employer is obliged to make the payment. If the wages are due under an award, enterprise agreement or statute, then, in the absence of any provision to the contrary, this obligation is absolute in character.”

29. (2020) 283 FCR 123; [2020] FCAFC 194.

  1. Finally, there are two recent decisions that confirm the broader interpretation of s 323(1). The first is that of Halley J in Euro Car Parts, a case where the interpretation of s 323(1) was in issue and determined on a final basis. Euro Car Parts Pty Ltd, the employer, appealed against an order from the Magistrate’s Court granting relief under s 323(1) for its alleged failure to pay Cannon, its employee, his salary in full between 2017 and 2020. One of its grounds of appeal was that the Industrial Magistrate did not have jurisdiction to require Euro Car Parts to make payments to Cannon under s 545(3) of the Fair Work Act, as any obligations the company had to pay Cannon only arose from a contractual basis, and not under s 323. Halley J dismissed this ground of appeal:

“[75] In my view, the conclusion that s 323 imposes a further statutory obligation to pay an amount due in full, whether the amount was payable under statute or contract or otherwise, is consistent with the natural and ordinary meaning of the text of s 323, its interrelationship with s 545 and a beneficial construction given the remedial and protective objectives of the civil penalty provisions in the FW Act in promoting the public interest in compliance: Australian Building and Construction Commissioner v Pattinson (2022) 274 CLR 450; 314 IR 301 at [15], [31] and [42].

…

[82] … The source, as in the origin of the obligation to pay, together with the specific amount to be paid and the time for payment, other than at least monthly, may well be found in a contract, not a discrete provision of the FW Act, but that does not preclude the imposition of a statutory obligation in s 323 to pay the contractual amount in full, in money and at least monthly.”

  1. Halley J concluded by finding that while the source of the obligation to pay may be founded elsewhere, s 323 of the FW Act nonetheless imposes a further statutory obligation to pay an amount in full, in money and at least monthly, consistent with the observations of Jessup J in Murrihy and Bromberg J in Australian Education Union, as well as the remedial and protective objectives of the Fair Work Act. [30]

    30. (2024) 332 IR 456; [2024] FCA 828 at [85].

  2. The second recent decision is that of O’Callaghan J in Wollerman v Fortrend Securities Pty Ltd (“Wollerman”),[31] in which the interpretation of s 323(1) was not put in issue. His Honour applied Jessup J’s decision in Murrihy that s 323(1) is a civil remedy provision that “picks up, amongst other things, entitlements arising under contracts of employment and gives statutory consequences to an employer’s failure to make good on them”. [32]

    31. [2025] FCA 103.

    32. Wollermann v Fortrend Securities Pty Ltd [2025] FCA 103 at [11], quoting Murrihy v Betezy.com.au Pty Ltd [2013] FCA 908; (2013) 238 IR 307 at [142].

  3. Standing in contrast to the authorities summarised above, is Colvin J’s decision in Wilkinson which Pacific National relied upon, which takes a narrower approach to the effect of s 323. It was handed down shortly before Euro Car Parts but was not considered in Euro Car Parts, nor in Wollerman. It has since been adopted in Dimkovski v Majorsite Property Group Pty Ltd [2024] FedCFamC2G 683 and Sabapathy v Viveganantham [2024] FedCFamC2G 666.

  4. In Wilkinson, Colvin J disagreed with Buchanan J’s conclusion in Wollongong Coal. His Honour agreed with the submissions of the respondent in Wollongong Coal and interpreted s 323 as follows:

“[100] Section 323(1) is expressed as an obligation concerning the manner in which an employer “must pay” the amounts described. Its focus is upon the manner of payment of “amounts payable to the employee” not upon the extent to which there is an obligation which means that there are amounts which are payable. In effect, its operative prescription concerns the way in which payment should be made of particular types of payment obligations which it describes but otherwise assumes that those amounts have been identified as payable. The requirement that it imposes is that such amounts be paid in full, in money and at least monthly.

[101] Arguably, there is an ambiguity as to whether the reference to “amounts payable to the employee in relation to the performance of work” includes amounts that are in dispute such that there is a contravention of the provision if it is subsequently determined that they are amounts that are payable. However, as has been explained, there are other provisions in the Fair Work Act which express obligations of that kind. Whether there is an obligation to make a payment and, consequently, whether there has been a failure to perform that obligation is addressed by other provisions of the Fair Work Act. Relevantly for present purposes, as has been explained, s 45 makes it a contravention for a person to contravene a term of a modern award. Where a term of a modern award requires an amount to be paid then s 45 is still contravened if the employer disputes the existence of that requirement but the employer's position is not vindicated. The existence of such provisions is an important matter of context; as are the terms of the Explanatory Memorandum as explained by the High Court in Mammoet.

[102] In those circumstances, in my respectful view, s 323(1) is concerned to ensure that the payments that are made by an employer to its employees for work done by them are made with appropriate frequency, are made without deduction and are not paid in kind. Although the section refers to amounts “payable” to an employee, the operative requirement concerns the ways in which an employer “must pay”. That is to say, the obligation that is imposed concerns the manner of payment where payment is being made of “amounts payable … in relation to the performance of work”. It concerns how payments in the category of payments as described are to be made. Consequently, if an employer is making a payment to an employee of an amount that is not “payable in relation to the performance of work” then s 323(1) does not apply.

[103] So, an employer and an employee may be in dispute as to whether an amount is payable in relation to the performance of work. In such a case the point has not been reached where the employer is to make payment for the purposes of s 323(1). Or, an employer may have formed their own view as to what is payable but that view may be incorrect because the amount is too low. Likewise, in such a case, as to the extent of the employer’s error, it is also the case that the point has not been reached where the employer is to make payment for the purposes of s 323(1). Therefore, in such cases, in failing to pay those amounts, the employer cannot be said to have breached the terms of s 323 because the statutory provision is not directed to whether there is an obligation to make payment; rather, it is concerned with the manner of payment where an employer is making payment for work done by the employee.

[104] On the other hand, where an employer has identified an amount to be paid but withholds payment or pays only part or defers payment so that the obligation to pay monthly is not performed, then there is a contravention of s 323(1).

[105] Conceivably, issues may arise as to whether an employer who wilfully ignores whether there is any payment obligation or fails to undertake any genuine consideration as to the amounts due to the employee or defers identifying the amount to be paid is, by that conduct, failing to pay as required by s 323(1). In such a case, the failure to pay will not be because of some explicable failure to identify an amount as being payable. Rather it will be because the obligation to pay at least monthly is not being met because, in such circumstances, the payment obligation is being unilaterally deferred by the employer. Therefore, it may amount to a failure to pay by failing to form a view as to what is payable. However, no case of that kind was advanced by Mr Wilkinson in the present case so that aspect can be left for when the occasion squarely arises.”

  1. In Wilkinson, Colvin J cited the decisions in Wollongong Coal and Murrihy, but did not refer to the other decisions noted above, such as the plurality in Qantas Airways at [7], which, as Halley J noted in Euro Car Parts, support a broader interpretation of s 323, namely that it creates “an obligation to pay the employee wages”. [33]

    33. Euro Car Parts Pty Ltd v Cannon (2024) 332 IR 456; [2024] FCA 828 at [82], quoting Qantas Airways Ltd v Flight Attendants’ Association of Australia (2020) 282 FCR 243; [2020] FCAFC 227 at [7].

  2. As can be seen in the quote above from Wilkinson, Colvin J ultimately concluded that the “amounts payable to the employee in relation to the performance of work” that their employer “must pay” in full, in money and at least monthly under s 323(1) do not include amounts that have not been paid because an employer and employee are “in dispute” as to whether they are payable nor those amounts that remain payable due to the employer’s error. I find this analysis to be unsatisfactory and prefer the conclusions reached in Murrihy, Wollongong Coal and by the plurality in Qantas Airways, and adopted in Euro Car Parts and Wollerman.

  3. It is unlikely that a statutory obligation to pay a sum in full at least monthly depends upon whether and to what extent those amounts are “disputed”. Such a test introduces a subjective element into the application of s 323. It is noted that Colvin J was prepared to conceive that an employer who “wilfully ignores” a payment obligation “or fails to undertake any genuine consideration as to the amounts due to the employee” may fail to pay as required by s 323. [34] This reasoning exposes the difficulty with the approach – it accepts that a failure to pay at all can be a contravention of s 323 but makes that conclusion contingent on the extent to which the employer has given “genuine consideration” to the issue. Such an approach would make the application of s 323 dependent on a view as to how much effort an employer has made to ensure it complies with its payment obligations. This conclusion seems at odds with the words of the section which introduce no such subjective notions and would see s 323 operate differently to all other civil penalty provisions in the Fair Work Act which require strict compliance with payment obligations in the Act and under fair work instruments.

    34. Wilkinson v Wilson Security Pty Ltd (No 3) (2024) 332 IR 387; [2024] FCA 705 at [105].

  1. Similarly, I reject the notion that s 323 does not apply to a failure to pay in full due to error. Neither intention nor error are relevant to proof of a contravention of s 323, which is simply made out by proof that wages and entitlements have not been paid as required. [35]

    35. Fair Work Ombudsman v Priority Matters Pty Ltd [2017] FCA 833 at [132].

  2. A narrower view of s 323 has also been expressed by Manousaridis J of the Federal Circuit Court in Coote v Mainline Access Pty Ltd (No 3) (“Coote”). [36] He held that s 323(1) did not create a statutory obligation to pay amounts that an employer is otherwise liable to pay under a contractual term. Manousaridis J reasoned that, as the wording in s 323(1) requires an employer to pay an employee amounts payable for the performance of work “in full”, the provision should be interpreted to require that when an employer makes a payment to an employee, it must be the full amount payable in the sense that there be no deductions not authorised by s 324. [37] He reasoned that if the intention of the legislation was to require the employer to pay amounts payable for work performed, there would be no need to add the requirement that the payment should be “in full”. [38] This interpretation, he said, was supported by the fact that s 543 of the Fair Work Act permits a national system employee to apply to the Federal Court or Federal Circuit Court to enforce a “safety net contractual entitlement” (such as a term requiring the employer to pay wages for work performed). [39] This, he concluded, meant that an employer’s breach of a contractual term to make a payment for work performed is not a breach of a civil remedy provision.

    36. (2019) 344 FLR 1; [2019] FCCA 383.

    37. (2019) 344 FLR 1; [2019] FCCA 383 at [41].

    38. (2019) 344 FLR 1; [2019] FCCA 383 at [41].

    39. (2019) 344 FLR 1; [2019] FCCA 383 at [46]-[48].

  3. For the reasons that follow, in my view the words “in full” address more than just unauthorised deductions.

  4. A statute is to be construed by considering the words read in their context, and “context” encapsulates surrounding statutory provisions, the mischief that the statute is intended to remedy, the provision’s purpose or policy, and extrinsic materials. [40]

    40. See R v A2 (2019) 269 CLR 507; [2019] HCA 35 at [32]-[33], [37].

  5. Before examining the natural and ordinary meaning of the text, I acknowledge that the context is consistent with the more limited view of s 323. The words “in full” are immediately followed by the words “(except as provided by s 324)”, which confirms the section is, at least, directed to the prevention of non-authorised deductions. The “mischief” that the section is directed towards, as noted by the High Court in Mammoet, is at least the mischief addressed by the former “Truck Act” provisions, which are generally understood to have been directed to preventing payment “in kind”, in the form of deductions from pay to offset the provision of meals, accommodation or other asserted benefits. There is nothing in the Explanatory Memorandum to suggest that s 323 was intended to introduce a federal statutory regime for contractual underpayments in employment of national system employees. The existence of the separate safety net contractual entitlement regime in ss 542 and 543 similarly points away from that conclusion, as Manousaridis J identified.

  6. However, as submitted by the RTBU, s 323 was not modelled off of a set of “standard” “Truck Act” provisions. It provided a simple, national scheme which replaced the patchwork of obligations within the different State and Territory “Truck Acts”. [41] The different “Truck Act” provisions (now repealed) were as follows:

    41. Explanatory Memorandum, Fair Work Bill 2009 (Cth), [1278].

  1. Industrial Relations Act 1996 (NSW), s 118(1): “Payment of remuneration to an employee is to be made in full without any deduction for goods, board or lodging or any other services supplied by the employer in payment (or part payment) of remuneration”, subject to the permitted deductions in s 118(2).

  2. Truck Act 1900 (ACT), s 1(1): “In every contract made with any worker, the wages of the worker shall be made payable in money only, and not otherwise; and if by agreement, custom, or otherwise, a worker is entitled to receive, in anticipation of the regular period of the payment of his or her wages, an advance as part, or on account, the wages, it shall not be lawful for the employer to withhold the advance, or make any deduction in relation to the advance, on account of poundage, discount or interest, or any similar charge.”

  3. Fair Work Act 1994 (SA), s 68(1): “If an employee does work for which the remuneration is fixed by an award or enterprise agreement, the employer must pay the employee in full, and without deduction, the remuneration so fixed”, subject to the permitted deductions in s 68(3).

  4. Minimum Conditions of Employment Act 1993 (WA), s 17C(1): “To the extent that an employee receives his or her pay in money the employee is entitled to be paid in full”, subject to authorised deductions in s 17D.

  5. Industrial Relations Act 1999 (Qld), s 391(1): “If an employer employs an employee to perform work for a fixed rate, the employer must pay the employee the fixed rate without deduction, other than a deduction authorised by—(a) a relevant industrial instrument; or (b) this division; or (c) the employee’s written consent.”

  6. Industrial Relations Act 1984 (Tas), s 51(3): “If, under an award or a registered agreement, an employee is entitled to be paid any sum by his employer, that employer is guilty of an offence if that sum is paid otherwise than in money without any deductions other than those that may be authorized by the employee.”

  1. As can be seen, the “Truck Act” provisions from the ACT, Queensland and Tasmania only required wages to be paid “without deduction”. The legislature, when creating the national scheme in 323(1), deliberately chose to include certain requirements from the patchwork of obligations within the different “Truck Acts”, and those were that payment was to be in full (except for deductions permitted under s 324), in money, and at least monthly.

  2. Ultimately when interpreting the meaning of legislation, the text – specifically, the “ordinary and grammatical sense of the statutory words … having regard to their context and the legislative purpose” [42] – is the starting point, and the end point. Legislation should be given its natural and ordinary meaning unless it is plain that Parliament intended some different meaning. [43] That is particularly desirable in a statute that sets out minimum standards applicable to almost all employees in Australia and is to be read and understood by them and their employers. [44]

    42. Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue (2009) 239 CLR 27; [2009] HCA 41 at [4].

    43. Masson v Parsons (2019) 266 CLR 554; [2019] HCA 21 at [26].

    44. See Fair Work Act 2009 (Cth), ss 3, 61.

  3. While the context set out above confirms that s 323 is at least intended to make an unauthorised deduction from pay a civil penalty offence, a natural and ordinary reading of the section gives it a wider effect. As Buchanan J concluded in Wollongong Coal and Halley J concluded in Euro Car Parts, s 323 does not only prohibit deductions other than those permitted in s 324. The plain meaning of the words “in full” is that s 323 creates a statutory obligation to pay the amount payable to an employee in relation to the performance of work each month. While the context, identified above, is consistent with a narrower view of the effect of the section, it is not inconsistent with the section also having the wider effect identified. In other words, the context does not require a departure from the natural and ordinary meaning of the words. The section not only addresses the mischief of unauthorised deductions for ‘in kind’ benefits but extends to preventing any short payment of moneys payable to an employee for the performance of work.

  4. I am strengthened in this view by the observation that it avoids a practical difficulty that would otherwise arise in determining whether an underpayment arose from an unauthorised deduction or otherwise. By its nature, a deduction assumes as a starting point acceptance of a full amount payable, with that amount reduced to reflect a view that there is a basis to reduce that full amount. It will not however always be easy to characterise whether any particular short payment is the result of a “deduction” from a starting point of what is accepted to be the full amount payable, rather than the result of an incorrect belief as to the full amount due. Such an exercise is one that almost inevitably will involve having to understand the employer’s subjective intention, to the extent it can be discerned. Take, for example, a situation where the employer pays an employee less than the full amount due for a week’s work, due to a belief that the employee left two hours early one day without good reason, in circumstances where the employee in fact had an entitlement to leave early. Were two hours wrongly “deducted” or did the employer simply incorrectly pay the hours which the employer considered had been worked? Is the answer different if the employee in fact remained at work at all relevant times but employer decided to ‘deduct’ two hours because of a view that the employee did no useful work during the last two hours? Such issues do not arise on an interpretation of s 323 that creates an obligation to pay whatever sum is owing, such that any short payment amounts to a contravention of s 323.

  5. In conclusion, while giving due deference to the considered views of Colvin J and Manousaridis J in Wilkinson and Coote, I prefer the conclusions of Jessup J, Buchanan J and Halley J in Murrihy, Wollongong Coal and Euro Car Parts respectively, which are consistent with the plurality in Qantas Airways: namely, that s 323 identifies and provides for the enforcement of an obligation to pay wages “in full” and “monthly”, and by so doing creates a civil penalty for a failure to pay a contractually obligated payment for work done.

  6. Accordingly, if the employees who were locked out were in fact entitled to be paid wages for the period of the lockout, then the failure to pay those wages in full, in money and within the month would have constituted a contravention of s 323(1).

  7. Before turning to the next issue there is one further matter to address in respect of s 323(1). Pacific National’s written submissions filed before hearing contended that there were in any event no amounts “payable to the employee in relation to the performance of work” because the employees had not performed any work to which the subsection could relate. This argument was withdrawn during the hearing, in my view correctly. Section 323 is not limited to payments for work done but extends to amounts payable “in relation to the performance of work”. Hence, as noted earlier, amounts payable for annual leave, long service leave and referable to a period when an employee was unable to work due to COVID-19 restrictions, [45] have all been held to be amounts “payable to the employee in relation to the performance of work”. The RTBU’s application does concern amounts payable in respect of the performance of work, notwithstanding it was work that the employer prevented the employees from doing.

    45. Stratton Finance Pty Ltd v Webb (2014) 245 IR 223; [2014] FCAFC 110; Association of Professional Engineers, Scientists and Managers, Australia v Bulga Underground Operations Pty Ltd [2019] FCA 1960; Qantas Airways Ltd v Flight Attendants’ Association of Australia (2020) 282 FCR 243; [2020] FCAFC 227.

Employer Industrial Action

  1. The RTBU’s case depends upon establishing that Pacific National’s lockout was not employer response action as defined in s 411.

  2. “Industrial action” is defined in s 19(1) of the Fair Work Act as:

19   Meaning of industrial action

(1) Industrial action means action of any of the following kinds:

(a) the performance of work by an employee in a manner different from that in which it is customarily performed, or the adoption of a practice in relation to work by an employee, the result of which is a restriction or limitation on, or a delay in, the performance of the work;

(b) a ban, limitation or restriction on the performance of work by an employee or on the acceptance of or offering for work by an employee;

(c) a failure or refusal by employees to attend for work or a failure or refusal to perform any work at all by employees who attend for work;

(d) the lockout of employees from their employment by the employer of the employees.

  1. Subsection 19(3) provides that an employer locks out employees from their employment if the employer prevents the employees from performing work under their contracts of employment without terminating those contracts.

  2. Division 2 of Chapter 3, Part 3-3 sets out when industrial action for a proposed enterprise agreement is “protected industrial action”. An employer lockout will only be protected industrial action, pursuant to s 408, for a proposed enterprise agreement if it is “employer response action” for the agreement. [46] Section 411(1) defines “employer response action” as such:

    46. Fair Work Act 2009 (Cth), s 408(c).

411   Employer response action

Employer response action

(1) Employer response action for a proposed enterprise agreement means industrial action that:

(a) is organised or engaged in as a response to industrial action by:

(i) a bargaining representative of an employee who will be covered by the agreement; or

(ii) an employee who will be covered by the agreement; and

(b) is organised or engaged in by an employer that will be covered by the agreement against one or more employees that will be covered by the agreement; and

(c) meets the common requirements set out in Subdivision B; and

(d) meets the additional requirements set out in this section.

  1. Section 416 provides that an employer who engages in employer response action can refuse to make payments to the employees in relation to the period of the action. Further, the immunity provision in s 415 protects an employer that takes protected employer response action from civil liability in respect of an action under any law that is in force in a State or Territory, except for an action involving personal injury, wilful or reckless destruction of or damage to property, or the unlawful taking, keeping or use of property.

  2. Relevantly for these proceedings, whether the lockout was employer response action as defined turns on two issues: first, whether it was organised or engaged in as a response to industrial action; and second, whether it met the requirements of Subdivision B, in particular the notice requirements. These issues are a restatement of two of the questions listed in the opening paragraph of this decision; first, whether on the facts the lockout commenced in response to the commencement of industrial action by the employees; and second whether employer industrial action is employer response action if it is notified to start at the exact same time as the industrial action notified to be taken by the union.

Whether the lockout was action organised or engaged in as a response to employee industrial action

  1. The leading decision on the interpretation of “employer response action” in s 411 is McCain. [47] In that case Hatcher and Catanzariti VPP held that an employer lockout must be taken in response to industrial action that is happening to constitute protected employer response action. Employer response action is unprotected if it pre-empts the taking of industrial action by its employees, even if that industrial action is being organised or threatened or is imminent or probable. [48] In the facts of that decision, the Australian Manufacturing Workers’ Union (AMWU) was bargaining for a new enterprise agreement with McCain Foods (Aust) Pty Ltd (McCain) covering food manufacturing workers at McCain’s site at Smithton, Tasmania. On 16 July 2021, the AMWU sent five notices to McCain stating that it intended to engage in “employee claim action”, in the form of work stoppages on 22 and 23 July 2021, starting at 7:00am on 22 July. On 19 July 2021, McCain notified AMWU that it intended to take employer response action by locking out AMWU members from 7:00am on 22 July until 7:00pm on 23 July 2021 (in other words, as in this case, employer action to commence at the same time as the notified employee action). Hatcher and Catanzariti VPP described McCain as “[implementing] its lockout before AMWU members undertook industrial action”. [49] On 29 July 2021, the AMWU sent a notice to McCain stating that it intended to take 1-hour stoppages regarding the performance of multiple types of work. However, no AMWU members took industrial action that day. At 5:17pm, McCain notified that it intended to lock out AMWU members from 7:00pm that evening, asserting that the uncertainty over AMWU industrial action was giving rise to unacceptable safety risks. The foreshadowed lockout commenced at 7:00pm. AMWU filed an application on 30 July 2021 for an order to stop unprotected industrial action under s 418 of the Fair Work Act. At first instance Clancy DP held that the employer action was taken in response to industrial action that had been organised, even if not taken, and as such was in accordance with s 411 of the Fair Work Act and protected. Hatcher and Catanzariti VPP upheld the AMWU’s appeal against Clancy DP’s decision, finding that McCain’s lockout on 29 July 2021 would only be protected industrial action if it was in response to industrial action in fact taken by its employees.

    47. Australian Manufacturing Workers’ Union v McCain Foods (Aust) Pty Ltd (2021) 310 IR 1; [2021] FWCFB 4804.

    48. Australian Manufacturing Workers’ Union v McCain Foods (Aust) Pty Ltd (2021) 310 IR 1; [2021] FWCFB 4804 at [40].

    49. Australian Manufacturing Workers’ Union v McCain Foods (Aust) Pty Ltd (2021) 310 IR 1; [2021] FWCFB 4804 at [4].

  2. The RTBU contended that Pacific National’s lockout was not capable of being employer response action because it was action that was stated to commence at the same time as the commencement of the employee action.

  3. Pacific National’s lockout notice on 17 October 2023 stated: “Pacific National will be engaging in Employer Response Action, commencing on 0001hrs on Wednesday 18 October 2023 and concluding at 0001hrs on Wednesday 25 October 2023.”

  4. The RTBU contends that the recipient of the notice would reasonably understand that the time of 12.01am notified by Pacific National should be read as a precise indication of the time at which the lockout would commence.

  5. The RTBU submitted that Pacific National’s action, so notified, entirely occluded the period in which RTBU members could have taken their notified work stoppages. This is because an employee’s ability to engage in the work stoppages necessarily depends on the actual non-compliance with an existing obligation and entitlement to attend work. Because the lockout was notified to start at 12.01am, the time at which the employees’ work stoppages were notified to begin, it was submitted that Pacific National had removed the obligation for employees to attend work from that time, and so erased any possibility of employees taking action. As it could not be said that there was any employee action to which the lockout was responding, the lockout was not “a response” to any industrial action and not “employer response action” under s 411. Counsel for the RTBU freely acknowledged this argument would not have been available had the notice stated that the lockout would start at 12.02am (1 minute later).

  6. The proper interpretative approach for a notice for industrial action is to determine what the recipient of the notice would reasonably have understood from the terms used in the notice rather than what the author intended. [50]

    50. Esso Australia Pty Ltd v Australian Workers Union (2015) IR 304; [2015] FCA 758 at [86] (Jessup J).

  1. Greenwood J in Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia v Pinnacle Career Development Pty Ltd [51] (“Pinnacle Career Development”) said the following on the question of whether a notice had adequately described the nature of the action to be engaged in and the day on which it would commence, pursuant to s 414(6):

“An assessment of adequacy must take account of all the circumstances and examine expressions used in the context of whether the concepts embodied in the expressions are well recognised in workplace relations.” [52]

51. (2010) 190 FCR 581; [2010] FCA 1350.

52. (2010) 190 FCR 581; [2010] FCA 1350 at [58].

  1. The notice stated: “Pacific National hereby gives notice that if any employee engages in The Stoppage, in response, Pacific National will be engaging in Employer Response Action” (emphasis added).

  2. In my view the recipient of the notice would reasonably have understood from the terms used in the notice that the lockout would start at 12.01am but would only occur, and would not start before, an employee commencing the industrial action defined as The Stoppage.

  3. It follows that the notice did not prevent employees taking industrial action. Indeed, it stated in effect that the lockout would not occur unless employees first took industrial action.

  4. The RTBU contended that Pacific National’s industrial action commenced, in accordance with its notice, at 12.01am on 18 October 2023, and since the employee action did not commence before 12.01am, then it could not have been in response to employee action. The RTBU contended that by commencing the lockout at 12.01am, Pacific National removed the possibility of employees taking action. In that regard the RTBU relied on the obiter comment of the Full Bench in Australian Rail, Tram and Bus Industry Union v Pacific National Executive Services Pty Ltd:

“As the lock out commenced at the same time that the employees’ action was due to commence, we do not see how it could be responsive to that action. The employees were unable to commence industrial action due to the lock out. The Deputy President’s approach is a departure from the approach taken by the Full Bench in McCain.” [53]

53. [2023] FWCFB 46 at [20].

  1. I concur with the view in McCain that to be employer response action a lockout has to be in response to industrial action actually taken by its employees, and as such the employer action cannot begin before or at the same time as the employee action which it is responding to begins.

  2. On the material before me Pacific National’s action did not commence before or at the same time as the employee action commenced but commenced after and in response to that action. I reach that conclusion for the following reasons.

  3. First, as noted, in my view Pacific National’s notice conveyed that its intended action would only commence if an employee first engaged in employee action.

  4. Second, I find as a matter of fact that the lockout did commence at or about 12.01am but after employee action had commenced. The evidence from Ms Deparis in that regard was not put in contest. On the evening of 17 October, Ms Deparis and Michael Patterson, Superintendent of Service Delivery, had conversations with two employees, Eoin Loughman and Justin Maguire, in which the employees stated that they intended to participate in the stoppage, and they were informed that they would be locked out if they did so. Ms Deparis gave evidence that “at or about 12.01am” on 18 October she had the following conversation with Mr Loughman, once she noticed that the latter was leaving the office:

Deparis: Are you leaving the office due to the PIA?

Loughman: Yes.

Deparis: OK. In that case I have a letter for you which is similar to the memo that we discussed earlier. Do you need any additional information?

Loughman: No.

  1. The letter provided to Mr Loughman was in nearly identical terms to Pacific National’s written notice of the lockout on 17 October. Relevantly, it provided that:

“The nature of PIA notified by the RTBU is a stoppage of work, commencing at 00001hrs [sic] on Wednesday 18 October 2023 and concluding at 0001hrs on 21 October 2023, specifically as follows:

“Stoppage of work in the form of 288 consecutive 15 minutes stoppages.” (“The Stoppage”).

…

Therefore, pursuant to section 414(5) of the Fair Work Act 2009 (Cth), Pacific National hereby gives notice that if any employee engages in The Stoppage, in response, Pacific National will be engaging in Employer Response Action, commencing at 0001hrs on Wednesday 18 October 2023 and concluding at 0001hrs on Wednesday 25 October 2023 (Period).

During that Period, each employee who engages in The Stoppage will not be permitted to perform any work (that is, they will be “locked out”). If this applies to you, you should not attend your place of work, and you will not be paid for the Period.”

  1. Ms Deparis had a conversation to the same effect with Mr Maguire and provided him with a letter in identical terms.

  2. Ms Deparis further gave uncontested evidence that she called employees who had not attended their shifts after 12.01 am on 18 October and, if the employee confirmed that they were participating in the stoppage, sent them a letter confirming that they were subject to the lockout. Her evidence included copies of the letters sent by Pacific National and text messages that Pacific National had sent to employees who had not attended their shifts to ask whether they were absent because of the work stoppage.

  3. On the basis of that evidence, I find that the employer response action commenced at or about 12.01am after and in response to the employee action.

Whether the lockout met the notice requirements in s 414

  1. In McCain the plurality approved of the conclusion of Greenwood J in Pinnacle Career Development, to the effect that an employer can give valid notice of “intended” employer response action in advance of employees taking industrial action, which is to be distinguished from the taking of the employer response action, which is valid subject to what employee action is occurring or not occurring. [54]

    54. Australian Manufacturing Workers’ Union v McCain Foods (Aust) Pty Ltd (2021) 310 IR 1; [2021] FWCFB 4804, at [44]-[45], quoting Communications, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union v Pinnacle Career Development Pty Ltd (2010) 190 FCR 581; [2010] FCA 1350 at [50]-[51].

  2. Industrial action taken by an employer has to comply with the notice requirements in s 414 to constitute “employer response action”. Subsection 414(5) obliges an employer to give written notice of “the action” to all bargaining representatives and take all reasonable steps to notify employees of “the action”. The article “the” in s 414(5) indicates that notice must pertain to the particular action that is proposed to be taken, and that action which does not conform with the notice cannot be said to have complied with the notice requirements in Subdivision B.

  3. Subdivision B includes the notice requirements in s 414, and in particular at subsections 414(5) and (6) notice requirements for an employer response action. Subsection 414(5) states that before an employer engages in employer response action, it must give written notice of the action to each bargaining representative of an employee who will be covered by the agreement and take all reasonable steps to notify the employees who will be covered by the agreement of the action. Under s 414(6), the notice has to specify the nature of the action and the day on which it will start.

  4. It was not put in issue by the RTBU that it was open to Pacific National to give notice of intended responsive employer action in advance of employee industrial action. The RTBU however contended that even if Pacific National had implemented a lockout in response to an employee engaging in a work stoppage, this action was nevertheless invalid because it did not comply with the action as notified, since the notice stated the lockout would commence at 12.01am, and if responsive to industrial action starting at 12.01am, then the lockout must have in fact commenced after 12.01am, which therefore made it action that was not “the” action notified.

  5. This would have been a difficult question to resolve, had the employee industrial notified to commence at 12.01am on 18 October 2023 had in fact commenced later that day or indeed the next day.

  6. On the facts of this case, I have found that as a matter of fact the lockout commenced after the employee action commenced, and did so at or about the time stated in the notice, namely 12.01am. While the evidence does not permit me to find with precision that the lockout commenced at 12.01am, as against at 12am or 12.02am, I do not consider that a sufficient basis to conclude that the action taken was not the action notified.

Conclusion

  1. Pacific National’s lockout was valid employer response action. The lockout was notified to, and did in fact, take effect in response to employee action being taken and in accordance with Pacific National’s notice. On that basis the application is dismissed.

  2. Had I found that the employer action was invalid I would have needed to address the fourth issue listed in the opening paragraph of this decision. Pacific National contended that the RTBU had led no evidence establishing why the 53 relevant employees who did not attend work from 12.01am on 18 October 2023 to 12.01am on 25 October 2023 were, but for the lockout, entitled to the payments which were not made. Pacific National contended that the RTBU had not established that the employees were otherwise ready, willing and able to work, and would have attended work but for the lockout. In that regard Pacific National relied on the existence of the employee industrial action, in the form of the consecutive 15 minute stoppages, and the effect of the no part-performance notices upon employees who prior to the lockout had been engaging in the indefinite partial work bans.

  3. Had I found that the employer response action was invalid, I would have determined that the employees in question were entitled to be compensated for their lost wages for the period of the lockout and required the parties to confer to determine appropriate orders to reflect that finding. Absent agreement I would have offered the parties the opportunity of further conciliation, failing which I would have brought the matter back before me to determine the most appropriate and efficient way to determine the orders to be made.

  4. I would have made such a determination notwithstanding the evidence of the planned 15 minute stoppages, since (had I otherwise upheld the RTBU case), the lockout would have had the effect of preventing the employees from being able to take such action.

  5. Further I would have made such a determination notwithstanding the evidence that there was industrial action in the form of partial work bans notified which some employees had taken before the lockout, and evidence that the employer had notified that if such work bans had continued it would not pay the employees who took such action. I take that view because the lockout notice intervened to prevent the employees working, with or without work bans. If it was not valid then I can see no reason why I would have reduced the amounts payable on the basis of the counterfactual, since the (in)valid action intervened to prevent that counterfactual arising.

  6. If I am wrong about that there would have still been a need to determine compensation for two reasons. First, I accept the RTBU’s submission that the furthest that the evidence about the partial work bans can be taken is that it was open to the 53 employees who participated in the stoppages to participate in the bans. It did not indicate whether those employees had actually ever previously participated in the bans or intended to do so. Had the RTBU been successful, that issue could have been resolved in subsequent proceedings determining the quantum of remedies. Second, the employer response action was two days longer than the employee action, and there would have been a need to consider whether as a result there was at least compensation due for those two days.

Order

  1. The application is dismissed.

Endnotes

Amendments

26 May 2025 - Footnote 1 inserted at [3], and subsequent footnotes renumbered. Paragraph numbering removed at level 3 headings, and subsequent paragraphs renumbered.

Decision last updated: 26 May 2025

Most Recent Citation
Cases Citing This Decision

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Kluck v Carpendale Agri Pty Ltd [2025] FCA 705