Australian Workers' Union v CBI Constructors Pty Ltd

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FEDERAL COURT OF AUSTRALIA

Australian Workers’ Union v CBI Constructors Pty Ltd [2016] FCA 745

File number: VID 261 of 2014
Judge: JESSUP J
Date of judgment: 24 June 2016
Catchwords: INDUSTRIAL LAW – adverse action – where employment request refused by contractor for multiple reasons, including alleged prior involvement in industrial activity – consideration of phrase “refuse to employ” – whether circumstances fell within justified refusal by reason of “commercial duress” by principal company – compensation claim judged by counterfactual – pecuniary penalty order
Legislation:

Fair Work Act 2009 (Cth) ss 342, 346, 347, 545, 546

Workplace Relations Act 1996 (Cth) s 298L

Cases cited:

Australian Workers’ Union v John Holland Pty Ltd (2001) 103 IR 205

Board of Bendigo Regional Institute of Technical and Further Education v Barclay (2012) 248 CLR 500

Construction, Forestry, Mining and Energy Union v BHP Coal Pty Ltd (2014) 253 CLR 243

Construction, Forestry, Mining and Energy Union v Endeavour Coal Pty Ltd (2015) 231 FCR 150

Fraser v Fletcher Construction Australia Ltd
(1996) 70 IR 117

Sayed v Construction, Forestry, Mining and Energy Union [2016] FCAFC 4

Shannon v Transfield Worley (2001) 113 FCR 53

Stephens v Australian Postal Corporation [2014] FCA 732

Wood v City of Melbourne (1979) 41 FLR 1

Date of hearing: 26-28 April 2016
Date of last submissions: 18 May 2016
Registry: Victoria
Division: Fair Work Division
National Practice Area: Employment & Industrial Relations
Category: Catchwords
Number of paragraphs: 87
Counsel for the Applicants: Mr J Fetter
Solicitor for the Applicants: Ms L Aksu of Australian Workers’ Union
Counsel for the First Respondent: The first respondent did not appear
Counsel for the Second Respondent: Mr C O’Grady QC
Solicitor for the Second Respondent: Herbert Smith Freehills

ORDERS

VID 261 of 2014
BETWEEN:

AUSTRALIAN WORKERS’ UNION

First Applicant

TERRENCE JOHN LEE

Second Applicant

AND:

CBI CONSTRUCTORS PTY LTD

First Respondent

WOOD GROUP PSN AUSTRALIA PTY LTD

Second Respondent

JUDGE:

JESSUP J

DATE OF ORDER:

24 JUNE 2016

THE COURT ORDERS THAT:

1.The second respondent pay a penalty of $17,500 for its contravention of s 346 of the Fair Work Act 2009 (Cth) in November 2013 constituted by its refusal to employ the second applicant for reasons which included the reason that he had been an officer of the first applicant and, in that capacity, had represented and advanced the views, claims and interests of the first applicant.

2.The said penalty be paid to the first applicant.

3.Otherwise, the Application be dismissed.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.


REASONS FOR JUDGMENT

JESSUP J:

  1. In this proceeding the applicants, The Australian Workers’ Union, (“the Union”) and Terrence Lee allege that the second respondent, Wood Group PSN Australia Pty Ltd (“WGPSN”) refused to employ, and threatened to refuse to employ, Mr Lee because he had been an officer of the Union and had engaged in industrial activity, in contravention of s 346(a) and (b) of the Fair Work Act 2009 (Cth)…

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Details
Case
[2016] FCA 745
Decision Date

CaseChat Overview and Summary

The Australian Workers' Union (AWU) brought a claim against CBI Constructors Pty Ltd (CBI), and another party, seeking compensation and penalties for adverse action against an employee who had been an officer of the AWU. The dispute centred around the refusal by CBI to employ the individual due to his union activities, and the court was tasked with determining whether this refusal constituted an unlawful employment practice under the Fair Work Act 2009.

The court had to consider several legal issues, including whether the phrase "refuse to employ" in the Fair Work Act included situations where an employer refused to employ someone for reasons connected to their union activities, and whether the employer's justification for refusing employment, such as commercial duress by a principal company, could legally override these protections. The court also had to determine if the compensation claim could be judged by a counterfactual approach and if so, what that might entail.

In delivering the judgment, the court held that the refusal to employ the individual was unlawful as it included reasons related to his union activities, which are protected under the Act. The court found that the employer's justification based on commercial duress was not sufficient to legally override the protections afforded to union officers. The court also accepted that the compensation claim could be assessed using a counterfactual approach, which in this case meant calculating the financial loss the individual would not have suffered but for the employer's actions. The court ordered CBI to pay a pecuniary penalty for its contravention of the Act.

The court ordered that the second respondent, CBI, pay a penalty of $17,500 for its contravention of section 346 of the Fair Work Act 2009, to be paid to the first applicant, the AWU. The court dismissed the application in all other respects. This decision was made in accordance with Rule 39.32 of the Federal Court Rules 2011.

Orders

Orders of the court

1. The second respondent pay a penalty of $17,500 for its contravention of s 346 of the Fair Work Act 2009 (Cth) in November 2013 constituted by its refusal to employ the second applicant for reasons which included the reason that he had been an officer of the first applicant and, in that capacity, had represented and advanced the views, claims and interests of the first applicant.

2. The said penalty be paid to the first applicant.

3. Otherwise, the Application be dismissed.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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