CFMEU v Woden Contractors Pty Limited
[2011] FMCA 473
•24 June 2011
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| CFMEU v WODEN CONTRACTORS PTY LIMITED | [2011] FMCA 473 |
| INDUSTRIAL LAW – right of entry – agreed statement of facts – admission of breach – considerations regarding penalty. |
| Fair Work Act 2009 (Cth) ss.501, 502, 546(3)(b) Work Safety Act 2008 (ACT) Part 4 Division 4.4, s.63 |
| A & L Silvestri Pty Ltd v Construction, Forestry, Mining and Energy Union [2008] FCA 466 Plancor Pty Ltd v Liquor, Hospitality & Miscellaneous Union (2008) 171 FCR 357 Ponzio v B & P Caelli Constructions Pty Ltd (2007) 158 FCR 543 |
| Applicant: | CONSTRUCTION, FORESTRY, MINING AND ENERGY UNION |
| Respondent: | WODEN CONTRACTORS PTY LIMITED |
| File Number: | CAG 65 of 2010 |
| Judgment of: | Neville FM |
| Hearing date: | 11 May 2011 |
| Date of Last Submission: | 11 May 2011 |
| Delivered at: | Canberra |
| Delivered on: | 24 June 2011 |
REPRESENTATION
| Solicitor/Advocate for the Applicant: | Mr Roberts |
| Solicitors for the Applicant: | Slater & Gordon |
| Counsel for the Respondent: | Mr Moir |
| Solicitors for the Respondent: | Wotton + Kearney |
ORDERS
Within 30 days of the date of these Orders, the Respondent pay the Applicant the sum of $7,500.
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT CANBERRA |
CAG 65 of 2010
| CONSTRUCTION, FORESTRY, MINING AND ENERGY UNION |
Applicant
And
| WODEN CONTRACTORS PTY LIMITED |
Respondent
REASONS FOR JUDGMENT
Introduction
This case concerns the determination of an appropriate penalty for an admitted breach of ss.501 and 502 of the Fair Work Act 2009
(“the FW Act”).
The facts are of narrow compass. The matter concerns the breach of right of entry provisions of the FW Act when members of the Applicant union endeavoured to enter, but were prevented from doing so on one occasion, the construction site of a very prominent bridge in the national capital, known as the Kings Avenue Overpass.
Subject to some typographical errors of no particular moment, the parties have determined and prepared a “statement of agreed facts.”[1] They have also agreed upon what is described in their respective submissions as an appropriate or permissible range for the penalty that should be imposed. In this regard, and subject to further comment later in these reasons, I note that in Ponzio v B & P Caelli Constructions Pty Ltd Jessup J said, at [129], that the phrase “permissible range” “refers to a range which should be permitted by the court … within which the penalty is neither manifestly inadequate nor manifestly excessive.”[2] Respectfully, this is also to say that the Court is not bound by any agreement between the parties regarding penalty. Rather, in the exercise of its discretion the Court must be satisfied that the penalty imposed is appropriate in all the circumstances of the case.
[1] In the first iteration of the papers filed, two officials of the Third Respondent were named as parties. By agreement, it was subsequently confirmed that it was sufficient for only the employer Company, the Third Respondent, to remain as a party.
[2] Ponzio v B & P Caelli Constructions Pty Ltd (2007) 158 FCR 543 at p.565.
Agreed Statement of Facts
Subject to some slight corrections, the ‘statement of agreed facts’ is as follows:
(i) The Applicant, the Construction, Forestry, Mining and Energy Union is and was at all material times an organisation of employees registered in accordance with the Fair Work (Registered Organisations) Act 2009 (Cth).
(ii) At all material times the Third Respondent was the principal contractor on, and controlled and occupied the construction site known as the Kings Avenue Overpass, which site was located at the intersection of King’s Avenue and Parks Way Russell,[3] in the Australian Capital Territory (the site).
[3] This reference, and others found later in the statement, should be corrected to read “Parkes Way”.
(iii) The Fair Work Act 2009 (Cth) (the FW Act) includes a statutory regime dealing with the rights of permit holders under that Act to enter workplaces for the purpose of, inter alia, exercising a State or Territory OHS right (see Division 3 Part 3-4 FW Act).
(iv) The Work Safety Act 2008 (ACT) (the WS Act) provides that authorised representatives of registered organisations may enter certain work premises to investigate contraventions of that Act which the authorised representative suspects on reasonable grounds may have happened, may be happening or is likely to happen at those premises (see Part 4 Division 4.4 especially s 63, WS Act). The WS Act also sets out a range of statutory work safety duties designed to secure and promote work safety and otherwise achieve the objectives of that Act.
(v) At all material times Dean Hall (Hall) and Brett Harrison (Harrison) were officers or employees of the Applicant, permit holders under the FW Act and authorised representatives under the WS Act.
(vi) On 11 September, 2010 the site was a workplace where members of the Applicant, or persons eligible to be members of the Applicant, worked.
(vii) Work at the site involved the construction of an overpass at the Russell roundabout in Canberra that would extend King’s Avenue over the Park’s Way [sic]. A main feature of this work was the construction of a bridge-like structure consisting of concrete and reinforcing steel. The concrete component of this work consisted of 1500 cubic metres of concrete. The placement of this concrete was one of the largest concrete deck pours undertaken in Canberra.
(viii) The concrete pour involved 12 months of careful planning and preparation by the Third Respondent. The concrete pour was originally scheduled to occur on 28 August 2010. However, the Third Respondent decided to delay the pour by one week in the aftermath of the GDE Project bridge collapse (as referred to in paragraph 10 below). The concrete pour was further delayed by a week owing to bad weather. The concrete pour commenced on the morning of 11 September, 2010, following extensive public notices and advertisements in the week leading up to the pour. The pour involved 40 concrete trucks, two concrete batch plants and approximately 100 workers on the site.
(ix) Hall and Harrison were concerned to ensure that the concrete pour at the site was carried out safely and without risk to employees engaged at the site.
(x) Both Hall and Harrison were aware of a major industrial accident that had occurred on the Gungahlin Drive Extension Project (GDE Project) on 14 August 2010. On that day whilst concrete placement was occurring, the falsework on the GDE Project collapsed along with 500 cubic metres of concrete and tonnes of steel. The half-built bridge collapsed onto the Barton Highway causing road closures and injuries to fifteen workers, nine of whom were hospitalised.
(xi) The contractor that was engaged to design and construct the formwork and falsework and to undertake the concrete placement on the GDE Project had some involvement with construction tasks on the Kings Avenue site. However, it was not responsible for the design or certification of the formwork and falsework system on the Kings Avenue site.
Events of 11 September, 2010
(xii) Early on the morning of 11 September 2010 Hall attended the site. As Hall approached the site he had an elevated view of the site. He observed what reasonably appeared to him to be safety risks associated with the site. Hall observed what he regarded as a lack of fall protection on certain areas of the site, workers establishing traffic control measures in the dark without appropriate lighting or protective clothing and workers working in the vicinity of plant and machinery without appropriate protective equipment or lighting.
(xiii) Hall sought entry to the site for the purpose of investigating suspected contraventions of the WS Act. Hall spoke with Glen Crawley, project manager at the site (Crawley) and asked for access to the site for this purpose. Hall produced his ‘right of entry’ permit to Crawley.
Crawley refused to allow Hall entry to the site saying words to the effect of:
Crawley: You are not allowed entry because you have not given the company 24 hours notice or a valid safety reason.
Hall replied to the effect:
Hall: I am not required to give notice for OH&S purposes.
Crawley refused entry to the site to Hall.
(xiv) At or about 5:50am Harrison arrived at the site. Hall spoke to Harrison about the safety issues at the site and conveyed his concerns to Harrison. Hall instructed Harrison to produce his ‘right to entry’ permit as requested and required. Hall and Harrison asserted their right to enter the site to Crawley. Crawley refused to allow Hall and Harrison to enter the site.
(xv) As a result of the refusal of Crawley to allow access to the site Hall and Harrison returned to Hall’s car in the car park near the site. Hall spoke to WorkSafe ACT officials by telephone who confirmed his and Harrison’s right to enter the site to exercise a Territory OHS right and to do so without prior notice to the Third Respondent, consistent with the FW Act and the WS Act.
(xvi) At or about 7am on the same day Hall and Harrison again sought to enter the site. They spoke with Peter Middleton, a director of the Third Respondent (Middleton). Middleton refused to allow access to the site to Hall and Harrison. Middleton said words to the effect:
Middleton: I have had advice about this and you are not allowed onto this site without giving us 24 hours notice or a valid safety reason. If you go on I will call the police.
(xvii) Further debate occurred between Middleton, Hall and Harrison. Middleton maintained his objection to the entry of Hall and Harrison. Eventually Hall and Harrison entered the site and conducted an inspection.
(xviii) The actions of the Third Respondent (through Crawley and Middleton) in refusing and/or unduly delaying entry and intentionally hindering or obstructing Hall and Harrison was based on a genuine misunderstanding on the part of the Third Respondent about the operation of the right of entry provisions under the WS Act and FW Act which was due to incorrect advice as to the entry of union officers/employees provided to the Third Respondent by an industry body and which advice was relied upon in good faith by the Third Respondent.
(xix) Prior to the events of 11 September 2010 the Applicant (through its officers and employees) and the Third Respondent had a working relationship that included a mutually agreed understanding in relation to the entry of permit holders of the Applicant to premises controlled and/or occupied by the Third Respondent, which both the Applicant and Third Respondent regarded as consistent with relevant industrial legislation.
(xx) Upon entry to the site by Hall and Harrison on 11 September 2010 a number of additional health and safety measures were undertaken by the Third Respondent at the request of Hall and Harrison, including the erection of temporary fall protection measures.
(xxi) Work proceeded without disruption on 11 September 2010 and the concrete pour was completed successfully and without any safety incidents occurring.
(xxii) Both Crawley and Middleton were acting within their actual or apparent authority as officers of the Third Respondent.
(xxiii) The Third Respondent refused and/or unduly delayed Hall and Harrison on 11 September, 2010, when both were entitled to enter the site, in contravention of s 501 of FW Act.
(xxiv) Further, on 11 September, 2010 the Third Respondent intentionally hindered or obstructed Hall and Harrison exercising rights in accordance with the FW Act, in contravention of s 502 of the FW Act.
(xxv) The Third Respondent informs the Applicant that following 11 September 2010, the Third Respondent has taken steps to ensure that its error is not repeated, including through additional training and information for managers about rights of entry for OHS purposes under the applicable legislation.
(xxvi) The maximum penalty for a contravention of sections 501 and 502 of the FW Act for a body corporate is $33,000. The parties have agreed that a penalty not exceeding $10,000 be paid by the Third Respondent and that the penalty be paid to the Applicant.
Principles & considerations regarding penalty
As previously indicated, in the light of the agreed statement of facts, the task of the Court is to determine the appropriate penalty. In this regard I note the following.
In NW Frozen Foods Pty Ltd v Australian Competition and Consumer Commission, the Full Court of the Federal Court (Burchett and Kiefel JJ; Carr J agreeing) said:[4]
Cases are authorities for matters of principle; but the penalty found to be appropriate, as a matter of fact, in the circumstances of one case cannot dictate the appropriate penalty in the different circumstances of another case.
[4] (1996) 71 FCR 285 at p.295.
Rather more recently, in A & L Silvestri Pty Ltd v Construction, Forestry, Mining and Energy Union, Gyles J said:[5]
A number of authorities discuss the factors to be taken into account in fixing a penalty, many of them borrowing from related fields, including the criminal law. It is sufficient to refer to the recent case of Kelly v Fitzpatrick [2007] FCA 1080; (2007) 166 IR 14 as an example. However, the discretion is at large. There are no mandatory statutory criteria and it is wrong to regard factors seen as relevant by one court as statutory criteria. Indeed, lists of factors can confuse an essentially straightforward task and lead to over-elaborate reasoning.
[5] [2008] FCA 466 at [6].
In more detail in Stuart-Mahoney v Construction, Forestry, Mining and Energy Union, Tracey J said (in the legislative context of that case):[6]
[6] (2008) 177 IR 61 at [40]. See also the comments of the Full Court (Moore, Middleton & Gordon JJ) in Construction, Forestry, Mining and Energy Union vWilliams (2009) 262 ALR 417 at pp.428-429 [28] – [33]; Kenny J in White v Construction, Forestry, Mining and Energy Union [2011] FCA 192 at [5], [6] & [8], and Ryan J in Construction, Forestry, Mining and Energy Union v Stuart-Mahoney [2011] FCA 56 at [80] & [82]. His Honour was there sitting as the Full Court. See also the Full Court judgment in Plancor Pty Ltd v Liquor, Hospitality & Miscellaneous Union (2008) 171 FCR 357 at pp.368-369 [35] – [37] (Gray J), and at pp.374-379 [57] – [69] (Branson & Lander JJ).
In my view, potentially relevant and applicable considerations for determining the appropriate penalty for a contravention of the BCII Act include:
• The nature and extent of the conduct which led to the breaches.
• The circumstances in which that relevant conduct took place.
• The nature and extent of any loss or damage sustained as a result of the breaches.
• Whether there had been similar previous conduct by the respondent.
• Whether the breaches were properly distinct or arose out of the one course of conduct.
• The size of the business enterprise involved.
• Whether or not the breaches were deliberate.
• Whether senior management was involved in the breaches.
• Whether the party committing the breach had exhibited contrition.
• Whether the party committing the breach had taken corrective action.
• Whether the party committing the breach had cooperated with the enforcement authorities.
• The need to ensure compliance with minimum standards by provision of an effective means for investigation and enforcement of employee entitlements.
• The need for specific and general deterrence.
Three other comments should be made. First, in Australian Ophthalmic Supplies Pty Ltd v McAlary-Smith (“McAlary-Smith”) Buchanan J observed, at [91]:[7]
At the end of the day the task of the court is to fix a penalty which pays appropriate regard to the circumstances in which the contraventions have occurred and the need to sustain public confidence in the statutory regime which imposes the obligations.
[7] Australian Ophthalmic Supplies Pty Ltd v McAlary-Smith (2008) 165 FCR 560.
Secondly, also in McAlary-Smith, Graham J referred to McHugh J’s comments in Markarian v The Queen and his Honour’s discussion of “instinctive synthesis” as an appropriate approach in determining penalty.[8] In Markarian, McHugh J said:[9] “There is only human judgment based on all the facts of the case, the judge’s experience, the data derived from comparable sentences, the guidelines and principles authoritatively laid down in statutes and authoritative judgments.”
[8] McAlary-Smith 165 FCR at p.577 [78].
[9] Markarian v The Queen (2005) 228 CLR 357 at pp.377-390 [48] – [84]. The quotation cited is at [71].
Thirdly, the Court must also have regard to ‘the totality principle.’[10]
[10] In this regard, among many places, see Buchanan J in McAlary-Smith at [98] – [103], with which Gray J essentially agreed, at [18] – [23]. See also Graham J also in McAlary-Smith at [66] – [70]. Among other things, Graham J said, at [66]: “The totality principle is designed to ensure that the aggregate of the penalties imposed is not such as to be oppressive or crushing.”
The Applicant submitted that the behaviour of the Third Respondent in the present matter was not and should not be regarded as being ‘at the top of the permissible range.’ Nonetheless, it was submitted that it was “objectively serious.” I accept this submission. As Marshall J said in Ponzio v Caelli Constructions, at [1]: “Safety in the workplace is a matter of paramount importance, especially in the construction industry.”
The Applicant also submitted, as did the Third Respondent, that the breaches alleged and admitted should be treated as a single course of conduct for the purposes of determining penalty. I accept this submission also.
The Third Respondent submitted that: (a) there was no prior or subsequent breach, the events in question thereby constituting, in effect, a “one-off” contravention; (b) officials of the Applicant had previously exercised their right of entry without issue prior to the contravening conduct; (c) the Third Respondent, upon learning the true or correct state of the law (having relied upon previously given incorrect advice), complied and expressed regret for the contravening conduct; and (d) the Third Respondent has co-operated with the Applicant in ensuring that there are no similar breaches in the future by providing additional training and information for its managers about union rights of entry, and particularly in the context of inspections that relate to OH&S issues. There was effectively no disagreement from the Applicant with these submissions. I accept them.
In my view, the co-operative stance of the Third Respondent, once fully apprised of the facts and that it had relied (inadvertently) on erroneous advice is a significant factor, as are the solitary nature of the breach and the further co-operation between the parties in the re-education of management of the Third Respondent. In these circumstances, it seems to me that specific deterrence is a major consideration. General deterrence remains a consideration. It is concerning that “industry advice” (as it was put in the submissions) upon which the Third Respondent relied seemingly continues to be regularly awry in relation to right of entry provisions concerning OH&S issues.
For my part, the only matters that have not been explained are: how there was no prior difficulty for union access to the site; and, how were there no prior breaches given that the Third Respondent was [apparently] relying on advice which it now knows to have been erroneous? Answers to these questions, however, are not relevant to the determination of penalty in the current matter.
Having regard to the agreed facts of the matter, and to the principles of law to which I have referred, in my view the maximum penalty agreed upon by the parties, namely a sum not exceeding $10,000, is also appropriate. In all the circumstances, the penalty that should be paid by the Third Respondent is $7,500.[11] As agreed between the parties, that sum should be paid to the Applicant. That should occur within
[11] See the recent decision of Tracey J in Construction, Forestry, Mining & Energy Union v Safety Glass Pty Ltd [2010] FCA 989, where the facts of that case bear some similarity to those of the matter currently before this Court. In that ‘right of entry case’, his Honour imposed a penalty of $9000.
30 days of the date of these orders.
I certify that the preceding seventeen (17) paragraphs are a true copy of the reasons for judgment of Neville FM
Associate:
Date: 24 June 2011
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