Director of the Fair Work Building Industry Inspectorate v Perkovic

[2015] FWC 4062

[2015] FWC 4062 [Note: An appeal pursuant to s.604 (C2015/4723 was lodged against this decision and the order arising from this decision - refer to Full Bench decision dated 7 September 2015 [[2015] FWCFB 5867] for result of appeal.]

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.510 - Upon referral, revoke or suspend an entry permit

Director of the Fair Work Building Industry Inspectorate
v
John Perkovic
(RE2015/356)

DEPUTY PRESIDENT GOSTENCNIK MELBOURNE, 19 JUNE 2015

Application/Notification by Director of the Fair Work Building Industry Inspectorate.

Introduction

[1] John Perkovic is an official of the Construction, Forestry, Mining and Energy Union (CFMEU) employed by it as an organiser. Mr Perkovic is the holder of a right of entry permit issued pursuant to s.512 of the Fair Work Act 2009 (Cth) (the Act) (the Permit). The Permit was issued to Mr Perkovic on 17 January 2013 and will, absent other intervening events, expire on 16 January 2016. 1

[2] In Director of the Fair Work Building Industry Inspectorate v Stephenson 2 White J, by order dated 23 December 2014, made declarations, inter alia, that Mr Perkovic contravened s.500 of the Act by reason of acting in an improper manner while exercising or seeking to exercise rights as a permit holder in accordance with s.484 of the Act on 7 May 2014 at a construction project taking place at 122 Grenfell Street, Adelaide (the Project).3 His Honour also declared that by reason of s.793 of the Act, the CFMEU was taken to have contravened s.500 of the Act by the conduct of, relevantly, Mr Perkovic constituting his contravention of s.500 of the Act.4 The Court imposed a pecuniary penalty on Mr Perkovic in the amount of $5,000.00 and on the CFMEU in the amount of $100,000.00 in respect of the conduct of six of its officials, including Mr Perkovic.5

[3] On 6 March 2015 the Director of the Fair Work Building Industry Inspectorate (the Director) made an application for the Permit issued to Mr Perkovic to be revoked or suspended pursuant to s.510 of the Act or alternatively pursuant to s.507 of the Act.

Standing

[4] Before turning to the substance of the matters which must be decided, it is necessary to deal with the objection raised by the CFMEU and Mr Perkovic to the standing of the Director to bring an application for revocation or suspension of an entry permit pursuant to s.510 of the Act.

[5] The CFMEU and Mr Perkovic contended that the Director did not have standing to bring an application for revocation or suspension of the Permit issued to Mr Perkovic pursuant to s.510 of the Act. They accepted that the Director in his capacity as an inspector 6 may apply under s.507 of the Act for suspension or revocation, but contended that under s.510 of the Act any power that the Commission exercises is on its own initiative and not on the initiative of a purported applicant such as the Director. The CFMEU and Mr Perkovic submitted that in contrast to s.507 of the Act, the Director is not expressly provided with standing to make an application under s.510 of the Act and it followed that the Director did not have standing.7

[6] The Director contended that by reason of s.59C(1) of the Fair Work (Building Industry) Act 2012 (FWBI Act), he has the same functions and powers of a Fair Work Inspector (as defined in the Act). This is not contentious. The Director contended that although s.510 of the Act does not specify who may apply for orders to be made pursuant to the provision, under s.508(3)(b) of the Act (which is a similar provision enabling the Commission to suspend or revoke entry permits in certain circumstances), the Director, as an Inspector, has standing to make an application. The Director submitted further or in the alternative that as an Inspector with the same functions and powers as a Fair Work Inspector he has standing and authority to apply for the suspension or revocation of entry permits pursuant to s.507(1) of the Act. Neither of these propositions is contentious. However, the Director submitted that he has standing under s.510 of the Act to bring this application by reason of:

● s.508(3)(b) of the Act (which indicates the Parliament's intention for the Director to have standing in similar applications which can be made under the Act);

● there being no provision to the contrary in the Act;

● the Director's deemed position as a Fair Work Inspector; and

● the fact that the Director was the relevant applicant in the Federal Court proceeding to which this application relates. 8

[7] The Director also relied on a recent decision of Vice President Watson in Director of the Fair Work Building industry Inspectorate v Smart 9[2015] FWC 3656 in which the Vice President dealt with the question of the Director’s standing to bring an application under s.510 of the Act as follows:

[4]While not contesting the jurisdiction of the Commission to suspend the right of entry permit of Mr Smart, Mr Sneddon submitted that the Director lacked standing to make the application. The argument was advanced on the basis that there is no specific provision regarding applications under s.510 and no express power, as exists in s.507, for the Director to make an application.
[5] The Federal Court has recently observed that the various provisions of Chapter 3 of the Act regarding revocation of right of entry permits complement each other rather than impose limitations.  Further, I note that the Acts Interpretation Act 1901 provides:

“Exercise of powers and performance of functions or duties
Powers, functions and duties may be exercised or must be performed as the occasion requires
(1)  Where an Act confers a power or function or imposes a duty, then the power may be exercised and the function or duty must be performed from time to time as occasion requires.
....”

[6] In a decision concerning s.510 Boulton J observed :

“[18]Given the nature of s.510 within the scheme of Part 3-4 of the FW Act, it would follow that where FWA becomes aware, whether by application or otherwise, that a matter as specified in the section has occurred, it must perform its functions as required under the section. The functions must be performed and the powers exercised in a manner consistent with the general requirements of the FW Act as set out in ss.577 and 578. These include the requirements for FWA in exercising the powers under s.510 to act in a manner which is “fair and just” and “open and transparent” and which takes into account the objects of the Act and Part 3-4 as well as “equity, good conscience and the merits of the matter.” There is also an overriding requirement that in performing such functions as those in s.510 that the principles of procedural fairness be observed.”

[7] Section 585 of the Act provides that an application to the FWC must be in accordance with the procedural rules (if any) relating to applications of that kind. There is no provision in the rules for applications under Part 3-4. The rules provide that a general form may be used if no specific form is prescribed.
[8] In my view the terms of s.510 permit an application being made by a person with a relevant interest. I indicated at the hearing of the matter that I considered that the application by the Director of the FWBC was valid and in any event I would grant the Director leave to intervene in the matter if necessary as he clearly has an interest in the proceedings. The Director was the applicant in the Federal Court proceedings giving rise to this application.
[9] As I have noted, it was conceded by Mr Smart that the Commission has jurisdiction to deal with the matter. It was also conceded that the circumstances in s.510(1)(d) existed by virtue of the decision of White J. It was accepted that the question for determination is whether the suspension required by s.510(1) should not occur because the suspension would be harsh or unreasonable in the circumstances. I turn to consider that question. 10 [Endnote omitted]

[8] Whilst the Vice President’s view has much to commend it, for my part, I find it unnecessary to determine the question in order to proceed to consider whether the Permit issued to Mr Perkovic should be revoked or suspended pursuant to s.510 of the Act. The Director has standing to make an application under s.507 of the Act and has done so. In so doing, the Director has identified circumstances set out in s.510(1)(d) of the Act, which compel the Commission to act unless satisfied that suspension or revocation would be harsh or unreasonable in the circumstances. 11 There is no dispute that having become aware of the circumstances identified in s.510(1)(d) of the Act the Commission is seized with jurisdiction. At the commencement of the hearing of this matter, I indicated that I was inviting the Director to make submissions and to lead relevant evidence in relation to the questions that I needed to determine whether to take action under s.510 of the Act.12 I did so having regard to the power in s.590 of the Act enabling the Commission to inform itself in relation to any matter before it in such manner as it considers appropriate, and specifically by inviting the Director to make submissions13 and by taking evidence,14 which in this case was taken in the form of an affidavit of Stephen Phillip Pemberton15 affirmed on 23 April 2015 (Pemberton affidavit).16 The CFMEU and Mr Perkovic did not cavil with this approach.17

[9] Given that I am seized of jurisdiction to act under s.510 of the Act, the Director has, pursuant to my invitation, made submissions and presented evidence relevant to the exercise of power under s.510 of the Act, and the CFMEU and Mr Perkovic have had the opportunity to lead evidence and make submissions relevant to the exercise of power under s.510 of the Act, the determination of the Director’s standing is not a matter, in the present circumstances, that is material to any question that I need to consider in order to properly determine the exercise of power under s.510 of the Act. I therefore do not propose to finally determine that question.

[10] For the reasons that will become apparent, I have found it unnecessary to deal with the Director’s application under s.507 of the Act, and that application is dismissed.

Consideration

Relevant statutory provisions

[11] As I have earlier observed, the Federal Court in Stephenson imposed a penalty on Mr Perkovic and on the CFMEU because Mr Perkovic contravened s.500 of the Act. That section provides:

500 Permit holder must not hinder or obstruct

A permit holder exercising, or seeking to exercise, rights in accordance with this Part must not intentionally hinder or obstruct any person, or otherwise act in an improper manner.
Note 1: This section is a civil remedy provision (see Part 4-1).
Note 2: A permit holder, or the organisation to which the permit holder belongs, may also be subject to an order by the FWC under section 508 if rights under this Part are misused.

Note 3: A person must not intentionally hinder or obstruct a permit holder, exercising rights under this Part (see section 502).

[12] Section 500 of the Act, along with s.510 of the Act, are part of a right of entry scheme established by Part 3-4 of the Act. Section 510 of the Act relevantly provides the following:

510 When the FWC must revoke or suspend entry permits

When the FWC must revoke or suspend entry permits
(1) The FWC must, under this subsection, revoke or suspend each entry permit held by a permit holder if it is satisfied that any of the following has happened since the first of those permits was issued:

....
(d) the permit holder, or another person, was ordered to pay a pecuniary penalty under this Act in relation to a contravention of this Part by the permit holder;
...

(2) Despite subsection (1), the FWC is not required to suspend or revoke an entry permit under paragraph (1)(d) or (f) if the FWC is satisfied that the suspension or revocation would be harsh or unreasonable in the circumstances.
(3) Subsection (1) does not apply in relation to a circumstance referred to in a paragraph of that subsection if the FWC took the circumstance into account when taking action under that subsection on a previous occasion.
Minimum suspension period
(4) A suspension under subsection (1) must be for a period that is at least as long as the period (the minimum suspension period) specified in whichever of the following paragraphs applies:

(a) if the FWC has not previously taken action under subsection (1) against the permit holder—3 months;
(b) if the FWC has taken action under subsection (1) against the permit holder on only one occasion—12 months;
(c) if the FWC has taken action under subsection (1) against the permit holder on more than one occasion—5 years.

Banning issue of future entry permits
(5) If the FWC takes action under subsection (1), it must also ban the issue of any further entry permit to the permit holder for a specified period (the ban period).
(6) The ban period must:

(a) begin when the action is taken under subsection (1); and
(b) be no shorter than the minimum suspension period.

[13] The object of Part 3–4 of the Act is to be found in s.480 of the Act and provides:

480 Object of this Part

The object of this Part is to establish a framework for officials of organisations to enter premises that balances:

(a) the right of organisations to represent their members in the workplace, hold discussions with potential members and investigate suspected contraventions of:

(i) this Act and fair work instruments; and

(ii) State or Territory OHS laws; and

(b) the right of employees and TCF award workers to receive, at work, information and representation from officials of organisations; and

(c) the right of occupiers of premises and employers to go about their business without undue inconvenience.

[14] In Maritime Union of Australia v Fair Work Commission 18 a Full Court of the Federal Court made the following observations about Part 3-4 of the Act:

Although the questions for resolution may be stated simply, it is important to recognise at the outset that Part 3-4 of the Fair Work Act fundamentally modifies common law rights.

A person granted an entry permit is conferred extensive power. Entry permits confer rights which significantly erode the common law right of occupiers to exclude those to whom they do not wish to grant entry. The Commonwealth legislature has nevertheless long concluded that conferring such powers is necessary in the context of industrial law. But it has also long sought to strike a balance between common law rights and otherwise untrammelled power. When construing a provision of an award and s 42A of the Conciliation and Arbitration Act 1904 (Cth), Keely, Gray and Ryan JJ in Meneling Station Pty Ltd v Australasian Meat Industry Employees’ Union (1987) 18 FCR 51 at 61 to 62 thus observed:

The right of entry contemplated by s 42A of the Act is available at any time during working hours, and for other purposes than the inspection of roster, time and wages records. It is also subject to conditions. Clause 23 has been framed, in our view, to strike a balance between the interest of a union party to an award in monitoring its observance and detecting breaches of it by an employer, and the interest, on the other hand, of an employer in carrying on business without interruption or harassment. A construction of the clause which favours one of those interests to a point where the other can be given scarcely any recognition is, therefore, to be avoided unless the language of the clause compels its adoption. Accordingly, since cl 23 of the Award provides a right to inspect records, it is reasonable to construe it as incidentally conferring a specific, preliminary, right to enter premises for that purpose.

See also: Lane v Arrowcrest Group Pty Ltd (1990) 27 FCR 427 at 439 to 440 per von Doussa J.

Section 480, extracted at [8] above, sets out that the object of Part 3-4 is to establish a framework that balances the right of organisations to represent their members, the right of employees to receive information and representation, and the right of occupiers of premises and employers to go about their business without undue inconvenience. The rights conferred by Part 3-4, including to enter premises and interview persons about suspected contraventions and to hold discussions with employees, have thus been assessed by the legislature as an appropriate balance between the rights of organisations, employees and occupiers. The rights conferred, however, are not “untrammelled” and are subject to both express and implied constraints: Australasian Meat Industry Employees’ Union v Fair Work Australia [2012] FCAFC 85 at [56], [2012] FCAFC 85; (2012) 203 FCR 389 at 405 per Flick J (Tracey J agreeing). The exercise of rights conferred upon a “permit holder” renders lawful that which would otherwise be unlawful: cf. Federal Commissioner of Taxation v Australia and New Zealand Banking Group Limited [1979] HCA 67; (1979) 143 CLR 499 at 540 per Mason J.

It is thus not surprising that the legislature has confined the category of persons who may be clothed with such powers to those persons who are “fit and proper”. 19

[15] To this I would add, it is also not surprising that the legislature has determined (subject to limited exceptions) to compel the removal of such powers from a person who has contravened any of the prohibitions found in Division 4 of Part 3-4 of the Act, and has had a pecuniary penalty imposed on that person or another person by reason on the contravention.

Exercise of power under s.510

[16] The CFMEU and Mr Perkovic referred to a decision of Boulton J in Parker and others 20as providing guidance as to the exercise of power under s.510 of the Act. In particular the decision in Parker provides guidance as to some of the circumstances to take into account in the exercise of the discretion to not suspend or revoke a right of entry permit because the consequence of doing so would be harsh or unreasonable.

[17] In Parker, Boulton J had regarded the following matters as relevant:

● the objects of Part 3-4;

● the nature and gravity of the underlying contravention of Part 3-4;

● the impact that the revocation or suspension of the entry permits might have on the Organisation, its members and the permit holder;

● whether training has been undertaken by the entry permit holders since the events; and

● general character evidence. 21

[18] Whilst not an exhaustive list, I accept that these matters are relevant to the exercise of power under s.510 of the Act. The Director did not submit otherwise, although he pointed out that the decision in Parker and the result were distinguishable on the facts. 22

Mr Perkovic’s contravening conduct

[19] In Stephenson, White J sets out the contravening conduct engaged in by Mr Perkovic on 7 May 2014 as follows:

The fourth set of contraventions: 7 May 2014: Action SAD 141 of 2014

In early 2014, Watpac Ltd was the head contractor on the construction of the Ibis Hotel at 122 Grenfell Street, Adelaide (the Grenfell St Site) and was the occupier of those premises.

At about 7:15am on 1 May 2014, six employees of the CFMEU attended at the Grenfell Street Site. They were the first to sixth respondents, Mr McDermott, Mr Stephenson, Mr Jarrett, Mr Sloane, Mr Pitt and Mr Perkovic (collectively, the CFMEU Officials).

Mr Kamminga was Watpac’s Site Manager. As such, he had responsibility for the day to day operations on the Site and had the authority of Watpac to permit, or not permit, as the case may be, people to enter the Site; the authority to request production for an inspection of entry permit and entry notices; and the authority to direct people to leave the Site.

At the time the CFMEU Officials attended at the Grenfell St Site on 1 May 2014, two Fair Work Building Industry Inspectors appointed under s 59 of the FWBI Act, Mr Flynn and Ms Peters, were also present and acting in their capacity as an Inspectors. The agreed facts do not indicate whether the presence of the two Inspectors was linked in any way to the attendance of the CFMEU Officials.

When the CFMEU Officials arrived at the Site, they met Mr Kamminga. They each signed the Visitors Register and then entered the Site. At the time they were signing the Register, Mr Kamminga asked the CFMEU Officials, “have you got a right of entry notice? Why are you here? Can we see your permits?” Mr McDermott responded with words to the effect of “You can’t get a right of entry”. Mr Kamminga then instructed the CFMEU Officials to leave the Site but Mr McDermott said “No”. The respondents acknowledged that in the statements just summarised Mr Kamminga was referring to an entry notice under s 487 which complied with s 518 of the FW Act and that in referring to “permits”, Mr Kamminga was referring to entry permits issued under s 512 of the FW Act.

After Mr McDermott indicated the refusal of the CFMEU Officials to leave, they then proceeded onto the part of the Grenfell St Site on which construction was taking place and entered the building.

While the CFMEU Officials were on the Site between 7:35am and 9:15am:

(e) They held discussions under s 484 of the Act with employees whose industrial interests the CFMEU was entitled to represent. Those discussions included discussions with employees of subcontractors working on the Site, including employees of Second Fix Carpentry Services and employees of Adelaide Partitions and Ceilings, in relation to enterprise bargaining agreement negotiations.


. . .


(h) Mr Kamminga also requested Mr McDermott, Mr Pitt and Mr Perkovic to produce their entry permits and an entry notice. Mr Kamminga asked them for their “ROE and permits”. Mr McDermott and Mr Perkovic responded to this request by saying to Mr Kamminga words to the effect of “Fuck off”, “Fuck yourself”, and “Grow some balls”. It is agreed that none of Mr McDermott, Mr Pitt and Mr Perkovic complied with Mr Kamminga’s requests.

The CFMEU Officials remained on the Grenfell Street Site until about 9:15am.

While the CFMEU Officials were on Site, an unpleasant incident involving Mr Perkovic and Mr Flynn occurred. Unlike the CFMEU and the other CFMEU Officials, Mr Perkovic, who was separately represented at the hearing, did not make any admissions in respect of this incident. Accordingly, in the claim against Mr Perkovic the Director relied on an affidavit from Ms Peters together with video footage taken by Ms Peters of the incident. Mr Perkovic did not challenge any of this evidence. The submissions made on his behalf assumed that the Court would make findings concerning the Flynn-Perkovic incident in accordance with the video footage and Ms Peters’ affidavit.

On the basis of the video footage and Ms Peters’ affidavit, I make the following findings concerning the Flynn-Perkovic incident. In some respects, these findings go beyond the facts agreed between the Director and the other respondents in Action No SAD 141 of 2014. That is because of the additional evidence which the Court received.

Mr Perkovic approached Mr Flynn who was wearing an orange high-visibility vest and a white hard hat. His identification as an FWBI Inspector was visible on his right hand shirt pocket. Mr Perkovic went so close to Mr Flynn that their stomachs were almost touching, if not touching and, at least five times, shouted at Mr Flynn, referring to him as “you piece of shit”, “you fucking piece of shit” and as a “cunt”. Almost immediately after the incident started, Ms Peters commenced videoing. The exchange between the two men included the following:

Flynn (to the effect): You’re hindering and obstructing me in the execution of my duty.

Perkovic: Do you want a fuckin’ photo, you fuckin’ piece of shit.

Flynn: Don’t touch me, get away from me.

Perkovic: You’re just about having a heart attack. You’re shitting yellow, you piece of shit. Go fuck ... brush your teeth next time, you piece of shit, alright?

You fuckin coward, I’d fuckin’ take you to school, you fuckin’ piece of shit.

The video shows that Mr Perkovic’s stance and manner was provocative, bullying and intimidating. It is evident that he sought to belittle and humiliate Mr Flynn who, despite Mr Perkovic’s, conduct stood his ground and did not respond in kind.

While the incident was occurring, Mr Pitt and Mr McDermott were also present, but to one side. When Ms Peters commenced videoing the incident, they too used their mobile phones to video the incident. Mr McDermott moved away into another room at one stage but returned just as Mr Perkovic moved away from Mr Flynn.

Each of Mr McDermott, Mr Stephenson, Mr Jarrett, Mr Sloane, Mr Pitt and Mr Perkovic acknowledge that they contravened s 500 of the FW Act by acting in an improper manner when exercising, or seeking to exercise, their rights as a permit holder in accordance with s 484 of the FW Act. Mr Stephenson and Mr Jarrett acted in an improper manner by reason of the following:

(a) They did not comply with three separate directions from Mr Kamminga to leave the Site;
(b) They did not comply with two separate requests by Mr Kamminga that they produce their entry permit and an entry notice;
(c) They failed to give any entry notice at all to Watpac as required by s 487 of the FW Act.

. . .

In Mr Perkovic’s case, his exercise of his right of entry in an improper manner arose from the following:

(a) His refusal to leave the Site after being directed to do so by Mr Kamminga;

(b) His refusal, using profane language, to produce his entry permit and an entry notice when requested by Kamminga to do so;

(c) His failure to provide any entry notice at all as required by s 487 of the FW Act;

(d) His conduct in the Flynn-Perkovic incident. 23

[20] A copy of the video footage originally exhibited to an affidavit of Angeliek Peters filed in the Stephenson proceedings was exhibited to the Pemberton affidavit and I have viewed the footage and taken it into account.

[21] In considering the pecuniary penalty that should be imposed on Mr Perkovic for his contravention of s.500 of the Act, and in fixing on $5,000.00 as the appropriate amount for the penalty, his Honour said the following:

Mr Perkovic is employed by the CFMEU as an organiser. He has no previous record of contraventions.

Even without the Flynn-Perkovic incident, his contraventions have to be regarded seriously. Mr Perkovic’s conduct in the Flynn-Perkovic incident was particularly egregious. He instigated the incident and engaged in sustained intimidatory and abusive conduct towards Mr Flynn. It must have been obvious to Mr Perkovic that Mr Flynn was an Inspector appointed by the Director and present on the Site in that capacity. Mr Perkovic attempted to belittle, humiliate and intimidate Mr Flynn. He is not entitled to any credit because those attempts were unsuccessful. It is on the contrary to Mr Flynn’s credit that he stood his ground and did not respond in kind. Mr Perkovic created circumstances which could easily have developed into something more serious.

Counsel for Mr Perkovic submitted that the Court should not deal with Mr Perkovic on the basis that a physical assault occurred. I accept that that is so in the sense that the evidence does not establish actual physical contact between Mr Perkovic and Mr Flynn. However, Mr Perkovic positioned himself so closely to Mr Flynn during the incident as to attempt physical intimidation. I do not accept the submission of counsel for Mr Perkovic that Mr Flynn moved during the incident so as to position himself more closely to Mr Perkovic. Mr Flynn did no more than move his feet without altering his position relative to Mr Perkovic.

In the criminal sentencing context, assaults against members of the police force and others in involved in law enforcement are regarded as serious criminal offences warranting severe penalties. The Courts recognise that they should do what they can to protect those who, like police officers, are engaged in the protection of the community itself. Those who attack persons involved in law enforcement cannot, in the absence of exceptional circumstances, expect leniency, is a major consideration: see R v McNamara [2009] SASC 227; (2009) 105 SASR 38 at [31].

In my opinion, similar considerations should inform the fixing of penalty in relation to conduct in contravention of s 500 of the FW Act which is directed to a FWBI Inspector. Inspectors appointed under s 59 of the FWBI Act have the same functions and powers as a Fair Work Inspector, but those functions and powers may be exercised only in relation to a “building matter” (s 59C) The powers of Fair Work Inspectors are governed by Ch 5 Pt 5-2 Div 3 of the FW Act. They may be exercised for a number of purposes but, in particular, in determining whether there has been compliance with the FW Act, the FWBI Act or with an industrial instrument. Inspectors should be able to discharge their duties without harassment, bullying or intimidation from anyone, let alone from persons who are present on a site only in the exercise of a right of entry granted for a limited purpose.

These considerations should be reflected in the penalty fixed in respect of Mr Perkovic.

I note again that there has been no expression of contrition or remorse by Mr Perkovic. He is entitled to some credit for his acknowledgment of his contravention and his willingness to facilitate the course of justice. However, the credit which can be given on account of this is diminished by the circumstance that he did not admit his conduct in the Flynn-Perkovic incident. 24

[22] The gravity of Mr Perkovic’s contravening conduct, so far as it is relevant for the purposes of fixing a penalty, is reflected in the observations of his Honour and in the size of the penalty imposed on Mr Perkovic relative to those imposed on other officials also found to have contravened s.500 of the Act during their entry on the Project on 7 May 2014. 25

Would it be harsh or unreasonable in the circumstances to revoke or suspend the Permit?

[23] The CFMEU and Mr Perkovic submitted that the task before the Commission in the present matter is one of conducting a balancing exercise that weighs the interests of Mr Perkovic, the CFMEU, employees, occupiers of workplaces and employers. Both the CFMEU and Mr Perkovic contended that revocation or suspension of the Permit would not strike an appropriate balance of the competing rights. They submitted that both the CFMEU and Mr Perkovic had been sanctioned by the Federal Court in relation to Mr Perkovic’s contravention, which was his first offence and which occurred over 12 months ago. Moreover, the CFMEU and Mr Perkovic submitted that there has not been a further contravention of Mr Perkovic’s obligations under Part 3-4 of the Act and so a revocation or suspension of the Permit would serve little purpose in safeguarding the rights of occupiers of premises and employers. I accept that the various matters identified are relevant but I do not accept that the mere passage of time and the absence of any further contravention results in there being little purpose in suspending or revoking the Permit for the purposes of safeguarding the rights of occupiers of premises or employers. This would ignore the gravity of the contravention, the particular nature of the contravening conduct, and the fact that Mr Perkovic has not shown, either before the Court or in proceedings before me, any remorse or contrition, nor offered any statement of regret for that conduct.

[24] It was further submitted that a revocation or suspension would detrimentally affect Mr Perkovic, the CFMEU and its members. In short, the CFMEU and Mr Perkovic submitted the balancing exercise favours the retention of the Permit.

[25] As to the specific question of whether revocation or suspension of the Permit would be harsh or unreasonable in the circumstances, the CFMEU and Mr Perkovic submitted that it would be harsh and unreasonable having regard to the matters discussed below.

[26] First, it was submitted the nature and gravity of the contravention of s.500 of the Act tells against revocation or suspension. This is because the pecuniary penalty imposed on Mr Perkovic was just below the middle of the applicable range and so it would be concluded that the contravention had a high level of gravity.

[27] Whilst I accept that the level of pecuniary penalty imposed on Mr Perkovic by the Court is an indicator of gravity, it does not follow that the contravening conduct did not involve a high level of gravity.

[28] First and most obviously, the determination of the level of the pecuniary penalty imposed by the Court involved a consideration of the multiplicity of factors and a process of instinctive synthesis taking into account all relevant factors, with the need for deterrence, both personal and in general, usually a prominent consideration in the dissemination of a penalty. 26

[29] Secondly, nowhere in the judgment in Stephenson does his Honour indicate that the contravening conduct engaged in by Mr Perkovic on 7 May 2014 was not a serious contravention or did not involve a high level of gravity. Indeed, the submission presently made is contrary to some of the specific observations made by his Honour and discussed immediately below.

[30] Thirdly, his Honour observed that:

● Even without the Flynn-Perkovic incident, Mr Perkovic’s contraventions have to be regarded seriously; 27

● Mr Perkovic’s conduct in the Flynn-Perkovic incident was particularly egregious; 28

● Mr Perkovic positioned himself so closely to Mr Flynn during the incident as to attempt physical intimidation; 29

● Mr Perkovic’s stance and manner during the Flynn-Perkovic incident was provocative, bullying and intimidating and it was evident that he sought to belittle and humiliate Flynn; 30 and

● Similar considerations to that which inform sentencing in the criminal context in cases of assaults against members of the police force should inform the fixing of penalty in relation to conduct in contravention s.500 of the Act which is directed to a FWBI Inspector. 31

[31] For these reasons, I do not accept that Mr Perkovic’s contravention did not involve a high level of gravity. In my view, Mr Perkovic’s refusal to leave the Project after being directed to do so by Mr Kamminga, his refusal, using profane language, to produce his entry permit and an entry notice when requested by Mr Kamminga to do so, his failure to provide any entry notice at all as required by s.487 of the Act and his conduct towards an FWBI Inspector, 32 conduct that I regard as particularly egregious, in combination is aptly described as conduct involving a high level of gravity.

[32] Mr Perkovic and the CFMEU also submitted that I should have regard to the outcome in Parker, particularly as it concerned Mr Mitchell. They contend that Mr Mitchell’s conduct was more grave than Mr Perkovic’s conduct, but that Boulton J suspended Mr Mitchell’s permit for three months. Consequently, the Commission should seek consistency in decision making and that any period greater than three months would be excessive, inconsistent and unjust.

[33] I accept that the Commission should strive for consistent decision-making but ultimately each case will need to be decided according to its particular facts and circumstances. To begin with, Mr Mitchell’s contravening conduct did not involve the additional element present here of seeking to intimidate an FWBI Inspector, a person empowered to investigate contraventions of, inter alia, the Act, going about his duties.

[34] Additionally, no evidence of the kind led in Parker in relation to Mr Mitchell concerning hardship on his family, the possible requirement to take leave during a suspension period, how Mr Mitchell might be utilised if his permit was suspended and character evidence 33, has been led in this case in relation to Mr Perkovic.

[35] Absent such evidence, reliance on Parker is abstract and of little assistance.

[36] Next the CFMEU and Mr Perkovic submitted that suspension or revocation of the Permit would cause hardship, disruption and disadvantage to Mr Perkovic, the CFMEU and its members. The hardship, disruption and disadvantage is said to manifest itself in the following ways:

● The suspension or revocation of the Permit would mean that Mr Perkovic will be less capable of serving his members;

● The building and construction industry is a dangerous industry in which there were serious and significant occupational health and safety issues, which need to be addressed. Any resulting suspension or revocation of the Permit would mean that Mr Perkovic will be less capable of serving his members in relation to safety issues, and this would be harsh or unreasonable in the circumstances;

● The Director is conducting a campaign in relation to right of entry and is discouraging builders from permitting or inviting an official onto construction sites unless the official holds a right of entry permit. Consequently, the campaign will result in a further curtailment of Mr Perkovic’s capacity to represent his members on construction sites, and so revocation or suspension of the Permit will be harsher unreasonable circumstances; and

● The possible introduction of the Building and Construction Industry (Fair and Lawful Building Sites) Code 2014 (Proposed Code), which if made, will have some retrospective operation and will prohibit entry of a union onto construction sites except as provided for by Part 3-4 of the Act. Consequently, the Proposed Code provides a further reason that the suspension or revocation would be harsh or unreasonable in the circumstances. If or when the Proposed Code is in operation, Mr Perkovic will be prevented from gaining entry to site by invitation or consent of the occupier or employer, and so will limit his capacity to represent his members, impact the CFMEU and likely impact his suitability for ongoing employment with the CFMEU.

[37] Apart from producing data about the prevalence of Occupational Health & Safety issues in the building and construction industry and an industry update from the Director concerning right of entry matters, neither the CFMEU nor Mr Perkovic led any other evidence which would support the generalised propositions that suspension or revocation would result in hardship, disruption and disadvantage. Mr Perkovic was not called to give evidence nor did any other official of the CFMEU give evidence about the particulars of any hardship, disruption or disadvantage asserted in the submissions.

[38] In my view, the capacity of Mr Perkovic to provide services to represent his members through the exercise of a right of entry permit under Part 3-4 of the Act will necessarily be affected if the Permit is suspended or revoked. But this is an ordinary and inevitable effect of s.510 of the Act. It is perhaps something to which Mr Perkovic should have turned his mind before acting in an improper manner when exercising or seeking to exercise those entry rights on 7 May 2014. Moreover, as the Director correctly points out, the CFMEU has a large number of permit holders in its employ 34 and so the reduction in that number by one will have a negligible effect on the capacity of the CFMEU to provide assistance to members.

[39] Moreover, the juxtaposition of a submission as to the effect of a suspension or revocation of the Permit on Mr Perkovic’s capacity to deal with safety issues with his conduct during the Flynn-Perkovic incident, variously described as provocative, bullying and intimidating, is stark. In any event, if the Permit is to be suspended or revoked, the combination of the CFMEU's remaining permit holders and the Occupational Health & Safety regulator in Victoria, WorkSafe, is likely to ensure that occupational safety issues on Victorian building and construction sites are not overlooked.

[40] Furthermore, other than the bare assertion that a revocation or suspension of the Permit will likely impact Mr Perkovic’s suitability for ongoing employment with the CFMEU, no evidence is offered by the CFMEU that this will be the case or how Mr Perkovic’s suitability would be impacted. Moreover, I would have thought that Mr Perkovic’s suitability for ongoing employment should more likely have been impacted by his egregious conduct towards Mr Flynn and by the financial harm caused by that conduct to the CFMEU than by any suspension or revocation of the Permit.

[41] As to the so-called right of entry campaign being conducted by the Director, it seems to me the Director is doing no more than fulfilling one of the statutory functions of his office, namely:

to disseminate information about designated building laws and the Building Code, and about other matters affecting building industry participants, including disseminating information by facilitating ongoing discussions with building industry participants. 35

[42] The Act is a designated building law. There is nothing improper about the Director informing building industry participants of existing right of entry provisions under the Act, that employers and occupiers do not need to permit a union official to enter a site unless the official holds a valid entry permit or that persons who might once have held an entry permit may no longer do so by reason of particular conduct, and how information about officials who no longer hold an entry permit may be obtained. That, as a result of the dissemination of information by the Director, Mr Perkovic might in the future be prevented from entering some construction sites in the event that the Permit is suspended or revoked does not, in my view, result in suspension or revocation being harsh or unreasonable in the circumstances. Mr Perkovic’s exclusion will be the consequence of the exercise by an occupier or employer of a lawful right to exclude a person from a construction site at which that person has no lawful right to be.

[43] Turning next to the Proposed Code, it should first be observed that presently the Proposed Code is not in operation. Secondly, it is not known when, if at all, the Proposed Code will commence operation. Thirdly, if the Proposed Code commences to operate, then when in operation it may prevent Mr Perkovic from entering a construction site by invitation or consent of the occupier or an employer. Fourthly, in that event, that result will have occurred because of the operation of the law. That consequence in the present circumstances does not, in my view, establish any harshness or unreasonableness that would result from a suspension or revocation of the Permit. In any event, that possibility is presently speculative.

[44] The CFMEU and Mr Perkovic also submitted that the fact that Mr Perkovic has recently undertaken training in the rights and obligations of a permit holder should militate against suspension or revocation. In the circumstances of this case I do not accept that merely undertaking such training militates against suspension or revocation. During the proceedings in Stevenson, Mr Perkovic did not admit his conduct during Flynn-Perkovic incident, nor did he express any contrition or remorse. 36 Mr Perkovic did not give evidence before me nor was any submission made that he is remorseful, particularly now that he has undertaken training in the rights and obligations of a permit holder and understands that his conduct during the Flynn-Perkovic incident was wrong. In light of his conduct during the Flynn-Perkovic incident and absent an expression from Mr Perkovic of the kind I have outlined, I do not accept that merely undertaking right of entry training militates against suspension or revocation.

[45] For these reasons I do not consider that either the suspension or the revocation of the Permit would be harsh or unreasonable in the circumstances.

Revocation or suspension of the Permit

[46] It follows from the above that as Mr Perkovic, and the CFMEU by reason of his conduct, have each been ordered in Stephenson to each pay a pecuniary penalty for contravening s.500 of the Act, that I must revoke or suspend the Permit.

[47] Clearly s.510(1) of the Act provides the Commission with the discretion to decide whether in a particular case revocation or suspension of an entry permit should occur. It seems to me that similar considerations to those, which arise on the question of whether suspension or revocation would be harsh or unreasonable in the circumstances, are appropriate considerations here. In addition there is the consideration of the consequence of revocation compared with suspension. Revocation will require an organisation to later apply to the Commission for the issue of a permit and require satisfaction that the proposed permit holder is a fit and proper person to hold a permit. Suspension, on the other hand, will usually result in the permit holder being able to immediately exercise his rights pursuant to the permit once the suspension period has passed. A further relevant consideration in this case is the treatment by this Commission of other permit holders under s.510 of the Act, on whom a penalty was imposed in Stephenson by reason of conduct at the Project on 7 May 2014. Consideration should also be given to the treatment of those other permit holders by the Court in Stephenson.

[48] It seems to me that Mr Perkovic’s contravening conduct in Stevenson was significantly more serious than that of the other five permit holders found by the Court also to have contravened s.500 of the Act on 7 May 2014. Mr Perkovic’s conduct involved a serious and ugly confrontation involving unprovoked intimidating, bullying and belittling behaviour, directed towards an FWBI inspector who was doing no more than carrying out his duties as an inspector.

[49] On the basis of the findings of the Federal Court in Stevenson, contravening conduct engaged in by Mr Perkovic is most closely comparable to that engaged in by Mr McDermott, save for the Flynn-Perkovic incident. 37 The penalty imposed by the Federal Court on Mr McDermott was $4,000.00 compared to the $5,000.00 penalty imposed on Mr Perkovic. In Director FWBII v Bolton and Others, by consent, Boulton J ordered the suspension of Mr McDermott’s entry permit for a period of six months.38 A corresponding ban period was also imposed. It might be thought, therefore, that suspension is also appropriate in Mr Perkovic’s case. I do not agree.

[50] The Flynn-Perkovic incident stands in stark contrast to Mr McDermott’s conduct so as to warrant not only condemnation but the effective imposition of a requirement that in the future the CFMEU will need to persuade the Commission that Mr Perkovic is a fit and proper person to hold an entry permit should the CFMEU wish that Mr Perkovic hold a permit again. This is best achieved by ordering revocation and I will do so. Indeed I have some difficulty envisioning a circumstance more warranting of revocation than this one. In any event, even if I were minded to suspend, in my view, the egregious nature of Mr Perkovic’s conduct warrants a period of suspension significantly longer than six months. The Permit is due to expire in seven months. This is shorter than the ban period that I intend to impose and so the suspension would operate in effect as a revocation.

The ban period

[51] Section 510(5) of the Act provides that if the Commission takes action under subsection (1), it must also ban the issue of any further entry permit to the permit holder for a specified period (the ban period). The ban period must begin when the action is taken under subsection (1) and be no shorter than the minimum suspension period. 39 This is the first occasion on which the Commission is to take action against Mr Perkovic under s.510(1) of the Act, and so the minimum suspension period relevant to the ban period is three months.40

[52] The Director submitted that the period of the ban should be two years based on the Mr Perkovic’s disregard for his obligations as a permit holder under Part 3-4 of the Act and his conduct during the Flynn-Perkovic incident. I propose to impose a significant ban period but I am not disposed to impose a ban of two years.

[53] The CFMEU’s and Mr Perkovic’s primary submission was one of no revocation or suspension but submitted that if suspension is to occur then a period of three months should be ordered. I assume from this that a ban period of three months should also be imposed. This submission has an air of unreality given the agreed outcomes in Director FWBII v Bolton and Others, and takes no proper account of the seriousness of Mr Perkovic’s contravening conduct. A three month ban period, in my view, is manifestly inadequate.

[54] In assessing the period of the ban, I have taken into account the seriousness of the Mr Perkovic’s contravening conduct earlier discussed, the penalties imposed on the other five permit holders in Stephenson, particularly Mr McDermott, and the outcomes under s.510 of the Act in relation to these permit holders. I have also taken into account the impact of the ban of Mr Perkovic, the CFMEU and its members, but for the reasons earlier discussed I do not regard that impact as significant and there is no evidence that Mr Perkovic’s employment with the CFMEU will be jeopardised, but even if it were, that would be due to his conduct (which should not be condoned) and not because of any order I make. I also take into account that this is the first occasion on which the Commission is taking action against Mr Perkovic under s.510(1) of the Act and that the contravening conduct in Stephenson was Mr Perkovic’s first contravention. I have taken into account the absence of any evidence of remorse or contrition, particularly as concerns the Fylnn-Perkovic incident. I acknowledge that Mr Perkovic has recently undertaken training, but for the reasons earlier given, this fact without more, does not persuade me that it should affect the length of the ban period that I propose to impose.

[55] I have earlier noted the difference in the penalty amounts imposed by the Court on Mr Perkovic and Mr McDermott in Stephenson. In effect, the difference is 20 per cent. Given that Mr McDermott’s ban period is six months it might be thought that a ban period of 8.5 months (being 20 per cent more than six months) might be appropriate. In my view that is too simplistic an approach and does not give sufficient weight to the gravity of Mr Perkovic’s conduct towards Mr Flynn. Moreover, it ignores the fact that the level of Mr McDermott’s penalty was in part determined because this was not the first occasion on which he had contravened industrial legislation. 41 In contrast, this was Mr Perkovic’s first contravention.42 This puts the relative penalty level in a different context, and as I have earlier indicated, a multiplicity of factors, only some of which are relevant here, are taken into account by a court in fixing on an appropriate penalty.

[56] In this case, not only did Mr Perkovic deliberately refuse to meet his basic obligations as a permit holder when asked to do so, but also he proceeded, unprovoked, to use abusive language and physical menace in an attempt to intimidate, bully and belittle an FWBI Inspector going about his lawful duties. All this was done under cover of a licence, which deprives the Project’s occupier of its proprietary right to otherwise exclude Mr Perkovic from the property over which it has control. In view of this conduct it should be a while before Mr Perkovic is again considered for the grant of such licence.

[57] The objects of Part 3-4 establish a scheme which balances rights that often times are competing. One of the ways this is achieved is to remove entry rights from persons who have had a penalty imposed for contravening right of entry laws, and to prevent a further permit being issued for a specified period. In my view, the removal of Mr Perkovic’s entry rights in view of his contravening conduct is consistent with the objects of Part 3-4. The ban period that is to be imposed will vary according the circumstances but must, in my view be of an appropriate length so as to take account of the seriousness of the contravention but no so lengthy as to be harsh or plainly unreasonable. A ban period that is appropriate in length having regard to the circumstances will give appropriate effect to the objects of Part 3-4.

[58] In the circumstances of this case, I consider that the ban period should run until 17 January 2017. An order giving effect to this decision is to be issued separately.

Conclusion

[59] Mr Perkovic is a permit holder and by reason of his contravention of s.500 of the Act, the CFMEU and he have each had imposed a pecuniary penalty in relation to a contravention of Part 3-4 of the Act. For the reasons given, I do not consider that suspension or revocation of the Permit would be harsh or unreasonable in the circumstances. I also consider that the appropriate action to take under s.510(1) of the Act is to revoke the Permit and I propose to do so.

[60] Pursuant to s.510(5) of the Act, I propose to impose a ban on the issue of any further entry permit to Mr Perkovic for the period beginning today and ending on 17 January 2017.

[61] An order giving effect to this decision is separately issued in PR568561.

DEPUTY PRESIDENT

Appearances:

For the Director: Mr J Snaden instructed by Mr M Kelleher

For Mr Perkovic and the CFMEU: Mr Y Bakri instructed by Ms C Kazakoff

Hearing details:

Melbourne

9 June 2015

 1   See s.516

 2 [2014] FCA 1432

 3   Ibid

 4   Ibid

 5   Ibid; in proceeding SAD141 of 2014

 6 The Director is a statutory office holder appointed by the Minister for Employment by written instrument pursuant to s.15(1) of the Fair Work (Building Industry) Act 2012 (FWBI Act) and an inspector with the same functions and powers as a Fair Work Inspector in relation to a building matter pursuant to ss.59A and 59C(1) of the FWBI Act

 7   Respondent's outline of submissions at [7]

 8   Director’s submissions at [5]-[7] and application Form F1 at [8]-[11]

 9   [2015] FWC 3656

 10   Ibid at [4]-[9]

 11   See s.510 (2)

 12   Transcript PN 8

 13   Section 590 (2) (b)

 14   Section 590 (2) (d)

 15   Exhibit 1

 16   Transcript PN 22 – PN 28

 17   Transcript PN 29 – PN 34

 18 [2015] FCAFC 56

 19   Ibid at [13]-[16]

 20   [201l] FWA 2577

 21   Ibid at [26]-[28], [33] and [33]

 22   Director’s outline of submissions in reply at [19]-[20]

 23 [2014] FCA 1432 at [46]-[63]

 24   Ibid at [141]-[147]

 25 The other five officials involved were ordered to pay pecuniary penalties ranging from $800.00 to $4000.00. See [2014] FCA 1432 at [148]

 26 See [2014] FCA 1432 at [73]-[75]

 27   Ibid at [142]

 28   Ibid

 29   Ibid at [143]

 30   Ibid at [57] and [142]

 31   Ibid at [144]-[145]

 32   Ibid at [63]

 33   See Parker and others [2011] FWC 2577 at [27] and [38]

 34   Director’s outline of submissions in reply at [26]

 35 See s.10(f) of the Fair Work (Building Industry) Act 2012

 36 [2014] FCA 1432 at [147]

 37   Ibid at [62] and [63]

 38   PR566953

 39   Section 510(6)

 40   See s.510(4)

 41 See [2014] FCA 1432 at [131]

 42   Ibid at [141]

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