SHEEHAN v Australian Municipal, Administrative, Clerical and Services Union
[2013] FCCA 2137
•30 September 2013
FEDERAL CIRCUIT COURT OF AUSTRALIA
| SHEEHAN v AUSTRALIAN MUNICIPAL, ADMINISTRATIVE, CLERICAL AND SERVICES UNION & ORS | [2013] FCCA 2137 |
| Catchwords: INDUSTRIAL LAW – Fair Work Act 2009 (Cth) – Fair Work (Registered Organisations) Act 2009 (Cth) – interlocutory application – Mareva relief – reinstatement – serious issue to be tried – considerations for reinstatement – application dismissed. |
| Legislation: Fair Work Act 2009 (Cth), ss.340, 341, 342 Fair Work (Registered Organisations) Act 2009 (Cth), ss.190, 200, 206, 286, 287, 305, 310 |
| Australian Broadcasting Corporation v O’Neill (2006) 227 CLR 57 Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing & Allied Services Union of Australia v Blue Star Pacific Pty Ltd (2009) 184 IR 333 Independent Education Union v Geelong Grammar School [2000] FCA 557 Mareva Compania Naviera SA v International Bulk Carriers SA (The Mareva) [1980] 1 All ER 213 |
| Applicant: | BRENDEN SHEEHAN |
| First Respondent: | AUSTRALIAN MUNICIPAL, ADMINISTRATIVE, CLERICAL AND SERVICES UNION |
| Second Respondent: | AUSTRALIAN MUNICIPAL, ADMINISTRATIVE, CLERICAL AND SERVICES UNION QUEENSLAND (SERVICES AND NORTHERN ADMINISTRATIVE) BRANCH, TRADING AS THE SERVICES UNION (ABN 86 351 665 653) |
| Third Respondent: | DAVID SMITH |
| Fourth Respondent: | JENNIFER THOMAS |
| Fifth Respondent: | NEIL HENDERSON |
| Sixth Respondent: | CARY POLLOCK |
| File Number: | BRG 695 of 2013 |
| Judgment of: | Judge Burnett |
| Hearing date: | 30 September 2013 |
| Date of Last Submission: | 30 September 2013 |
| Delivered at: | Brisbane |
| Delivered on: | 30 September 2013 |
REPRESENTATION
| The Applicant appeared on his own behalf. |
| Counsel for the Respondents: | Mr E. White |
| Solicitors for the Respondents: | Hall Payne Lawyers |
ORDERS
That the Applicant’s time for filing the principal application be extended to 15 August 2013.
That the Applicant file and serve his statement of claim by 4:00pm on 30 October 2013.
That the First, Third, Fourth, Fifth and Sixth Respondents file and serve their defence by 4:00pm on 27 November 2013.
That the matter be listed for mention at 9:30am on 4 December 2013.
That there be liberty to apply.
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT BRISBANE |
BRG 695 of 2013
| BRENDEN SHEEHAN |
Applicant
And
| AUSTRALIAN MUNICIPAL, ADMINISTRATIVE, CLERICAL AND SERVICES UNION |
First Respondent
AUSTRALIAN MUNICIPAL, ADMINISTRATIVE, CLERICAL AND SERVICES UNION QUEENSLAND (SERVICES AND NORTHERN ADMINISTRATIVE) BRANCH, TRADING AS THE SERVICES UNION (ABN 86 351 665 653)
Second Respondent
DAVID SMITH
Third Respondent
JENNIFER THOMAS
Fourth Respondent
NEIL HENDERSON
Fifth Respondent
CARY POLLOCK
Sixth Respondent
REASONS FOR JUDGMENT
(Ex tempore)
The applicant commenced an application on 15 August 2013 seeking relief against the named respondents in respect of various alleged contraventions of the Fair Work Act 2009 (Cth) (“FW Act”) and the Fair Work (Registered Organisations) Act 2009 (Cth) (“RO Act”). The application came on before me last Wednesday for mention on its first return. At that time the applicant informed the Court that he was seeking interlocutory orders. Given my inability to attend to the application that day, it was adjourned to today for hearing.
The relief sought by the applicant is comprised of two limbs. The first is the issue of a Mareva[1] order in respect of funds held by a body associated with an industrial organisation. The second is for reinstatement of former employment held by the applicant with the first respondent (“the Union”).
[1] Mareva Compania Naviera SA v International Bulk Carriers SA (The Mareva) [1980] 1 All ER 213.
The applicant is a longstanding trade union employee. He has been employed by a number of different trade unions both in Australia and New Zealand in various capacities since approximately 1999. More recently he was employed by the Union in the role of organiser.
He came to that role having previously been employed as an organising coordinator by United Voice. In May 2011 the applicant took up employment with the Union. In the course of negotiating his employment, a number of conditions were discussed, including one related to a contribution of one per cent of his gross income to a fund titled the “Happy Wanderers Club.” The applicant claims that this fund was established and maintained by senior officials of the Union as a re-election or ‘slush’ fund.
He was also required to join the first respondent. He understood this to mean, in fact, that he was required to join the second respondent rather than any branch of the first respondent. In any event, he accepted those terms and acted upon them, and was in turn employed. He passed the probationary period and was deemed permanently employed from December 2011. On 23 April 2012 the applicant took sick leave for an anxiety condition. Save for a short period, he has not substantially returned to work since that time.
While initially on sick leave, he transitioned onto income protection benefits. The Union had in place an income protection insurance scheme for all its employees. Since then the applicant appears to have been in continuous receipt of those benefits, save for one discrete period. He has informed the Court that he is still under treatment and review in respect of his medical condition, and does not know when he will be fit to return to work.
The income protection payments appear to approximate half his former grossed-up entitlements, although I note that there is some dispute about that matter because of disagreement between the parties about the value of a motor vehicle allowance which was provided for in his remuneration package. In any event, in August 2012 the applicant was given notice that the Union proposed a restructure. At that time he was actually in the process of applying for his income protection benefit entitlements. He was informed in September 2012 that he was to be assigned to the ‘Growth team’ in the proposed restructure.
That issue appears to have caused him some distress, and I infer that it was contrary to the wishes he had expressed during the consultation phase. To compound matters, the applicant says that problems arose concerning payment of other entitlements, which resulted in the applicant emailing a complaint to the sixth respondent in late October. The situation then appears to have escalated, with other matters also falling into the dispute, including his medical condition. On 12 December 2012, the applicant received a letter from the second respondent which stated:
“As you know the Union has restructured its organising operations into Growth and Development teams. At present you have not been allocated to a team. We are now considering how the operations can be adjusted in light of Dr Slack’s report in order to accommodate your potential requirements.”
On 24 January 2013 he was advised that he was to be terminated. He believed that this was because of his medical condition. There were other issues then extant, but in any event it appears that he immediately made application to the Fair Work Commission, which resulted in a decision by the Union not to act upon that letter until the applicant was fit to return to work.
At around this time an anonymous letter was forwarded to the secretaries of both the New South Wales and Victorian branches of the Union. I will come back to that matter momentarily.
The applicant returned to work on 6 May 2013. About a week later, Ms J. Thomas, who was then the Acting Secretary of the Queensland branch, together with Ms K. Nelson (Branch Secretary), made a recommendation. She subsequently wrote to the applicant on 15 May 2013 requesting an explanation in respect of the anonymous letter which had been sent earlier that year. The applicant denied any knowledge of the letter.
Ms Thomas and Ms Nelson did not accept his explanation, and a decision was taken to formally terminate the applicant’s employment. In doing so, Ms Nelson formally denied that the applicant’s absence from work, his health or correspondence between him and the Union in relation to other complains were the reasons for his termination. That is, the Union appeared to address most of the workplace rights issues that might ordinarily be expected to give rise to a general protections claim.
It appears however that the anonymous letter was the sole purpose. The letter itself makes allegations of fraud, mismanagement of funds, the creation of the unlawful fund (Happy Wanderers Club) and other misfeasance on the part of those who manage the Union. The terms of the letter relate to many of the matters which have been expressed in the applicant’s affidavits regarding allegations and complaints concerning the employment of financial resources.
From my review of the letter it appears that the complaints are more about the manner in which the fund was managed, rather than the siphoning-off of the resources. The term “fraud” as used in the letter somewhat mischaracterises the complaints, although allegations are made, for instance, concerning the employment of close friends. However, in the context of what appears to be a factional dispute, particularly having regard to the matters detailed in the applicant’s affidavit, I read the complaints to be more a reference to allegations of preferred employment of factional allies rather than friends per se.
The letter reads more like a campaign statement or a rally to arms. Its terms are not offensive and its language is temperate. In those circumstances, it does surprise me that the letter could be regarded as sufficient to justify termination, even if it was written by the applicant (a fact that he denies). In any event, it is against that background that the applicant was terminated and that relief is now sought.
Before progressing to consider the relief that ought to be granted, two matters must be addressed. These matters are not in contention. The parties agree that reference to the second respondent ought be struck out. The second respondent is not relevant to this proceeding and accordingly an order will be made directing that the application be dismissed as against the second respondent.
The second matter is not in contention. The applicant requires an extension of time to bring his application. No issue appears to arise in respect of this matter. He has provided a reasonable explanation for delay, and the delay is short being only a matter of two days. Leave should be granted for an extension of time for bringing the application.
The substantive matters in dispute between the parties concern the interim orders that are sought today. The applicant seeks interim orders in respect of the fund and reinstatement. The relief sought is in the nature of injunctive relief. The principles in respect of injunctive relief are well settled.
The position was set out by Greenwood J in Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing & Allied Services Union of Australia v Blue Star Pacific Pty Ltd (2009) 184 IR 333, where his Honour dealt with the principles outlined by the High Court in Australian Broadcasting Corporation v O’Neill (2006) 227 CLR 57. As his Honour noted at [21]:
“… It is therefore necessary for the applicants to show a sufficient likelihood of success in the principal proceeding at trial to justify, in the circumstances, the preservation of the status quo pending the trial. That is the sense in which the applicants must demonstrate whether a prima facie case is made out. In analysing whether the applicants have demonstrated a sufficient likelihood of success to justify the preservation of the status quo pending trial, the court will examine the strength of the prima facie case and whether, if the evidence remains as it is, there is a probability that at the trial of the action the plaintiff will be held entitled to relief. The strength of the probability of success depends in part upon the nature of the rights asserted by the applicants and the practical consequences likely to flow from the order the applicants seek. A sufficient likelihood of success in this sense might properly also be described as whether the applicants have shown a serious question to be tried. The applicants must also demonstrate that the injury the individual applicants would be likely to suffer if an interlocutory injunction is not granted, outweighs the injury the defendant would suffer if the injunction is granted. Further, the applicants must show that damages will not be an adequate remedy. The question of balance of convenience and the adequacy of damages are in turn influenced by the strength of the prima facie case and the nature of the rights asserted by the individual applicants …”
With those matters in mind, I turn to the two issues alive in this application. The first is the Mareva relief. The applicant submits that an order should be made freezing the funds presently held by the Happy Wanderers Club. The applicant details in his affidavit the manner in which the funds were accumulated. He maintains an interest in that fund as one of the original persons to subscribe to it and as a person responsible for a motion leading to its creation.
He contends the fund is, in effect, intended to operate as a slush fund for the purpose of the re-election of the secretary and assistant secretary of the Union. The basis of the applicant’s contention is that the fund is operated contrary to the interests of members, in contravention of the various provisions of the RO Act.
The Union says that the application should fail for three reasons:
a)the application is misconceived;
b)the Court has no jurisdiction; and
c)even if the Court does have jurisdiction, the applicant himself has no standing.
So far as the respondent contends that the application is misconceived, it argues that none of the causes of action relied upon by the applicant, to the extent that he does have standing to bring proceedings, may give relief against the respondent as his employer, or named officers of the organisation acting in such a capacity.
It is against that background that the applicant makes the allegation that there has been an unlawful deduction from his wages. It was contended for the respondent that there can be no relief pursuant to the sections relied upon by the applicant against the Union or its members and that, accordingly, the cause of action itself has no basis.
I think that this is an instance where, as the respondent contends, the Federal Circuit Court of Australia has no jurisdiction; jurisdiction vests solely in the Federal Court of Australia, pursuant to the RO Act. The applicant relies upon ss.190, 286 and 287 of the RO Act, which vests jurisdiction in the Federal Court in respect of matters pertaining to ss.200, 206(3), 305 and 310. Furthermore, the applicant has no standing pursuant to ss.286 and 287. The respondent therefore contends that the application for Mareva relief must fail as the applicant has not demonstrated any jurisdiction on the part of the Court or any standing on his own behalf entitling relief.
The next matter concerns reinstatement. In that regard there is some contest as to whether there is a serious issue to be tried. I have already indicated that an issue seems to arise regarding the authorship of the letter central to the termination. Even if the applicant did not write the letter, notwithstanding the fact that he fails to identify a proper basis in his contentions, it appears that an argument may arise in relation to breach of a general protection if the Union did, as it says, act upon the letter in the belief that the applicant was the author. More particularly I note the protection provided to the applicant by operation of s.341(c)(i):
“Meaning of workplace right
Meaning of workplace right
(1) A person has a workplace right if the person:
…
(c) is able to make a complaint or inquiry:
(i) to a person or body having the capacity under a workplace law to seek compliance with that law or a workplace instrument; or
…”
The letter spoken of deals with matters which pertain to a workplace law and, if the respondents did seek to take action in the manner in which they did, it is certainly open to be found that the action taken against the applicant was adverse action: s.342(1), Item 1, Column 2. There is certainly a live issue as to whether there is sufficient causation between that adverse action and the exercise of the workplace right as required under s.340(1).
In my view, however, what is more significant in this case is the question of whether the applicant ought be granted the interim relief that is sought, being reinstatement. There is of course no doubt that the Court has the power to make interlocutory orders as it considers appropriate in respect of its exercise of power regarding alleged contraventions of the FW Act, and of course there is no question that those interlocutory powers extend to reinstatement.
The matters that might ordinarily be considered in that context were particularly addressed in the decision of Independent Education Union v Geelong Grammar School [2000] FCA 557. In that case Finkelstein J was considering an application for reinstatement on an interlocutory basis brought by a teacher (Dr Holden) at the Geelong Grammar School Timbertop Campus. He complained about employment conditions at the campus in question, and ultimately was terminated.
When the matter came on for interlocutory hearing, reinstatement was not only identified as an appropriate remedy, but in that instance was provided. In that case, commencing at [33], his Honour relevantly addressed the approach to considering the remedy of reinstatement on an interlocutory basis. He stated:
“[33] Having satisfied myself that Dr Holden has shown that there is a serious case that his dismissal was for a prohibited reason, the question arises whether he should be reinstated on a temporary basis. An essential factor in determining whether I should grant that relief is whether Dr Holden would suffer "irreparable harm" if denied relief. "Irreparable harm" is a phrase familiar in equity jurisprudence. It is taken to mean that the plaintiff must show that he is at some risk of injury which cannot be compensated or remedied other than through the grant of an interlocutory injunction. The rationale is well understood. If damages will provide adequate compensation and the defendant is in a position to pay them, then ordinarily there will be no justification in running the risk of an injunction pending trial.
[34] Here, however, it must be remembered that reinstatement is a remedy that is available to Dr Holden if he ultimately succeeds in his claim against the school. In the case of dismissal for a prohibited reason it might be taken to be accepted that, in the ordinary case, reinstatement is the appropriate remedy. It is true, as the High Court pointed out in Slonim v Fellows [1984] HCA 51; (1984) 154 CLR 505, that a court should act with some caution before it orders reinstatement because it is an interference with an employer's ordinary rights. But when the dismissal is for a prohibited reason, in particular a reason of the type mentioned in the provisions presently under consideration, the court should not be hesitant in granting the remedy in an appropriate case.”
There were a number of issues in that case which justified the awarding of that remedy which are not evident in this case. As I have already noted, there is a serious issue to be tried between the parties. I do not propose to express any view as to the final prospects of the claim at this time, beyond noting that such exists.
In this case I note that, unlike Independent Education Union v Geelong Grammar School, the circumstances do not involve a standard master-servant arrangement. As is evident from the material placed before me, the organisation in question is a trade union. It is a highly politically charged organisation. As the plaintiff himself explains in his earlier affidavit, there are significant factional issues that give rise to some of the relevant background to this application, although they may not be immediately apparent in the actual termination itself.
Although the applicant does not necessarily state that he has fallen out with the forces presently in control of the Union, the material suggests that there has been falling out somewhere. Such an inference seems to be clear when one has regard to the terms of the offending letter, which, as I have earlier noted, reads like a call or rally to arms.
It appears to me that the applicant has fallen from favour with those in positions of power in an organisation where power itself is often a matter of great moment. That itself is no justification for termination, but does mean that, were he to be reinstated, it would likely be only be a matter of time before he would find himself in the same position he confronts today.
Therefore the circumstances in Independent Education Union v Geelong Grammar School are readily distinguishable from the facts of this case. That observation highlights the point identified by Finkelstein J when he noted the requirement to identify any irredeemable or irreparable harm.
In that vein I also take into account the fact that in Independent Education Union v Geelong Grammar School Dr Holden was not only likely to find himself dismissed from his employment but also removed from his domestic circumstances. Dr Holden’s remuneration included accommodation for himself and his family. Had temporary relief not been granted there was a prospect that he would not only suffer loss of income but also an unnecessary dislocation of his family, as the school campus itself was a very remote and isolated one.
This is not an analogous circumstance. The applicant is in receipt of ongoing income protection insurance benefits which relate to his psychological disability. However, to some extent that is a double-edged sword for the purposes of this application. It means that he will suffer minimal or lesser damage than might otherwise be the case if he was not granted the interlocutory relief, and also presents the problem that, because he is eligible for the benefits of disability insurance, there can be no certainty as to when he would be fit to return to work.
That matter stands very much in favour of the respondent, which ought to be permitted to progress with its reorganisation (a matter which appears to have been the source of this dispute).
I am satisfied that damages in this instance would be an adequate remedy. Having regard to the nature of the organisation and its highly political characteristics, it is likely that if the applicant has been the subject of unlawful adverse action on the part of the respondent a better remedy for him would be damages, which would reflect not only the loss of income but also other losses by way of compensation also available to him under the FW Act.
I note that the applicant contends that he has been essentially a full time trade union employee for the last 20 years. He states that matter as one in his favour, contending that he will be disadvantaged in the labour market. But, as I have noted and as is obvious from the material placed before the Court, this is a highly politically charged workplace environment. No doubt a fall out with one group does not necessarily mean a fall out with all others. I leave that as a matter for further development at trial. That observation highlights the perpetual uncertainty that accompanies employment in such an environment. It suggests to me that there has always been the prospect of disruption to his long term employment, a factor which would ordinarily be taken into consideration.
In summary, having regard then to the matters considered, I have come to the view that the balance of convenience does not favour the granting of the interim relief sought by the applicant, and I propose to make no such orders. I remind the applicant that, as Finkelstein J noted in his reasons, the fact that reinstatement may not be ordered on a temporary basis does not deny that matter as a form of final relief in the event that the evidence demonstrates it to be the proper course after trial.
I certify that the preceding forty-one (41) paragraphs are a true copy of the reasons for judgment of Judge Burnett
Date: 11 December 2013
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