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Stuart-Mahoney v Construction, Forestry, Mining and Energy Union

Stuart-Mahoney v Construction, Forestry, Mining and Energy Union

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FEDERAL COURT OF AUSTRALIA
Stuart-Mahoney v Construction, Forestry, Mining and Energy Union [2008] FCA 1426
INDUSTRIAL RELATIONS – penalty hearing – admitted contraventions – civil penalty provisions – relevant considerations in determining appropriate penalty – penalty determined
WORDS AND PHRASES – ‘unlawful industrial action’, ‘involved’
Building and Construction Industry Improvement Act 2005 (Cth) ss 3, 36, 37, 38, 43, 48, 49, 69
Mornington Inn Pty Ltd v Jordan (2008) 247 ALR 714
Kelly v Fitzpatrick (2007) 166 IR 14
Trade Practices Commission v CSR Ltd [1991] ATPR 52,135 (41-076)
Construction, Forestry, Mining and Energy Union v Coal and Allied Operations Pty Ltd (No 2) (1999) 94 IR 231
Hadgkiss v Aldin (2007) 164 FCR 394
Furlong v Australian Workers Union (2007) 162 IR 171
Carr v Communications, Electrical, Electronic, Engineering, Information, Postal, Plumbing and Allied Services Union of Australia [2007] FMCA 1526
Cruse v Construction, Forestry, Mining and Energy Union [2007] FCA 1873
Leighton Contractors Pty Ltd v Construction, Forestry, Mining and Energy Union (2006) 164 IR 375
Australian Competition and Consumer Commission v IPM Operations Maintenance Loy Yang Pty Ltd (No 2) [2007] FCA 11
Finance Sector Union v Commonwealth Bank of Australia (2005) 147 IR 462
Australian Competition and Consumer Commission v ABB Transmission and Distribution Ltd [2001] ATPR 41-815
Australian Opthalmic Supplies Pty Ltd v McAlary-Smith (2008) 165 FCR 560
Australian Competition and Consumer Commission v Australian Safeway Stores Pty Ltd (1997) 145 ALR 36
Ponzio v B & P Caelli Constructions Pty Ltd (2007) 158 FCR 243
KAREN STUART-MAHONEY v CONSTRUCTION, FORESTRY, MINING AND ENERGY UNION, JOHN PARKER and CHARLES CORBETT
VID 1323 OF 2006
TRACEY J
19 SEPTEMBER 2008
MELBOURNE

IN THE FEDERAL COURT OF AUSTRALIA

VICTORIA DISTRICT REGISTRY

VID 1323 OF 2006

BETWEEN:

KAREN STUART-MAHONEY
Applicant

AND:

CONSTRUCTION, FORESTRY, MINING AND ENERGY UNION
First Respondent

JOHN PARKER
Second Respondent

CHARLES CORBETT
Third Respondent

JUDGE:

TRACEY J

DATE OF ORDER:

19 SEPTEMBER 2008

WHERE MADE:

MELBOURNE

THE COURT DECLARES THAT:
1.Between 6 October 2005 and 12 October 2005 each of the respondents contravened s 38 of the Building and Construction Industry Improvement Act 2005 (Cth) by engaging in unlawful industrial action (being the imposition of an overtime ban).
2.Between 6 October 2005 and 12 October 2005 each of the respondents contravened s 43 of the Building and Construction Industry Improvement Act 2005 (Cth) by organising action (being the imposition of an overtime ban) with intent to coerce Hooker Cockram Projects Ltd to engage a person as a building employee.

THE COURT ORDERS THAT:
1.A penalty of $20,000.00 be imposed on the first respondent for contravening s 38 of the Building and Construction Industry Improvement Act 2005 (Cth).
2.A penalty of $35,000 be imposed on the first respondent for contravening s 43 of the Building and Construction Industry Improvement Act 2005 (Cth).
3.A penalty of $2,000 be imposed on the second respondent for contravening s 38 of the Building and Construction Industry Improvement Act 2005 (Cth).
4.A penalty of $6,000 be imposed on…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2008] FCA 1426
Decision Date: 19 September 2008

CaseChat Overview and Summary

In Stuart-Mahoney v Construction, Forestry, Mining and Energy Union, the court considered penalties against the CFMEU and two of its officials for their actions in organising an overtime ban at a construction site. The CFMEU and its officials were found to have contravened sections 38 and 43 of the Building and Construction Industry Improvement Act 2005 (Cth). The legal issues before the court were whether the actions of the CFMEU and its officials warranted a penalty and, if so, the appropriate amount of that penalty.

The court found that the overtime ban imposed by the CFMEU and its officials was serious and designed to coerce the employer to meet employment requirements, rather than pursuing lawful alternatives such as negotiations or dispute resolution. The ban resulted in no work being done on the project for six working days, which the court deemed to be a significant disruption. The court also noted that the conduct was deliberate and that the CFMEU had not exhibited contrition or taken corrective action. The court considered these factors along with the need for compliance, specific deterrence, and general deterrence in determining the penalty.

The court ultimately imposed penalties on the CFMEU and the two officials. The CFMEU was fined $55,000, with $20,000 for the contravention of section 38 and $35,000 for the contravention of section 43. The two officials were fined $8,000 each, with $2,000 for the contravention of section 38 and $6,000 for the contravention of section 43. The court suspended the penalties for one year on the condition that the CFMEU did not breach the relevant acts again within that period. If the condition was met, the penalties would not have to be paid. Each party was ordered to bear their own costs.

Orders

Orders of the court

1. A penalty of $20,000.00 be imposed on the first respondent for contravening s 38 of the Building and Construction Industry Improvement Act 2005 (Cth).

2. A penalty of $35,000 be imposed on the first respondent for contravening s 43 of the Building and Construction Industry Improvement Act 2005 (Cth).

3. A penalty of $2,000 be imposed on the second respondent for contravening s 38 of the Building and Construction Industry Improvement Act 2005 (Cth).

4. A penalty of $6,000 be imposed on the second respondent for contravening s 43 of the Building and Construction Industry Improvement Act 2005 (Cth).

5. Paragraphs 3 and 4 of these orders be wholly suspended for 12 months from the date of these orders. If the second respondent is not found to have breached any provision of the Building and Construction Industry Improvement Act 2005 (Cth) or the Workplace Relations Act 1996 (Cth) as a result of conduct occurring within 12 months of the date of these orders he shall not be obliged to pay the penalties.

6. Subject to paragraph 5, the penalties imposed in paragraphs 1 - 4 of these orders be paid into the Consolidated Revenue Fund within 30 days.

7. Each party bear his or its own costs in relation to the proceeding.

Background

Background to the litigation

The term “action” in s 43(1) is not defined. Importantly, it is not limited to “building industrial action”. The prohibition extends to organising or taking any action where there is an intention to coerce another to engage in the conduct referred to in paragraphs (a) – (d). The intention of the respondent, in imposing the overtime ban, was clearly to ensure that the Employment Requirements were met. By organising the meeting of workers on 6 October 2005 and ensuring the continuation of the overtime ban until the Employment Requirements were met, Parker and Corbett clearly contravened s 43 of the BCII Act. Pursuant to s 69(1)(b) and s 69(1)(d), this conduct is taken to be conduct of the CFMEU. Therefore, the CFMEU also contravened s 43(1). BACKGROUND TO THE CONTRAVENTIONS In about June 2001, the Victorian government published a document entitled “Framework for the Future” which raised concerns about the persistently high levels of unemployment in the Latrobe Valley and announced a number of forthcoming works, including the works that became the project, aimed at developing skills in the region. July 2004 meeting On or about 21 July 2004, before work on the project had commenced, representatives of Hooker Cockram met with Parker and Mr Martin Kingham (Branch Secretary of the CFMEU Construction and General Division, Victorian Building Unions Divisional Branch) pursuant to the pre-start meeting provision of the Collective Agreement. Parker, apparently with the Framework for the Future document in mind, requested that apprentices be engaged on the project. It is an agreed fact that the issue of engaging apprentices on the project was discussed at the meeting. The parties are at odds about what was agreed during these negotiations. It appears that these differences did not become apparent until September 2005 when there was no longer an apprentice engaged at the site. From the commencement of the project until September 2005, an apprentice was engaged on the project by one of Hooker Cockram’s sub-contractors, Clifton Formwork Pty Ltd. In late September 2005, the work of Clifton Formwork was coming to an end and the apprentice was removed from the project. On 28 September 2005, Parker, Corbett and Mr Ray Wilson, a CFMEU Occupational Health and Safety Representative, met with the Construction Manager of Hooker Cockram, Mr Jeff Owen. The parties agree that: ·Parker told Owen that Hooker Cockram had broken an agreement to have apprentices employed on the site for the whole period of the project; ·Owen said that Hooker Cockram disputed that such an agreement existed and advised Parker that it had agreed only to encourage its sub-contractors to engage apprentices; and ·Parker did not accept Hooker Cockram’s position and said that he would call a meeting of workers on the site over the issue. Overtime ban On 6 October 2005, Parker and Corbett held a meeting of all workers at the project site to discuss the lack of apprentices working on the site. It is an agreed fact that Parker and Corbett raised for consideration, encouraged and supported a decision of the meeting that there be an overtime ban from that evening, which was to continue until Hooker Cockram agreed to the Employment Requirements (see paragraph [16] above).

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

TRACEY J

Full text does not contain this section.

Ratio Decidendi

Legal Principle Established

Established by: TRACEY J

The respondents submit that no penalty should be imposed against any of the respondents but do not oppose the Court making the declarations sought by the applicant. CONSIDERATION In Kelly v Fitzpatrick (2007) 166 IR 14 I set out a non-exhaustive range of considerations to which regard may be had in determining whether conduct calls for a penalty, and if so, the amount of such penalty. These considerations were derived from a number of decisions of this Court including Trade Practices Commission v CSR Ltd [1991] ATPR 52,135 (41-076) (which concerned contraventions of the Trade Practices Act 1974 (Cth)) and Construction, Forestry, Mining and Energy Union v Coal and Allied Operations Pty Ltd (No 2) (1999) 94 IR 231 (which concerned contraventions of Part XA of the WR Act). 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. cf Hadgkiss v Aldin (2007) 164 FCR 394 at [61]; Furlong v Australian Workers Union (2007) 162 IR 171 at [7] – [10]; Carr v Communications, Electrical, Electronic, Engineering, Information, Postal, Plumbing and Allied Services Union of Australia [2007] FMCA 1526 at [7]; and Cruse v Construction Forestry Mining and Energy Union [2007] FCA 1873 at [71].The nature and extent of the conduct The overtime ban meant that no work was performed on the project after 3.30 pm on any working day from Thursday 6 October 2005 to Wednesday 12 October 2005 - a total of six working days. The ban was only lifted once Hooker Cockram had agreed to meet the Employment Requirement, after being told three times that the ban would not be lifted until the Employment Requirement was met. In my view the conduct was serious and was designed to coerce Hooker Cockram (or, through it, one of its sub-contractors) to meet the Employment Requirement. The ban was imposed in preference to alternative, lawful, actions such as negotiations or resort to dispute resolution procedures which were available to the CFMEU and its members. Circumstances in which the conduct took place

IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY	VID 1323 OF 2006

JUDGE:	TRACEY J
DATE OF ORDER:	19 SEPTEMBER 2008
WHERE MADE:	MELBOURNE