Case: Leighton Contractors Pty Ltd v Construction, Forestry, Mining and Energy Union (2006) 164 IR 375
Outcome: considered
Sections 48 and 49 were both located in Chapter 7 of the BCII Act. Section 2 of that Act provided that the chapter was to commence on the date of Royal Assent. If, as has been assumed, s 49 applied to the Second Strike action, it is difficult to see why s 48 should not also have applied. However the respondents submitted that the decision of Le Miere J in Leighton Contractors Pty Ltd v Construction, Forestry, Mining and Energy Union (2006) 164 IR 375 established that s 48 did not apply to conduct occurring prior to 12 September 2005, although his Honour appears to have accepted that s 49 did apply. 26 The applicant accepted that s 48 had no application for present purposes but asserted that the respondents had admitted the alleged contraventions, and that the precise basis for treating Mr Powell, the CFMEUW and the CFMEU as having contravened s 38 was not in dispute. The applicant also submitted that the common law concerning accessorial liability would fill any "lacuna" caused by the absence of a provision such as s 48. 27 The respondents have not sought to withdraw any of the admissions contained in the statement of agreed facts. I propose to dispose of the matter upon the basis of such facts. However, in identifying the seriousness of the conduct alleged against each respondent it will be necessary to say something about accessorial liability. Because the question has been ventilated at length, I will first address the question of whether s 49 applied to the conduct of the first, second and fourth respondents in connection with the Second Strike action. As the applicant has not relied upon s 48, it is not necessary to consider its application for present purposes. 52 In Leighton at [30], Le Miere J set out these passages and observed: In my opinion, convening and conducting a meeting of workers during working hours might, but will not necessarily, constitute a ban, limitation or restriction on the performance of building work and hence be building industrial action. Such conduct is capable of constituting a "ban, limitation or restriction on the performance of building work" if its purpose is to prevent or deter or discourage employees from performing building work and it purports to be at least hortatory, if not authoritative and binding, upon the person or persons to whom it is directed. In this way relevant building industrial action may be committed by a person other than an employer or employee. 53 As to the requirement that the relevant conduct was "constitutionally-connected action", that term was defined in s 36 to mean: ... building industrial action that satisfies at least one of the following conditions: (a) the action is taken by an organisation; (b) the action is taken by a constitutional corporation, or adversely affects a constitutional corporation in its capacity as a building industry participant; (c) the action is taken in connection with an industrial dispute; (d) the action relates to work that is regulated by a Commonwealth industrial instrument; (e) the action relates to the negotiation, proposed negotiation, or making or proposed making, (as relevant), of a collective agreement under Division 2 of Part 8 of the Workplace Relations Act ; (f) the action occurs in a Territory or Commonwealth place. 54 In the present case the applicant claimed that the Second Strike action was constitutionally connected, having been taken by the CFMEU (an organization for the purposes of para (a) of the definition), and it having adversely affected AGC (a constitutional corporation) in its capacity as a building industry participant. However para (a) would only have applied if the relevant action were taken by the CFMEU. I proceed upon the basis that para (b) applied. 55 In para 34 it is agreed that the strike on 25 August 2005 was unlawful industrial action, and that Mr Powell, in conducting the meeting and taking the vote, "aided the workers to engage in" such unlawful industrial action in contravention of s 38. Paragraph 36 seems to assert that the actions referred to in paras 33 to 35 were not authorized by AGC. Those actions included the raising of issues at the authorized meeting held on 24 August 2004. It is not clear to me that such matters were necessarily unlawful. I proceed upon the basis that the relevant unlawful industrial action was the failure to attend for work, or to perform work, on 25 August 2005, and that Mr Powell "aided" the workers to engage in such action by his conduct at the meeting. It is agreed that he thereby contravened s 38. It is also agreed that the CFMEU and the CFMEUW engaged in such action and similarly contravened s 38. Whatever the true state of the law may be with respect to accessorial liability at common law, it is not necessary for me to take that matter further, given these admissions. 56 The applicant identified the following relevant considerations in fixing penalties: (a) the nature of the unlawful industrial action found to have occurred; (b) the circumstances in which the relevant conduct took place (including whether the conduct was undertaken in deliberate defiance or disregard of the Act); (c) the likely deterrent effect (both specific and general) of any civil penalty imposed; (d) the consequences of the conduct found to be in contravention of the BCII Act, both in terms of the amount of loss or damage caused, if any, and less tangible effect on the building and construction industry and public generally; (e) the period over which the contraventions extended; (f) the extent of co-operation with regulatory authorities and any acknowledgment of wrong doing; (g) the need to give effect to the statutory purposes underpinning the BCII Act and the relevant parts of the WR Act; (h) whether the contraventions involved or were directly attributable to the conduct of senior management; (i) the Respondents' past record of statutory contraventions and other conduct in industrial relations; (j) if the contravention involved an association or organization, the size of that association or organization; (k) A building association's corporate culture; and, (l) the financial position of each of the Respondents (if the evidence suggests that they will personally pay any penalty that is imposed). 61 I have previously referred to the decision in Leighton. That case involved alleged breaches of s 38 of the BCII Act. The three respondents were, I understand, the CFMEU, the CFMEUW and Mr McDonald, although this is not entirely clear from the report of the case. Mr McDonald conducted meetings at which industrial action was considered. The relevant industrial action was the holding of the meetings during working hours and subsequent bans and strikes. I note that there were eighteen infringements by the CFMEU and five by the CFMEUW. Mr McDonald committed sixteen infringements. The industrial action extended over a longer period of time than did the presently relevant conduct. 62 The respondents have other industrial "background". The applicant pointed to the decision in Cruse v CFMEU [2007] FMCA 1873. In that case the CFMEU was found to have breached s 38 in connection with an unlawful strike lasting two and a half days. In Australian Competition and Consumer Commissioner v CFMEU [2006] FCA 1730 ; [2007] ATPR 42-140 all four of the present respondents were found to have engaged in secondary boycott action by preventing or hindering the supply of concrete to a site by forming a picket line at the gate. Both Mr McDonald and Mr Powell have had their rights of entry revoked or suspended because of their conduct in connection with the exercise of such rights. The applicant asserts that the CFMEU has, on numerous occasions, been found to have contravened other provisions of industrial legislation involving coercive behaviour and false and misleading statements, advising or organising action with intent to coerce an employer and breaching orders. Unfortunately, save in the case of the Leighton matter, I was not told whether this conduct occurred before or after that with which I am present concerned. In Leighton , the relevant conduct occurred in March 2005. Normally, only conduct preceding that in question is taken into account in fixing penalties. In any event, although the respondents have apparently engaged in prior industrial misconduct, I have insufficient information to justify my according great weight to such misconduct. 70 The penalties imposed in Leighton offer a convenient starting point for present purposes. Because of the more extensive misconduct in that case, the penalties in this case should be lower. In Leighton the relevant conduct was all contrary to s 38 of the BCII Act. For that reason, and because the maximum penalty for such a breach is higher than those for the WR Act infringements, I will commence by considering the penalties for the infringements of s 38. Mr McDonald was not involved in this aspect of the case. 71 In Leighton the penalty imposed on Mr McDonald was $30,000 against a maximum penalty of $22,000 for each infringement. The applicant suggested that in this case a penalty of $2,500 should be imposed on Mr Powell. The respondents suggested a penalty of $1,000, fully suspended for a period of six months. In other words no penalty would be payable in the event that Mr Powell behaved himself for that period. This approach may have been partially motivated by the view that there was really only one course of unlawful conduct. I find it difficult to take such an indulgent view of Mr Powell's conduct, given that he had some previous history of disobedience to industrial law, and that, as I infer, the second strike imposed additional disruption upon AGC. The substantial penalty imposed upon Mr McDonald in Leighton also dictates something more than a merely nominal penalty in this case. The two unions also have previous histories of industrial misconduct. For each of them the maximum penalty is $110,000. In Leighton the CFMEUW was treated as being less involved in the contraventions than was the CFMEU. This may have reflected the fact that the CFMEU had acknowledged eighteen contraventions whilst the CFMEUW had acknowledged only five. The Court imposed a penalty of $30,000 upon the CFMEUW for those five infringements. In this case, the applicant suggested a penalty of $20,000 for each union. The respondents submitted that a penalty of $5,000, fully suspended, was appropriate. I do not agree. There was nothing trivial about the misconduct in question. I see no real basis for distinguishing between the CFMEU and the CFMEUW. 72 The applicant's recommendation of a penalty of $2,500 for Mr Powell is, in my view, at the lower end of the appropriate range. I adopt it, subject to any adjustment which may be necessary after I have considered the appropriate penalty for him in connection with the First Strike action. The penalties imposed on the CFMEU and CFMEUW should be roughly equivalent to that imposed upon Mr Powell but adjusted, having regard to the higher maximum penalty. I see no reason for treating the two unions as being more or less culpable than was Mr Powell. Subject to the possibility of adjustment for overall effect I fix the penalty at $12,000 in each case. 73 I turn to the First Strike action. It led to a two day strike and involved a much larger number of men, serving a wider range of employers, than did the later strike. It was, in that sense, more serious. On the other hand, in the case of Mr McDonald, it was the only action in which he was involved. The maximum penalties under the WR Act are substantially lower than those under the BCII Act. For Messrs Powell and McDonald the maximum penalty for a breach of s 170MN is $6,600. The maximum for the CFMEU is $33,000. In the case of a corporation, the maximum penalty for a breach of s 178 is $49,500. It is important to keep in mind that the conduct constituting the CFMEU's breach of s 170MN was the same as that constituting its breach of s 178. 76 Turning to Messrs Powell and McDonald, the applicant submitted that in Mr Powell's case, the penalty should be $2,500 and in Mr McDonald's, $4,000. The respondents submitted that each should receive a penalty of $1,500 of which two-thirds should be suspended for a period of six months. The distinction between the treatment of Mr McDonald and that of Mr Powell is presumably based upon Mr McDonald's involvement in the Leighton matter and the rather more serious circumstances surrounding the revocation of his entry permits as compared to those surrounding the suspension of Mr Powell's permits. As I have said, it may be unfair and unwise to place much reliance upon the latter matter, given absence of any knowledge concerning the dates of the relevant misconduct. With regard to the Leighton matter, I must keep in mind the fact that Mr McDonald had not been dealt with for such conduct at the time of the First Strike action. However I am inclined to accept that Mr McDonald has a somewhat worse record than does Mr Powell. 77 I do not accept that Mr Powell's infringement of s 170MN (with a maximum penalty of $6,600) should attract the same penalty as his infringement of s 38 of the BCII Act (with a maximum penalty of $22,000). It is true that the first strike was more serious than the second. More employers and employees were involved, and the strike was for two days rather than one. On the other hand, Mr Powell engaged in the Second Strike action knowing that he had previously engaged in the First Strike action, and probably intending to aggravate the effects upon AGC of the earlier strike. These considerations will be best reflected by my imposing a penalty of $1,000 upon Mr Powell in connection with the First Strike action. In the case of Mr McDonald, a penalty of $1,500 is appropriate. Thus, the penalties which I have provisionally fixed are: s 170MN s 178 s 38 Total Mr Powell $1,000 Nil $ 2,500 $ 3,500 CFMEUW Nil Nil $12,000 $12,000 Mr McDonald $1,500 Nil Nil $ 1,500 CFMEU $1,000 $5,000 $12,000 $18,000 78 Having considered the overall conduct of the various respondents and all other material facts, I see no reason to make any further adjustment to these figures. I also see no reason for suspending any of the penalties.