Sections 348 and 355
121 It is convenient to deal with ss 348 and 355 together as they both employ the concept of threatening to take action against a person with intent to coerce that person.
122 Section 348 of the FW Act is in the following terms:
A person must not organise or take, or threaten to organise or take, any action against another person with intent to coerce the other person, or a third person, to engage in industrial activity.
Note: This section is a civil remedy provision (see Part 4-1).
123 Section 347 defines the circumstances in which a person engages in industrial activity and, on the applicant's case, the relevant paragraph is s 347(b)(iv), being compliance with a lawful request or requirement that BNC employ Mr Clark.
124 Relevant to this case, the elements of the alleged contravention of s 348 are as follows:
(1) a threat to take action against BNC;
(2) with intent to coerce BNC; and
(3) to comply with a lawful request of the CFMEU to employ Mr Jason Clark.
125 Section 355 of the FW Act relevantly provides as follows:
A person must not organise or take, or threaten to organise or take, any action against another person with intent to coerce the other person, or a third person, to:
(a) employ, or not employ, a particular person;
…
Note: This section is a civil remedy provision (see Part 4-1).
126 Relevant to this case, the elements of the alleged contravention(s) of s 355 are as follows:
(1) a threat to take action against BNC;
(2) with intent to coerce BNC; and
(3) to employ Mr Jason Clark or not to employ Mr Dan Hylands or both.
127 The applicant relies on the presumption in s 361 of the FW Act. That section relevantly provides:
(1) If:
(a) in an application in relation to a contravention of this Part, it is alleged that a person took, or is taking action for a particular reason or with a particular intent; and
(b) taking that action for that reason or with that intent would constitute a contravention of this Part;
it is presumed that the action was, or is being, taken for that reason or with that intent, unless the person proves otherwise.
128 In this case, the applicant's case is that the respondents threatened to take action and, on the face of it, such an allegation does not engage s 361. Jessup J noted the difference between taking action and threatening to take action in Director of Fair Work Building Industry Inspectorate v Construction, Forestry, Mining and Energy Union (The Red and Blue Case) [2015] FCA 1125; (2015) 254 IR 200 where he said (at [111]):
In making findings as to Mr Edwards' intent on 14 June 2013, I have placed no reliance on s 361 of the FW Act. In the submissions made on behalf of the applicant, it was treated as self-evident that s 361 applied to so much of s 355 as dealt with the matter of intent. Although counsel for the respondents said nothing on the subject, I regard the position as unclear at best. Section 355 makes a distinction between organising and taking action, on the one hand, and threatening to do so, on the other hand. Section 361 applies only to the mental element involved in taking action. In terms, it does not apply to a threat to take action. Historically, the prohibitions now to be found in s 355 were located in s 43 of the Building and Construction Industry Improvement Act 2005 (Cth) ("the BCII Act"). Their antecedents were not in Pt 16 of the Workplace Relations Act 1996 (Cth) ("the WR Act"), to which the reverse onus provision, then s 809, applied. No such provision applied to s 43 of the BCII Act. Section 361 now does apply to s 355, of course, but its extension beyond its actual terms, ie to threats, would be more than a mere continuation of a pre-existing legislative regime. It would be law reform of a kind which went unmentioned in the relevant Explanatory Memorandum. The result of applying s 361 as proposed by the applicant would, of course, be to expose a respondent to penal liability in a case in which the relevant applicant had not independently proved the facts relied on. Before taking such a step, and in the face of the plain language of s 361, I would require a more definite indication of legislative intention than the history of the legislation, and the parliamentary materials, disclose.
With respect, I agree with his Honour's reasoning and will take the same approach. Other judges of the Court have also taken the same approach: Australian Building and Construction Commissioner v Parker [2017] FCA 564; (2017) 266 IR 340 at [105] (Flick J); Australian Building and Construction Commissioner v Upton (The Gorgon Project Case) [2017] FCA 847 at [119] (Barker J); Construction, Forestry, Mining and Energy Union v De Martin & Gasparini Pty Ltd (No 2) [2017] FCA 1046 at [364] (Wigney J); Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union (The Quest Apartments Case) [2017] FCA 1398 at [70] (Tracey J).
129 The meaning of "coerce" has been considered in a number of authorities. In Seven Network (Operations) Ltd v Communications, Electrical, Electronic, Energy, Information, Postal, Pluming and Allied Services Union of Australia and Others [2001] FCA 456; (2001) 109 FCR 378, Merkel J said (at [41]-[42]):
The above cases establish that there must be two elements to prove "intent to coerce" under s 170NC(1). First, it needs to be shown that it was intended that pressure be exerted which, in a practical sense, will negate choice. Second, the exertion of the pressure must involve conduct that is unlawful, illegitimate or unconscionable. The requirement that the pressure exerted be unlawful, illegitimate or unconscionable must be considered in the context of the scheme of the Act and of the fact that, subject to the immunity in respect of protected industrial action under s 170MT of the Act, many forms of industrial action are unlawful: see Ansett Transport Industries (Operations) Pty Ltd v Australian Federation of Air Pilots [1991] 1 VR 637.
The requirement of unlawfulness etc might, in a sense, be said to have been superimposed upon the ordinary meaning of "coercion": cf Hanley at [11]. However, without such a requirement s 170NC(1) could have an anomalous operation in so far as it might prevent the legitimate exercise of rights by employees or employers. In Hanley the Full Court did not really consider this issue. In all the circumstances I consider that it is appropriate to apply the approach taken to s 170NC(1) in Cadbury Schweppes, Finance Sector Union and Qenos unless I am satisfied that that approach is clearly wrong, which I am not.
130 In National Tertiary Education Industry Union v Commonwealth of Australia and Another [2002] FCA 441; (2002) 117 FCR 114, Weinberg J considered the meaning of "intent to coerce" in s 170NC of the Workplace Relations Act 1996 (Cth). His Honour said (at [97] and [103]):
With regard to the second issue to be determined, in my view the expression "intent to coerce" should be construed as requiring something more than a mere inducement to comply. The term "coercion" connotes something akin to the use of force, or at least the threat of harm to the interests of another.
The approach to the expression "intent to coerce" taken in each of the authorities set out above makes it clear that what is required is an intent to negate choice, and not merely an intent to influence or to persuade or induce. Coercion implies a high degree of compulsion, at least in a practical sense, and not some lesser form of pressure by which a person is left with a realistic choice as to whether or not to comply.
131 In Esso Australia Pty Ltd v Australian Workers' Union [2016] FCAFC 72; (2016) 245 FCR 39, Buchanan J (with whom Siopis J agreed) considered the meaning of intent to coerce in s 348 of the FW Act. His Honour noted by reference to a number of authorities to which he referred that coercion had been held to involve proof of two elements, being the negation of choice and the use of unlawful or illegitimate or unconscionable means (at [174]). As to the second element, his Honour said that it was not necessary to establish that a person intended to act unlawfully, illegitimately or unconscionably and nor was it a defence to show that a person believed that their action would be lawful, legitimate or not unconscionable (at [176]). His Honour summarised his conclusion as to the second element as follows (at [194]):
… The requirement of intent applies to the purpose of negating choice. The additional element that the means employed be unlawful, etc. involves an objective test. That approach is consistent with the common law origins of the notion of coercion which can be traced back to the tort of economic duress, as explained in the cases to which I referred earlier. In that common law context, the notion of purpose, or intent, applies to the first element but not the second. There is no reason to think that the statutory adoption of the common law concept has altered its nature. …
132 On appeal, the High Court reached the same conclusion (Esso Australia Pty Ltd v The Australian Workers' Union [2017] HCA 54). Kiefel CJ, Keane, Nettle and Edelman JJ (with whom Gageler J agreed on this point at [65]) said at [2]:
The AWU's appeal relates to coercive conduct of the kind proscribed by ss 343 and 348 of the Fair Work Act. The question is whether, in order to amount to organising or taking, or threatening to organise or take, action against another person with intent to coerce the other person within the meaning of s 343 or s 348, the person organising, taking or threatening the action must do so with intent that the action be unlawful, illegitimate or unconscionable. The answer to that question is that a contravention of s 343 or s 348 is constituted of organising, taking or threatening action against another person with intent to negate the other person's choice. It is unnecessary that the person organising, taking or threatening the action know that the action is, or intend that the action be, unlawful, illegitimate or unconscionable. The AWU's appeal should thus be dismissed.
Later their Honours said (at [61]):
… Either way, it is clear that a person taking coercive action need not have an accurate appreciation of the legal nature of the action. As Gleeson CJ said in Electrolux Home Products Pty Ltd v Australian Workers' Union in relation to s 170NC of the Workplace Relations Act, it was sufficient to establish an intent to coerce to demonstrate that the person organising, taking or threatening the action intended it to negate the other person's choice and that the person organising, taking or threatening the action had actual knowledge of circumstances that made his or her conduct coercive:
"The elements of the conduct prohibited by s 170NC, so far as presently relevant, are action, or threats of action, with intent to coerce another to agree, or not to agree, to the making of an agreement under Div 2 or Div 3. An accurate appreciation of the legal nature of the agreement in question is not an element of the intent required by s 170NC."
The fact that a person may be acting under a mistake of law as to whether industrial action is protected industrial action is no more relevant than would be the fact that the person neither knew nor cared whether the industrial action was protected industrial action. The same applies to ss 343 and 348 of the Fair Work Act.
(Citations omitted.)
133 The threat of going to war was a threat of unlawful, illegitimate, unconscionable action, that is, to take a form of industrial action and would be reasonably understood as such. I adopt the same approach as that adopted by Mansfield J in the Contempt Proceedings (see [34] above). The respondents submitted that the war comment may have meant no more than that the CFMEU would commence proceedings for all infractions of industrial laws concerning its members which related to BNC, no matter how minor. In my opinion, that ignores the context in which the war comment was made which is all important. I refer to the findings which I have made. There were a number of conversations in the weeks and days before 13 May 2014 when the employment of Mr Clark and the termination of Mr Hylands' employment was raised. Before the war comment was made, Mr Bleasdale made it clear to Mr O'Connor and Mr Merkx that he was not going to accede to their demands. I infer an intent to coerce on the part of Mr O'Connor, particularly as Mr Bleasdale had made it clear that he was not going to accede to the demands made. The conduct fell within the terms of s 348 (and s 347(b)(iv)).
134 Mr O'Connor's threat also fell within the terms of s 355 of the FW Act. As I understand it, the applicant alleges that there were two contraventions of s 355, one in relation to the threat seeking the employment of Mr Clark, and the other in relation to the threat seeking the termination of Mr Hylands' employment.
135 In my opinion, the applicant's submission is correct. The subject-matter of the conversation was the employment of Mr Clark and the termination of Mr Hylands' employment and the suggestion was even made that Mr Clark replace Mr Hylands. Even though the war comment was preceded by the words, "If you don't find him a job", the context indicates that the threat related to the employment of Mr Clark and the termination of Mr Hylands' employment.
136 The CFMEU is also liable for Mr O'Connor's contraventions of ss 348 and 355 by reason of the operation of ss 363 and 793 of the FW Act. The parties focused on s 793. The respondents admitted the following in its Further Amended Defence (Defence):
21. The CFMEU denies the allegations in paragraph 21, save that it admits that to the extent that O'Connor or Merkx admit conduct or a state of mind or are found to have engaged in conduct or to have had a state of mind by this Honourable Court, that any such conduct or state of mind is taken to be the conduct or state of mind of the CFMEU pursuant to section 793 of the FW Act.
(A similar plea is made in relation to s 363 and in relation to the alleged contravention of s 355.)
137 The CFMEU is liable for contraventions of ss 348 and 355.
138 The applicant alleges that Mr Merkx also contravened ss 348 and 355 as a principal contravener because he acted in concert with Mr O'Connor. In the alternative, he was a person involved in the contraventions under s 550 of the FW Act.
139 As I understood it, Mr Merkx submitted that the applicant has not pleaded that he was a principal contravener of ss 348 and 355. It is not pleaded (so the submission goes) that Mr Merkx said anything that could be construed as a threat within ss 348 and 355. The threat was the "war comment" and that statement was made by Mr O'Connor.
140 It is true that the applicant pleads that Mr O'Connor made the war comment and that it is that comment which, on the applicant's case, constituted the threat. However, that does not mean that, if the circumstances warrant it, a conclusion cannot be drawn that Mr Merkx was a joint contravener of the sections with Mr O'Connor. Such a conclusion is within the terms of the applicant's Statement of Claim.
141 In my opinion, the circumstances warrant a conclusion that Mr Merkx was a principal contravener because he acted in concert with Mr O'Connor. On the findings I have made, Mr O'Connor and Mr Merkx were concerned about the union status of BNC's employees. Mr Merkx raised that issue with Mr Bleasdale. More particularly, they wanted BNC to employ Mr Clark who was on the CFMEU executive and they wanted the termination of Mr Hylands' employment because he would not join the CFMEU. Each of them approached Mr Bleasdale before 13 May 2014 about one or more aspects of this plan. It was Mr Merkx who "did the talking" when they first approached Mr Bleasdale on 13 May 2014. At the meeting at approximately 12.15 pm, both Mr Merkx and Mr O'Connor fully participated in the discussion which took place. In fact, Mr Merkx made the opening comments. In my opinion, the inference is irresistible that each fully endorsed the comments made by the other. That is how the discussion proceeded and neither qualified what the other had said. In those circumstances, in my opinion, both Mr O'Connor and Mr Merkx are principal contraveners of ss 348 and 355 of the FW Act.
142 If I am wrong in holding that Mr Merkx was a principal contravener, I would find him liable as a person involved in the contraventions under s 550. In my opinion, he participated in the relevant acts with the necessary knowledge so as to make him a person involved (Yorke and Another v Lucas [1985] HCA 65; (1985) 158 CLR 661; Rural Press Limited and Others v Australian Competition and Consumer Commission [2003] HCA 75; (2003) 216 CLR 53; Rafferty and Another v Madgwicks [2012] FCAFC 37; (2012) 203 FCR 1 at [249]-[254]).
143 On the face of it, the CFMEU is responsible for Mr Merkx's conduct in the same way it is responsible for Mr O'Connor's conduct. However, a question arises as to whether the CFMEU is responsible for two contraventions of s 348 and four contraventions of s 355, or one contravention of s 348 and two contraventions of s 355. Unlike the facts in Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union (No 3) [2017] FCA 10, in this case there was only one threat. In my opinion, the latter is the correct position in those circumstances.