Australian Building and Construction Commissioner v Parker

Australian Building and Construction Commissioner v Parker - [2017] FCA 1082 - FCA 2017 case summary — Zoe

[9]

The principles to be applied 4 The principles to be applied when imposing penalties are well settled. They need not be recanvassed in any great detail. 5 It is sufficient for present purposes to again emphasise that the purpose sought to be achieved by the imposition of penalties, of the kind presently in issue, remain those identified by French J (as his Honour then was) in Trade Practices Commission v CSR Ltd (1991) ATPR ¶41-076. His Honour there observed (at 52,152): Punishment for breaches of the criminal law traditionally involves three elements: deterrence, both general and individual, retribution and rehabilitation. Neither retribution nor rehabilitation, within the sense of the Old and New Testament moralities that imbue much of our criminal law, have any part to play in economic regulation of the kind contemplated by Pt IV. Nor, if it be necessary to say so, is there any compensatory element in the penalty fixing process - Trade Practices Commission v. Mobil Oil Australia Ltd (1984) 4 FCR 296 at 298 (Toohey J.). The principal, and I think probably the only, object of the penalties imposed by s. 76 is to attempt to put a price on contravention that is sufficiently high to deter repetition by the contravenor and by others who might be tempted to contravene the Act. These observations have oft been cited, including by French CJ, Kiefel, Bell, Nettle and Gordon JJ in Commonwealth v Director, Fair Work Building Industry Inspectorate [2015] HCA 46 at [55], (2015) 258 CLR 482 at 506. Their Honours there concluded (at 505): [53] Civil penalty proceedings are civil proceedings and therefore an adversarial contest in which the issues and scope of possible relief are largely framed and limited as the parties may choose, the standard of proof is upon the balance of probabilities and the respondent is denied most of the procedural protections of an accused in criminal proceedings. [54] Granted, both kinds of proceeding are or may be instituted by an agent of the state in order to establish a contravention of the general law and in order to obtain the imposition of an appropriate penalty. But a criminal prosecution is aimed at securing, and may result in, a criminal conviction. By contrast, a civil penalty proceeding is precisely calculated to avoid the notion of criminality as such. (Citations omitted.) Their Honours thereafter went on to cite with approval the observations in CSR Ltd previously set forth. 6 It is also sufficient to again acknowledge that the process of fixing the quantum of penalty is a process of "instinctive synthesis": Australian Ophthalmic Supplies Pty Ltd v McAlary-Smith [2008] FCAFC 8 at [27] to [28], [55] and [78], (2008) 165 FCR 560 at 567 to 568 per Gray J, 572 and 577 per Graham J; Fair Work Ombudsman v Quest South Perth Holdings Pty Ltd (No 4) [2017] FCA 580 at [35] per Gilmour J. A useful summary of some of the matters to be taken into account when fixing the penalties to be imposed nevertheless remains the following list provided by Tracey J in Kelly v Fitzpatrick [2007] FCA 1080 at [14], (2007) 166 IR 14 at 18 to 19, namely: • The nature and extent of the conduct which led to the breaches. • The circumstances in which that 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 and • The need for specific and general deterrence. As his Honour has subsequently pointed out, "[e]ach of these considerations has the potential to have both an ameliorative and aggravating impact in the course of the instinctive synthesis process": Director of Fair Work Building Industry Inspectorate v Construction, Forestry, Mining and Energy Union [2015] FCA 1213 at [16]. 7 It should also be recognised that the Court may be assisted by submissions by the parties as to the appropriate penalties to be imposed; but the Court is not bound by those submissions as it has an independent function in imposing such penalties as it considers appropriate: Commonwealth v Director, Fair Work Building Industry Inspectorate [2015] HCA 46, (2015) 258 CLR 482 at 504. French CJ, Kiefel, Bell, Nettle and Gordon JJ there considered some of the earlier decisions of this Court and concluded: [48] [NW Frozen Foods Pty Ltd v Australian Competition and Consumer Commission (1996) 71 FCR 285] and [Minister for Industry, Tourism & Resources v Mobil Oil Australia Pty Ltd [2004] FCAFC 72, [2004] ATPR ¶41-993] do not suggest that the task of a judge faced with an agreed civil penalty submission is to determine whether the submitted penalty is "wholly outside" the "range of penalties reasonably available" or that the court is "bound to impose [an agreed] penalty irrespective of whether it is considered appropriate". To the contrary, as was emphasised in Mobil Oil, those cases make plain that the court is not bound by the figure suggested by the parties. The court asks "whether their proposal can be accepted as fixing an appropriate amount" and for that purpose the court must satisfy itself that the submitted penalty is appropriate. (Footnotes omitted.) See also: Australian Competition and Consumer Commission v Prysmian Cavi E Sistemi S.R.L. (No 13) [2017] FCA 851 at [13] per Besanko J.

[10]

The quantification of penalties urged by the parties 8 Adopting that approach, the following Table sets forth each of the contraventions found to have occurred in the present proceeding and the maximum penalty that may be imposed. The Table also sets forth the penalties which the Commission and the Respondents contend are the appropriate penalties to be imposed in respect to each contravention: Contravention Sec. 348 Sec. 348 Sec. 355 Sec. 355 Sec. 417 Sec. 50 Total 24 July 25 July 24 July 25 July First Respondent Maximum penalty: $10,200 $10,200 $10,200 $10,200 $10,200 $51,000 (Parker) Comm indicative: $8,160 $8,160 $8,160 $8,160 $8,160 $40,800 Resp indicative: $6,000 Second Respondent Maximum penalty: $10,200 $10,200 $10,200 $10,200 $10,200 $51,000 (Kera) Comm indicative: $8,160 $8,160 $8,160 $8,160 $8,160 $40,800 Resp indicative: $4,000 Third Respondent Maximum penalty: $10,200 $10,200 $10,200 $10,200 $10,200 $10,200 $61,200 (Reeves) Comm indicative: $8,160 $8,160 $8,160 $8,160 $8,160 $8,160 $48,960 Resp indicative: $3,000 Fourth Respondent Maximum penalty: (Genovese) Comm indicative: Resp indicative: Fifth Respondent Maximum penalty: $10,200 $10,200 (Michael Greenfield) Comm indicative: $6,630 $6,630 Resp indicative: $2,000 Sixth Respondent Maximum penalty: $10,200 $10,200 $10,200 $10,200 $10,200 $51,000 (Collier) Comm indicative: $8,160 $8,160 $8,160 $8,160 $8,160 $40,800 Resp indicative: $3,500 Seventh Respondent Maximum penalty: $10,200 $10,200 (Darren Greenfield) Comm indicative: $6,630 $6,630 Resp indicative: $2,000 Eighth Respondent Maximum penalty: $10,200 $10,200 (Sloane) Comm indicative: $6,630 $6,630 Resp indicative: $2,000 Ninth Respondent Maximum penalty: $10,200 $10,200 (Taylor) Comm indicative: $6,630 $6,630 Resp indicative: $1,500 Tenth Respondent Maximum penalty: $10,200 $10,200 (Auimatagi) Comm indicative: $6,630 $6,630 Resp indicative: $1,500 Eleventh Respondent Maximum penalty: $51,000 x 4 = $204,000 $51,000 x 4 = $204,000 $51,000 x 4 = $204,000 $51,000 x 4 = $204,000 $51,000 x 9 = $459,000 $51,000 $1,326,000 (CFMEU) Comm indicative: $163,200 $163,200 $163,200 $163,200 $328,950 $40,800 $1,022,550 Resp indicative: $60,000 Twelfth Respondent Maximum penalty: $51,000 x 4 = $204,000 $51,000 x 4 = $204,000 $51,000 x 4 = $204,000 $51,000 x 4 = $204,000 $51,000 x 9 = $459,000 $1,275,000 (CFMEU NSW) Comm indicative: $163,200 $163,200 $163,200 $163,200 $328,950 $981,750 Resp indicative: $20,000

[12]

The contraventions - a single course of conduct 10 The approach urged upon the Court by Senior Counsel on behalf of the Commission proceeds, at least in part, upon the submission that the penalties to be imposed should reflect one course of conduct for the s 417 contraventions, namely those contraventions which involved organising or engaging in industrial action. It is further submitted on behalf of the Commission that the penalties in respect to the ss 348 and 355 contraventions should reflect two contraventions, one on each of 24 and 25 July 2014 by each Respondent found to have contravened those provisions, the second day being conduct urging continued industrial action in the face of a notice issued by the Fair Work Commission pursuant to s 418 of the Fair Work Act. 11 That approach is accepted. 12 The submission advanced on behalf of the Respondents that the events on 24 and 25 July 2014 and all the contraventions that have been found to have occurred constituted but a single course of conduct is rejected. In Construction, Forestry, Mining and Energy Union v Cahill [2010] FCAFC 39, (2010) 269 ALR 1 at 12, Middleton and Gordon JJ there usefully set forth as follows the principle sought to be applied by the Respondents: [39] As the passages in [Construction, Forestry, Mining and Energy Union v Williams [2009] FCAFC 171, (2009) 262 ALR 417] explain, a "course of conduct" or the "one transaction principle" is not a concept peculiar to the industrial context. It is a concept which arises in the criminal context generally and one which may be relevant to the proper exercise of the sentencing discretion. The principle recognises that where there is an interrelationship between the legal and factual elements of two or more offences for which an offender has been charged, care must be taken to ensure that the offender is not punished twice for what is essentially the same criminality. That requires careful identification of what is "the same criminality" and that is necessarily a factually specific enquiry. Bare identity of motive for commission of separate offences will seldom suffice to establish the same criminality in separate and distinct offending acts or omissions. (Emphasis in original.) Although a Court should (accordingly) certainly have regard to common elements in contraventions so as not to penalise a party twice for the same conduct, it is wrong to group contraventions in such a way as to impose one penalty for multiple contraventions: Fair Work Ombudsman v Grouped Property Services Pty Ltd (No 2) [2017] FCA 557 at [423] per Katzmann J. By taking such an approach a court would be failing to engage directly and specifically with the consequences of each contravention. 13 In so concluding it is nevertheless noted that s 557 of the Fair Work Act does not "cover the field" so as to exclude the common law principle of taking into account, when imposing a penalty, whether the conduct complained of constituted a single course of conduct: Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union [2017] FCAFC 53 at [88] per Dowsett and Rares JJ. 14 On the facts of the present case it is not considered that the events that took place on 24 and 25 July 2014 were part of a single course of conduct. If for no other reason, the facts had changed as between the two dates by reason of: the s 418 order made by the Commission on the afternoon of 24 July 2014; and the findings made in respect to the events occurring on 25 July 2014, including the fact that Mr Parker was then not only seeking to inform the workers assembled on that day of the order that had been made by the Commission but was also "setting out to create 'an atmosphere of defiance'" which was separate action taken with a view to "incit[ing] or encourag[ing] the workers to continue their existing strike action": [2017] FCA 564 at [255] to [256]. Mr Reeves on 25 July 2014 also urged the workers to "make a decision like yesterday" notwithstanding the orders of the Commission: [2017] FCA 564 at 288. 15 Moreover, it is further separately concluded that the facts giving rise to the contraventions were sufficiently disparate such that it could not be concluded that the contraventions arose out of the same "legal and factual elements". Although ss 348 and 355 of the Fair Work Act are both directed at proscribing "coercion", the elements of the two offences are both expressed in different terms and involve separate findings of fact necessary to make out a contravention of each provision. On no view can it be said that the "legal and factual elements" necessary to prove a contravention of s 417 are the same as the elements necessary to make out a contravention of either s 348 or s 355.

[13]

The loss caused 16 As noted by Tracey J in Kelly v Fitzpatrick [2007] FCA 1080 at [14], (2007) 166 IR 14 at 18 to 19, one of the factors to be taken into account when assessing the penalty to be imposed is "[t]he nature and extent of any loss or damage sustained as a result of the breaches". 17 In the circumstances of the present case, the industrial action that took place on 24 and 25 July 2014 was extensive and, it may readily be inferred, occasioned considerable loss and damage. 18 Findings have been made that a considerable number of workers failed to attend work following the Stop Work Meeting held on 24 July 2014: [2017] FCA 564 at [191]. 19 In addition to that specific finding, there remained the very real potential for loss given the number of workers involved in the industrial action and the size of the building project: cf. Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union (No 2) [2010] FCA 977 at [46], (2010) 199 IR 373 at 382 per Barker J. Concurrence is expressed with the observations made by his Honour as follows: [46] … It is not possible to discount the potential losses. It is not possible simply to say that every project has built into it some wriggle room to ensure that a project will be finished on time according to the contract, even taking into account some industrial action. In my view, to approach the question of potential loss on this basis would be incorrect. While one cannot say with any certainty, as the respondents submit and the Commissioner, in effect, accepts, just what losses if any flow from the disruption, the potential is real and must be borne in mind in the assessment of penalty. It is exactly that sort of potential loss that, from an industrial point of view, brings pressure to bear on an employer. That is why the [Building and Construction Industry Improvement Act 2005 (Cth)] proscribes the act that leads to the disruption. 20 The extent of the disruption to a major building project such as that involved at the Barangaroo Site is a matter of some moment. But this factor, it is considered, only supports the assessment of penalties imposed rather than being a factor which increases what would otherwise have been a lower penalty. It is the "circumstances in which that conduct took place" and the deliberateness and intent pursued by the major participants which are the more prominent factors calling for the imposition of the penalties which have been imposed.

[14]

The imposition of penalties at the high end or the maximum penalty 21 The Commission further submits that the penalties to be imposed should be "at the high end to reflect the objective seriousness of the contraventions, the coercive nature of the conduct of Parker, Kera, Reeves and Collier (and through them the Union Respondents)". 22 It will be noted from the Table that the Commission does not seek the imposition of the maximum penalty. 23 Although this Court is not bound to impose a penalty within the range submitted on behalf of the opposing parties, that range certainly provides a useful touchstone. 24 Some reservation is nevertheless expressed as to whether the maximum penalty should be considered in respect to: Messrs Parker, Kera, Reeves and Collier; and/or one or other of the Union Respondents. 25 Caution certainly needs to be exercised before the maximum penalty prescribed by the legislature should be imposed: Markarian v The Queen [2005] HCA 25, (2005) 228 CLR 357 at 372. Gleeson CJ, Gummow, Hayne and Callinan JJ there observed: [31] It follows that careful attention to maximum penalties will almost always be required, first because the legislature has legislated for them; secondly, because they invite comparison between the worst possible case and the case before the court at the time; and thirdly, because in that regard they do provide, taken and balanced with all of the other relevant factors, a yardstick. … These observations are equally apposite to contraventions of the Fair Work Act as they are in the context of criminal law sentencing, as was the case in Markarian: cf. Fair Work Ombudsman v Grouped Property Services Pty Ltd (No 2) [2017] FCA 557 at [390] to [391] per Katzmann J. 26 As Counsel on behalf of the Respondents submitted, it would certainly be possible to envisage "something significantly worse" than the conduct pursued in the present case by Messrs Parker, Kera, Reeves and Collier. Although it may be difficult to envisage worse conduct than the disruption to the work being undertaken on a major city building project involving over 1,000 employees, it could certainly be envisaged (for example) that the conduct pursued on 25 July 2014 could have been far more belligerent - at least in respect to Messrs Kera, Reeves and Collier. 27 Concurrence is thus expressed with the submission that the conduct of Messrs Parker, Kera, Reeves and Collier does not warrant the imposition of the maximum penalty. But penalties approaching the maximum are appropriate as against those Respondents. 28 The conduct of the Construction, Forestry, Mining and Energy Union (the "CFMEU") and the Construction, Forestry, Mining and Energy Union, New South Wales Branch (the "CFMEU NSW") attract different considerations. 29 In very summary form, the CFMEU has been found in the present proceeding to have contravened ss 50, 348, 355 and 417 of the Fair Work Act. A separate Table prepared by the Commission in respect to contraventions by the Respondents of the Fair Work Act, the Building and Construction Industry Improvement Act 2005 (Cth) and/or the Workplace Relations Act 1996 (Cth) (the "Workplace Relations Act") record over 100 occasions upon which contraventions have been found and/or penalties have been imposed on the CFMEU. 30 Founded upon this chronology, it is concluded that the CFMEU has long demonstrated by its conduct that it pays but little regard to compliance with the law and indeed has repeatedly sought to place itself above the law. 31 The CFMEU is to be regarded as a "recidivist" offender: cf. Director of the Fair Work Building Industry Inspectorate v Construction, Forestry, Mining and Energy Union [2015] FCA 226 at [63] per Tracey J. Its conduct has only gone down-hill since his Honour made those observations. It is difficult, if not impossible, to envisage any worse conduct than that pursued by the CFMEU. The CFMEU assumes a prominent role in the industrial affairs of this country and has consistently exhibited a contempt for compliance with the law. The conduct of its officers and employees has consistently shown a total contempt for the rights of occupiers and a total contempt for the constraints imposed by the law. It is difficult to perceive how such conduct can be regarded as in the best interests of the bulk of its members and the workers it supposedly represents. Such conduct may promote the CFMEU as a "militant" union. But the constraints imposed by the law apply to all - including the CFMEU. 32 It is, with respect, not possible to envisage worse union behaviour. The prior imposition of penalties - some nearing the maximum - against the CFMEU has not deterred it from engaging in clearly unlawful industrial action. Indeed, the conduct for which the CFMEU assumes liability in the present proceeding shows a further and serious contempt for the law. The CFMEU's conduct exposes a cavalier disregard for the prior penalties imposed by this Court and exposes the fact that such prior impositions of penalties have failed to act as a deterrent against further unlawful industrial action. 33 The maximum penalty should thus be imposed upon the CFMEU. In the absence of legislative action, it may (regrettably) be expected that even penalties imposed at the maximum now permitted will not act as a deterrent. 34 The conduct of the CFMEU NSW calls for different considerations. As correctly submitted on behalf of the Respondents, "the contraventions of the federal union should not be visited upon the state union or the personal respondents" as they "all have separate identities". 35 A table helpfully included in the Supplemental Submissions in Reply filed by the Respondents on 14 August 2017 identifies 9 occasions upon which the CFMEU NSW has been exposed to penalties, over a period from 2004 to 2011. Its conduct in the past has, accordingly, not attracted findings as to contraventions or resulted in penalties imposed to anywhere near the same extent as the CFMEU. Its conduct nevertheless remains far from satisfactory. But such conduct calls for less than the maximum penalty. 36 In the circumstances, it is considered that a penalty in the amount of 75% of the maximum should be imposed on the CFMEU NSW.

[16]

In imposing these penalties it is recognised that the penalties imposed on Messrs Parker and Kera are greater in total than that originally suggested by the Commission; but this Court is not bound by any penalty or range of penalties suggested by one or other of the parties: cf. Commonwealth v Director, Fair Work Building Industry Inspectorate [2015] HCA 46 at [48], (2015) 258 CLR 482 at 504. The conduct of Messrs Parker and Kera, it is concluded, warrant penalties greater than that suggested. It is further recognised that the penalties imposed on Messrs Reeves and Collier are less than those suggested by the Commission; but again the same principle applies as to the Court not being bound by the submissions of any of the parties. 40 The penalties imposed on Mr Parker in respect to his contraventions, it is considered, properly reflect the position he occupies as State Secretary of the CFMEU and the prominent role he assumed during the course of the events on 24 and 25 July 2014. That conduct included not only his intention to "stir up" the workers and his setting out to create "an atmosphere of defiance", particularly "towards the FWBC inspectors"; but also included his objective of getting the workers on 25 July 2014 to continue their strike action from the previous day in defiance of the Fair Work Commission's order. Mr Parker's conduct also included misrepresenting facts when addressing the workers on 24 July 2014 (including misrepresenting the facts to members of the CFMEU) and a willingness to take on the police if they stood in the way of achieving his objectives. Such conduct exhibits a willingness to misrepresent facts even to the CFMEU's own members, contempt for the police and a contempt for those administering the Fair Work Act. To urge workers to continue their strike on 25 July 2014 in the face of the orders made by the Commission the previous day and in creating an "atmosphere of defiance" goes well beyond the conduct that should be expected of a responsible State Secretary. Also of some relevance is the fact that Mr Parker has previously been found to have contravened the Workplace Relations Act: Darlaston v Parker [2010] FCA 771, (2010) 189 FCR 1. 41 The penalties imposed on Mr Kera in respect to his contraventions of ss 348, 355 and 417, it is considered, properly reflect the prominent role he assumed on both 24 and 25 July 2014. They also reflect, as too is the case with Messrs Parker, Reeves and Collier, condemnation of conduct pursued with an intent to coerce and the manner in which he addressed the assembled Site employees. Mr Kera, by his conduct on both 24 and 25 July 2014 exhibited contempt for (for example) whether the action being proposed on 24 July 2014 was "unprotected action" and contempt for (for example) those administering the Fair Work Act by referring on 25 July 2014 to the inspectors then present as "fucking dogs". His conduct in urging the reinstatement of Mr Genovese and in representing to the workers on 24 July 2014 that there had been an "injustice committed down here at Barangaroo against Peter Genovese" in circumstances where he had a lack of knowledge as to the allegations being made was irresponsible. Also of relevance is the fact that Mr Kera has also previously been found to have contravened a provision of the Workplace Relations Act: Darlaston v Parker [2010] FCA 771, (2010) 189 FCR 1. 42 The relevance in making these observations as to prior contraventions is to recognise that they are a matter that may be taken into account when determining the penalty to be presently imposed and in assessing the gravity of the present contraventions but not as a matter which "impose[s] a fresh penalty for past offences": cf. Veen v The Queen (No 2) (1988) 164 CLR 465 at 477 per Mason CJ, Brennan, Dawson and Toohey JJ. 43 The penalties in respect to Mr Reeves, in respect to his contraventions, also reflect the role he assumed on 24 and 25 July 2014 and his intent to coerce. They also reflect the finding that his "involvement … was not as immediate as that (for example) of Mr Parker". Mr Reeves was also found to have contravened s 50. Of particular concern is the fact that on 25 July 2014 Mr Reeves urged the workers to "make a decision like yesterday" notwithstanding the orders of the Fair Work Commission. 44 The penalties in respect to Mr Collier, in respect to his contraventions, also reflect the prominent role he assumed on 24 and 25 July 2014. The findings with respect to his conduct on 24 July 2014 included the finding that his use of the words "[y]ou're a fucking grub, fucking dog" was less a public expression of views but rather an attempt to intimidate the Fair Work inspectors. Mr Collier's intent to coerce, it has been found, was even more manifest on 25 July 2014 than on 24 July 2014. On 25 July 2014, Mr Collier exhibited a significant degree of contempt for those administering the Fair Work Act by repeatedly referring to the Fair Work inspectors as "dogs". 45 To the extent that the conduct of Messrs Parker, Kera, Reeves and Collier has been found to expose a willingness to place themselves outside the law and outside the constraints imposed by the Fair Work Act, it is to be recalled that "every subject in this land, no matter how powerful" should remember that "[b]e you ever so high, the law is above you": Gouriet v Union of Post Office Workers [1977] 1 QB 729 at 761 to 762 per Lord Denning MR. 46 In respect to the conduct of the remaining Respondents found to have contravened s 417 of the Fair Work Act, namely Messrs Michael Greenfield, Darren Greenfield, Sloane, Taylor and Auimatagi, it is considered that the following penalties should be imposed: Respondent Penalty Michael Greenfield $3,000 Darren Greenfield $5,000 Sloane $5,500 Taylor $4,500 Auimatagi $3,000

[17]

47 The penalty imposed on Mr Michael Greenfield, in respect to his contravention of s 417 but not any contravention of ss 348 or 355, reflects his greater involvement in the events on 25 July 2014 than on the previous day and reflects his lack of an intent to coerce the Site employees involved. 48 The penalty imposed upon Mr Darren Greenfield, in respect to his contravention of s 417 but not any contravention of ss 348 or 355, reflects his lack of any intent to coerce the Site employees and his lack of any intent to coerce Lend Lease by his conduct on 25 July 2014. But his conduct on 25 July 2014 has been found to have been accurately described as conduct whereby he "vilified and abused Fair Work Inspectors lawfully attending the site". 49 The penalty imposed upon Mr Sloane, in respect to his contravention of s 417 but not any contravention of ss 348 or 355, reflects his lack of any intent to coerce the Site employees. But his conduct on 25 July 2014, including his "tapping" Mr O'Connor on the shoulder, has not been characterised as a "joke" but rather as conduct falling within s 417. Also of relevance is the fact that Mr Sloane has also been found to have previously contravened a provision of the Fair Work Act: Director of the Fair Work Building Industry Inspectorate v Stephenson [2014] FCA 1432. 50 The penalty imposed upon Mr Taylor, in respect to his contravention of s 417 but not any contravention of ss 348 or 355, reflects his lack of any intent to coerce the Site employees. But his conduct on 24 and 25 July 2014, it has been held, went beyond a "mere presence" on those days and also included his comments directed at the Fair Work inspectors. Mr Taylor, it may be noted, is no longer employed by the CFMEU NSW. 51 The penalty imposed upon Mr Auimatagi, in respect to his contravention of s 417 but not any contravention of ss 348 or 355, also reflects the finding as to an absence of an intent on his part to coerce the Site employees. His involvement which brings him within s 417, it is considered, is on a par with that of Mr Michael Greenfield. Mr Auimatagi is also no longer employed by the CFMEU NSW. 52 To the extent it was submitted that there was some degree of "co-operation" on the part of the Respondents in respect to the present proceeding such that that was a factor to be taken into account when assessing penalties, that submission is rejected. Such "co-operation" was minimal and certainly not such as to warrant any reduction in the penalties now imposed. 53 The penalties imposed, it should finally be noted, attempt to reflect the individual circumstances of each Respondent but also seek to ensure that there is appropriate comparability between the facts and circumstances of each contravention. "Discrepancy or disparity is not simply a question of the imposition of different sentences for the same offence": cf. Postiglione v The Queen (1997) 189 CLR 295 at 301 to 302. Dawson and Gaudron JJ there went on to observe (at 302): Rather, it is a question of due proportion between those sentences, that being a matter to be determined having regard to the different circumstances of the co-offenders in question and their different degrees of criminality. Although analogies to the criminal law are generally inappropriate when fixing penalties under the Fair Work Act, there remains a common objective of ensuring that there is some degree of equality and comparability in approach in respect to each Respondent.

[18]

Totality 54 The quantum of the penalties imposed, both upon the individuals and the Union Respondents (in their totality), it is concluded, are appropriate both in respect to each of the Respondents and overall. 55 In so concluding, it is recognised that it is necessary "to ensure that … the sum of the penalties imposed for several contraventions does not result in the total of the penalties exceeding what is proper having regard to the totality of the contravening conduct involved": Australian Competition and Consumer Commission v Australian Safeway Stores Pty Ltd (1997) 145 ALR 36 at 53. Goldberg J there concluded: The totality principle is designed to ensure that overall an appropriate sentence or penalty is appropriate and that the sum of the penalties imposed for several contraventions does not result in the total of the penalties exceeding what is proper having regard to the totality of the contravening conduct involved: McDonald v R (1994) 48 FCR 555; 120 ALR 629. But that does not mean that a court should commence by determining an overall penalty and then dividing it among the various contraventions. Rather the totality principle involves a final overall consideration of the sum of the penalties determined. In Mill v R (1988) 166 CLR 59; 83 ALR 1 the High Court accepted the following statement as correctly describing the totality principle: The effect of the totality principle is to require a sentencer who has passed a series of sentences, each properly calculated in relation to the offence for which it is imposed and each properly made consecutive in accordance with the principles governing consecutive sentences, to review the aggregate sentence and consider whether the aggregate is "just and appropriate". The principle has been stated many times in various forms: "when a number of offences are being dealt with and specific punishments in respect of them are being totted up to make a total, it is always necessary for the court to take a last look at the total just to see whether it looks wrong"; "when … cases of multiplicity of offences come before the court, the court must not content itself by doing the arithmetic and passing the sentence which the arithmetic produces. It must look at the totality of the criminal behaviour and ask itself what is the appropriate sentence for all the offences". See also: Fair Work Ombudsman v Grouped Property Services Pty Ltd (No 2) [2017] FCA 557 at [428] per Katzmann J. 56 In assessing penalties in the present proceeding in the amounts stated, it is concluded that those penalties in their totality are appropriate, especially when consideration is given to (inter alia): the facts and circumstances surrounding each contravention. Also of relevance in supporting such a conclusion are such further factors as: the number of sub-contractors and workers disrupted by the unlawful action; the very real potential, if not the fact, that significant loss would inevitably have followed from such unlawful action; and the fact that the Barangaroo site was one of the largest building projects then being undertaken in the Sydney city region.

[19]

The source of funding for the penalties imposed 57 No question arose as to the ability of the Respondents to pay the penalties imposed. 58 Indeed, it was accepted on behalf of the Respondents that the penalties imposed on the individual Respondent would most likely be paid from the monies held by the Construction and General Division of the NSW Divisional Branch of the CFMEU. 59 The Commission's evidence established that for the 2015 calendar year that Division received over $9 million in membership fees, being approximately 82.8f its overall revenue. A "capitation fee" of $793,804 was paid by that Division to the national office of the CFMEU. Legal costs in the sum of $692,152 were incurred, including $209,845 incurred in respect to the Royal Commission. 60 A concern for the assets and income base of the CFMEU was a matter which attracted attention not only in this case but also in the proceeding before Mortimer J in Director of the Fair Work Building Industry Inspectorate v Construction, Forestry, Mining and Energy Union (No 2) [2016] FCA 436. Her Honour there observed: [111] The CFMEU is an organization with a large asset and income base. It occupies a position with particular legal privileges and responsibilities as a registered organisation under the Fair Work (Registered Organisations) Act 2009 (Cth). It is exempt from income tax, and in that sense whatever funds it determines to use to pay pecuniary penalties are not "after tax" funds. … It, obviously enough, remains a matter for the Legislature as to whether such an organisation - or other like organisations - is exempt from taxation. 61 But a matter of present concern is that it is disturbing that considerable sums of money are being paid out of membership fees in respect to both the payment of penalties and legal fees for conduct involving unlawful conduct. And, on the facts of the present case, blatantly unlawful conduct. 62 An inference is inescapably drawn that the penalties which have been imposed in the past, and the penalties to be imposed in the present proceeding, have simply been regarded as the "costs of doing business". 63 It is unlikely that deterrence can be achieved by the imposition of penalties comparable to those that have been imposed in the past. Such penalties have proven to be ineffectual. 64 Whatever further steps may be taken by the Legislature to prescribe a meaningful sanction to achieve an acknowledged existing purpose of deterrence is a matter for the Legislature to pursue.

[20]

A correction to the findings previously made 65 The conclusions as to the penalties to be imposed have proceeded on the assumption that the findings of contraventions as have been made are the contraventions that attract the imposition of penalties. 66 However, there was some disagreement between the parties as to whether there should be some variation or correction to the findings already made against: Mr Kera; Mr Michael Greenfield; and Mr Taylor. 67 The uncertainty in respect to Mr Kera arose out of the following findings: [439] The pleading as advanced in para [64] of the Further Amended Statement of Claim, namely the contravention of s 417 of the Fair Work Act, is the counterpart allegation to that made against Mr Parker at para [56]. Just as the allegation against Mr Parker has proved unnecessary to resolve, so too has the counter-part allegation against Mr Kera not been resolved. [440] The pleading in para [65] as against Mr Kera, that allegation being the counterpart to the allegation made against Mr Parker at para [57], has also been made out. That part of the judgment, although directing attention to the conduct of Mr Kera, was making comparable findings as against both Mr Parker and Mr Kera. Paragraph [439] of the judgment was intended to refer to the alleged contravention of s 355 of the Fair Work Act. Thus, in para [439] of the judgment, the reference to para [64] of the Further Amended Statement of Claim should have been a reference to para [65] and the reference to para [56] should have been a reference to para [57]. Paragraph [440] of the judgment was intended to refer to the alleged contravention of s 417 of the Fair Work Act. Thus, in para [440] of the judgment, the reference to para [65] of the Further Amended Statement of Claim should have been a reference to para [64] and the reference to para [57] should have been a reference to para [56]. The mistaken references were simply an inadvertent juxtaposition of the paragraphs in the pleadings. 68 Power to make that variation to the judgment is conferred by r 39.04 of the Federal Court Rules 2011 (Cth). 69 The uncertainty surrounding Mr Michael Greenfield is said on his behalf to arise from the fact that the finding of a contravention of s 417 on 25 July 2014 "[o]n its face … discloses an error". Any variation or correction of this finding is opposed by the Commission and is submitted to be a finding which follows from (inter alia) earlier findings made as to the events on 25 July 2014 being a continuation of the events on the preceding day. 70 No variation or correction is made to the finding of a contravention on the part of Mr Michael Greenfield. The finding reflects the intention of the Court. It is respectfully considered to be a finding which is well founded upon such existing findings as have been made. It is not considered necessary to make further findings to support the conclusion reached; nor is it considered appropriate to now seek to make such further findings as may be considered necessary to support the conclusion already reached. The finding as to a contravention of s 417 is a finding which stands or falls on the existing reasons and findings. The separate hearing as to the penalties to be imposed is not the opportunity to make further findings, even if necessary. 71 The uncertainty surrounding Mr Taylor arises out of, embarrassingly, conflicting findings. This conflict arises out of the following paragraphs: [515] The allegation in para [109] is thus made out. The contravention by Mr Taylor of s 417 is established. [516] It may be noted that the reference to "Sloane" in para [110] is assumed to be a typographical error and should be a reference to Mr Taylor. So understood, the allegation advanced in para [110] is nevertheless rejected. It is the counterpart allegation to that made against Mr Parker at para [59]. The reasons for rejecting para [59] apply equally to para [110]. [517] Notwithstanding considerable reservation as to the reliability of Mr Taylor's evidence, the Commissioner has not discharged the onus of proof in making out any of the contraventions alleged against Mr Taylor. Earlier in the judgment, separate consideration was given to the evidence against Mr Taylor and findings made as to his involvement on 24 and 25 July 2014: [2017] FCA 564 at [351] to [360]. The finding intended to be made, and in fact made at para [515], was that Mr Taylor contravened s 417. The finding intended to be made at para [517], was that the Commissioner had not discharged the onus of proof in making out the contraventions of s 348 and 355. That was clearly the intention of the Court. 72 Power to correct the finding at para [517] is conferred by r 39.04 of the Federal Court Rules 2011 (Cth). 73 The penalties imposed, accordingly, give effect to the findings and conclusions previously reached.

[21]

An order for advertising 74 One question raised by the Court during the course of the hearing on penalty was whether the Court: had the power to make an order that the Respondents publish in either or both a Sydney newspaper or the journal published by the CFMEU a summary of the findings made and the making of the orders imposing penalties; and/or assuming it has such power, whether an order to that effect should be made. Underlying both aspects of the question was the purpose sought to be achieved. In respect to the prospect of publication in either or both formats, one significant purpose would be: deterrence: i.e., bringing expressly to the attention of the members of the CFMEU the contraventions that have occurred and the penalties imposed may, on one view, hold the CFMEU and the individual Respondents to better account at the hands of the Union's membership. Publication of the fact that orders have been made, including orders for the payment of penalties by particular persons, may well act as a deterrence to those committing contraventions. The fact that the involvement of the Union, and perhaps more so the involvement of the individuals, is to be made public by way of notice in a local newspaper may more readily hold such conduct to public account. 75 Another purpose, more so should publication be ordered in the CFMEU journal, would be the purpose of: better informing the Union members not only of the findings made and the fact of contraventions but the additional fact that the payment of membership fees went towards, to a very significant extent, the payment of monies for the unlawful conduct the subject of the contraventions. This was the purpose upon which greater emphasis was placed during the course of the hearing. Notwithstanding that emphasis then given, the purpose of deterrence upon reflection also looms large. 76 There is a legitimate public interest in informing members of the CFMEU as to how the fees paid by its members are being expended. The militant actions taken by the CFMEU and its repeated recourse to unlawful industrial action and the depletion of assets derived from member's subscriptions should not be regarded by its members as a "badge of courage" or "badge of honour"; such actions should be regarded by both the public and the CFMEU members with condemnation of the unlawful conduct of its officers, employees or agents which will not be tolerated. In the absence of such conduct being brought to the attention of both members of the Union and the public, it may be doubted whether it would otherwise be known that the conduct of the officers, employees or agents of the CFMEU has been found to be both in defiance of the law and with contempt towards those administering the Fair Work Act. Such conduct, it is to be hoped, will be regarded by the general CFMEU membership as bringing the union into disrepute. More widespread distribution of such facts, it is hoped, may act as a significant deterrence. 77 There is also a legitimate interest in informing those sub-contractors and workers who were disrupted in the performance of their duties on 24 and 25 July 2014 of the ultimate fate of the proceeding brought by the Commission. Bringing those offending to the knowledge of those affected by the unlawful conduct may also buttress a purpose of deterrence. 78 The immediate statutory source of the power to make an order that there be publication of an advertisement is to be found in s 545 of the Fair Work Act. Section 545(1) provides as follows: The Federal Court or the Federal Circuit Court may make any order the court considers appropriate if the court is satisfied that a person has contravened, or proposes to contravene, a civil remedy provision. That provision, albeit a provision which confers a discretion subject to no express constraints, nevertheless unquestionably imposes limits upon the power conferred: Construction, Forestry, Mining and Energy Union v Australian Building and Construction Commissioner [2016] FCAFC 184, (2016) 341 ALR 383. Allsop CJ, when comparing the terms of s 545(1) to s 23 of the Federal Court of Australia Act 1976 (Cth), there relevantly noted this restriction as follows (at 384): [5] Section 545(1) does not use the word "kinds" as s 23 does; but, like s 23, it requires the consideration and making of a choice of what is "appropriate" in the exercise of judicial power upon the satisfaction of relevant matters: that someone has contravened or proposes to contravene a civil remedy provision. That consideration and choice must have limits. Such limitation comes from the requirement that the order is capable of properly being seen as appropriate to be made if there has been or is threatened to be a contravention. Such a judgment, and any restrictions or limitations on the choice, will be derived from the text and context of the statute, the nature of judicial power and inhering considerations of legal legitimacy. 79 Although s 545 may thus be regarded as a source of power subject to limits discerned by reference to (inter alia) "legal legitimacy", it is nevertheless considered to be a sufficient source of power to make an order for the advertisement of the findings and orders made by the Court. Even though in other statutory contexts (e.g., Competition and Consumer Act 2010 (Cth) sch 2 s 246(2)(d)) there may be found an express power to order advertising, the absence of an express reference to such an order in s 545 does not deny the width of the power there conferred. If necessary, recourse could also be had to s 23 of the Federal Court of Australia Act 1976 (Cth) as a further source of power to make a publication order. 80 The objectives sought to be achieved in the present case are akin to the objectives endorsed by French J (as his Honour then was) in Australian Competition and Consumer Commission v Real Estate Institute of Western Australia Inc [1999] FCA 1387, (1999) 95 FCR 114 at 133. His Honour there explained his position as follows: [49] In my opinion there is power to make orders under s 80 which bring the outcome of the proceedings to the attention of members of REIWA and to the public as consumers. It is important that such advertisements are seen to do more than merely announce a "win" for the ACCC and the contrition of the respondent. Such advertisements in cases involving contraventions of Pt IV are within the power conferred by s 80 if they are directed to informing the relevant markets of the outcome of the litigation so that those in the market have at least a broad understanding of the ways in which the contravenors have had to change their conduct. This will at least alert those in the markets to question or inquire about the lawfulness of conduct in the future which may seem to contravene the Act and/or breach the injunctions which have been granted. In this way, public advertising as proposed may aid in the enforcement of the primary orders and the prevention of the repetition of the contravening conduct. In so saying, it is not intended to assert any exhaustive principle upon which the making of such orders under s 80 can be justified. It is doubtful, however, that the Court is entitled to make orders for such wide purposes as the general education of the public about the Act and its enforcement. In my opinion the proposed notices in the REIWA Review and REIWA News and the proposed advertisement in The West Australian newspaper are appropriately ancillary to the primary relief that is sought and are within power. 81 Publication, it should be expressly noted, is not intended to serve any purpose of imposing a punishment on the contraveners. Publication, it is intended, is to serve the purpose of deterrence (and perhaps incidentally) a separate purpose of educating not only those in the CFMEU and the public but more generally those in the building industry that contraventions will attract penalties and thereby serve as a deterrent more generally. 82 There should, accordingly, be published in two major Sydney newspapers (being the city in which the unlawful conduct took place) and the journal published by the CFMEU a notice in terms agreed between the parties as to the context in which the present contraventions have been found to have occurred and the penalties imposed. In the absence of agreement, the text of the advertisements will be settled by the Court itself. It is envisaged that such an advertisement could be potentially drafted in less than about two A4 pages. 83 Publication should be at the expense of the Respondents. 84 Such an order, it is concluded, is appropriate notwithstanding the fact that the events giving rise to the dispute occurred in July 2014, over 3 years ago. Notwithstanding the passage of time, there remains a continuing need to make orders that will act as a deterrent. That need remains ever present. 85 It is noted that an order for publication, albeit in different circumstances, was made in Hadgkiss v Construction, Forestry, Mining and Energy Union (No 4) [2007] FCA 425, (2007) 161 IR 338.

[22]

Referral to the Director of Public Prosecutions 86 A further question explored during the course of the hearing as to penalties was the question as to whether an order should be made referring to the Director of Public Prosecutions the findings made as to the manner in which Messrs Parker, Kera, Collier and Sloane had given evidence. 87 Of particular concern was whether the Director should consider whether those persons had committed an offence under s 35 of the Crimes Act 1914 (Cth). Section 35(1) of that Act provides as follows: Giving false testimony A person commits an offence if: (a) the person gives false testimony touching a matter; and (b) the person does so: (i) in a judicial proceeding; or (ii) with the intention of instituting a judicial proceeding; and (c) the matter is material in the judicial proceeding; and (d) the judicial proceeding is a federal judicial proceeding. 88 While submitting that the Court may have a duty to refer such conduct, Senior Counsel initially stopped short of making a submission on behalf of the Commission that such an order should be made. A short adjournment was granted to enable instructions to be obtained. Senior Counsel on behalf of the Commission thereafter did make such a submission. 89 The Court in such circumstances, it was submitted on behalf of the Commission, has the following function, as expressed by Hall J in Simpson v Hodges [2007] NSWSC 1230: [268] A judicial officer who believes that offences have been committed is under a duty to refer the proceedings to the relevant authority: [Normandy Woodcutters Ltd v Simpson [2002] NTSC 43 at [53] per Mildren J]. Accordingly, where evidence is given in proceedings in this Court that reasonably suggests that an offence has or may have been committed in relation to proceedings conducted before it, the Court has a duty to refer the proceedings. As Mildren J observed in [Normandy Woodcutters Ltd v Simpson [2002] NTSC 43], referring the papers is not an exercise of judicial power and no findings are made and no injury to anyone's reputation arises by a mere referral. Nor, as his Honour observed, is the judicial officer required to give anyone an opportunity to be heard in such a matter. [269] In light of the evidence to which I have referred and for the above reasons, the Registrar of this Court will be directed to forward a copy of these reasons for judgment to the Director of Public Prosecutions and to make available, as may be required, the full transcript of these proceedings and the exhibits for inspection by any officers authorised in that behalf by the Director of Public Prosecutions. 90 In very summary form, the reasons for decision previously published make observations and findings in respect to the evidence given against each of the following named Respondents: Mr Parker; Mr Kera; Mr Collier; and Mr Sloane. 91 In the course of resolving the facts for the purposes of determining the contraventions, observations were made as to the evidence given by a number of Respondents, but these four witnesses in particular. 92 In the case of Mr Parker, it was then observed (inter alia) that it was "questionable whether his failure to recollect was to be attributed to a lack of memory of events occurring some time ago or to an unwillingness to be fully frank in the evidence that he was giving": [2017] FCA 564 at [234]. It was further observed that the "latter explanation … is considered to be the more likely explanation": [2017] FCA 564 at [234]. 93 In the case of Mr Kera, it was then observed that (inter alia) his "evidence was characterised by a failure to answer many of the questions which were put to him and more characterised by an attempt to convey the evidence that he wanted to give": [2017] FCA 564 at [261]. But it was further observed that whether this "was due to inadvertence or was deliberate may be left to one side": [2017] FCA 564 at [261]. 94 In the case of Mr Collier, it was then observed (inter alia) that it was to be "queried whether Mr Collier was prepared to be fully frank in the evidence he was giving" and that some of his evidence "was not credible": [2017] FCA 564 at [325]. 95 In the case of Mr Sloane, it was then observed (inter alia) that "the extent of his inability to recall what was said … is more the product of an attempt to shield himself behind a professed inability to recall rather than a genuine attempt to answer the questions put to him": [2017] FCA 564 at [348]. 96 Other observations were also made as to the reliability of the evidence of these witnesses and other individual Respondents. 97 But it is the evidence of Messrs Parker, Kera, Collier and Sloane which should be referred to the Office of the Director of Public Prosecutions to be there given such consideration as it sees fit as to whether the matters should be pursued further.

At a glance

Court

Decision date

Before

Source

Judgment (25 paragraphs)

Parties

Legislation Cited (10)

Cases Cited (41)