Carr v Higgins Coatings Pty Ltd

'a failure or refusal by persons to attend for work or a failure or refusal to perform any work at all by persons who attend for work, if: … (iii) the persons are employed by…a constitutional corporation'. 12 There can be little doubt that the respondent, which is admitted to be a body corporate, and in the title to the proceeding has attributed to it an ACN number, would be a constitutional corporation. I can assume that it trades, when it undertakes painting work for a head contractor on a building site, and it therefore falls within par (c) of the definition of 'constitutional corporation' in s 4(1) of the Workplace Relations Act. 13 It appears from the agreed statement of facts that the respondent had a policy not to pay employees for periods when they were engaged in industrial action. It had not paid employees on other sites on 5 and 6 August 2003, when they had taken industrial action. The payment was authorised by a supervisor at the Concept Blue site, who made the decision having regard to Mr Czyzewski's 27 years and Mr Dryden's six years of service to the respondent, and to the fact that they were not responsible for the strike action. The decision of the supervisor was not the result of any pressure from any union. It was not approved by the directors of the respondent, who were not aware of it at the time, and only became aware of it in 2005. The directors have made inquiries, and are not aware of the respondent paying strikers on any other occasion. Subsequently, the directors have instructed the supervisor concerned that there is to be no exemption from the policy of not paying employees engaged in industrial action. 14 It is also agreed that there was no cost to the respondent from the stoppages on the Concept Blue site. The respondent's works on the site were completed within time and within budget. 15 The respondent has had no prior contravention of Pt VIIIA of the Workplace Relations Act alleged against it. The applicant concedes that the respondent has cooperated since the commencement of this proceeding, and that that is a mitigating factor to be taken into account. 16 In light of the various mitigating factors, counsel for the applicant has conceded that this would be an appropriate case for the Court to impose no penalty. This is a case in which individual deterrence has no operation whatsoever. Having regard to its existing policy not to pay employees for periods when they were engaged in industrial action, the respondent was already deterred. The payment that was made to each of the two employees was a payment unauthorised by the respondent in the sense that its directing mind and will was unaware that the supervisor proposed to make the payment, despite the respondent's policy that such payments should not be made. 17 In those circumstances, it is difficult to see how the imposition of any penalty at all could be appropriate in relation to the particular respondent. General deterrence is, in such circumstances, not an appropriate reason for imposing a penalty. The penalisation of those whose conduct is essentially innocent, in order to deter others, is more likely to bring the law into disrepute than to preserve the integrity of the statutory scheme and to bring about widespread compliance with it. 18 I, therefore, propose to impose no penalty on the respondent. 19 Counsel for the applicant contends that I should nevertheless make a declaration in the form sought in the application. A declaration is not, and is not contended to be, an order consequential upon any of the orders referred to in s 187AD(1) of the Workplace Relations Act. In order to find a power for the Court to grant a declaration it is necessary to go, as the applicant concedes, to s 21 of the Federal Court of Australia Act 1976 (Cth). Subsection (1) of that section provides: 'The Court may, in relation to a matter in which it has original jurisdiction, make binding declarations of right, whether or not any consequential relief is or could be claimed.' 20 As I have said in my judgment in Australian Competition and Consumer Commission v Francis [2004] FCA 487 (2004) 142 FCR 1 at [92]-[113], I have great difficulty accepting that a declaration which does nothing more than record a historical event is properly described as a declaration of right. A declaration of right settles a state of dispute between parties, by declaring what the rights of one or other or both of them are, and enables them to conduct their relations in the future on the basis that their rights are thereby established. In essence, it is a remedy looking towards future conduct, rather than at past conduct. 21 It is also important to note that a declaration settles a controversy; it does not simply give effect to an agreement. In the present case, there is an agreement that there has been a contravention by the respondent of s 187AA(1)(b) of the Workplace Relations Act. In my view, the making of a declaration reflecting that agreement would not be a proper exercise of the Court's power. I am aware that it has become a practice under the Trade Practices Act 1975 (Cth) ('the Trade Practices Act') for applicants to seek, and for the Court to make, declarations that appear to do nothing other than reflect the fact that past conduct amounts to a contravention of provisions of that Act. Declarations in that form have often been made in cases in which the option of a penalty has not been available, but have also been made in cases where a penalty is an option, and even in cases in which penalties have been opposed. It is perhaps too late to protest about that practice under that Act, it having been sanctioned by the High Court of Australia, at least impliedly, in Rural Press Ltd v Australian Competition and Consumer Commission [2003] HCA 75 (2003) 216 CLR 53 at [89]-[90] per Gummow, Hayne and Heydon JJ, by the failure of the High Court to condemn the making of declarations of that kind, even though it condemned the particular, rather vague, form of the declarations that had been made in that case. 22 Recent cases under s 187AA of the Workplace Relations Act suggest that the practice is threatening to spill over from the Trade Practices Act to that area. There have been a number of cases in which judges have made declaratory orders where they have not imposed penalties under s 187AA. In no case, so far as I am aware, has any judge engaged in discussion in reasons for judgment about whether the making of such a declaration is appropriate. 23 In my view, it is not. Counsel for the applicant contends that the making of a declaration would send the right message to others that the law is being enforced. I am not sure that a case such as this would gain such notoriety that others would inevitably learn what they would learn from reading s 187AA of the Act, namely that it is unlawful to make payments to employees who are engaging, or have engaged, in industrial action. 24 As I have said, there are circumstances in which the making of orders by courts in relation to conduct of parties that is essentially innocent can operate more to bring into disrepute the laws under which the orders are made than to maintain the integrity of that system of laws. I think it would be unfortunate to be making any declaration in a case such as this, which I think would not tend to promote respect for the law. 25 For all of those reasons, it appears to me that the only appropriate order is to dismiss the application. I don't accept that such an order will send any wrong message. All that it accomplishes is that the relief sought in the application is not to be granted. It in no way condones what the respondent has done and certainly does not send any message that the respondent has not contravened s 187AA. 26 No issue as to the costs of the proceeding arises because of s 347 of the Workplace Relations Act. 27 The orders that I make are as follows:

1. Dennis James Carr be substituted for Adrian Edwards as the applicant in the proceeding and the title of the proceeding be amended accordingly.

(2004) 142 FCR 1

(2003) 216 CLR 53

[2003] HCA 75