Director of the Fair Work Building Industry Inspectorate v Construction, Forestry, Mining and Energy Union

Date of hearing: 24 and 26 March 2015

Date of last submissions: 26 March 2015

Place: Melbourne

Division: FAIR WORK DIVISION

Category: Catchwords

Number of paragraphs: 104

Counsel for the Applicant: Mr N Harrington

Solicitor for the Applicant: Maddocks

Counsel for the First and Third Respondents: Mr C Dowling

Solicitor for the First and Third Respondents: Slater and Gordon Lawyers

Counsel for the Second Respondent: The Second Respondent did not appear

IN THE FEDERAL COURT OF AUSTRALIA VICTORIA DISTRICT REGISTRY FAIR WORK DIVISION VID 340 of 2014

BETWEEN: DIRECTOR OF THE FAIR WORK BUILDING INDUSTRY INSPECTORATE

AND: CONSTRUCTION, FORESTRY, MINING AND ENERGY UNION

JUDGE: TRACEY J DATE OF ORDER: 20 april 2015 WHERE MADE: MELBOURNE

1. On 28 June 2013, the Second Respondent (Mr Danny Berardi) contravened s 340 of the Fair Work Act 2009 (Cth) ("the Act") in that Mr Berardi took adverse action against Element Five Pty Ltd because it did not exercise a workplace right, namely the making of an enterprise agreement with the First Respondent ("the CFMEU").
2. On 31 July 2013, the Second Respondent engaged in conduct that contravened s 340 of the Act, in that Mr Berardi took adverse action against Element Five Pty Ltd because it did not exercise a workplace right, namely the making of an enterprise agreement with the CFMEU.
3. On 28 June 2013, the Second Respondent contravened s 343 of the Act, in that Mr Berardi took action against Element Five Pty Ltd with the intention to coerce Element Five Pty Ltd to exercise a workplace right, namely the making of an enterprise agreement with the CFMEU.
4. On 31 July 2013, the Second Respondent contravened s 343 of the Act, in that Mr Berardi took action against Element Five Pty Ltd with the intention to coerce Element Five Pty Ltd to exercise a workplace right, namely the making of an enterprise agreement with the CFMEU.
5. On 28 June 2013, the Second Respondent contravened s 348 of the Act, in that Mr Berardi took action against Element Five Pty Ltd with the intention to coerce Element Five Pty Ltd to engage in industrial activity, namely to comply with his lawful request that Element Five Pty Ltd enter into an enterprise agreement with the CFMEU.
6. On 31 July 2013, the Second Respondent contravened s 348 of the Act in that Mr Berardi took action against Element Five Pty Ltd with the intention to coerce Element Five Pty Ltd to engage in industrial activity, namely to comply with his lawful request that Element Five Pty Ltd enter into an enterprise agreement with the CFMEU.
7. On 28 June 2013, the Third Respondent (Mr Shaun Reardon), by operation of s 550 of the Act, contravened s 343 of the Act, in that Mr Reardon, by act or omission, was knowingly concerned in the conduct of Mr Berardi that was intended to coerce Element Five Pty Ltd to exercise a workplace right, namely the making of an enterprise agreement with the CFMEU. THE COURT ORDERS THAT:
8. A penalty in the amount of $20,000 be imposed on the First Respondent for contravening s 343 of the Act on 28 June 2013.
9. A penalty in the amount of $8,500 be imposed on the First Respondent for contravening s 343 of the Act on 31 July 2013.
10. A penalty in the amount of $6,000 be imposed on the Second Respondent for his contraventions of ss 340, 343 and 348 of the Act on 28 June 2013, referred to in declarations 1, 3, and 5 of these orders.
11. A penalty in the amount of $2,500 be imposed on the Second Respondent for his contraventions of ss 340, 343 and 348 of the Act on 31 July 2013, referred to in declarations 2, 4 and 6 of these orders.
12. A penalty in the amount of $6,000 be imposed on the Third Respondent for contravening s 343 of the Act on 28 June 2013, referred to in declaration 7 of these orders.
13. The penalties imposed in paragraphs 8 to 12 inclusive of these orders be paid to the Commonwealth of Australia within 30 days of the date of these declarations and orders.
14. In default of payment of any of the penalties imposed pursuant to paragraphs 8 to 12 inclusive of these orders the Applicant have liberty to apply for direction for enforcement of payment.
15. Each party bear his or its own costs in the proceeding.
16. The proceeding otherwise be dismissed. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

IN THE FEDERAL COURT OF AUSTRALIA VICTORIA DISTRICT REGISTRY FAIR WORK DIVISION VID 340 of 2014

BETWEEN: DIRECTOR OF THE FAIR WORK BUILDING INDUSTRY INSPECTORATE

AND: CONSTRUCTION, FORESTRY, MINING AND ENERGY UNION

JUDGE: TRACEY J DATE: 20 april 2015 PLACE: MELBOURNE

REASONS FOR JUDGMENT 1 The applicant ("the Director") brings the present proceeding against three respondents: the Construction, Forestry, Mining and Energy Union ("the CFMEU") and two individuals who were, at relevant times, officials of the CFMEU, Mr Danny Berardi and Mr Shaun Reardon. 2 The Director has alleged that each of the respondents has contravened provisions appearing in Part 3-1 of the Fair Work Act 2009 (Cth) ("the Act"). 3 Element Five Pty Ltd ("E5") was the head contractor responsible for undertaking building work at a site in Hawthorn. The CFMEU wanted E5 to enter into an enterprise agreement with it. E5 resisted these demands. As a result E5 was subjected to threats and industrial action which interfered with work at the site in June and July 2013. The principal actor on the CFMEU's side was Mr Berardi. Mr Berardi was alleged to have contravened ss 340, 343 and 348 of the Act on two occasions. Mr Reardon was alleged to have been involved in one of Mr Berardi's contraventions of s 343 of the Act (see s 550 of the Act) and the CFMEU was said to be liable for all contraventions of its two officials because of the deeming provision contained in s 363 of the Act.

PROCEDURAL HISTORY 4 The Director's application was filed on 18 June 2014. A statement of claim was filed on the same day. 5 The application and the statement of claim were served on each of the respondents. In the case of Mr Berardi that service was effected on 4 July 2014 when the documents were handed to a woman at Mr Berardi's residence who undertook to give the documents to him. Subsequently, an order for substituted service was made on 1 August 2014. 6 Thereafter, the Director's solicitors kept Mr Berardi informed of the timing of directions hearings and continued to serve relevant documents on him in accordance with the methods stipulated in the order for substituted service. 7 The CFMEU and Mr Reardon filed a defence on 27 August 2014. 8 Mr Berardi did not file a defence. 9 Mr Berardi did not participate at any stage of the interlocutory process and he did not appear at trial despite being advised of the hearing dates. 10 The Director filed four affidavits on 28 November 2014. The deponents were: Mr Christopher Bull, an occupational health and safety co-ordinator for a company associated with E5. Mr Robert Morton, a director and construction manager of E5. Mr Geoffrey Hodder, who was, at relevant times, a site manager employed by E5. Mr Macgregor Bessant, a project manager employed by E5. 11 None of the respondents filed any affidavit evidence. 12 Prior to trial the Director reached an agreement with the CFMEU and Mr Reardon pursuant to which: the CFMEU admitted two contraventions of s 343 of the Act, one on 28 June 2013 and the other on 31 July 2013. It did so on the assumption that Mr Berardi had contravened s 343 on these days and that the deeming provision, contained in s 363 deemed it to have also taken the proscribed actions. Mr Reardon admitted one contravention of s 343 of the Act on 28 June 2013 by reason of his involvement in Mr Berardi's conduct on that day: see s 550 of the Act. 13 The making of these admissions was conditional. They depended on the Court making findings that Mr Berardi had contravened s 343 on 28 June and 31 July 2013. 14 I invited counsel for the Director to direct my attention to the evidence which he contended established that Mr Berardi had contravened ss 340, 343 and 348 on each of these days. Having considered this evidence and the Director's legal submissions, I advised the parties present that I was satisfied that Mr Berardi had committed each of the contraventions alleged by the Director. I said that I would publish my reasons for so concluding at the same time as I dealt with the relief sought by the Director. 15 Upon being so advised counsel for the CFMEU and Mr Reardon confirmed their admissions of liability for contraventions of s 343 of the Act. 16 At some time after 31 July 2013 and before 4 July 2014 Mr Berardi had ceased to be employed by the CFMEU.

THE EVIDENCE 17 Neither the CFMEU nor Mr Reardon sought to challenge any of the evidence on which the Director relied at trial. 18 When the trial commenced each of the persons who had sworn or affirmed affidavits on which the Director relied were present in the precincts of the Court lest Mr Berardi appeared and wished to cross-examine one or more of them. When he did not appear they were excused. Their evidence remained unchallenged and the following factual findings are based on that evidence. 19 In 2013 Lonza Nominees Pty Ltd ("Lonza Nominees") proposed to develop a site at 25 Lynch Street, Hawthorn. Thirty one apartments were to be built on five levels at the site. Lonza Nominees engaged E5 as the head contractor for the project. In turn E5 subcontracted with National Cranes Pty Ltd ("National Cranes") to perform work at the site. National Cranes subcontracted Associated Cranes Pty Ltd ("Associated Cranes") to perform cranage work. E5 also engaged Nucon Design and Construct Pty Ltd ("Nucon") to manufacture, supply and deliver precast concrete panels to the site. These panels were to be used to form the walls and the core structure of the building. 20 In May 2013 Mr Morton telephoned Mr Berardi. In the course of their conversation Mr Berardi said words to the effect: "You're doing a job in my area. We need to meet and you need to come in and discuss and sign an EBA." 21 In mid-June 2013 another CFMEU official advised Mr Morton that: "The time has come for you to sign an EBA." 22 On 27 June 2013 Mr Berardi and another CFMEU official attended the site and asked Mr Hodder whether E5 had entered into an agreement with the CFMEU. Mr Berardi intimated to Mr Hodder that he was aware that E5 had planned a lift on the site the following day. 23 E5 had scheduled work on the site for 28 June 2013. Nucon was to deliver concrete panels from its plant in Shepparton and National Cranes was to lift those panels into position. 24 As scheduled, trucks carrying the concrete panels arrived at the site at about 6:00 am on 28 June 2013. Employees of National Cranes also attended and lifted at least one precast concrete column which was already on site into position. 25 Shortly before 9:00 am the National Cranes crew leader approached Mr Bessant and told him that the shop steward from the site across the road had come and told him (the crew leader) to call an official from the CFMEU. The crew leader called him and had been told not to do anything until Mr Berardi arrived on the site. The crew leader complied with the direction and as a result work ceased. 26 Mr Berardi arrived at the site about an hour later. He spoke to some of the crane crew and asked whether the chains on the panel truck had been undone. When he was told that they had not been undone Mr Berardi said to them: "Well, you're not going to do any work today. Pack up and go home." 27 Shortly afterwards Mr Morton had some telephone conversations with Mr Berardi. In the first of these Mr Berardi told Mr Morton that "You're playing games with me in my area; you won't be lifting the panels today." A little later Mr Morton told Mr Berardi that E5 needed to lift the panels on the site that day. Mr Berardi responded with words to the effect: "You're not fucking lifting the panels." Mr Morton then told Mr Berardi that E5 would not be signing an EBA with the CFMEU. Mr Berardi responded: "Well, you'll be fucked. I'll blockade all your sites." 28 At about 11:30 am Mr Morton telephoned Mr Reardon. He told Mr Reardon about Mr Berardi's conduct at the site earlier in the day and asked Mr Reardon to intervene to ensure that work could continue. Mr Reardon told Mr Morton that he would not intervene and said words to the effect: "Why would I help you and change his [Mr Berardi's] direction? You've shown the CFMEU no respect" and "I'm fucking sick of it, I've had enough and you'll sign an EBA." 29 At about 1:00 pm the Nucon trucks, carrying the concrete panels, left the site. At about the same time the crane crew packed up the crane and also left. 30 No further productive work was carried out at the site that day. 31 On 31 July 2013, E5 had scheduled the installation of more concrete panels. Associated Cranes had been engaged to lift them. Work commenced and panels were being lifted into position by crane. 32 At about 10:00 am Mr Berardi and another official from the CFMEU arrived at the site and spoke to Mr Hodder. Mr Berardi said to Mr Hodder: "You still don't have an EBA." Mr Berardi then walked on to the site and spoke to the crane operator. He said: "Stop what you are doing." The crane operator complied. According to Mr Hodder work stopped for about three hours. Mr Morton, on the other hand, said that, when he arrived at the site between 10:30 and 11:00 am on that morning "the crane was working and work was proceeding on site as planned." I accept that work stopped for a period after Mr Berardi had approached the crane operator but only for a period of about an hour. 33 Mr Bessant gave some general evidence about the additional costs incurred by E5 as a result of the conduct of Mr Berardi on both days. The figures which he provided were estimates and were unsupported by any underlying financial documentation. 34 E5 had arranged for four trucks and drivers to collect panels from the Nucon plant in Shepparton and deliver them to the Hawthorn site. The cost of each truck and driver was put at about $2,000 for the return trip. The trucks returned to Shepparton unloaded. The $8,000 was effectively thrown away. 35 After the events of 28 June 2013 it appears that E5 terminated the contract of National Cranes and engaged Associated Cranes to perform further cranage work at the site. Some attempt was made by Mr Bessant to quantify E5's losses occasioned by the cessation of cranage work at the site after 9:00 am on 28 June 2013 and for an hour or so on 31 July 2013. I accept that these losses occurred but the evidence does not allow me to put a figure on them. 36 Following the events of 28 June 2013 E5 was concerned that any further attempts by it to install concrete panels would be frustrated by industrial action. It commissioned AFS Walling Systems ("AFS") to prepare a design of replacement panels which might be suitable for installation at the site. AFS charged $1,800 for this work. 37 Despite the interruptions to work on 28 June and 31 July 2013, E5 completed the project before the contracted practical completion date. Mr Bessant estimated that, had these delays not occurred, the work would have been completed a week earlier. He estimated that the additional week on site cost E5 about $6,000 which represented the costs of employees who had to remain until practical completion, administrative functions and certain overheads such as site power and security. I accept this estimate.

THE LEGISLATION 38 Section 340(1) of the Act provides that a person must not take adverse action against another person because that other person has a workplace right or has, or has not, exercised a workplace right. Section 341(1)(b) relevantly defines a "workplace right" as one, pursuant to which a person is able to participate in "a process or proceedings under a workplace law or workplace instrument." Such a process includes the making of an enterprise agreement: see s 341(2)(e). 39 Adverse action is relevantly defined in Item 7(c) of the table sub-joined to s 342(1) of the Act. Under that Item an officer or member of an industrial association, such as the CFMEU, takes adverse action against a person if that person is an independent contractor and the action has the effect, directly or indirectly, of prejudicing the independent contractor in relation to a contract for services. 40 Section 343(1)(a) provides that a person must not take, or threaten to take, any action against another person with intent to coerce the other person to exercise a workplace right. 41 Section 348 of the Act provides that a person must not take, or threaten to take, any action against another person with the intent to coerce the other person "to engage in industrial activity." 42 Section 347(b)(iv) provides that a person engages in industrial activity if the person does, or does not, comply with a lawful request made by, or requirement of, an industrial association. 43 Section 360 of the Act provides that "a person takes action for a particular reason if the reasons for the action include that reason." 44 Section 361 provides that, if it is alleged that a person took action for a particular reason or with a particular intent "it is presumed that the action was … taken for that reason or with that intent, unless the person proves otherwise."

Contravention of s 340 45 At all relevant times it was open to E5 to enter into an enterprise agreement under the Act with the CFMEU. Mr Berardi and another CFMEU official had made it plain to representatives of E5 that E5 needed to sign such an agreement. These approaches occurred in May and June 2013: see above at [20]-[22]. E5 initially failed to respond to such requests or demands and then, on 28 June 2013, Mr Morton advised Mr Berardi that E5 would not be entering into an agreement with the CFMEU. 46 In these circumstances Mr Berardi took the action described above in paragraphs [25], [26], [27] and [32]. This action prejudiced E5 by interfering with its work schedule and causing some additional expense in the performance of its contract with Lonza Nominees. The conduct also interfered with E5's contractual arrangements with Nucon and its cranage subcontractors. In the absence of any evidence to the contrary from Mr Berardi it must be presumed that he undertook such adverse action because, as the Director alleges, E5 had failed and declined to enter into an enterprise agreement with the CFMEU. 47 For these reasons I found that Mr Berardi had contravened s 340 on both 28 June and 31 July 2013.

Contravention of s 343 48 The Director alleged that Mr Berardi brought work to a halt at the site on 28 June 2013 and procured a shorter stoppage of work on 31 July 2013 with the intent to coerce E5 to enter into an enterprise agreement with the CFMEU. 49 The entering into such an agreement is, for reasons already given, a workplace right. 50 An intention to "coerce" forms an element of the statutory proscription in three of the sections appearing in Part 3-1 of the Act. These sections are 343, 348 and 355. Some of these provisions are the successors of earlier provisions such as ss 170NC and 789 of the Workplace Relations Act 1996 (Cth). In State of Victoria v Construction, Forestry, Mining and Energy Union (2013) 218 FCR 172 the Full Court considered that the meaning to be accorded to the phrase "intent to coerce" had become settled (see at 187). The Court referred, with approval, to Merkel J's statement in Seven Network (Operations) Ltd v Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia (2001) 109 FCR 378 at 388 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. Secondly, the exertion of the pressure must involve conduct that is unlawful, illegitimate or unconscionable." 51 The first of these elements was explained in greater detail by Weinberg J in National Tertiary Education Industry Union v Commonwealth (2002) 117 FCR 114. Speaking of this element his Honour said (at 143) that: "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." 52 The second element was considered by Buchanan J in Fair Work Ombudsman v National Jet Systems Pty Ltd (2012) 218 IR 436. His Honour pointed to the common law origins of this element in the torts of coercion and duress. In doing so he referred (at 443) to the judgment of McHugh J in Crescendo Management Pty Ltd v Westpac Banking Corporation (1988) 19 NSWLR 40 at 46 where McHugh J had equated the three categories saying (at 46) that: "Pressure will be illegitimate if it consists of unlawful threats or amounts to unconscionable conduct. But the categories are not closed …". 53 Mr Berardi's conduct, on both 28 June and 31 July 2013 evinced an intention by him to negate E5's choice to enter or not to enter into an enterprise agreement with the CFMEU. 54 He sought to achieve this end by preventing work being undertaken on the project thereby occasioning economic loss to E5. His various interventions, including his instructions to employees of sub-contractors, constituted a direct and intentional interference with E5's contractual arrangements with Lonza Nominees and E5's sub-contractors. In doing so he acted unlawfully: see Fightvision Pty Ltd v Onisforou (1999) 47 NSWLR 473 at 512; Ranger Uranium Mines Pty Ltd v Federated Miscellaneous Workers' Union of Australia (1987) 89 FLR 349 at 350-1. 55 In the absence of any evidence from Mr Berardi or on his behalf it is presumed that the action taken by him was taken with the relevant intent. 56 Mr Berardi contravened s 343 on both 28 June and 31 July 2013.

Contravention of s 348 57 The Director's case was that Mr Berardi contravened s 348 by taking and/or organising the stoppages of work at the site on 28 June and 31 July 2013 with the intent to coerce E5 to comply with the demand that it enter into an enterprise agreement with the CFMEU. 58 What I have already said about Mr Berardi's intention to coerce, in dealing with his liability under s 343, also applies in relation to s 348. 59 I accept the Director's contention that Mr Berardi contravened s 348 on both 28 June and 31 July 2013.

RELIEF 60 The Director sought declarations that the various respondents had contravened particular provisions of the Act and the imposition of pecuniary penalties. 61 The Court has jurisdiction to grant declaratory relief in such cases: see s 21 of the Federal Court of Australia Act 1976 (Cth). 62 Such declarations are appropriate in order to explain the basis upon which liability of particular respondents has been established. Declarations also have an educative effect by identifying conduct which is proscribed by legislation: see Director of the Fair Work Building Industry Inspectorate v Cartledge [2014] FCA 1047 at [101]; DP World Sydney Limited v Maritime Union of Australia (No 2) [2014] FCA 596 at [7]. 63 Pecuniary penalties may be imposed by the Court for contraventions of civil remedy provisions such as ss 340, 343 and 348 of the Act: see s 546(1). 64 The maximum penalties prescribed for a contravention of each provision is 300 penalty units (for a body corporate) and 60 penalty units (for an individual): see ss 539(2) and 546(2) of the Act. The value of a penalty unit is $170.00: see s 12 of the Act and Crimes Act 1914 (Cth), s 4AA(1). As a result the maximum pecuniary penalty available for each contravention by the CFMEU is $51,000 and by each of the individual respondents, $10,200. The Court may order that any pecuniary penalty be paid to the Commonwealth: see s 546(3)(a).

FIXING PECUNIARY PENALTIES 65 The principles which guide the determination of appropriate pecuniary penalties in cases such as the present are now well settled: see Director of the Fair Work Building Industry Inspectorate v Cartledge [2014] FCA 1047 at [50] (Mansfield J). 66 The task of the Court is to ensure that any penalty which is imposed is proportionate to the gravity of the contravening conduct: Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union (No 2) (2010) 199 IR 373 at [5] (Barker J). 67 The penalty is to be determined by a process of "instinctive synthesis": Australian Ophthalmic Supplies Pty Ltd v McAlary-Smith (2008) 165 FCR 560 at 567-8 (Gray J), 572 (Graham J). This process involves the Court having regard to all relevant factors before fixing a penalty which brings them all into account. 68 Where multiple contraventions arise from a series of related events which constitute a course of conduct principles of proportionality and consistency come into play in determining the appropriateness of the penalty: Australian Ophthalmic Supplies at 572. 69 The ultimate penalty "must be proportionate to the offence and in accordance with the prevailing standards of punishment": Ponzio v B & P Caelli Constructions Pty Ltd (2007) 158 FCR 543 at 559 (Lander J); Australian Ophthalmic Supplies at 572. 70 Consistency requires that "[l]ike cases should be treated in like manner": Wong v The Queen (2001) 207 CLR 584 at 591 (Gleeson CJ). The consistency principle does not require a detailed factual comparison between past cases and that presently under consideration with a view to fixing a higher or lower penalty depending on the outcome of the comparative analysis: Plancor Pty Ltd v Liquor, Hospitality and Miscellaneous Union (2008) 171 FCR 357 at 376 (Branson and Lander JJ). 71 It is also necessary to ensure that a respondent is not punished twice for the same conduct. The principle was explained by the Full Court in Construction, Forestry, Mining and Energy Union v Cahill (2010) 269 ALR 1 at 12 as follows: "It [the 'course of conduct' principle] 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 inter-relationship 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." 72 This principle is to be applied separately from and anterior to the final check constituted by the application of the totality principle: Mornington Inn Pty Ltd v Jordan (2008) 168 FCR 383 at 396-7 (Stone and Buchanan JJ). It does not necessarily require the application of a single penalty for all of the contravening conduct: Cahill at 13. 73 The totality principle falls for consideration at the end of the process. It requires the Court to stand back and decide whether the aggregate of multiple penalties fixed by it is appropriate for the total contravening conduct involved: see Australian Competition and Consumer Commission v Australian Safeway Stores Pty Ltd (1997) 145 ALR 36 at 53 (Goldberg J). The principle is designed to "ensure that the aggregate of penalties imputed is not such as to be oppressive or crushing": Stuart-Mahoney v Construction, Forestry, Mining and Energy Union (2008) 177 IR 61 at [60] (Tracey J). A consequence of the application of the principle is that the aggregate penalty may be reduced if it is considered to be too great.

PENALTY - MR BERARDI 74 Mr Berardi was the principal offender. It will, therefore, be convenient to deal first with the penalties which should be imposed on him. 75 Mr Berardi's contraventions of ss 340, 343 and 348 of the Act on 28 June and 31 July 2013 arose from the same conduct. As the Director conceded the legal and factual elements constituting a contravention of s 348 are the same as those which gave rise to a contravention of s 343. Mr Berardi's contraventions of ss 340 and 343 both related to E5's failure to exercise the same workplace right. 76 Although the object which Mr Berardi sought to achieve informed his conduct on both days, that conduct differed both as to its nature and effect. The stoppage of work on 28 June 2013 was for much longer than that which occurred on 31 July 2013 and the financial consequences for E5 were much greater on the earlier occasion. 77 For these reasons it will be appropriate to impose a single penalty for contraventions of each of the three sections in respect of each day. 78 The principal purpose served by imposing a pecuniary penalty in cases such as the present is deterrence, both specific and general: General Manager of Fair Work Australia v Health Services Union [2013] FCA 1306 at [24] (Middleton J). Not surprisingly the Director placed considerable emphasis on this consideration. 79 In this context he directed attention to a number of contraventions, by Mr Berardi, of provisions of the Building and Construction Industry Improvement Act 2005 (Cth) ("the BCII Act"). 80 In Gregor v CFMEU [2009] FMCA 1266 Mr Berardi was found to have contravened s 38 of the BCII Act by interrupting work at a building site and conducting a meeting of workers in which he directed them not to perform any further work at the site and to leave the site immediately. A penalty of $1,000 was imposed but was wholly suspended for two years. It became payable because, not long afterwards, Mr Berardi again contravened s 38, this time by imposing a ban on the performance of work at another site at Hawthorn: see Gregor v Berardi [2010] FMCA 805. A penalty of $5,000 was imposed for this contravention. 81 Undaunted Mr Berardi continued to offend. In 2013 Jessup J, in this Court, imposed penalties of $5,000 and $4,500 for contraventions of s 43 of the BCII Act by Mr Berardi at building sites in Ashwood and Canterbury. Mr Berardi had encouraged a mobile crane crew not to enter a work site and had persuaded workers on another site to go on strike, in both instances with a view to coercing an employer to re-instate an employee: Director of the Fair Work Building Industry Inspectorate v Construction, Forestry, Mining and Energy Union [2013] FCA 515. 82 The type of conduct involved in these cases bears a striking similarity to that presently under consideration. 83 A penalty for contraventions of Part 3-1 of the Act must be fixed at a level that is sufficiently high to deter repetition by a contravener and by others who might be tempted to follow suit: cf DP World Sydney Limited v Maritime Union of Australia (No 2) [2014] FCA 596 at [18]; Ponzio v B & P Caelli Constructions Pty Ltd (2007) 158 FCR 543 at 559-560 (Lander J). In Grocon Constructors (Victoria) Pty Ltd v Construction, Forestry, Mining and Energy Union (No 2) (2014) 241 IR 288 at [196] Cavanough J observed that: "… few things could be more destructive to the authority of the Court and to the rule of law than the idea that fines or similar punishment are akin to a tax that, once budgeted for, enable the use of unlawful conduct to achieve industrial outcomes." Put another way (as has been done in the context of contraventions of consumer law) a penalty "must be fixed with a view to ensuring that the penalty is not such as to be regarded by [the] offender or others as an acceptable cost of doing business.": see Singtel Optus Pty Ltd v Australian Competition and Consumer Commission (2012) 287 ALR 249 at 265. 84 Mr Berardi is not to be punished again for his earlier misconduct. The fact that he has continued to engage in similar conduct, notwithstanding the earlier penalties does, however, suggest that those penalties have not been sufficient to deter further misconduct by him: cf Veen v R (No 2) (1988) 164 CLR 465 at 477-8. In such cases a more severe penalty may be warranted than would be the case where the offender has not previously contravened the relevant provision. This is such a case. 85 I bear in mind that Mr Berardi is no longer employed by the CFMEU. This may mean that there is limited scope for him engaging in similar misconduct in future. The evidence does not, however, disclose Mr Berardi's present employment (or lack of it) and, as a result, any attempt to make an assessment of the scope for Mr Berardi committing future contraventions of the Act would be purely speculative. 86 In these circumstances the need for deterrence of Mr Berardi and other union officials must weigh heavily when fixing an appropriate penalty. 87 Under the Act an employer, such as E5, has a right to enter or not to enter into an enterprise agreement with a particular union (or any union). The Act provides for a process whereby the CFMEU could have instigated and pursued enterprise level collective bargaining with E5 on behalf of E5's employees. 88 Despite, it may be assumed, Mr Berardi being aware of the relevant statutory regime, he showed no interest in complying with it. His attitude was that E5 was undertaking construction work in what he described as "my area" and that this meant that E5 was required to sign an enterprise bargaining agreement with the CFMEU. When he was told that this demand would not be complied with his response was "Well, you'll be fucked. I'll blockade all your sites." He then set about disrupting work on two days thereby causing economic loss to E5. Mr Berardi was intent on imposing his will on E5 regardless of E5's rights under the Act and in disregard of the protections afforded to the company by ss 340, 343 and 348 of the Act. 89 As a result of Mr Berardi's failure to appear in the proceeding I have no information which would enable me to assess his capacity to pay any penalty imposed on him. 90 Mr Berardi has shown no remorse or contrition for his conduct or undertaken to comply with the requirements of the Act in future. 91 When his wishes were frustrated Mr Berardi arrogated to himself the right to direct workers on the site to stop performing their duties and then to leave the site. As already noted the consequences of his conduct were different on the two days. On 28 June 2013 work ceased in the early hours and did not resume that day. Four large trucks had to return to Shepparton without being unloaded. A mobile crane had to be dismantled and leave the site having done little work. The interruption to work on 31 July 2013 lasted for only about an hour or so. These differences need to be taken into account in fixing a penalty. 92 In the circumstances I consider that a penalty of $6,000 should be imposed in respect of the contraventions on 28 June 2013 and $2,500 in respect of those on 31 July 2013. Having decided on these penalties I had regard to the totality principle and decided that no adjustment was required. The aggregate sum, in my view, is appropriate having regard to the entirety of Mr Berardi's relevant conduct.

PENALTY - CFMEU 93 The CFMEU accepted that, if Mr Berardi had contravened s 343 of the Act on each of the two days, it too was liable for these contraventions because Mr Berardi had acted in his capacity as an official of the CFMEU: see s 363 of the Act. 94 Again, the need for deterrence, both specific and general, was stressed by the Director. He provided the Court with a table containing a list of 19 cases since 2004 in which the CFMEU had been found to have engaged in coercive conduct in contravention of various provisions of Commonwealth industrial legislation. These contraventions had led to the imposition of substantial pecuniary penalties on the CFMEU. The conduct, and the circumstances in which it occurred, varied in its nature and severity. 95 The Director also drew attention to a series of judicial observations relating to the CFMEU's ongoing willingness to ignore legislative proscriptions which constrained its conduct. The most recent of these observations was made by White J in December 2014, in Director of the Fair Work Building Industry Inspectorate v Stephenson [2014] FCA 1432 at [76]-[77]. His Honour there said: "The Director provided a schedule of the occasions on which the CFMEU has been dealt with by Courts for non-contraventions [sic] of industrial legislation. It is fair to describe the CFMEU record as dismal. Since 1999, the CFMEU has had penalties imposed on it by a Court on numerous occasions … The record indicates an attitude of indifference by the CFMEU to compliance with the requirements of the legislation … It also indicates that deterrence must be a prominent consideration in the fixing of penalties in the present cases." 96 The present conduct of one of its officials adds to this depressing litany of misbehaviour. 97 It evidences an ongoing disregard for the rule of law and highlights the need for the imposition of meaningful penalties within the limits imposed by the Act. 98 The CFMEU has not contested liability. This is a factor which counts in its favour. It has not, however, deprecated Mr Berardi's conduct or expressed any contrition for failing to prevent his contraventions. Nor has it indicated any willingness to take steps to ensure that its officials in future comply with their legal obligations. 99 In the circumstances I consider that a penalty of $20,000 should be imposed on the CFMEU in respect of Mr Berardi's contravention of s 343 on 28 June 2013 and $8,500 in respect of his contravention on 31 July 2013. Again, I have had regard to the totality principle in fixing these penalties.

PENALTY - MR REARDON 100 Mr Reardon was, at relevant times, Assistant Secretary of the Victoria - Tasmania Divisional Branch of the Construction and General Division of the CFMEU. He did not contest the Director's allegation that he was involved in Mr Berardi's contravention of s 343 of the Act on 28 June 2013. Mr Reardon's liability arose because Mr Morton had advised him of Mr Berardi's conduct on that day and Mr Reardon had stridently declined to intervene: see above at [28]. 101 The Director referred the Court to three decisions of the Federal Magistrates Court and this Court in which Mr Reardon had been penalised for contraventions of ss 38 and 43 of the BCII Act relating to contraventions which had occurred in 2008 and 2009. A total of seven contraventions were involved. 102 Mr Morton had explained to Mr Reardon what Mr Berardi had done at the site and the consequences of that conduct. I infer that Mr Reardon would have been in a position, had he been so minded, by reason of his position as Assistant Secretary of the Branch, to have directed Mr Berardi to desist. Mr Reardon, in substance, endorsed what Mr Berardi had done, notwithstanding that it involved contraventions of the Act. Although Mr Reardon was not the actor his level of culpability was co-extensive with that of Mr Berardi. 103 Mr Reardon expressed no remorse for his conduct and expressed no willingness, in future, to comply with the Act. He gave no evidence about his capacity to meet any pecuniary penalty which the Court might be minded to impose. 104 I consider that a penalty of $6,000 should be imposed on Mr Reardon for his involvement in Mr Berardi's misconduct. I certify that the preceding one hundred and four (104) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Tracey.