Penalty principles
30 By subs 49(2)(a) of the BCII Act the maximum penalties available for a contravention of s 38 of the BCII Act, at material times, are:
(1) for a body corporate, $110,000 (1,000 penalty units); and
(2) for an individual, $22,000 (200 penalty units).
In this regard a penalty unit has the same meaning as in s 4AA of the Crimes Act 1914 (Cth) which defines a "penalty unity" to be $110 as at 21 February 2012: see 4(1) BCII Act.
31 Neither s 49 nor any other section of the BCII Act specifies any particular factors or principles that are to be taken into account by a court when it considers the imposition of a penalty for contravention of s 38 (or any other provision of the BCII Act).
32 Thus, consideration of penalty is governed by general principles.
33 About these general principles, the parties are general agreement. The overriding principle is that when fixing a penalty a court should ensure that the penalty is proportionate to the gravity of the contravening conduct. Deterrence, both specific and general, is also relevant. The process of fixing the penalty is one involving instinctive synthesis. Nonetheless it is appropriate for the Court to have regard to a range of factors that might be relevant in the circumstances of a particular case, being cautious, however, not to regard any previously articulated set of factors that may be relevant to the penalty setting process as rigid or as if imposed by the legislature itself. These principles were referred to generally by me in Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union (No 2) [2010] FCA 977; (2010) 199 IR 373.
34 A similar approach to the setting of penalties under other regulatory, civil penalty legislation of the Commonwealth has been adopted. See for example the discussion in Comcare v Post Logistics Australasia Pty Ltd [2012] FCAFC 168; (2012) 207 FCR 178 at [43]-[79]. Whilst primarily concerned with the imposition of a pecuniary penalty under the former Occupational Health and Safety Act 1991 (Cth) the observations made by the Full Court about the factors relevant to the imposition of a civil penalty in that statutory context are generally relevant in the present statutory context.
35 It remains then to consider the circumstances in which the contraventions here took place in order to assess the seriousness of the contraventions by the various respondents.
36 It can be seen from the agreed facts that the conduct of the first respondent, Mr McDonald, is at the root of the contraventions in each case. By reason of the operation of the BCII Act the two unions, the CFMEU and CFMEUW, attract liability because of the conduct of their member, employee and assistant secretary.
37 As is apparent from the prior penalty decisions relied on by each of the parties, Mr McDonald and the unions are no strangers to the BCII Act and like predecessor legislation concerned with regulation of the building and construction industry.
38 Indeed, Mr McDonald's awareness of the relevant regulatory provisions and preparedness to act in the way it is agreed that he did is confirmed by the agreed facts and is a factor of direct relevance to the penalty setting process in this case.
39 The agreed facts provide the Court, in many respects, with a relatively general account of the circumstances in which the contraventions occurred. The Court is told that Mr McDonald attended the site from about 5.00 am on 21 February 2012 and without any authorisation from any of the site occupiers entered onto the site and attended the pre-start area of the contractor, CIA. He began talking to some of the CIA and Karridale employees and engaged them in a meeting. He then encouraged other site employees to attend this meeting. In the end about 48 CIA employees and about 10 or 11 Karridale employees were present at the meeting in the CIA pre-start area. Then about 12 PCM employees attended and joined in the meeting.
40 At material times, Mr McDonald was asked by Mr John Lange, an employee of the Chamber of Commerce and Industry of WA who was engaged by Citic to provide industrial relations support on the site, to leave the site because he did not hold a right of entry permit. Mr McDonald responded by telling Mr Lange to, "Fuck off".
41 Mr Lange then addressed the group of Karridale employees and told them that what was occurring could be unlawful industrial action.
42 Mr Lange again asked Mr McDonald to leave the site because he didn't have a right of entry permit to which Mr McDonald, on this occasion, replied:
I haven't had one for seven years and that hasn't fucking stopped me.
43 It also appears that while the meeting was going on other site employees joined the meeting "from time to time".
44 From about 6.30 am Mr McDonald continued to address the meeting. By this time the meeting had cut into ordinary rostered working hours and there were apparently some 87 site employees in the CIA pre-start area who were then being addressed by Mr McDonald.
45 It is accepted that, at this point, the meeting was not authorised and constituted unlawful industrial action. It is identified above as the first building industrial action.
46 During the course of the first unlawful industrial action, Mr McDonald, amongst other things, told site employees present (in substance) that although people in Perth considered that they were being overpaid, he and Mr Buchan (the divisional branch secretary of the CFMEU and secretary of the CFMEUW) were "right behind you 110%".
47 Mr McDonald also then said to the meeting that if they were going to be docked four hours pay they "may as well go home".
48 It also appears Mr McDonald was then told by a security officer that he was going to call in the police to forcibly remove Mr McDonald. Mr McDonald responded by observing that it looked like he would be arrested and said to the employees: "I trust you will do what's necessary in sympathy".
49 A show of hands was then called for by a participant at the meeting from those who were going off for the day in support of Mr McDonald. The show of hands indicated a majority in support of not working as rostered for the rest of the day.
50 By 7.00 am, the unauthorised stop work meeting had concluded and the site employees dispersed and Mr McDonald left the site.
51 The second building industrial action admitted by the respondents to be in contravention of the BCII Act was the action of some 48 CIA employees and 29 PCM employees in leaving the site and not performing work for the rest of the day, despite being rostered to do so.
52 It is noted, however, that the Karridale employees who attended the meeting returned to work as rostered.
53 It is obviously accepted by the respondents that the conduct of Mr McDonald at the meeting led to the second building industrial action.
54 From these facts it is not entirely clear why it was that Mr McDonald attended in the CIA pre-start area to address the various employees of contractors. There is no additional information provided to explain the apparent concern expressed by Mr McDonald that people in Perth held the view that these employees were overpaid. The best that can be said from the facts that are agreed is that Mr McDonald, and the respondents through Mr Buchan, were intent on providing a show of industrial strength in the event that the employers of these employees might be influenced by some asserted public sentiment to reduce their pay rates.
55 From these facts there is nothing to suggest that Mr McDonald ever attempted to keep the initial meeting in the CIA pre-start area to a limited time so that the various site employees could commence their rosters at the scheduled time.
56 Rather, the clear inference is that Mr McDonald was more than content to take the meeting into scheduled rostered hours and challenge the employers of the site employees attending the meeting. He plainly was not fazed by the direction from Mr Lange that he should leave the site and his response, that he had not had a right of entry permit for seven years and that had not stopped him from attending on such sites, discloses that Mr McDonald's conduct in taking the meeting into the scheduled rostered hours may also be considered not to have been accidental.
57 Mr McDonald then suggested at the meeting that the site employees take the whole day off, given they would be docked four hours in any event.
58 As soon as Mr McDonald was advised by the security officer that the police were going to be called to remove him, his immediate response was to suggest that as an additional reason why the site employees should go out for the day, "in sympathy".
59 Mr McDonald's conduct involves a calculated and careless attitude to the law governing the employment of persons by employers. It was calculated to cause disruption to employers carrying out building and construction work on the site and it was careless in that Mr McDonald was aware of the legal consequences of his actions and pursued them nonetheless. In the result, he achieved his aims by both taking the meeting into the scheduled rostered hours and then ultimately causing a large number of site employees to take the whole day off.
60 Thus, when one has regard to the nature and extent of the conduct which led to the contraventions, it cannot be described as trivial, but calculated and careless. Mr McDonald knew he did not have any right to enter upon the site. He refused to leave when asked. He then invited site employees to go out for the day. When told that the police were coming to take him away, he responded, effectively, by confirming his call for a day long strike.
61 The circumstances from which the conduct took place, as I have commented above, are stated very generally. It is not entirely clear why on this occasion Mr McDonald and then other respondents considered it necessary to act in the way that Mr McDonald did.
62 Nonetheless the nature and extent of any loss or damage sustained as a result of the contraventions is also very generally stated. It plainly caused disruption, such that the site employees who left the site for the day did not perform any rostered work hours that day. No evidence has otherwise been provided as to the extent of the loss or damage. This disruption, no doubt, was material, although the Court is not in any position to particularise the loss suffered by contractors.
63 There is a question whether the contraventions were distinct or arose out of the one course of conduct. There is no doubt that the conduct giving rise to the contraventions is related. On the face of it, Mr McDonald went to the site with the view of conducting a meeting. I accept, however, as stated above, that there is nothing to suggest Mr McDonald ever intended keeping his meeting to a limited time so that site employees could commence their scheduled rosters on time on the day in question. Rather, the inference is open and I draw it that Mr McDonald always intended that the meeting would cut into the scheduled roster. He invited a day long strike. Once he was told that the police would come, he confirmed that call.
64 In my view, while it is open to say, and reasonable to say, that separate penalties should be imposed for the first and second unlawful industrial actions involving Mr McDonald, in the result I consider the two acts of contravention are closely related and this should be borne in mind when setting the penalties. In that regard, the second is more serious, as both parties accept, involving as it did a day's strike.
65 It is also appropriate in considering the seriousness of the contraventions to have regard to the size of the business enterprise involved, whether or not the contraventions were deliberate and whether senior management was involved in these contraventions. There is no doubt that the unions are large organisations who are actively engaged in protecting the interests of their members. In this case, as I have stated above, the conduct of Mr McDonald was quite deliberate. Mr McDonald took the name of Mr Buchan when emphasising that the unions were behind the employees in relation to the perceptions apparently expressed in Perth about the rates of pay of the employees. There is no evidence to suggest that the respondents dispute, on any reasonable grounds, that Mr McDonald was acting within the scope of his employment and position with the unions when he so acted. There is nothing to suggest he was freelancing, for example, or taking the name of Mr Buchan in vain.
66 It is also appropriate to have regard to whether or not a contravener has exhibited contrition for offending conduct. Where true contrition is expressed, this may reflect on the assessment of the seriousness of the contravention. It may also bear on the question of whether a specific or general deterrent factor needs to be displayed in the penalty imposed. In this case, there is nothing to suggest that Mr McDonald has expressed any contrition for the contraventions. Indeed, his conduct in going onto the site, convening a meeting, taking the meeting into rostered working hours and then effectively calling the men out, in circumstances where he plainly knew he had no right to be on the site and that what he was doing was going to attract the attention of the authorities, means no account should be taken of any appeal to contrition.
67 I do accept, however, that in the end the respondents have admitted the contraventions and this factor, in reducing the time and expense of the applicant in pursuing the prosecution of this proceeding, should be taken into account when penalty is set.
68 It is also common to take into account any corrective action taken following the contravention. However, that is not a relevant factor here.
69 This is a case where, in the end, I consider the contraventions involved in the first unlawful industrial action and the second unlawful industrial action to be approaching the middle level of seriousness. I say that because, while there is no particular identified loss or damage, the fact is that Mr McDonald took what can only be described as calculated and careless behaviour which he knew was unlawful in circumstances where he had contravened in a similar way on previous occasions.
70 It may be seen to be conduct that was designed to cause disruption and inflict some degree of harm on the various contractors on the site and provide a reminder to all concerned of the industrial strength of the respondents.
71 Whether or not from the respondents' point of view such action might have been considered pre-emptive in relation to any concern harboured by them about site employees' pay and conditions at the site, the conduct of the respondents in flouting the industrial laws was, as I say, calculated and careless in this regard.
72 The penalty set should therefore, if posed at a level of seriousness at about the middle, provide both a specific deterrent to Mr McDonald and the unions to indicate to them, as they must be aware, that such conduct will always be met with penalties of this nature, and as a general deterrent to others involved in the building and construction industry not to engage in such behaviour.
73 It was mentioned above that there are a number of prior incidents involving unlawful industrial action that have resulted in the imposition of penalties against the respondents. It is generally accepted by the parties that the penalties imposed for the conduct described in the cases listed in Sch B of the respondents' outline of submissions on penalty are relevant in this case, and I take them into account generally when setting penalty. Among other things, they confirm that the respondents are not "cleanskins" when it comes to compliance with industrial laws such as the BCII Act and know that repeated, calculated contraventions will be met with monetary penalties of some significance.