Hadgkiss v Construction Forestry Mining and Energy Union

REASONS FOR JUDGMENT 1 I have found that the fifth respondent made false and misleading statements to three employees of the first respondent concerning their obligation to join the third and fourth respondents, in breach of s 298SC of the Workplace Relations Act 1996 (Cth), and that that conduct is by the statute to be taken as conduct of the third and fourth respondents. I then proposed making a declaration concerning the third and fourth respondents' contraventions, but not that of the fifth respondent. The questions which now arise for determination are which of the third and fourth respondents should pay the compensation to the three employees, in a sum which represents the amounts they paid by way of membership fees, and the quantum of any pecuniary penalty to be paid by the third, fourth and fifth respondents. 2 As to the first question, the third and fourth respondents have not clarified the position as to which of them received the moneys or how it was shared. There will therefore be an order that they are jointly liable to repay the sums. 3 The maximum pecuniary penalty which the third and fourth respondents can be ordered to pay for a contravention of Part XA is $33 000 each. The maximum penalty for a person such as the fifth respondent is $6600. The Workplace Relations Act is silent as to the matters which might influence an assessment of penalties. 4 Justice Dowsett, in dealing with the penalties payable by the first and second respondents for other conduct in breach of the Part, identified a number of factors as relevant: the circumstances in which the conduct took place; any previous similar conduct; the number of contraventions and whether they are properly seen as distinct or separate occurrences; the consequences of the conduct; the need and the circumstances for the protection of industrial freedom of association; the purpose of the legislation; the need for a deterrent; the capacity of the relevant persons to pay; whether there has been shown a disposition to cooperate with the authorities; whether the contravention arose out of the conduct of senior management or at a lower level; and whether the corporation has a culture of compliance. The two last-mentioned factors were relevant to a corporation. Translated to industrial associations, questions as to what, if any, action they have taken to ensure officers are familiar with the statutory prohibitions, and the principle of freedom of association enshrined in the legislation assume importance. 5 The conduct of the fifth respondent occurred on one occasion, although his lack of understanding, and his evidence that he said the same thing on each occasion that he sought to have new employees join the third and fourth respondents makes it highly likely that he has done so on other occasions. I do not consider that he did so in flagrant disregard of the Workplace Relations Act 1996 (Cth), although he should have acquainted himself with its provisions. As difficult as it may be to believe that anyone could not know about a person's freedom to join, or not join, an industrial association, I am prepared to accept that he did not. In that regard, he had received no advice or training whatsoever from the third and fourth respondents as to his duties as their officer. He has recently been retrenched, not for reasons associated with this matter, and there is no reason to believe that he is a person of substantial financial means. It is correctly pointed out on his behalf that a specific need for a deterrent affecting him is absent. He is about to commence his own business and will have no further dealings with industrial associations. Indeed, I was initially inclined not to award a penalty against him at all but I recognise that there is a need for general deterrence. The penalty should be sufficient to make the point, but no more. He was the agent for the third and fourth respondent and although there is no evidence that he was told to say what he did, there was nothing to ensure that he did not. He did not understand what he said was wrong. It did not have any serious financial effect upon the employees although the importance of it as impinging upon their rights should not, therefore, be lessened. 6 The applicant submits that the fifth respondent did not fully cooperate by being completely frank in his later evidence. It is, however, acknowledged that he did cooperate when he first agreed to be interviewed and he was frank in his initial admission, at least before he realised that he was in some trouble. I accept this as accurate. It may also be observed that he has never been in this kind of trouble before. It became difficult for him to reflect upon what he had said when he was later represented by the third and fourth respondents. I did not detect in him a desire to be other than frank and I infer that he was concerned by the position in which he found himself. I therefore propose to order that he pay a pecuniary penalty of $300. 7 Although the conduct in question was not as serious as some other conduct in breach of the Part may be, the third and fourth respondents' approach to their officers and to the conduct of proceedings such as this are important factors. There is discernible a level of detachment, if not arrogance, in their approach and I can discern no real concern for the position of the fifth respondent and other officers like him. They have not acknowledged their wrongdoing. When it was apparent from the fifth respondent's statements of interview that he had said that it was a 'union shop', it must have indicated to them that his position, and therefore theirs, was not readily defensible. They undertook a technical defence which has consumed time and costs. They have not recognised that they have failed their officers in their obligations, as industrial associations, to properly educate them. 8 Their assertion that the third respondent has increased programs to this end is without substance. One reference to freedom of association provisions was made by it in a seminar since the proceedings were commenced. It proposes some rule changes, to the effect that it is no part of an officer's duty to contravene the Act or to induce or coerce or threaten people to join an industrial association. This would appear to be in its own interests and provide possible defences. The third and fourth respondents, also rely upon the statement made by the applicant himself that it represents a positive cultural shift. It does not, however, amount to an acknowledgment of their need for officer training. 9 The applicant has submitted that the penalty to be imposed upon the third and fourth respondents should be increased because they, or more particularly, the third defendant, have engaged in similar conduct on previous occasions. There would not appear to be evidence that the fourth respondent has been involved in prior contraventions of this nature. The point the third respondent seeks to make is that it is an amalgamated federation and the conduct in the cases relied upon by the applicant is conduct of branches of different divisions of the third respondent, which are largely autonomous. As a national body it should be not be liable for their conduct, or be seen to have been responsible for their conduct in the past. 10 The third respondent is the body responsible for penalties as an organisation. It has adopted the structure which it now seeks to be distanced from. In any event it should be in a position to be more influential with respect to those divisions at least with respect to matters involving the rights of others which are enshrined in legislation. The cases referred to by the applicant do not however suggest that contraventions of this kind have been habitual and I accept that the third respondent may not have been aware of this particular problem. Nevertheless, as I have said, it owed duties to ensure its officers know of the statutory provisions. 11 The third and fourth respondents' alternative submission was that the penalty that Dowsett J imposed on the first respondent, $3000, is a useful guide to penalty. I do not consider it has much relevance to them. Putting aside the different nature of the conduct, the corporate respondent in that case was contrite, made undertakings as to compliance and cooperated with the authorities, to the extent that the matter proceeded upon an agreed statement of facts. I propose to impose penalties against the third respondent in the sum of $6000 and against the fourth respondent in the sum of $3000. There will also be an order that the penalties be paid into consolidated revenue. 12 The orders of the Court will therefore be: 1. To declare that the third and fourth respondents have each engaged in conduct in contravention of s 298SC of the Workplace Relations Act 1996 (Cth) as it stood at September 2004, by their representative making false and misleading representations to three employees of the first respondent in September 2004, that the employees were obliged to join the third and fourth respondents in order to work for the first respondent. 2. Further order pursuant to s 298U(a) of the Act: (a) The third respondent pay a penalty of $6000; (b) The fourth respondent pay a penalty of $3000; (c) The fifth respondent pay a penalty of $300; within twenty-eight days, in respect of their contraventions of s 298SC of the Act. 3. The penalties payable in accordance with the preceding order are to be paid into the consolidated revenue fund. 4. Further order pursuant to s 298U(c) of the Act that the third and fourth respondents pay the following compensation: (a) to Robert Holz the sum of $200; (b) to Cameron Dann the sum of $200; (c) to Dean Angus the sum of $50; within twenty-eight days, and that their solicitor file an affidavit concerning that compliance forthwith upon payment being made. I certify that the preceding twelve (12) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Kiefel.