Lend Lease Project Management & Construction (Australia) Pty Ltd v... [2011] FCA 387 | Case summary

REASONS FOR JUDGMENT 1 It is a matter of direct observation from the Commonwealth Law Courts Building in Brisbane, where this application is being heard, that a large construction project is under way in the block from the river beyond this Court's site. That large construction project has been under way for some time, again as a matter of direct observation. The project entails the construction in a block between George Street and Roma Street of premises that will house, upon their completion, the Supreme Court of Queensland and the District Court of Queensland. In other words, the project is one which is intimately associated with one of the co-equal branches of government of the State of Queensland, the judicial branch of government. 2 It was also common ground between the parties that the project is one which, in today's economic times in Queensland, is an important source of work in the building industry in the Brisbane metropolitan area. For each of these reasons then, there are, quite apart from matters of industrial relations, at least two important public interests served by this particular building project. 3 It was for me a matter of direct observation today that there was no work occurring on that particular project site. The explanation for that was revealed by the application made this afternoon by Lend Lease Project Management & Construction (Australia) Pty Ltd (Lend Lease). 4 Lend Lease seeks injunctive relief and the imposition of penalties pursuant to s 421(3) of the Fair Work Act 2009 (Cth) (Fair Work Act) and further, or in the alternative, s 39 and s 49 of the Building and Construction Industry Improvement Act 2005 (Cth) (Building and Construction Industry Improvement Act) and s 23 of the Federal Court of Australia Act 1976 (Cth) (Federal Court of Australia Act). It makes that application on the basis of grounds stated in what are said to be accompanying affidavits. It claims the imposition of a penalty or penalties upon named respondents due to alleged contraventions of s 38 and s 44 of the Building and Construction Industry Improvement Act, orders that the court thinks necessary to stop such contraventions and such orders as the court thinks necessary to remedy the effects of such contraventions. 5 Lend Lease also seeks interlocutory relief. The interlocutory relief is detailed in Part B of the application. It includes directions as to the further conduct of the proceeding. In the course of the hearing of the application this afternoon, the claim for interlocutory relief was modified so as to engage in terms an order which was made yesterday in Fair Work Australia by Senior Deputy President Richards. 6 The background to that order is best viewed in light of the recommendation which the Senior Deputy President made also that day. The recommendation which he made was in these terms: Alleged industrial action at Brisbane Supreme Court and District Court sites [1] Following a hearing today in relation to an application under section 418 of the Fair Work Act (the Act) by Lend Lease Project Management and Construction (Australia) Pty Ltd (Lend Lease), I have found that unprotected industrial action is happening and also is threatened or probable on the Brisbane Supreme Court and District Court constructions sites at 419 George Street in Brisbane. A stop order has been applied to the employees and the relevant unions (identified in the order) for a duration for two months. This stop order follows the expiry of an earlier order on 22 March 2011, which applied to the same site. [2] The application was necessitated for reason of the withdrawal of labour in the context of continuing concerns with allegations of sham contracting on the site. [3] At the time of the prior stop order I issued a Recommendation concerning the way in which this issue (which was central to the stoppage at that time as well) might be able to be explored between the parties.
[4] Over the course of today's hearing it became apparent to me that Lend Lease was in the process of developing what appears to be an enhanced initiative to deal with sham contracting concerns. [5] Reasonably, this initiative might have been the subject of an application to Fair Work Australia (FWA) by the relevant unions which might have rendered recourse to industrial action (with lost wages to employees and considerable costs to Lend Lease) unnecessary. [6] In this context I now recommend as follows: By Wednesday, 20 April 2011, Lend Lease inform the relevant unions and FWA in writing of the detail of its intentions to engage an external auditor or external services capable of conducting audits with the goal of reducing the incidence of or likelihood of sham contracting on the site. 7 Today's application, of course, involves no excursion into whether or not there is, to use a term which is current in industrial relations, if inaccurate, "sham contracting" on that site. I make the observation that it is an inaccurate term because one might apprehend in many instances that the very purpose of an arrangement would be to be efficacious rather than a sham. I understand though the term is used loosely in a way which embraces arrangements akin to those of an employee although not in the form of such an arrangement. 8 Be that as it may, there is, against the background of that recommendation, a subsisting order made by Fair Work Australia under s 418 the terms of which now correspond with the terms of the interlocutory injunctive relief sought by Lend Lease. 9 The application has been made on very short notice indeed today but it has been made on notice and there has been an appearance on behalf of the first respondent named in the application, the Construction, Forestry, Mining and Energy Union (CFMEU), and the fifth respondent, the Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia (CEPU). There has also been an appearance for the fourth respondent, the Construction, Forestry, Mining and Energy Union, Industrial Union of Employees, Queensland. As to the fourth respondent, there is, at present, an interrogative note as to whether that body remains, as its name might suggest, a union registered under State industrial law or whether it has been taken up under transitional provisions as a federally registered union. In the result today nothing particularly turns on that. Understandably, given the urgency of the matter, there is an absence of precision as to whether it is a separate legal entity under State or Federal law. For the present, it is enough that it is more likely than not a legal entity, with precision as to the source of that legal entity status not presently being required. 10 There is no relief sought against the named second, third and sixth respondents by way of interlocutory injunctive relief. 11 Whilst affidavits are mentioned in the application, in the result, Lend Lease read and relied upon but one affidavit in relation to the claim for interlocutory injunctive relief, that is an affidavit of Mr Kearney sworn today. 12 Mr Kearney has been, since about September 2006, employed by Lend Lease as a foreman. More particularly since about November 2008 he has been the General Foreman (Structure) on the Law Courts Project site. Lend Lease has about 70 to 80 employees on that project site. On a day to day basis there are approximately 450 persons, including those Lend Lease employees, employed at the project site. 13 Mr Kearney deposes that on Monday of this week, 11 April 2011, he attended at the Law Courts Project site for work at about 5.55 am. Shortly thereafter, around 6 am, he attended a pre-start meeting of the Lend Lease employees at the site. He had some further discussions with managers on the project. At about 6.55 am that day he was situated on the ground floor, also known as the podium of the project. At about 7 am he noticed workers streaming back through the Roma Street pedestrian gate and entering the podium area to the stairs to the basement lunch rooms. It is in those lunch rooms that the workers' personal belongings are stored. He was informed, at about 7.15 am, that the workers were going home and out for 24 hours. 14 The following day, at about 5.55 am, Mr Kearney again attended for work at the Law Courts Project. At about 6 am on 12 April, and for the following 20 minutes, he attended a pre-start meeting. At about 6.30 am he put on his personal protection equipment and went to the podium area. At about 7 am he observed the workforce streaming through the Roma Street pedestrian gate and entering the podium area to the stairs to the basement lunch rooms. At about 5 minutes past 7 am, with a work colleague, he went to the pedestrian crossing on Roma Street, crossed over that road, and then went down that street to where a number of union organisers were standing. He recognised there two persons, a Mr Pearson and a Mr O'Doherty, and others who he observed had AMWU and ETU on their clothing. The AMWU, I note, is more likely than not, in terms of inference from known industrial terminology, not a respondent union. The ETU, on the other hand, is in all likelihood, a reference to a body associated with another union which is a respondent. In any event, a conversation transpired, the effect of which was that Mr Pearson informed Mr Kearney that the workforce was on strike and: Anyone going up there would be scabs. There is a report-back meeting tomorrow morning. 15 Today again, at about 5.55 am, Mr Kearney attended the Law Courts project for work. Once again, at about 6 am, he attended a pre-start meeting for Lend Lease employees. At about 6.30 am he decided to go to the Roma Street gate to observe what was happening at the meeting of workers across the park adjacent to the project. I infer from that statement that there was a meeting of workers at the park adjacent to the project in progress at that time. At about 6.45 am Mr Kearney observed some Lend Lease employees standing near the Law Courts project traffic gate situated in Roma Street. He went over to where they were standing, spoke with some of them, the effect of the conversation being an inquiry by him as to what was happening today and if they were aware that a particular individual had resigned from the union. 16 From the position at that gate Mr Kearney could observe the meeting of the workers in the park opposite. He observed there a person, Mr Pearson, who he had met on previous occasions. At about 7.52 am he observed workers raising their arms into the air and he heard Mr Pearson say words to the effect: Thank you very much. 17 At about that time he also received information from Mr O'Doherty who informed him, along with others with whom Mr Kearney was then in company, that the workers had gone out for 24 hours with a report-back meeting tomorrow, 14 April 2011. Shortly before 8 am Mr Kearney observed the workers dispersing from the meeting. He heard a loud cheer as this occurred. He saw them walking in the direction of Roma Street train station, across Roma Street, heading towards the Roma Street gates. He saw them going through those gates across the podium and towards the stairs of the basement and the lunch room. Mr Kearney deposes that work on the project was to have been undertaken today. Details of reinforcement and precast cement columns were programmed for today. Also, formwork was to have been undertaken, construction of decks, altering perimeter screens, installation of facades and fit-out work and services, and petitioning and ceiling work were also to have been undertaken. 18 Mr Kearney deposes that, because the project was not working today, a number of subcontractors have had to be informed that there were no facilities or services available to assist them. Further, contractors delivering precast columns and reinforcing work have had to be turned away. In addition, curtains have had to be delivered to another site. There were also scheduled service repairs and maintenance of men and materials hoists which were to have been undertaken on and from Monday of this week. 19 Mr Kearney deposes that if work had been undertaken on the site today he would have expected on-site a full complement of subcontractors. He would have expected that the workforce on the project would have been approximately 400 today. 20 At the meeting of the workers in the park which he observed Mr Kearney deposes to having identified Mr Pearson from the BLF which, again, I infer to be a reference to part of the union which is the first respondent and Mr O'Doherty from the CFMEU and also an ETU organiser that he had seen the previous day. 21 The application for interlocutory injunctive relief is grounded upon s 421(3) of the Fair Work Act. Materially, that empowers the Federal Court to grant an injunction on the application of a person such as Lend Lease, it being a person relevantly affected (see column 2 of item 15 of s 539(2)) if it is satisfied that another person, to whom an order such as that made by Fair Work Australia applies, has contravened or proposes to contravene a term of the order. It is not necessary today to form any concluded view at all as to whether contraventions of the order made by Fair Work Australia have occurred. Rather, it is necessary on an interlocutory basis to decide whether there is a serious question to be tried in that regard and further, where the balance of convenience lies. 22 I should record that there was originally reference to a separate source of power to grant injunctive relief found in the Building and Construction Industry Improvement Act but there was no reliance upon that source of power for the interlocutory relief. 23 It should also be recorded that the Australian Building and Construction Commissioner, as is his right under the Building and Construction Industry Improvement Act and the Fair Work Act, sought to intervene in the proceeding to support the granting of interlocutory injunctive relief. As I understood it the basis of the intervention and the support was a disposition on the part of that Commissioner that orders made by this country's industrial arbitrator, Fair Work Australia, should be obeyed by those affected by them. In other words, the concern of the Commissioner, understandably, was the preservation of the integrity of the present industrial relations system which applies under the Fair Work Act. I take into account, in deciding whether or not to grant the interlocutory relief, that particular intervention and the submission made in that regard in relation to preservation of integrity. 24 It was put on behalf of the unions for whom appearance was made that there was an element of futility in the granting of interlocutory injunctive relief. I accept, of course, that it is in the nature of a subversion of judicial power for orders to be made which are futile. I am not persuaded, however, that this is such a case. What particularly concerns me in that regard is the evidence from Mr Kearney which goes apparently to a disposition to hold a meeting tomorrow to decide whether or not to go back to work. On the evidence to hand, I am quite satisfied, in terms of a question for trial being raised, that that meeting is not the result of a rogue workforce or, for that matter, rogue industrial officials. Rather, it appears to be a meeting, the responsibility for the convening of which lies on the part of the unions which are named respondents, at least in terms of a serious question to be tried. 25 The order made by Fair Work Australia did not, of course, admit of the unions or for that matter, individual workers, arrogating to themselves a right to decide whether or not to obey the order made by that industrial arbitrator. To assert such a right is to assert in effect industrial anarchy. I consider that it is the duty of those exercising the judicial power of the Commonwealth in circumstances where there is raised a serious question to be tried as to whether there is a defiance of such an order to grant interlocutory injunctive relief, especially in relation to a project which involves the particular public interests which I have earlier described. 26 It was also put on behalf of the respondent unions that there was no undertaking as to damages proffered by Lend Lease. As developed in argument, that submission was that, if it transpired that there was at trial no substance in the substantive application, the unions would be put to particular expense by way of costs in resisting that application. Costs, though, are the subject of discrete provision under the Fair Work Act. It does not seem to me to be appropriate to regard an undertaking as to damages as embracing that particular subject. More pertinent, in terms of undertakings and in terms of whether or not to grant injunctive relief, was the absence of any undertaking on behalf of any of the respondent unions to do that which they are in any event obliged to do, which is obey the orders of Fair Work Australia. 27 I have no doubt that raised prima facie on Mr Kearney's affidavit is industrial action in terms of the Fair Work Act. It seems to me in the circumstances that this particular industrial action is, in terms of a question raised seriously for a trial, in defiance of the orders of Fair Work Australia. I therefore propose to grant interlocutory injunctive relief. 28 As to the terms of that relief and as I noted earlier, the application was modified in the course of argument so as to embrace the terms of the order made by Fair Work Australia. That order is wider in terms of those bound than just the unions for whom appearance is made today. It therefore seems to me necessary to delete from that order, in terms of an order which I would make, reference to each union other than the first respondent, the fourth respondent and the fifth respondent. In that regard, paragraph 3.2 will need adaptation. 29 I can see much sense in the ancillary directions that are found in paragraph 4 of the Fair Work Australia order being taken up. I consider that I have power to make such ancillary orders by virtue of s 421(3) of the Fair Work Act, as well as s 23 of the Federal Court of Australia Act. In particular, I can see much sense in the obligation found in paragraph 4.1.3.2 as to provision of the Fair Work Australia recommendation of 12 April 2011. There will need to be a modification to paragraph 4.1.3.4 so as to take up Thursday 14 April 2011 in lieu of Wednesday 13 April 2011. There having been an appearance on behalf of the first, fourth and fifth respondents I do not see any need for express provision in relation to service of the orders, as is found in the Fair Work Australia order, clause 6. 30 The order being one made on an interlocutory basis it should have a limited life. In that regard, the case is able to be heard for directions by the docket judge on the afternoon of 27 April 2011. I therefore propose to make the order run until 4.30 pm on 27 April 2011 or further earlier order. There is no need, of course, for the order to have a title in the way in which the Fair Work Australia order has in cl 1. There will also need to be modification of the definitions clause found in cl 2. 31 I am willing to hear submissions as to any further modifications which either party, or the intervenor for that matter, submits ought to be made. 32 The further order I make, then, is that the matter is adjourned for directions to 2.15 pm on 27 April 2011. I certify that the preceding thirty-two (32) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Logan.

Lend Lease Project Management & Construction (Australia) Pty Ltd v Construction, Forestry, Mining and Energy Union

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