FEDERAL COURT OF AUSTRALIA

Construction, Forestry, Mining & Energy Union v Coal & Allied Operations Pty Ltd (No. 2) [1999] FCA 1714

INDUSTRIAL LAW – Workplace Relations Act 1996 (Cth) – Part XA Freedom of Association – fixing of penalty following breach – whether to be paid into Consolidated Revenue Fund or to particular organisation or person

Workplace Relations Act 1996 (Cth) ss 298U, 356

Gibbs v City of Altona (1992) 37 FCR 216, followed

Municipal Officers Association of Australia v City of Bayswater (1987) 22 IR 45, cited

CONSTRUCTION, FORESTRY, MINING AND ENERGY UNION v COAL AND ALLIED OPERATIONS PTY LTD (No. 2)

NG 778 of 1998

BRANSON J

SYDNEY

9 DECEMBER 1999

THE COURT ORDERS THAT:

1.                  The respondent pay a penalty of $2,000 in respect of conduct in contravention of Part XA of the Workplace Relations Act 1996 (Cth) (“the Act”), namely the issuing of a written warning to Allan Burford in respect of his absence from work on 5 December 1997.

2.                  The respondent pay a penalty of $500 in respect of conduct in contravention of Part XA of the Act, namely the issuing of a written warning to Stephen Burke in respect of his absence from work on 5 December 1997.

3.                  The respondent pay a penalty of $1,000 in respect of conduct in contravention of Part XA of the Act, namely the issuing of a written warning to Allan Bromage in respect of his absence from work on 5 May 1998.

4.                  Each penalty be paid to the applicant.

Note:    Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

REASONS FOR JUDGMENT

INTRODUCTION

1                     On 5 November 1999 I delivered my reasons for deciding that the respondent had engaged in conduct in contravention of Part XA of the Workplace Relations Act 1996 (Cth) (“the Act”) on three occasions.  I found that three other instances of conduct pleaded in the applicant’s statement of claim had not been shown to be conduct in contravention of Part XA of the Act.

2                     The matter was listed for argument as to the appropriate orders to be made in the light of my reasons for decision.

3                     As a result of certain undertakings offered by the respondent, which were accepted by the applicant, only the questions of penalty, if any, and the person, body or fund to whom or to which any such penalty should be paid, now require determination by the Court.

4                     I will not repeat the findings of fact set out in my earlier reasons for decision.  Those reasons and these are to be read together.

LEGISLATION

5                     Section 298U of the Act relevantly provides as follows:

“In respect of conduct in contravention of this Part, the Court may, if the Court considers it appropriate in all the circumstances of the case, make one or more of the following orders:

(a)               an order imposing on a person or industrial association whose conduct contravened or is contravening the provision in question a penalty of not more than:

(i)                 in the case of a body corporate - $10,000; or

(ii)               in any other case - $2,000;

….”

6                     Section 356 of the Act provides:

“A court that imposes a monetary penalty under this Act (other than a penalty for an offence) may order that the penalty, or a part of the penalty, be paid:

(a)               into the Consolidated Revenue Fund; or

(b)               to a particular organisation or person.”

CONSIDERATION

7                     The Act gives no explicit guidance as to the circumstances in which an order imposing a penalty under s 298U of the Act will be appropriate or as to the circumstances in which a penalty of or near the maximum, or alternatively of a lesser amount, may be called for.  The Court is simply directed to consider what is appropriate in all the circumstances of the case.

8                     The following matters, which are not intended to comprise an exhaustive list, seem to me to be considerations to which the Court may appropriately have regard in determining whether particular conduct calls for the imposition of a penalty, and assuming that it does, the amount of the penalty:

(a)                The circumstances in which the relevant conduct took place (including whether the conduct was undertaken in deliberate defiance or disregard of the Act);

(b)               Whether the respondent has previously been found to have engaged in conduct in contravention of Part XA of the Act;

(c)                Where more than one contravention of Part XA is involved, whether the various contraventions are properly seen as distinct or whether they arise out of the one course of conduct;

(d)               The consequences of the conduct found to be in contravention of Part XA of the Act;

(e)                The need, in the circumstances, for the protection of industrial freedom of association; and

(f)                 The need, in the circumstances, for deterrence.

9                     The respondent has contended that, in the circumstances of this case, the Court should not consider it appropriate to make an order imposing a penalty in respect of any of the three instances of conduct found to be in contravention of Part XA of the Act.

10                  It has not been suggested that the respondent has previously engaged in conduct in contravention of Part XA of the Act.  It was submitted that the conduct did not result in any actual harm to the employment of the men concerned and that the subsequent retrenchment of the men rendered the conduct irrelevant to their respective employment positions.  Moreover, it was submitted that the conduct resulted from deficiencies in management practice rather than from any intention to harm the men by reason of their being officers of an industrial association.  The publication on 5 November 1999 of the reasons for decision of the Court, it was suggested, will allow correction of the deficiencies.

11                  I have given careful consideration to the contentions of the respondent.  I have also had regard to the following matters:

(a)                the respondent has been found to have engaged in conduct in contravention of Part XA of the Act in three instances (ie this is not a case of an isolated instance of conduct in contravention of the Part);

(b)               the conduct had the potential at the time that it was engaged in to affect the men concerned in a significant way (ie by making them more vulnerable to being dismissed from their employment); and

(c)                the conduct was that of senior management of the respondent and not that of relatively junior staff acting within the scope of their authority.

12                  The above matters indicate, in my view, that it would be inappropriate to regard the contraventions of Part XA of the Act as trivial or merely technical.

13                  I conclude that, in all of the circumstances of this case, it would be appropriate for a penalty or penalties to be imposed.

14                  However, I do not regard any of the three instances of conduct in contravention of Part XA of the Act as being at the serious end of the scale of possible conduct in contravention of Part XA of the Act.  I accept that the conduct flowed from deficiencies in management practice and was not undertaken in deliberate disregard of the Act.  It seems to be fair to assume that the legislature intended penalties of or near the maximum allowed by the Act to be reserved for serious incidents of conduct in contravention of Part XA of the Act, and perhaps for cases in which the need for protection or deterrence is particular strong.  I do not consider that this case falls into one of those categories.

15                  As is mentioned above, the respondent has been found to have engaged in conduct in contravention of Part XA of the Act in three instances.  Two of these instances arose from a single management decision to refuse to approve union business leave for any employee representatives to attend a resumed AIRC hearing on 5 December 1997.  These two instances may be seen to be closely related even if they do not technically arise out of the one course of conduct.  In all of the circumstances of the case, I consider it appropriate to make an order imposing a penalty on the respondent of $2,000 in respect of its conduct in issuing a written warning to Mr Burford in respect of his absence from work on 5 December 1997 and a further penalty of $500 in respect of its related conduct in issuing a written warning to Mr Burke in respect of his absence from work on the same day.

16                  As to the conduct of the respondent in issuing a written warning to Mr Bromage in respect of his absence from work on 5 May 1998, I consider it appropriate in all of the circumstances of the case to make an order imposing a further penalty of $1,000.  The amount of this penalty is intended to reflect my finding that this third incident, whilst the result of a course of conduct distinct from each of the other two incidents, shared a genesis with them.  That is, each of the three incidents flowed from the respondent’s review of its policy concerning union business leave.

17                  Gray J observed in Gibbs v City of Altona (1992) 37 FCR 216 at 223:

“Section 356 of the Act [then entitled the Industrial Relations Act 1988] empowers the court to order payment into the Consolidated Revenue Fund or to a particular organisation or person.  The usual order, when the proceeding is not brought by an inspector appointed under the Act, is for payment to the person or organisation applying for the penalty.  The reasons for this are canvassed in Vehicle Builders’ Employees’ Federation of Australia v General Motors Holdens Pty Ltd (1977) 32 FLR 100 at 111-114 and Seymour v Stawell Timber Industries Pty Ltd (1985) 9 FCR 241 at 245-246 in the judgment of Northrop J.”

18                  I see no reason in this case to depart from the usual order.  The conduct found to be in contravention of Part XA of the Act affected the legitimate interests of the applicant and its members (cf Municipal Officers Association of Australia v City of Bayswater (1987) 22 IR 45 at 51).

19                  In exercise of the discretion vested in the Court by s 356 of the Act, I consider it appropriate to order that the whole of each of the penalties to be imposed under s 298U of the Act be paid to the applicant.

Associate:

Dated:                                          9 December 1999