FEDERAL COURT OF AUSTRALIA

Pine v Casello Constructions Pty Ltd [2005] FCA 1854

Pine v Casello Constructions Pty Ltd

VID 873 OF 2005

NORTH J

23 NOVEMBER 2005

MELBOURNE

IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY                                                           VID 873/2005

BETWEEN:                           LISETTE PINE
                                                APPLICANT

AND:                                      CASELLO CONSTRUCTIONS PTY LTD

                                                RESPONDENT

JUDGE:                                  NORTH J

DATE OF ORDER:              23 NOVEMBER 2005

PLACE:                                  MELBOURNE

THE COURT DECLARES, pursuant to s.21 of the Federal Court Australia Act 1976 (Cth) the Respondent has contravened s187AA of the WR Act by making payment to each of:

1.

1. Steven Stonehouse;
2. Rick Gibilisco;
3. Tony Distefano;
4. Michael Sartorello;
5. Colin Barun;
6. Timothy Traill;
7. Carmine Parente;
8. Michael Mazzarella;
9. Johnny Distefano
10. Giovanni (John) Martuccio;
11. Thomas Callaghan
12. Aaron Giles;
13. Robert Jaman;
14. Goce (George) Dimoski;
15. Antonio Sirianni; and
16. Giovani (John) Gravina,

for a period on 5 August 2003 in which they engaged in industrial action.

2.

1. Damien Vendramini;
2. Adam D’Angelo;
3. Rob Galna; and
4. Spiro Balassopoulos,

 for a period or periods on 5 and 6 August 2003 in which they engaged in industrial action.

REASONS FOR JUDGMENT

1                     Before the Court are two applications under s 187AD(1)(a) of the Workplace Relations Act 1996 (Cth) (the Act) in relation to a contravention by Casello Constructions Pty Ltd, the respondent, of s 187AA(1) of the Act.

2                     The respondent is a subcontractor carpentry company which has admitted to having paid some of its employees during work stoppages on 5 August 2003 and 6 August 2003. The employees were engaged in industrial action as defined by the Act and it is therefore accepted that the respondent was in breach of s187AA(1) of the Act.

3                     The industrial action on 5 August 2003 was taken in response to the death of a labourer, Mr. Andrew Schouten, on a construction site in Shepparton. On 1 August 2003, Mr. Schouten died when a crane he was working near struck overhead powerlines. Mr. Schouten’s death resulted in a safety audit being conducted at the Three Towers and Concept Blue sites in accordance with the On-site Fatalities Policy and Procedure of the Construction, Forestry, Mining and Energy Union (CFMEU) on 5 August 2003. As a result of Mr Schouten’s death and the implementation of the On-site Fatalities Policy and Procedure, employees of the respondent stopped work at these two sites. On 5 August 2003, 17 employees stopped work at the Three Towers site for four and a half hours and four employees stopped work on the Concept Blue site for six and a half hours. On 6 August 2003, four employees stopped work for three hours on the Concept Blue site. The stoppage related to the employers failure to agree to pay workers for the initial stoppage on 5 August 2003. The contravention alleged is the payment by the respondent to the 21 employees amounting to a total of approximately $2000.

4                     A number of cases have been decided by the Court in relation to almost the same circumstances, namely the payment by subcontractors to employees on 5 August 2003 on construction sites during work stoppages during a safety audit following a death in the industry.  In Ponzio v D and E Air Conditioning Pty Ltd [2005] FCA 964 (D and E Air Conditioning) it was said at [21] that, whilst the factors to be considered in each case might be derived from the authorities, each case must be determined on its own facts.

5                      The starting point in this case must be that the respondent agreed that it has contravened the Act. The industrial laws of Australia should be obeyed, but the circumstances of each case will determine the appropriateness of the penalty to be imposed.  Therefore, although the contravention of the Act is not in issue, it is necessary to consider the particular circumstances of the respondent's conduct. 

6                     Mr O'Grady, who appeared as counsel for the applicant, argued the respondent was aware the employees were engaged in industrial action and deliberately made the payment. Mr O'Grady suggested the appropriate penalty in this case should be in the region of $1000 or approximately $50 for each of the 21 employees involved.

7                     The circumstances, however, bear a slightly different complexion. Mr. Cassar, the director of the respondent, approached the head contractor, Multiplex to seek advice on the policy to be followed in light of the stoppages which affected every Multiplex site and not just the sites presently in question.  Mr Cassar then took his lead from Multiplex. This was a rational and practical approach to a difficulty which had arisen on a site governed by a head contractor. Whilst the solution was not lawful, the respondent’s conduct was understandable. Mr Cassar has since taken steps to ensure this mistake will not be repeated.  On 7 and 14 November 2005, Mr Cassar undertook a two day course relating to his obligations under the Workplace Relations Act.  Furthermore, on 26 May 2005 Mr Cassar notified all employees in writing of the policy of the respondent in the following terms:

I have instructed our site foreman that any stop work on site for whatever reason and duration, must be reported immediately to me.

Further, it is imperative that the information recorded on employee’s time sheets provides an accurate and full account of the work performed or activities undertaken.

Finally we must state Casello’s policy on payment for industrial action. In the future, Casello will not pay any employee who has ceased work without management’s authority or participated in industrial action. The only possible exception to this is where there is a genuine safety issue whereby employees are at risk of immediate personal danger in there immediate work area.

8                     The conduct occurred on two days and the issue was different on each day.  This is a matter to which the Court adverted in D and E Air Conditioning.  The stoppage on 5 August 2003 was in observance of the CFMEU policy activated by the death of a fellow worker in the industry.  Those circumstances carry a different culpability than the circumstances which arose on 6 August 2003. Then the stoppage was less related to that unfortunate death of a construction worker and more related to the question of payment for the stoppage on the previous day. This distinction is a relevant factor to take into account. Most of the conduct in issue in this case occurred on 5 August 2003 and was thus less culpable. 

9                     There is also a need to consider the question of general deterrence. In a case such as this the respondent necessarily incurs legal costs in defending the application.  There is no dispute in this case that the respondent has incurred legal costs of $8000 in defending the application.  No subcontractor knowing of the circumstances of this case would be tempted to make a payment of about $2000 to its workers knowing the financial consequence would be to incur costs of $8000 to defend such an application. The general deterrence does not require the imposition of a monetary penalty. Given the record of the respondent, its co-operation with the applicant, acknowledgment of the alleged contravention early on and the amount of disadvantage already suffered, it is unlikely the respondent will be involved in any further contraventions of the Act.      

10                  Considering all the circumstances the appropriate order in this case is for the Court make the declaration sought, but otherwise to impose no penalty. 

Associate:

Dated:              23 November 2005