FEDERAL COURT OF AUSTRALIA

Australian Building and Construction Commissioner v Construction, Forestry, Maritime, Mining and Energy Union [2019] FCA 468

ORDERS

THE COURT DECLARES THAT:

1.    The second respondent, an officer of the first respondent acting in that capacity for the purposes of s 363(1)(b) of the Fair Work Act 2009 (the FW Act), contravened s 348 of the FW Act when, on 25 November 2016, after an induction held at the site of the construction project known as the Trillium Apartments project in Melbourne, Victoria (the Trillium Project), he threatened to and did prevent Mr John Patsalas from working on the Trillium Project, and did so with intent to coerce Mr Patsalas to engage in industrial activity within the meaning of s 347(b)(vi), specifically by paying a fee to the first respondent (Campanaro’s 25 November 2016 s 348 Contravention).

2.    The third respondent, an officer of the first respondent acting in that capacity for the purposes of s 363(1)(b) of the FW Act, contravened s 348 of the FW Act when, on 15 February 2017, after an induction held at the site of the construction project known as the EQ Tower Apartments project in Melbourne, Victoria (the EQ Project), he threatened to and did prevent Mr Patsalas from working on the EQ Project, and did so with intent to coerce Mr Patsalas to engage in industrial activity within the meaning of s 347(b)(vi), specifically by paying a fee to the first respondent (Caratozzolo’s 15 February 2017 s 348 Contravention).

3.    The first respondent contravened s 348 of the FW Act in that it:

(a)    by reason of ss 363(1) and/or 793(1) of the FW Act, engaged in the same conduct as that by which its officer effected Campanaro’s 25 November 2016 s 348 Contravention; and

(b)    by reason of ss 363(3) and/or 793(2) of the FW Act, engaged in that conduct with the same intent to coerce as that with which its officer engaged in the same conduct.

4.    The first respondent contravened s 348 of the FW Act in that it:

(a)    by reason of ss 363(1) and/or 793(1) of the FW Act, engaged in the same conduct as that by which its officer effected Caratozzolo’s 15 February 2017 s 348 Contravention; and

(b)    by reason of ss 363(3) and/or 793(2) of the FW Act, engaged in that conduct with the same intent to coerce as that with which its officer engaged in the same conduct.

THE COURT ORDERS THAT:

5.    The second respondent pay a pecuniary penalty of $4,000 in respect of his contravention of s 348 of the FW Act as declared in paragraph 1 above.

6.    The third respondent pay a pecuniary penalty of $4,000 in respect of his contravention of s 348 of the FW Act as declared in paragraph 2 above.

7.    The first respondent pay the following pecuniary penalties:

(a)    $35,000 in respect of its contravention of s 348 of the FW Act as declared in paragraph 3 above; and

(b)    $35,000 in respect of its contravention of s 348 of the FW Act as declared in paragraph 4 above.

8.    The pecuniary penalties referred to in orders 1 to 3 above are to be paid to the Commonwealth of Australia within 28 days.

9.    The proceeding with regard to the first, second and third respondents otherwise be dismissed.

10.    There be no order as to costs.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

O’CALLAGHAN J:

Introduction

1    By amended originating application dated 23 November 2018, the applicant (the Commissioner) seeks declarations of contraventions of s 348 of the Fair Work Act 2009 (Cth) (the FW Act) by each of the first to third respondents (the respondents) and the imposition of pecuniary penalties, for conduct that occurred at two construction sites in the Melbourne CBD in November 2016 and February 2017.

2    The respondents accept that they each contravened s 348: the first respondent (the CFMMEU) twice, and the second and third respondents (Messrs Campanaro and Caratozzolo respectively) once each. The respondents also accept that declarations should be made. The parties have agreed to the form of the declarations.

3    The parties agree that a “low to mid range” penalty is appropriate for the second and third respondents. In respect of the CFMMEU, however, the Commissioner seeks the maximum available penalty, while the respondents say a low to mid range penalty is appropriate.

Penalties applicable

4    The maximum penalty for each contravention in this case is 300 penalty units for the CFMMEU and 60 penalty units for Messrs Campanaro and Caratozzolo.

5    A “penalty unit” is defined in s 4AA of the Crimes Act 1914 (Cth). At the relevant time the value of a penalty unit was $180. Accordingly, the maximum penalty that might be imposed for each contravention on the CFMMEU is $54,000, and $10,800 each on Messrs Campanaro and Caratozzolo. The CFMMEU was, at that time, the CFMEU, but I shall refer to the union by its new name.

The facts

6    There was no dispute as to the relevant facts. The following factual outline is drawn from the applicant’s Outline of Submissions on Relief Against the First to Third Respondents, filed 21 February 2019.

7    The conduct contravening s 348 of the FW Act occurred on two separate occasions:

(a)    by Mr Campanaro on 25 November 2016 at the Trillium Apartments project, located at 36-40 La Trobe Street, Melbourne (the Trillium Project); and

(b)    by Mr Caratazzolo on 15 February 2017 at the EQ Tower Apartments project, located at 127-141 A’Beckett Street, Melbourne (the EQ Project).

8    At the time, Messrs Campanaro and Caratazzolo were delegates of the CFMMEU, and “officers” or “officials” for the purposes of s 12 of the FW Act, and were acting in their capacity as officers of the CFMMEU at the relevant times.

9    On 25 November 2016, Mr Campanaro held a meeting with Mr John Patsalas, an independent contractor or employee of Prolac Pty Ltd (Prolac), a company contracted to perform painting work on the Trillium Project and the EQ Project. During that meeting, Mr Campanaro told Mr Patsalas that he had to pay fees to the CFMMEU in order to commence working at the site. After Mr Patsalas paid the fees to the CFMMEU, Mr Campanaro permitted Mr Patsalas to commence work. By reason of this exchange, Mr Patsalas was prevented from performing work for approximately one hour at the Trillium Project.

10    On 15 February 2017, Mr Caratozzolo met Mr Patsalas shortly after Mr Patsalas had been inducted into the EQ Project. During that meeting, Mr Caratozzolo told Mr Patsalas that he needed to pay outstanding fees to the CFMMEU and would not be permitted to work at the site until he did so. Shortly thereafter, Mr Patsalas paid fees to the CFMMEU and returned to the EQ Project to commence painting work.

Declaratory relief

11    The Commissioner seeks the following declarations, which the respondents do not oppose, namely that:

(1)    Mr Campanaro contravened s 348 of the FW Act on 25 November 2016 by taking or threatening to take action against Mr Patsalas with the intent to coerce Mr Patsalas to pay a fee to the CFMMEU (Campanaro’s 25 November 2016 s 348 Contravention).

(2)    Mr Caratozzolo contravened s 348 of the FW Act on 15 February 2017 by taking or threatening to take action against Mr Patsalas with the intent to coerce Mr Patsalas to pay a fee to the CFMMEU (Caratozzolo’s 15 February 2017 s 348 Contravention).

(3)    The CFMMEU contravened s 348 of the FW Act on 25 November 2016 by reason of Mr Campanaro’s 25 November 2016 s 348 Contravention (the CFMMEU’s 25 November 2016 s 348 Contravention).

(4)    The CFMMEU contravened s 348 of the FW Act on 15 February 2017 by reason of Mr Caratozzolo’s 15 February 2017 s 348 Contravention (the CFMMEU’s 15 February 2017 s 348 Contravention).

The applicant’s submissions regarding pecuniary penalties

12    The Commissioner seeks orders pursuant to s 546(1) of the FW Act imposing appropriate pecuniary penalties on each of the respondents for each of their admitted contraventions of the FW Act. The Commissioner also seeks an order pursuant to s 546(3) of the FW Act that any penalties imposed be paid to the Commonwealth of Australia within 28 days.

13    The Commissioner submits that, having regard to the factors set out below, the contraventions call for penalties to be imposed on the CFMMEU at the maximum available level and at the low to mid range for Messrs Campanaro and Caratozzolo.

Against the CFMMEU

The nature and extent of the contravening conduct

14    The Commissioner submits that one of the objects of Part 3-1 of the FW Act (in which s 348 appears) is the protection of freedom of association, and that a pecuniary penalty should reflect the importance of the maintenance of that objective of the FW Act.

15    The Commissioner submits that the contraventions of s 348 of the FW Act, which involve threats and coercive conduct to secure industrial objectives pursued by Mr Campanaro, Mr Caratozzolo and the CFMMEU, are the antithesis of the scheme for which the FW Act provides. He submits that coercion contraventions are “a particularly serious form of industrial (mis)conduct”, citing Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union (2017) 249 FCR 458, and Mortimer J in Director of the Fair Work Building Industry Inspectorate v Construction, Forestry, Mining and Energy Union (No 2) [2016] FCA 436 at [136].

16    He further submits that the unlawful conduct the subject of this proceeding is but another example of the same modus operandi deployed by the CFMMEU and its officers on a large number of previous (and subsequent) occasions, which has been variously described by this court as “dismal”, “appalling”, “reveal[ing] a lamentable, if not disgraceful, record of deliberately flouting industrial laws” (in Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union (The BKH Contractors Case) (No 2) [2018] FCA 1563 at [129]) and “disgraceful and shameful” (in Construction, Forestry, Maritime, Mining and Energy Union v Australian Building and Construction Commissioner (The Broadway on Ann Case) [2018] FCAFC 126 at [65]).

The contraventions were deliberate

17    The Commissioner submits the contraventions were “self-evidently” deliberate, noting that the CFMMEU is a highly-experienced and skilled participant in the industrial arena, that both Messrs Campanaro and Caratozzolo have experience in the industry and experience in representational roles within it, and that each of the respondents knew full well the vice of the contravening behaviour and chose to engage in it anyway.

The contraventions were not isolated incidents

18    The Commissioner submits that these were not isolated incidents, and sets out in a table the CFMMEU’s engagement in prior contravening conduct involving freedom of association constituted by insistence upon financial union membership as a necessary pre-condition to working on construction sites in 18 cases over a 15 year period prior to the events presently under consideration.

19    The Commissioner cites Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union (The Quest Apartments Case) (No 2) [2018] FCA 163, which similarly involved “no ticket no start” coercive conduct, in which Tracey J found that the “irresistible inference” from this history of contraventions is that:

…the CFMEU, acting through its site-based officials, persists in insisting on union membership as a condition for working on construction sites which it regards as “union sites”. At the very least it condones the actions of its onsite officials. Such misconduct continues notwithstanding the CFMEU and its officials being aware, as a result of the various judgments, that it is proscribed by various provisions of the Act.

The size and status of the CFMMEU

20    The Commissioner submits that the CFMMEU is a large, prominent and influential national union, and that it is both cash and asset rich, citing previous observations made by the court about the nature of the CFMMEU’s, size, role and favourable treatment under the FW Act, noting that the Victoria/Tasmania branch of the CFMMEU’s Construction and General division alone:

(a)    recorded revenue of $30,238,248 for the year ending 31 March 2018; and

(b)    as at 31 March 2018, had net assets of $68,428,675 (including $20,935,904 of cash and cash equivalents).

21    The Commissioner says that the CFMMEU has sufficient means to pay any penalties imposed by this Court, and that they are simply a cost of the way in which the CFMMEU does business. The Commissioner further submits that, in the absence of any evidence to the contrary, it can be inferred that the CFMMEU will itself also seek to pay the penalties imposed on Messrs Campanaro and Caratozzolo. (He did not seek a personal payment order).

The CFMMEU’s history of contravening and the importance of deterrence

22    The Commissioner noted that the CFMMEU’s repeated infractions have been the subject of sustained judicial criticism over an extended period of time, citing numerous examples.

23    The Commissioner submits that unlawful conduct is “normalised” within the CFMMEU, and that the CFMMEU simply does not care about the law or the penalties imposed for contraventions of it, citing Director of the Fair Work Building Industry Inspectorate v Construction, Forestry, Mining and Energy Union (The Mitcham Rail Case) [2015] FCA 1173 at [29].

24    The Commissioner says that he does not seek to punish the union again for its earlier conduct, but that its recidivism and continued willingness to engage in contravening conduct requires the imposition of the severest penalties in order to achieve the necessary deterrent effect, and that the longer such recidivism continues, the more likely it is that this consideration will carry greater weight than the principle that the maximum available penalty must be reserved for the worst possible offending.

Against Messrs Campanaro and Caratozzolo

25     The Commissioner submits that both Messrs Campanaro and Caratozzolo held positions of “considerable responsibility and power on the site” and acted as “gatekeeper[s]” (using the language employed by Tracey J in Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union (Quest Apartments Case) (No 2) [2018] FCA 163 at [62]), and that they arrogantly assumed unto themselves an authority to determine whether or not unfinancial members of the union would be allowed to work on the site.

26    As to specific deterrence, the Commissioner submits that Mr Campanaro is listed as an office holder of the CFMMEU, and thus has further, ongoing opportunity to contravene the FW Act. In oral submissions the Commissioner submitted that the fact Mr Caratozzolo is no longer an officeholder does not obviate the need for specific deterrence in the absence of evidence to support a conclusion that he cannot or will not re-join the CFMMEU as an official or participate in activities to which the FW Act applies, citing Australian Building and Construction Commissioner v McDermott (No 3) [2018] FCA 1105 at [38].

Mitigation

27    The Commissioner submits that the respondents can point to nothing of substance in mitigation. The Commissioner contends that a discount for a plea in civil penalty proceedings is not available simply because a respondent has spared the community the cost of a contested trial and that to obtain any discount, an admission of liability ought indicate an acceptance of wrongdoing and a suitable and credible expression of regret, citing Mornington Inn v Jordan (2008) 168 FCR 383 at 405, per Stone and Buchanan JJ:

As Branson J has pointed out (see Alfred v Walter Construction Group Limited [2005] FCA 497) the rationale for providing a discount for an early plea of guilty in a criminal case does not apply neatly to a case, such as the present, where a civil penalty is sought and the case proceeds on pleadings. Nevertheless, in our view, it should be accepted, for the same reasons as given in [Cameron v the Queen (2002) 209 CLR 339], that a discount should not be available simply because a respondent has spared the community the cost of a contested trial. Rather, the benefit of such a discount should be reserved for cases where it can be fairly said that an admission of liability: (a) has indicated an acceptance of wrongdoing and a suitable and credible expression of regret; and/or (b) has indicated a willingness to facilitate the course of justice.

28    The Commissioner submits that there is no evidence of either in the present proceeding.

Totality

29    The Commissioner submits that as a matter of principle, it is right to treat each contravention of the FW Act separately and distinctly for the purpose of imposing penalties, and that recidivists such as the CFMMEU should be entitled to no leniency on these discretionary penalty factors.

The respondents’ submissions regarding pecuniary penalties

30    The respondents seek penalties in the low to mid range for each of the contraventions by the respondents.

Objective seriousness and the proportionality principle

31    The respondents submit that the Commissioner’s submissions are underpinned by the notion that a contravener’s prior record can be used to inflate a penalty beyond an amount proportional to the objective circumstances of the contravening conduct. The respondents submit that the maximum penalty is for the worst category of contravening, citing Auimatagi v Australian Building and Construction Commissioner [2018] FCAFC 191 at [175], and that in the absence of any attempt to characterise the contravening conduct in the present case as falling within the worst category of case, the Commissioner’s assertion that maximum penalties should be imposed on the CFMMEU is unsound and redolent of an attempt to punish the CFMMEU again for its past transgressions.

Characterising the objective seriousness of the s 348 contraventions

32    The respondents do not dispute that the contravening conduct was deliberate.

33    The respondents submit that the contravening conduct engaged in by Messrs Campanaro and Caratozzolo was isolated, not systematic or protracted. They say that the relevant test is not whether the contravener has previously broken the law, but whether the particular contravening conduct is isolated or systemic as, for example, part of an ongoing, organised or deliberate campaign. They note that there is no evidence or assertion that the conduct was premeditated or planned. They further submit that there is also no evidence of any link between Mr Campanaro’s contravention on 25 November 2016 and Mr Caratozzolo’s contravention on 15 February 2017, and that therefore the respective incidents were separate and distinct.

34    They submit that there is no evidence of senior management involvement in the contravening conduct, that there is no evidence or assertion that either Mr Campanaro or Mr Caratozzolo, at the time of the contravening conduct, were senior officials with managerial responsibility in the CFMMEU. On the contrary, they were onsite workplace representatives.

35    In relation to the contravention involving Mr Campanaro, it was submitted that although Mr Patsalas was, by reason of the contravention, delayed in commencing his work by approximately an hour, there is no evidence that he was not paid for the work he performed during this time or that he or Prolac suffered any loss. It was further submitted that the terms of his engagement by Prolac are unclear, and that whether he would have been paid for the time he was delayed in commencing work is uncertain and that no positive findings can be made on this point.

36    So far as the contravention concerning Mr Caratozzolo is concerned, it was submitted that there is no evidence or assertion that Mr Patsalas or Prolac suffered any economic loss, and that there is no assertion or evidence that work was delayed or that there was any loss of productivity.

Matters relevant to the contraveners

37    The respondents point to the fact that Messrs Campanaro and Caratozzolo have not previously been found to have contravened industrial laws and that the contravening conduct appears to have been an aberration which occurred over two years ago.

38    The respondents acknowledge the CFMMEU’s history of contraventions, but submit that that history, while relevant to assessment of the need for specific and general deterrence, cannot be taken into account, for the reasons set out above, to produce a penalty beyond the objective circumstances of the contravening conduct.

39    The respondents also note that the Commissioner’s submission that “[g]eneral deterrence has a significant role to play in the penalties imposed by the Court upon Messrs Campanaro and Caratozzolo, being employees and officeholders of the CFMMEU at the time that the contraventions occurred” is premised on Messrs Campanaro and Caratozzolo being employees of the CFMMEU, which they never have been.

40    They submit that the Commissioner is incorrect to assert that no credit or discount can be given to the respondents for their cooperation with the Commissioner or their admissions because there is no expression of contrition or remorse. They submit that the utilitarian value of cooperation with a regulatory authority and assistance in its prosecution of contraventions is not diminished, or otherwise impacted, by the absence of contrition, and that in this case there was significant utilitarian value to the respondents’ admissions and cooperation. They cite in support of this the following passage from Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union (2017) 254 FCR 68 at [163] per Dowsett, Greenwood and Wigney JJ:

About the only thing that could be said in favour of the CFMEU, other than that the conduct was related to genuine concerns about sham contracting, is that it cooperated with the Commissioner in relation to these proceedings by admitting the contraventions and reaching agreement in relation to the facts. Importantly, the admissions and agreed facts were also not withdrawn after the initial agreement in relation to the penalty amounts was withdrawn by the Commissioner. There is no doubt that the CFMEU should receive credit for this cooperation. From a public policy perspective, it is important to encourage such cooperation by reflecting it in the penalties imposed. It also shows willingness on the part of the CFMEU to accept responsibility for its actions and to facilitate the course of justice. The fact that the proceedings were not defended saved the community the expense of a potentially lengthy contested hearing.

41    In oral submissions counsel for the respondents also relied on Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union [2011] FCA 810 at [107] in which Gilmour J also gave the respondents “credit” for a “substantial degree of cooperation which, although not immediate, did result in the avoidance of what may otherwise have been a lengthy and expensive trial”.

42    They submit that whether a contravener has admitted its conduct and assisted the regulator or prosecuting body in the prosecution of the matter are separate and distinct mitigating factors to contrition and remorse.

In response to the Commissioner’s comparative analysis

43    The respondents submit that the Commissioner’s conclusion that the CFMMEU’s history of offending requires maximum penalties to be imposed elides the need to characterise the objective seriousness of the actual contravening conduct engaged in, and that the Commissioner makes no serious attempt to do this in his submissions. They submit further that this court has rejected any attempt to deploy a comparative analysis of penalties imposed in other cases, citing Australian Building and Construction Commissioner v Gava [2018] FCA 1480 at [74].

Consideration

Correct approach to assessment of penalties

44    As the court said in Construction, Forestry, Maritime, Mining and Energy Union v Australian Building and Construction Commissioner (The Non-Indemnification Personal Payment Case) [2018] FCAFC 97 at [22]:

The overwhelming importance of deterrence as the protective purpose of the penalty does not exclude the need to determine a penalty which is proportionate to the contravening conduct. The history of contravention is to be taken into account in fixing the proper level of penalty for the proportionate response to the contravention in question. Proportionality has within it the need to characterise the seriousness of the contravention. Proportionality of penal response to a contravention assessed by reference to its seriousness and gravity is an essential characteristic of the application of the statute. The penal response is for that contravention, not earlier contraventions: Veen v The Queen (No 2) (1988) 164 CLR 465 at 477-478. Prior contraventions may reveal an apparent disregard for the Act and the need for deterrence by a penalty at a level appropriate to achieve that objective. It is to be borne in mind, however, that it is for the conduct in question that the penalty is imposed, not for prior conduct.

45    In Construction, Forestry, Maritime, Mining and Energy Union v Australian Building and Construction Commissioner (The Broadway on Ann Case) [2018] FCAFC 126 at [93], Justice Bromwich, dissenting in the result, but not in point of principle, outlined five points of principle concerning the imposition of civil penalties for contraventions of the FW Act:

(1)    While any prior contravention is a factor which may be taken into account in determining quantum, it cannot be given such weight as to lead to the imposition of a penalty which is disproportionate to the gravity of the instant contravention.

(2)     The maximum penalty available under statute must be reserved for the worst category of cases. However, this does not mean that a lesser penalty must be imposed because it is possible to envisage a worse case.

(3)    The Federal Circuit Court and this Court should not, without giving the parties proper notice and an opportunity to be heard, disregard the submissions of the regulator and impose a penalty in excess of what the regulator seeks.

(4)    While the formulation of the quantum of an appropriate penalty usually involves, in the final analysis, an “instinctive” synthesis of competing factors, the process leading to that synthesis is not instinctive.

(5)    The outcomes arrived at by courts in prior cases can be used to help ensure reasonable consistency in the application of principle and as a yardstick for the determination of appropriate penalties.

46    As Bromwich J made clear, it is, of course, necessary to have regard to the maximum penalty. It is, however, only one of the factors to which regard must be had in arriving at the quantum of penalty.

47    As the Full Court said in Australian Competition and Consumer Commission v Reckitt Benckiser (Australia) Pty Ltd [2016] FCAFC 181; 340 ALR 25 at 63 [154]- [156] (cited in The Non-Indemnification Personal Payment Case at [26]):

In considering the sufficiency of a proposed civil penalty, regard must ordinarily be had to the maximum penalty. In Markarian, a criminal sentencing context, it was observed at [31] that:

careful attention to maximum penalties will almost always be required, first because the legislature has legislated for them; secondly, because they invite comparison between the worst possible case and the case before the court at the time; and thirdly, because in that regard they do provide, taken and balanced with all of the other relevant factors, a yardstick.

The reasoning in Markarian about the need to have regard to the maximum penalty when considering the quantum of a penalty has been accepted to apply to civil penalties in numerous decisions of this Court both at first instance and on appeal (Director of Consumer Affairs, Victoria v Alpha Flight Services Pty Ltd [2015] FCAFC 118 at [43]; Australian Competition and Consumer Commission v BAJV Pty Ltd [2014] FCAFC 52; (2014) ATPR 42-470 at [50]- [52]; Setka v Gregor (No 2) [2011] FCAFC 90; (2011) 195 FCR 203 at [46]; McDonald v Australian Building and Construction Commissioner [2011] FCAFC 29; (2011) 202 IR 467 at [28]- [29]). As Markarian makes clear, the maximum penalty, while important, is but one yardstick that ordinarily must be applied.

Care must be taken to ensure that the maximum penalty is not applied mechanically, instead of it being treated as one of a number of relevant factors, albeit an important one. Put another way, a contravention that is objectively in the mid-range of objective seriousness may not, for that reason alone, transpose into a penalty range somewhere in the middle between zero and the maximum penalty. Similarly, just because a contravention is towards either end of the spectrum of contraventions of its kind does not mean that the penalty must be towards the bottom or top of the range respectively. However, ordinarily there must be some reasonable relationship between the theoretical maximum and the final penalty imposed.

48    In deciding whether the maximum penalty should be imposed in a situation where there were multiple prior contraventions of the same provision, the Chief Justice and Collier and Rangiah JJ held in Auimatagi v Australian Building and Construction Commissioner [2018] FCAFC 191 at [176] (referring to The Broadway on Ann Case and The Non-Indemnification Personal Payment Case) that prior contraventions were only one factor and could not justify a penalty “disproportionate to the gravity of the instant contravention”, noting that “[t]he maximum is for the worst category of cases.”

49    The parties made competing submissions in respect of the relevance of whether the contravening parties showed any contrition. I accept that the presence of contrition is not necessary for the CFMMEU’s cooperation to be taken into account.

50    With those principles in mind, I now turn to consider the appropriate penalties in respect of the admitted contraventions.

Campanaro’s 25 November 2016 s 348 Contravention

51    Mr Campanaro coerced Mr Patsalas into paying fees to the CFMMEU in order to commence working. Contraventions of the FW Act involving coercive conduct are particularly serious, as counsel for the respondents accepted.

52    Mr Campanaro, however, did not act aggressively, and the only damage flowing from his conduct was to delay Mr Patsalas commencing work by one hour. Further, he has no prior (or subsequent) record of contraventions, and the contravention was an isolated one. I also take into account the utilitarian value of his admissions.

53    I will impose a penalty of $4,000 on Mr Campanaro for the 15 February 2017 s 348 Contravention.

The CFMMEU’s 25 November 2016 s 348 Contravention

54    In arriving at an appropriate penalty for the CFMMEU, I take into account its prior history, its apparent willingness to contravene the FW Act in a serious way to impose its will, and the need for deterrence of an organisation of its size and financial resources.

55    I also take into account the fact that the particular conduct, as serious as it is, cannot be said to fall within the “worst category of cases”.

56    I will impose a penalty of $35,000 on the CFMMEU for its 25 November 2016 s 348 Contravention.

Caratozzolo’s 15 February 2017 s 348 Contravention

57    Mr Caratozzolo similarly coerced Mr Patsalas into paying fees to the CFMMEU before he commenced work.

58    However, as with the conduct of Mr Campanaro, Mr Caratozzolo did not act aggressively, and no damage flowed from his conduct. Further, he too has no record of prior or subsequent contraventions. This was an isolated incident insofar as it concerned Mr Caratozzolo’s involvement and there is no evidence of a link between it and Mr Campanaro’s contravention. I also take into account the utilitarian value of the admissions and the fact that the parties were agreed as to the appropriate penalty range.

59    I will impose a further penalty of $4,000 on Mr Caratozzolo for the 15 February 2017 s 348 Contravention.

The CFMMEU’s 15 February 2017 s 348 Contravention

60    In arriving at an appropriate penalty for the CFMMEU, I take into account the same factors I did in respect of its 25 November 2016 s 348 Contravention.

61    I will impose a penalty of $35,000 on the CFMMEU for its 15 February 2017 s 348 Contravention.

Totality

62    In arriving at these penalties, I have had regard to the totality of the penalties, the overall seriousness of the contraventions, and the need for the proportionality of the penalties to the seriousness of the contraventions and to the conduct as a whole, consistently with the totality principle: see, by way of example only, Australian Ophthalmic Supplies Pty Ltd v McAlary-Smith (2008) 165 FCR 560, 583 at [102] (per Buchanan J).

Associate:

Dated:    4 April 2019

SCHEDULE OF PARTIES