FEDERAL COURT OF AUSTRALIA

Australian Building and Construction Commissioner v Construction, Forestry, Maritime, Mining and Energy Union (The Bay Street Case) (No 2) [2019] FCA 1859

ORDERS

THE COURT DECLARES THAT:

1.    On 22 April 2015, the Second Respondent contravened:

(a)    section 346 of the Fair Work Act 2009 (Cth) (“FW Act”) at a construction site at 209-213 Bay Street, Brighton (“site”) by organising industrial action against Tarastar Pty Ltd trading as BPM Built (“BPM”) because BPM engaged in industrial activity within the meaning of s 347(b)(iv) of the FW Act by not acceding to the request or demand made by the Second Respondent for BPM to provide additional site amenities; and

(b)    section 348 of the FW Act at the site by organising industrial action against BPM with intent to coerce BPM to engage in industrial activity within the meaning of s 347(b)(iv) of the FW Act by acceding to the request or demand made by the Second Respondent for BPM to provide additional site amenities.

2.    On 22 April 2015, the Third Respondent contravened:

(a)    section 346 of the FW Act at the site by organising industrial action against BPM, because BPM engaged in industrial activity within the meaning of s 347(b)(iv) of the FW Act by not acceding to the request or demand made by the Third Respondent for BPM to provide additional site amenities; and

(b)    section 348 of the FW Act at the site by organising industrial action against BPM with intent to coerce BPM to engage in industrial activity within the meaning of s 347(b)(iv) of the FW Act by acceding to the request or demand made by the Third Respondent for BPM to provide additional site amenities.

3.    The First respondent contravened:

(a)    section 346 of the FW Act on 22 April 2015 by reason of the conduct of the Second and Third Respondents referred to in declarations 1 and 2; and

(b)    section 348 of the FW Act on 22 April 2015 by reason of the conduct of the Second and Third Respondents referred to in declarations 1 and 2.

THE COURT ORDERS THAT:

1.    Pursuant to r 8.21(1)(d) of the Federal Court Rules 2011 (Cth), the name of the First Respondent be amended to “Construction, Forestry, Maritime, Mining and Energy Union”.

2.    The First Respondent pay $38,000 in respect of its contravention of s 348 of the FW Act dealt with in declaration 3(b).

3.    The Second Respondent pay $6,000 in respect of his contravention of s 348 of the FW Act dealt with in declaration 1(b).

4.    The Third Respondent pay $6,500 in respect of his contravention of s 348 of the FW Act dealt with in declaration 2(b).

5.    The Second Respondent pay the penalties in Order 3 personally in that he not, whether before or after the payment of those penalties:

(a)    seek to have or encourage the First Respondent in any way whatsoever, directly or indirectly, to pay to him or for his benefit in any way whatsoever, any money or benefit referable to the payment of the penalties, whether in whole or in part; and

(b)    accept or receive from the First Respondent in any way whatsoever, any money or benefit referable to the payment of the penalties, whether in whole or in part.

6.    The Third Respondent pay the penalties in Order 4 personally in that he not, whether before or after the payment of those penalties:

(a)    seek to have or encourage the First Respondent in any way whatsoever, directly or indirectly, to pay to him or for his benefit in any way whatsoever, any money or benefit referable to the payment of the penalties, whether in whole or in part; and

(b)    accept or receive from the First Respondent in any way whatsoever, any money or benefit referable to the payment of the penalties, whether in whole or in part.

7.    The Applicant serve these orders on:

(a)    the First Respondent in accordance with rule 10.04 of the Federal Court Rules; and

(b)    the Second and Third Respondents in accordance with rule 10.01 of the Federal Court Rules.

8.    The pecuniary penalties referred to in Orders 2 to 4 above be paid to the Commonwealth of Australia within 56 days.

9.    There be no order as to costs.

10.    The proceeding is otherwise dismissed.

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

REASONS FOR JUDGMENT

BROMBERG J:

BACKGROUND

1.    The Applicant (“Commissioner”) seeks declarations and civil penalties in relation to contraventions of the Fair Work Act 2009 (Cth) (“FW Act”) by the first (“CFMMEU”) second (“Long”) and third (“Benstead”) respondents. Unless otherwise apparent, a reference to the CFMMEU is intended as a reference to all of the respondents.

2.    I set out a chronology of significant events in my earlier judgment on liability, Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union (The Bay Street Case) [2018] FCA 83 (“primary judgment”). An outline of the events follows.

3.    At all material times, Tarastar Pty Ltd trading as BPM Built (“BPM”) was the head contractor on a building project to deliver a large residential apartment building at 209-213 Bay Street, Brighton (“site”). The estimated value of the project was between $20 and $30 million and was scheduled to take over a year to complete. BPM engaged Straight Line Excavations Pty Ltd to carry out building work at the site, who in turn engaged its own employees, as well as independent contractors, including Wagstaff Piling Pty Ltd (“Wagstaff”). At all material times employees of Wagstaff were on site performing piling works required in the early stages of the project.

4.    At all material times Long and Benstead were officers and employees of the CFMMEU, acting in that capacity. On 20 April 2015, Long and Benstead attended the site and introduced themselves to Rob Finney (“Finney”), Senior Site Supervisor for BPM.

5.    On 21 April 2015, Benstead returned to the site. Following a meeting with workers, Benstead held a discussion with Finney where he stated that the amenities were inadequate and that the site needed a dedicated female toilet. Finney explained that arrangements had been made, in consultation with Worksafe and the female worker, that would allow her to use the existing toilets.

6.    Later that afternoon, Benstead held a telephone conversation with Luke Skurrie (“Skurrie”), BPM’s Construction Manager. During the conversation, Benstead identified two problems, being no female toilet and that the sheds were not big enough. Skurrie agreed to organise a separate toilet. He also explained that the shed accommodated 18 workers, and there were 16 workers on site. BPM did not make any change to the amenities on site on 21 April 2015.

7.    On 22 April 2015, Long and Benstead attended the site and held discussions with workers. Finney initially resisted Long and Benstead entering the site without “the correct paperwork and notice”, but ultimately relented because he did not want to antagonise the CFMMEU. Following the discussions, Long told Finney that he was “sending the boys home because the amenities aren’t up to standard”. Finney tried to protest that the sheds were large enough to accommodate all 16 workers but neither Long nor Benstead responded. Workers employed by Wagstaff walked off site between about 1pm and 1.30pm (“industrial action”). The usual finishing time was 5.30pm.

8.    On the afternoon of 22 April 2015 Finney ordered an additional site shed and a portable toilet to be delivered to the site immediately which were installed before 23 April 2015.

9.    In the primary judgment I found that the industrial action was organised against BPM and that adverse action was taken against BPM on 22 April 2015 in contravention of s 346(b) of the FW Act. I also found that by organising action against BPM with an intent to coerce BPM to engage in “industrial activity” of the kind specified by s 347(b)(iv) of the FW Act, Long and Benstead contravened s 348 of the FW Act on 22 April 2015. I further found that the CFMMEU committed a single contravention of each of ss 346 and 348 on 22 April 2015.

Declarations

10.    The Commissioner seeks various declarations in relation to the contraventions of ss 346 and 348. The CFMMEU accepts that it is appropriate for the Court to make the declarations sought. It is well settled that there is educative value and utility in formally recording the basis upon which the proceeding has been resolved. The proposed declarations serve that purpose and will be made.

Pecuniary penalties

Position of the parties

11.    The Commissioner sought orders under s 546(1) of the FW Act imposing pecuniary penalties on each of Long, Benstead and the CFMMEU separately, for their contravention of s 348 of the FW Act. The Commissioner did not seek a separate penalty for the contravention of s 346 by the respondents because of s 556 of the FW Act.

12.    The Commissioner submitted that the following penalties should be imposed:

(a)    For Long — Penalties at the high end of the range for his contravention of s 348.

(b)    For Benstead — Penalties at the high end of the range his contravention of s 348.

(c)    For the CFMMEU − Penalties at or close to the maximum for two separate contraventions of s 348.

13.    The CFMMEU submitted that the penalties should be the following:

(a)    For Long — Penalties at the low end of the range for his contravention of s 346.

(b)    For Benstead — Penalties at the low end of the range his contravention of s 346.

(c)    For the CFMMEU − Penalties at the low end of the range for one contravention of s 346.

Applicable penalties

14.    The general principles relevant to the imposition of penalties under the FW Act are well settled and were not in contest.

15.    In Australian Building and Construction Commissioner v Construction, Forestry, Maritime, Mining and Energy Union (Cardigan Street Case) [2018] FCA 957 at [48]-[54] I surveyed the authorities and set out the applicable principles for the imposition of penalties pursuant to s 546(1) of the FW Act.

[48]    Section 546(1) of the FW Act provides no express guidance in relation to the determination of an appropriate pecuniary penalty in respect of the contravention of a civil remedy provision under the FW Act. The section simply says that the Court may make an order imposing a pecuniary penalty the Court considers is appropriate.

[49]    However, the authorities provide substantial guidance. The purpose of a civil penalty is primarily, if not wholly, protective to promote the public interest in compliance: Commonwealth of Australia v Director of the Fair Work Building Industry Inspectorate (2015) 258 CLR 482 (the “Agreed Penalties Case”) at [54]-[55] (French CJ, Kiefel, Bell, Nettle and Gordon JJ). This objective is achieved by putting a price on contraventions that is sufficiently high to deter repetition by the contravenor and by others who might be tempted to contravene. Both specific and general deterrence are important considerations: Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union [2017] FCAFC 113 (the “QLD Infrastructure Case”) at [98] (Dowsett, Greenwood and Wigney JJ).

[50]    In relation to specific deterrence, it has been frequently observed that a pecuniary penalty for a contravention of the law must be fixed with a view to ensuring that the penalty is not to be regarded by the offender or others as an “acceptable cost of doing business”: Australian Competition and Consumer Commission v TPG Internet Pty Ltd (2013) 250 CLR 640 at [66] (French CJ, Crennan, Bell and Keane JJ); Singtel Optus Pty Ltd v Australian Competition and Consumer Commission [2012] FCAFC 20 at [62]-[63] (Keane CJ, Finn and Gilmour JJ). On the other hand, general deterrence is directed at sending a message to a broader audience that contraventions of the kind under consideration are serious and not acceptable: Australian Securities and Investments Commission v Southcorp Ltd (No 2) (2003) 130 FCR 406 at [32] (Lindgren J).

[51]    The fixing of a pecuniary penalty involves the identification and balancing of all the considerations relevant to the contravention and the circumstances of the respondent, and making a value judgment as to what is the appropriate penalty in light of the protective and deterrent purposes of a pecuniary penalty. This process has been described as an “instinctive synthesis” akin to that undertaken in criminal sentencing: Markarian v The Queen (2005) 228 CLR 357 at [51] (McHugh J); QLD Infrastructure Case at [100].

[52]    A non-exhaustive list of the considerations that may be relevant when fixing a pecuniary penalty is conveniently set out in the QLD Infrastructure Case, where the Full Court identified those considerations that relate to the objective nature and seriousness of the offending conduct, and those that concern the particular circumstances of the respondent in question in the following terms:

[103]    The factors relating to the objective seriousness of the contravention include: the extent to which the contravention was the result of deliberate, covert or reckless conduct, as opposed to negligence or carelessness; whether the contravention comprised isolated conduct, or was systematic or occurred over a period of time; if the defendant is a corporation, the seniority of the officers responsible for the contravention; the existence, within the corporation, of compliance systems and whether there was a culture of compliance at the corporation; the impact or consequences of the contravention on the market or innocent third parties; and the extent of any profit or benefit derived as a result of the contravention.

[104]    The factors that concern the particular circumstances of the defendant, particularly where the defendant is a corporation, generally include: the size and financial position of the contravening company; whether the company has been found to have engaged in similar conduct in the past; whether the company has improved or modified its compliance systems since the contravention; whether the company (through its senior officers) has demonstrated contrition and remorse; whether the company had disgorged any profit or benefit received as a result of the contravention, or made reparation; whether the company has cooperated with and assisted the relevant regulatory authority in the investigation and prosecution of the contravention; and whether the company has suffered any extra-curial punishment or detriment arising from the finding that it had contravened the law.

[53]    In determining the appropriate penalty, the Court must also give consideration to the maximum penalty for the contravention. As the Full Court observed in the QLD Infrastructure Case at [106], there are at least three reasons for this: first, that the legislature has legislated for the maximum penalty as an expression of the legislature’s policy concerning the seriousness of the prescribed conduct; second, that it permits comparison between the case under consideration and the worst possible case (where the maximum penalty can be treated as the penalty appropriate for the worst possible case); and third, that the maximum penalty provides a “yardstick” which should be taken and balanced with all the other relevant factors.

[54]    While giving appropriate significance to the principle of deterrence, the amount of the penalty should also be proportionate to the contravention and should not be so high as to be oppressive: Trade Practices Commission v Stihl Chainsaws (Aust) Pty Ltd (1978) ATPR 40-091 (Smithers J) at 17,896; NW Frozen Foods Pty Ltd v Australian Competition and Consumer Commission (1996) 71 FCR 285 at 293 (Burchett and Kiefel JJ); QLD Infrastructure Case at [107].

16.    The parties were in contest in relation to the application of the proportionality principle expressed at [54] of the Cardigan Street Case (as set out above) and its interaction with a compelling need to take into account a contravener’s prior contraventions. I recently dealt with that issue in Australian Building and Construction Commissioner v Powell (No 2) [2019] FCA 972 at [26]-[30] as follows:

[26]    Three Full Courts of this Court have recently emphasised the importance of determining a penalty which is proportionate to the contravening conduct in the context of any need to take into account a contravener’s prior contraventions.

[27]    In Construction, Forestry, Maritime, Mining and Energy Union v Australian Building and Construction Commissioner (The Non-Indemnification Personal Payment Case) [2018] FCAFC 97, Allsop CJ, White and O’Callaghan JJ observed (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] HCA 14; 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.

[28]    Relying on the Non-Indemnification Personal Payment Case and the reasons of Bromwich J in Construction, Forestry, Maritime, Mining and Energy Union v Australian Building and Construction Commissioner (The Broadway on Ann Case) [2018] FCAFC 126, Allsop CJ, Collier and Rangiah JJ said the following in Auimatagi v Australian Building and Construction Commissioner [2018] FCAFC 191 (at [176]):

It is a fundamental principle, at the core of the judicial power to impose a penalty, that the imposition is for the contravention in question. Prior contraventions, even so many and often so serious as the Union may have engaged in in the past, is a factor which may be taken into account in determining the appropriate quantum for the contravention; it cannot be taken to lead to a penalty that is disproportionate to the gravity of the instant contravention. The maximum is for the worst category of cases.

[29]    Endorsing the observations in the Non-Indemnification Personal Payment Case quoted above at [28], Besanko and Bromwich JJ (with whom Reeves J agreed) in Parker v Australian Building and Construction Commissioner [2019] FCAFC 56 at [339]-[348] elaborated upon the applicable principles by emphasising that:

•    a court in imposing civil penalties is entitled to have regard to prior contravention in the exercise of its discretion, but not so as to permit such a history to be given such weight as to lead to the imposition of a penalty that is disproportionate to the gravity of the contravention that is being considered;

•    the role of any past contravention should be no more than a prism through which to view the instant contravention;

•    where past contraventions manifest an ongoing attitude of disobedience to the law, the heightened need for deterrence may indicate that a more severe penalty is warranted for the instant contravention;

•    nonetheless, the penalty must still fall within the applicable range that is otherwise considered appropriate for the instant contravention.

[30]    The well settled principles most recently expressed in Parker call for a structured approach to the imposition of a penalty on a contravener with a history of contraventions, the object of which is to ensure that the contravener does not “suffer the fate of being sanctioned anew for past contraventions” (at [341]). First, the Court must, identify the applicable range of penalties for that contravention without regard to the contravener’s prior history of contraventions. Having done that, the Court should then take into account that history in assessing where, within the applicable range, the penalty should fall.

17.    I note that in his recent judgment, Australian Building and Construction Commissioner v Pattinson [2019] FCA 1654, Snaden J came to the view (at [39]-[69]) that there are two competing approaches by Full Courts of this Court as to the role of prior contraventions in the assessment of the imposition of a penalty, reflected by the reasoning of the majority (Tracey and Logan JJ) in Construction, Forestry, Maritime, Mining and Energy Union v Australian Building and Construction Commissioner (The Broadway on Ann Case) (2018) 265 FCR 208 and the approach of the Full Court (Besanko, Reeves and Bromwich JJ) in Parker v Australian Building and Construction Commissioner [2019] FCAFC 56.

18.    The reasoning in Parker is consistent with that of the Full Court in Construction, Forestry, Maritime, Mining and Energy Union v Australian Building and Construction Commissioner (The Non-Indemnification Personal Payment Case) (No 2) [2018] FCAFC 117 and Auimatagi v Australian Building and Construction Commissioner [2018] FCAFC 191, referred to above at [16] and has been followed by many judges of this Court, including myself, see: Australian Building and Construction Commissioner v Hassett [2019] FCA 855 (O’Callaghan J), Powell (Bromberg J), Australian Building and Construction Commissioner v Construction, Forestry, Maritime, Mining and Energy Union (The Laverton North and Cheltenham Premises Case) (No 2) [2019] FCA 973 (Bromberg J), Australian Building and Construction Commissioner v Construction, Forestry, Maritime, Mining and Energy Union (The Aldi/Altona North Case) (No 2) [2019] FCA 1667 (Bromberg J), Australian Building and Construction Commissioner v Construction, Forestry, Maritime, Mining and Energy Union (Geelong Grammar School Case) (No 2) [2019] FCA 1498 (Mortimer J), Australian Building and Construction Commissioner v Construction, Forestry, Maritime, Mining and Energy Union (Syme Library Case) (No 2) [2019] FCA 1555 (Wheelahan J) .

19.    I respectfully disagree with the conclusion of Snaden J in Pattinson (at [63] and following) that the observations in Parker do not “[represent] the law as it presently stands”. The Full Court in Parker relied on and applied the two principles enumerated by Mason CJ, Brennan, Dawson and Toohey JJ in Veen v the Queen (No 2) (1988) 164 CLR 465 at 477-478 that:

    the antecedent criminal history of an offender “cannot be given such weight as to lead to the imposition of a penalty which is disproportionate to the gravity of the instant offence”; and

    “the maximum penalty prescribed for an offence is intended for cases falling within the worst category of cases for which that penalty is prescribed”.

20.    There can be no doubt that those principles state the law and are binding upon a single judge of this Court. As for the first of those principles, I understand the analysis in Parker to be emphasising that the penalty imposed must be proportionate to the gravity of the instant offence rather than proportionate to the gravity of the contravener’s history of offending. In my respectful view, an approach to proportionality focused upon the gravity of the contravener’s offending rather than the gravity of the instant contravention invites error.

Consideration

21.    The maximum penalty for a contravention of s 346 or s 348 by an individual at the time of the contraventions was $10,200. The corresponding maximum penalty for a body corporate, such as the CFMMEU, was $51,000.

22.    Pursuant to s 556 of the FW Act, a person is not liable to be ordered to pay a pecuniary penalty for more than one civil penalty provision in relation to the same conduct. Both the Commissioner and the CFMMEU agree that s 556 has application and that the Court should only impose one penalty for the contraventions of ss 346 and 348. The parties disagree about whether the penalty should attach to the contravention of s 346 or s 348.

23.    The Commissioner submitted that penalties should be imposed for the contraventions of s 348 as the events of 22 April 2015 took place due to Long and Bensteads’ motivation to coerce BPM to comply with their request. To support his contention, the Commissioner relied on Canturi v Sita Coaches Pty Ltd (ACN 004 444 900) (2002) 116 FCR 276 at [84] (Ryan J) and Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union (The Quest Apartments Case) (No 2) [2018] FCA 163 at [20] (a probable intended reference to [22]-[28]) (Tracey J) for the proposition that the Commissioner may select from the available penalty provisions that which should be the vehicle for the imposition of a single penalty. However, the statement made by Ryan J in Canturi was that, in certain cases where a perpetrator is exposed to two separate penalties by the same conduct, it may be the case that the applicant should be allowed to elect which penalty should be applied, and that that suggestion has particular force where a provision confers powers additional to the imposition of penalties such as the power to order payment of compensation or reinstatement of an affected employee. However, in Canturi, Ryan J found that such an election would “serve no useful purpose” where, as was the case in Canturi and as it is here, the maximum penalties prescribed for each contravention are the same: see also Quest Apartments Case at [24]. The Commissioner also referred to statements made in Minister for Industry, Tourism and Resources v Mobil Oil Australia Pty Ltd [2004] FCAFC 72 at [53](iv) (a probable intended reference to [51](iv)) (Branson, Sackville and Gyles JJ) for the proposition that the Court has regard to the specialist views of the regulator on issues in relation to penalty. However, the observations there made were specific to a case where the parties have made joint submissions as to the appropriate penalty to be imposed.

24.    Both ss 346 and 348 have the same maximum penalties, and the legislature has thereby treated them as “equally serious”: Quest Apartments Case at [24]. I will treat s 348 as the lead contravention in relation to which a penalty should be imposed. I take this approach as s 348 has an additional ingredient of intending to coerce. This is the same approach that I took in the Aldi/Altona North Case at [30].

25.    As detailed by the principles to which I have referred, I need to consider the factors relating to the objective nature and seriousness of each contravention. I accept that the contravening conduct on 22 April 2015 should be regarded as objectively serious. The conduct was deliberate and, I would infer given Long and Bensteads’ long-standing experience as union officials, engaged in in the knowledge that it was unlawful.

26.    The CFMMEU submitted that I should take into account the fact that the motivation for the unlawful conduct was legitimate and proper, being an attempt to have inadequate sanitation and amenity facilities addressed. The Commissioner contended that the submission ought to be disregarded because the respondents had other lawful means to address any issues with site amenities. It is not apparent to me how the means suggested by the Commissioner (the use of right of entry provisions) would have addressed any inadequacy in the amenities on the site. However as I later record, the failure of the respondents to demonstrate the unavailability of a lawful alternative to the action they took to address their concerns is of relevance.

27.     The Commissioner also relied upon what was stated by Dowsett and Rares JJ in relation to s 348 of the FW Act in Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union (2017) 249 FCR 458 at [73]-[74], that the lawfulness of a request cannot be treated as in any way mitigating the seriousness of a contravention, and is an irrelevant consideration in determining the level of seriousness of a penalty. However, those observations were directed to a finding (at [74]) that there was error in the primary judge taking into account, as a mitigating factor, the “lawfulness” of the “lawful request” made by the contravener under s 347(b)(iv) of the FW Act, in circumstances where the making of a “lawful request” under that provision was an element of the contravention.

28.    The submission here made by the respondents is not that the lawfulness of the s 347(b)(iv) request be taken into account as a mitigating factor, but that the “genuine and legitimate motivation” of the respondents in pursuing their unlawful conduct be taken into account. The respondents submitted that in assessing the seriousness of the contraventions their “unlawful conduct … needs to be placed in [an] appropriate context.” The asserted context here was that the respondents’ purpose or motive for taking the unlawful conduct was their desire to have addressed what the respondents characterised as the patently inappropriate and morally reprehensible circumstance that a female on a building site was being required to use the same toilet as the men on that site.

29.    Whether those circumstances were in fact inappropriate or reprehensible is not the point, what matters is the respondents’ perception of them, so long as that perception was reasonably available. It was not contested that the complaint made by Benstead to Finney that the female worker on site needed a dedicated female toilet (see primary judgment at [16]-[17]) was not based on a genuine and reasonably held concern and an inference is available that that foundation existed. The same conclusion is available in relation to the complaint made that the site sheds were inadequate.

30.    As Jagot J observed in Fair Work Ombudsman v Construction, Forestry, Maritime, Mining and Energy Union [2018] FCA 934 at [46]-[47], it is necessary to recognise that unlawful conduct occurred in a particular context and had a particular purpose. As in that case, this was not “an exercise of industrial power for some arbitrary or capricious end”. As her Honour went on to say at [47], placing unlawful conduct in context does not involve accepting that the contravener’s perceptions justified the unlawful conduct or that the “ends justify the means”.

31.    The relevance to the assessment of the appropriate penalty of the purpose for which unlawful conduct is taken was also recognised by Barker J in Fair Work Ombudsman v Maritime Union of Australia [2012] FCA 1232 at [25] where his Honour said:

Although, as was agreed by the respondents, the industrial action was unlawful, I accept that it arose out of concerns for the treatment of the BPA employees. As such, the conduct of the respondents is to be contrasted with conduct carried out for arbitrary or base motives.

32.    The relevance of motive or purpose on sentencing in the criminal context and in particular, that it may bear on the need for specific deterrence, was also acknowledged in the following observation made by Vincent JA (Phillips CJ and Cummins AJA in agreement) in R v Arundell [2003] VSCA 69 at [35]:

Whilst the effect upon the victim will remain the same, whatever may be the reason for or pressures underlying the commission of an offence, the motive for embarking upon the activity can assume relevance in a number of different ways. It may bear, for example, upon the genuineness of any expression of remorse, the need for specific deterrence or the prospects of the offender's rehabilitation. Sometimes, but I suspect only in extremely rare circumstances, the presence of extreme financial pressures might mitigate the level of culpability of an individual who breaches the trust reposed in him to the extent and the manner evidenced in the present case.

33.    I accept that the perceptions held by Long and Benstead are relevant in assessing the seriousness of their contraventions and, in turn, the need for specific deterrence. I consider, however, that those perceptions only slightly diminish the need for specific deterrence in circumstances where the respondents have not demonstrated that their unlawful conduct was the only realistic means available to them to address the concerns which motivated that conduct.

34.    As a result of Long and Bensteads’ conduct, 8 workers employed by Wagstaff walked off the site for approximately half a day. Whether any loss was suffered by BPM was not the subject of any evidence. The Commissioner did not seek to adduce evidence quantifying any economic loss suffered by BPM. Even though no evidence has been adduced, I would infer that some loss was occasioned: see Director of the Fair Work Building Industry Inspectorate v Robinson (2016) 241 FCR 338 at [39] (Charlesworth J). However, I presume that if the loss occasioned had been significant, the Commissioner would have led direct evidence of it.

35.    The countervailing factors are that the conduct occurred at a single site, was limited in time, involved no aggression or violence and on the evidence before me, if loss or damage was occasioned, I am unable to infer that it was significant. On balance, I would regard the contravention as at the mid-level of the range in relation to its seriousness.

36.    In relation to the CFMMEU’s contravention by reason of Long and Bensteads’ conduct on 22 April 2015, all of the factors just referred to are to be taken into account but additionally, there is one other factor which increases the level of seriousness of the contravention in my mind. The Commissioner contended that the contravention involved senior personnel of the CFMMEU. I reject the Commissioner’s submission that Long and Benstead should be regarded as senior officials given their long-standing experience and positions as the Commissioner has not adduced any evidence to support this submission. I do, however, consider that the evidence before me permits an inference that the senior leadership of the CFMMEU or more particularly the Construction and General Division (Victoria/Tasmania Divisional Branch) of the CFMMEU (“Divisional Branch”) of which Long and Benstead are officials, condoned the contravening conduct and was therefore involved in that conduct. I have come to that view on the same basis as I did in the Cardigan Street Case at [82]-[86]. The evidence of the kind to which I there refer, is also available here and permits the same inference to be drawn.

37.    On that basis, I consider that the contravention by the CFMMEU is at the higher end of the range in relation to its seriousness.

38.    I now turn to consider the particular circumstances of the contravener, the second category of factors summarised in Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union (2017) 254 FCR 68 at [104] (Dowsett, Greenwood and Wigney JJ). Neither Long, Benstead or the CFMMEU have exhibited any contrition or remorse for the contravening conduct. The need for specific deterrence is not thereby diminished. Further, there was no cooperation relevant to mitigation.

39.    Long and Benstead are experienced officials of the CFMMEU and remain employed officials of that organisation. As ongoing employees, specific deterrence remains relevant.

40.    To effectuate the need for specific deterrence, the penalty that ought to be imposed should be meaningful and, by reference to Long and Bensteads’ capacity to pay, the penalty should have significance. Beyond the fact that Long and Benstead remain in employment, there is no evidence as to their financial capacity. I will assume that their financial capacity is that of an average working person and that a meaningful penalty is a penalty that would have significance to such a person. In contrast, there is evidence about the financial means of the CFMMEU and even if I were only to take into account the revenue and net assets of the Divisional Branch, the CFMMEU has the financial capacity to pay very substantial pecuniary penalties.

41.    The Commissioner relied upon a history of contravening conduct in relation to each of Long, Benstead and the CFMMEU. Not all of that contravening conduct by the CFMMEU referred to by the Commissioner may be characterised as involving prior contraventions committed before the contraventions here being considered. The weight to be accorded to prior contraventions which have been the subject of judgment and penalty and those that have not and the relevance of contraventions occurring after the present contraventions was discussed by me in the Laverton North and Cheltenham Premises Case at [71]-[72]. I adopt the reasoning that flows from those observations:

[71]    Prior contraventions are relevant to the need for specific deterrence. As was said by Mason CJ, Brennan, Dawson and Toohey JJ in Veen at 477-8 the antecedent criminal history of an offender is a factor which may be taken into account in determining the sentence to be imposed because it is relevant ‘to show whether the instant offence is an uncharacteristic aberration or whether the offender has manifested in his commission of the instant offence a continuing attitude of disobedience of the law.’ An attitude of disobedience of the law demonstrated by the contravener’s prior history of contraventions, will inform the extent of deterrence necessary to address the level of disobedience demonstrated by those prior contraventions. Contraventions of the law committed prior to the instant contravention will, as King CJ explained in R v McInerney (1986) 42 SASR 111 at 113, be:

more cogent if they have been the subject of conviction before the immediate offence. In such cases, the offender has committed the immediate offence notwithstanding the formal judgment and condemnation of the law in respect of the earlier offences and notwithstanding the warning as to the future which the conviction experience implies.

[72]    In addition to its reliance on prior contraventions of industrial laws, the Commissioner also sought to rely on contraventions committed after the instant contraventions. Contraventions of industrial laws which post-date an instant contravention are unable to reliably say much at all about the contravener’s “continuing attitude of disobedience of the law” at the time of the commission of the instant contravention. Why some weight ought to be given to contraventions of that kind was not explained by the Commissioner. That some weight can be given to contraventions of that kind is suggested by Tracey J in Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union (Footscray Station Case) [2017] FCA 1555 at [48]. I would accept that for the purpose of demonstrating that the instant contravention is not “an uncharacteristic aberration”, a contravention which post-dates the instant contravention may be taken into account. However, to give such contraventions potency in assessing an appropriate penalty for the instant contravention bears the risk that the contravener will be punished twice.

42.    In relation to Long, the Commissioner submitted that it is appropriate for the Court to have regard to two proceedings in which penalties were imposed on the CFMMEU (not Long), in relation to conduct that the CFMMEU admitted was engaged in by Long and also the fact that Long’s federal entry permit was suspended in a separate proceeding brought as a result of such admissions. The respondents submitted that it is inappropriate for the Court to consider these matters in determining the appropriate penalty to be imposed on Long. I reject the Commissioner’s submission as there is no basis for treating admissions made by the CFMMEU as admissions made by Long.

43.    Long has the following history of prior contraventions of industrial laws which are set out below chronologically, with an indication of when the penalty was imposed. The Commissioner submitted that I take into account contraventions found against Long in the Laverton North and Cheltenham Premises Case. The CFMMEU submitted that would not be appropriate as no finding of contravention had been made at the time of the instant contraventions. Those contraventions are prior contraventions and should be taken into account and accorded weight in accordance with the principles referred to at [41] above, they are included in the table of prior contraventions. I note that of all of Long’s prior contraventions, only the 2 contraventions of 28 May 2008 were the subject of formal judgment and condemnation delivered prior to the instant contraventions.

44.    In relation to Benstead, the Commissioner also submitted that it is appropriate for the court to have regard to a decision in which the CFMMEU had contraventions imposed on it (not Benstead) for conduct engaged in by Benstead. I reject this submission on the same basis that I rejected the submission made in respect of Long above at [41].

45.    Benstead has the following history of prior contraventions of industrial laws which are set out below chronologically with an indication of when the penalty was imposed. I note that of Benstead’s prior contraventions, 5 thereof were the subject of a formal judgment and condemnation delivered prior to the instant contravention.

46.    In relation to the CFMMEU and in particular the Divisional Branch, the evidence put before the Court of contraventions of industrial laws was essentially the same as that which was before the Court in the Laverton North and Cheltenham Premises Case. The observations and conclusions there made by me are apposite:

[76]    The CFMMEU, and in particular the Divisional Branch, has an appallingly long history of prior contraventions of industrial laws. The Commissioner relied on a document setting out that prior history, the accuracy of which was not challenged by the CFMMEU. The Commissioner’s analysis shows that the CFMMEU has regularly been involved in the contravention of provisions of the FW Act or the BCCII Act which have attracted pecuniary penalties. The document shows that the CFMMEU has been ordered to pay very significant penalties in relation to those contraventions including many very close to (or at) the maximum available penalty. The document and the updating of it, records over 140 proceedings in which penalties for contraventions of industrial laws dating back to 1999 were imposed. Many if not most of those cases involve multiple contraventions. Over 100 of those cases deal with contraventions that occurred prior to the contraventions here being dealt with. It appears that around 65 of the cases involved the Divisional Branch and around 55 of those cases concerned multiple prior contraventions which occurred prior to the instant contraventions. There can be no doubt that the CFMMEU, through the Divisional Branch, has a significant antecedent history of prior contravening conduct which supports the need for deterrence, particularly specific deterrence. That consideration must loom large in the fixation of appropriate penalties.

47.    In the Laverton North and Cheltenham Premises Case, I also made further observations about why a compelling need for specific deterrence in relation to the CFMMEU was there demonstrated. Again, on the evidence before me, the same observations are apposite:

[77]    In relation to specific deterrence I also take into account that, despite the admissions made by the respondents in relation to the instant contraventions, there is no evidence before me of the CFMMEU taking any compliance action to counsel, educate or inform MacDonald or Long in order to prevent the reoccurrence of contravening conduct by them in the future. Nor is there any evidence before me of any compliance regime ever put in place by the CFMMEU to address its long history of prior contraventions. As I said in the Cardigan Street Case at [85] ‘[t]he absence of any evidence of compliance systems within the CFMMEU is particularly alarming given the heavily critical comments of the CFMMEU made by this Court in many cases over recent years’. As I also there said at [86] ‘[a]n organisation faced with a litany of contraventions over an extended period of time, which repeatedly incurs not only significant financial penalties but also pointed judicial criticism, would necessarily put in place measures to change the cultural or normative conduct of the contravening behaviours of its officers and employees’ unless such behaviour was condoned by the senior leadership of the organisation. That inference, made in the Cardigan Street Case, is equally available here. All of that is demonstrative of a compelling need for specific deterrence.

The number of contraventions attributed to the CFMMEU

48.    As set out at [112]-[114] of the primary judgment, I found that the CFMMEU committed a single contravention of each of ss 346 and 348 by reason of the sum of the conduct of Long and Benstead. The Commissioner seeks to re-agitate this finding and submitted that the correct legal analysis is that, by their actions, Long and Benstead each individually organised industrial action in contravention of ss 346 and 348 as their conduct across 20-22 April 2015 was not identical and the Court should therefore find two contraventions of each of ss 346 and 348 by the CFMMEU. The Commissioner submitted that the cases of Robinson and Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union [2017] FCA 1269, which were relied upon in the primary judgment, were cases concerning s 557 of the FW Act and not the relevant provisions under consideration in the present proceeding and instead sought to rely upon the reasoning of Besanko J in Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union (No 3) [2017] FCA 10 and also cited the reasoning of Dowsett and Rares JJ in Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union at [96]-[97].

49.    In the primary judgment I cited Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union at [21]-[23], a case decided by Reeves J on this point concerning contraventions of ss 343 and 348. In that case Reeves J preferred the reasoning of Charlesworth J in Robinson and Australian Building and Construction Commissioner v McDermott (No 2)  (2017) 252 FCR 393 to that of Besanko J in Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union (No 3). Even if I had been persuaded that there is a proper basis for reconsidering the finding made in the primary judgement, I respectfully agree with the conclusion of Reeves J and would not have been persuaded to disturb my earlier finding that the CFMMEU committed a single contravention of each of ss 346 and 348 by reason of the sum of the conduct of Long and Benstead.

50.    Given that there is only one contravention of s 348 for which a penalty will be imposed with respect to the CFMMEU, I need not deal with the submissions made by the Commissioner or the CFMMEU in relation to the course of conduct and totality principles.

Whether or not personal payment orders should be made in respect of Long and Benstead

51.    The Commissioner contended that the Court should make a personal payment order in respect of the penalties to be imposed on Long and Benstead.

52.    The orders for personal payment which are sought have been framed in accordance with the order made by the Full Court (Allsop CJ, White and O’Callaghan JJ) in the Non-Indemnification Personal Payment Case. The orders sought would require Long and Benstead to pay the penalty imposed by the Court personally and not to seek or encourage the CFMMEU to pay to them any money or provide any financial benefit referable to the payment of the penalty, and additionally, not accept or receive from the CFMMEU any money or financial benefit referable to that payment.

53.    In the Laverton North and Cheltenham Premises Case, I considered the circumstances in which it may be appropriate to make a personal payment order. My observations, which need not here be repeated, are set out at paragraphs [87]-[94]. The unique circumstances upon which I there relied are equally present in this case. It was not contested that Long and Benstead had never previously personally paid a penalty imposed on them for contraventions of industrial laws. However, I note that a personal payment order was made for Long in the Laverton North and Cheltenham Premises Case, which was decided after the hearing of this proceeding. I consider that a personal payment order should be made in respect of the penalties imposed on Long and Benstead.

54.    Taking into account and balancing the considerations I have described, I will impose a penalty of $6,000 upon Long, a penalty of $6,500 upon Benstead and a penalty of $35,000 upon the CFMMEU for the contravention by each of them of s 348 of the FW Act. I will make an order that the penalties be paid within 56 days. If there is a basis for extending that time, the respondents may apply for such an extension by letter directed to my associate setting out the basis for any extension.

Associate:

Dated:    12 November 2019