Federal Court of Australia

Construction, Forestry, Maritime, Mining and Energy Union v Fair Work Ombudsman (Boggo Road Cross River Rail Case) [2023] FCA 507

ORDERS

THE COURT ORDERS THAT:

1.    The appeal is allowed.

2.    Declaration 1(f) made by the Federal Circuit and Family Court of Australia (Div 2) on 28 July 2022 be varied to read:

(f)    making an offensive comment to a manager on site that suggested the manager was trying to look at his penis while in the toilet block;

3.    Declaration 2(c) made by the Federal Circuit and Family Court of Australia (Div 2) on 28 July 2022 be varied to read:

(c)    making insultingly childish comments to staff of the occupier, in particular saying “Pete, Pete, pumpkin eater”;

4.    Orders 5, 6, 7 and 8 made by the Federal Circuit and Family Court of Australia (Div 2) on 28 July 2022 are set aside.

5.    The first appellant pay a pecuniary penalty of $50,000 for each of its two contraventions of s 500 of the Fair Work Act 2009 (Cth), a total of $100,000, to the Commonwealth of Australia within 28 days of the date of this order.

6.    The second appellant pay a pecuniary penalty of $7,000 for his contravention of s 500 of the Fair Work Act 2009 (Cth) to the Commonwealth of Australia within 28 days of the date of this order.

7.    The third appellant pay a pecuniary penalty of $7,000 for his contravention of s 500 of the Fair Work Act 2009 (Cth) to the Commonwealth of Australia within 28 days of the date of this order.

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

REASONS FOR JUDGMENT

ABRAHAM J:

1    This is an appeal from ABCC v CFMMEU (Boggo Road Cross River Rail Case) [2022] FedCFamC2G 574 (the primary judgment), in which the primary judge imposed civil penalties on the Construction, Forestry, Maritime, Mining and Energy Union (CFMMEU) and two of its employed organisers, Andrew Blakely and Luke Gibson, for contraventions of s 500 of the Fair Work Act 2009 (Cth) (the FW Act) when they entered the Boggo Road site (the site) on 15 April 2020.

2    The appellants admitted the contraventions and the proceedings were conducted on the basis of agreed facts pursuant to s 191 of the Evidence Act 1995 (Cth) (Evidence Act). The Court was only required to determine the orders to be made in consequence of those admitted contraventions.

3    The primary judge:

(a)    declared that the second and third appellants, Mr Blakely and Mr Gibson, had contravened s 500 of the FW Act, and imposed on each the maximum civil penalty being $12,600 (also making personal payment orders in respect of that penalty); and

(b)    declared that the first appellant, the CFMMEU, had contravened s 500 of the FW Act by each of the contraventions of the second and third appellants, and imposed the maximum penalty, being $63,000, on it in respect of each of its contraventions.

4    The primary judge also found, and declared, that each of the second and third appellants had engaged in homophobic conduct. The appellants contended that those findings and declarations involved appellable error and should be set aside. They were also critical of the primary judge’s assessment of the conduct, contending that his Honour’s discretion in the imposition of the penalty miscarried.

5    The appellants plead ten grounds of appeal, the first three being directed to the primary judge’s conclusion that the second and third appellants had engaged in homophobic conduct, the remaining relating to the imposition of the penalties. The first three grounds are as follow:

The Pumpkin Eater Grounds

1.    His Honour erred (at Judgment [41], [42]-[52]) in finding that the third respondent had made a homophobic slur by calling Peter Cullen “Pete Pete Pumpkin Eater” because:

a.    that conclusion was not open on the pleaded facts of the matter;

b.    there was no evidence before the Court that “pumpkin eater” is a homophobic slur; and

c.    “pumpkin eater” having either a meaning as referring to sexual conduct or a meaning as a homophobic slur was not knowledge to which his Honour was entitled to have regard pursuant to s.144 of the Evidence Act 1995 (Cth) as:

i.    it was not knowledge that is:

1.    not reasonably open to question; and

2.    common knowledge in Queensland or any other locality; or

3.    capable of verification by reference to a document the authority of which cannot reasonably be questioned; and

ii.    his Honour did not comply with the requirements of s.144(4) of the Evidence Act 1995 (Cth) as he did not disclose the contents of Annexure 1 and give the respondents an opportunity to respond to it.

2.    Alternatively, his Honour denied the respondents procedural fairness by declining to disclose to them the meaning of the term “pumpkin eater” to which he proposed to have regard in reaching the conclusion that it was a homophobic slur.

The Homophobic Slur Grounds

3.    His Honour erred in finding that the second respondent made a homophobic slur by suggesting that Mr Cullen was trying to look at his penis in the toilet block as that conclusion was not open on the pleaded facts of the matter.

6    The respondent conceded that those first three grounds are established, and as a result the remaining grounds were not pressed by the appellants. I am satisfied on the material before me that that concession was properly made. As explained below, the finding that the second and third appellants had engaged in homophobic conduct did impact on the penalties imposed. Accordingly, the penalties are to be re-determined.

7    For the reasons below:

(a)    In relation to the second appellant, Mr Blakely, I impose a penalty of $7,000.

(b)    In relation to the third appellant, Mr Gibson, I impose a penalty of $7,000.

(c)    In relation to the first appellant, the CFMMEU, I impose a penalty of $50,000 in relation to each of its two contraventions, resulting in a total penalty imposed of $100,000.

8    I also vary the following declarations made by the primary judge as follows:

(a)    Declaration 1(f) which was to the effect that the second appellant had contravened s 500 of the FW Act by “making a homophobic slur to Peter Cullen that suggested Mr Cullen was trying to look at his penis while in the toilet block”, should be varied to read that the second appellant contravened s 500 of the FW Act by “making an offensive comment to a manager on site that suggested the manager was trying to look at his penis while in the toilet block”.

(b)    Declaration 2(c) which was to the effect that the third appellant had contravened s 500 of the FW Act by “insulting Peter Cullen with a homophobic slur that he was a ‘pumpkin eater’”, should be varied to read that the third appellant contravened s 500 of the FW Act by “making insultingly childish comments to staff of the occupier, in particular saying ‘Pete, Pete, pumpkin eater’”.

Factual background

9    The events of 15 April 2020 can be summarised as follows.

10    At or around 7:45am, the second and third appellants attended the site and were observed by representatives of the occupier, CPB Contractors Pty Ltd (CPB). To enter the site, they walked past signs requesting that they comply with site occupational health and safety (OHS) requirements.

11    The second and third appellants were approached by a senior supervisor for CPB. When asked why they were present, they did not give a meaningful answer. Instead, the third appellant asked to use the toilet. The senior supervisor then approached the second and third appellants with a safety advisor (a manager) for CPB, Mr Peter Cullen. The second and third appellants advised that they wished to enter the site pursuant to s 117 of the Workplace Health and Safety Act 2011 (Qld) (WHS Act) but, upon a request to do so, did not produce their entry permits for inspection (instead, inter alia, asking which of their permits was sought). Mr Cullen advised that until he had seen their permits, he would not be escorting the second and third appellants on site. The second appellant advised Mr Cullen that he intended to contact Work Health and Safety Queensland (the regulator) and request that they send inspectors to the site.

12    A brief conversation about names followed, then another request that the second and third appellants provide their entry permits. During which the third appellant said to Mr Cullen “Pete, Pete Pumpkin Eater”. Upon request by the senior supervisor for their notices of entry, the second and third appellants did each produce a “WHS Permit Holder Notice of Entry” under s 19 of the WHS Act (the notices of entry).

13    Mr Cullen then repeated his request for the second and third appellants’ entry permits, followed by another request for the same by the senior supervisor and the industrial relations advisor for CPB. It was stated each time that no entry would occur unless the permits were shown. The second and third appellants did not produce their entry permits.

14    At or about 8:26am, the second and third appellants left the pre-start area and entered further into the site. The second appellant did not comply with the senior supervisor’s request to “come back here”. He then stopped in the middle of a roadway in front of the heavy vehicle gate opening, preventing the entry of a truck. Mr Cullen requested that the second appellant move out of the way of the truck, but instead he placed himself in its intended path for a short time. During that time, Mr Cullen: repeated his request to see the second appellant’s entry permits; and requested that he return to the pre-start area, as did the senior supervisor. The second appellant either ignored the requests, or otherwise refused to comply, saying words to the effect of “I am just stretching my legs”. He then engaged in aggressive behaviour towards the senior supervisor, walking directly towards him, puffing his arms bent at the elbows, raising the sides of his torso and smirking.

15    In the toilet block on site, the second appellant made a comment in offensive terms to Mr Cullen, suggesting that Mr Cullen was trying to look at his penis. The second appellant then accessed and inspected each of the crib rooms and meeting rooms on site. In doing so, he interrupted a site induction taking place. The industrial relations advisor then repeated his request for the second appellant to show his entry permit and requested that he return to the pre-start area. The second appellant did not comply with either request.

16    After leaving the pre-start area, the third appellant was approached by the senior supervisor, who requested that he return to the pre-start area. He did not comply with the request and replied in a belligerent manner, saying words to the effect of “what do you think I am, a dog? You want me to pull my pocket out and lead me around like a dog?”.

17    At around 9:39am, inspectors from the regulator arrived at the site. The second and third appellants produced their entry permits when requested by the inspectors. The inspectors and the second and third appellants then discussed the suspected safety breaches identified in the notices of entry with representatives of CPB, and inspected various areas of the site. At approximately 10:55am, the second and third appellants left the site.

The finding

18    It is necessary to refer, albeit briefly, to the circumstances in which the primary judge found and then imposed penalties on the basis that the second and third appellants had engaged in homophobic conduct.

19    In the primary judgment at [42]-[43], the primary judge described the circumstances in which his Honour raised the issue:

[42]    There was some consternation at the Bar table when I expressed that the term “pumpkin eater” was a homophobic slur. Counsel, who may have had a somewhat sheltered existence, did not understand that this term could be used in this manner.

[43]    At the hearing, I did not wish to explain what the term means because it is quite disgusting and I believed that the use of this term was common enough knowledge. I have absolutely no doubt that it was meant as a homophobic slur to Mr Cullen.

20    At [48], the primary judge found that the second appellant’s comment in the toilet block was “clearly a reference” to the third appellant’s earlier use of the term “pumpkin eater”.

21    At [50]-[52], the primary judge stated that:

[50]    Counsel for the Applicant quite properly conceded that he had not made any submission to suggest that the term “pumpkin eater” was a homophobic slur. With all due respect to Counsel, it was proper for him to inform the Court of this, however, that does not mean that the Court is fettered by the fact that Counsel has not understood the words that were said and what the term “pumpkin eater” actually refers to.

[51]    I am not criticising either Counsel in any way; I wish that I did not know what this term actually means because it is so disgusting. But I do know what the term means and given all of the surrounding circumstances (especially the later slur by the Second Respondent), I am in no doubt that this term was uttered by the Third Respondent as an insult of the homophobic kind.

[52]    Since reserving this decision, I thought back to an earlier decision of mine in Bunning v Centacare [2015] FCCA 280. In that decision, I unfortunately had to use terms identifying a number of paraphilias including copraphilia, urophilia and necrophilia. There were many queries afterwards by persons whom I would have considered “worldly” as to what these terms meant. It may be the same is true of “pumpkin eater”. Whilst I do not wish to explain this term in the body of these Reasons, I have given an explanation in Annexure 1 to this judgement.

22    The impact of this finding on the penalties imposed is obvious from [90]:

[90]    The behaviour of uttering quite disgusting homophobic slurs has been consigned to the chapters of the dark history of Australia where the hurling of vitriolic insults which targeted a person’s sexuality, race or religion were unfortunately tolerated as if such belittling and bullying was something that a victim just “had to cop”. Those days are thankfully gone and only troglodytes would attempt to resurrect them. For the Second and Third Respondents (who are supposedly fit and proper persons to hold an entry permit pursuant to s 512 of the FW Act) to utter such slurs to bully and belittle a person simply must be deterred by all means available to a Court.

23    As a consequence, the primary judge imposed the maximum penalty on each appellant.

24    As is evident from the above, and the appellants’ admissions, there was no allegation made by the respondent that the conduct included a homophobic slur or homophobic conduct. The appellants’ admissions to the contraventions therefore did not encompass an admission to such conduct. The primary judge found not only that there was such conduct, but that it was intended by the second and third appellants to be homophobic conduct.

25    A consideration of the transcript of the proceedings below reflects the following:

(a)    It was the primary judge who raised the matter of homophobia of his Honour’s own volition.

(b)    His Honour raised the topic during the appellants’ submission explaining the conduct admitted to, by interrupting and saying “[a]nd when you don’t get your own way, you resort to homophobic slurs”.

(c)    As soon as it was raised, the appellants’ counsel took issue with the interpretation, submitting, inter alia, “that the description ‘pumpkin eater’ is not a phrase that is in common use as a homophobic slur”. The appellants’ counsel then repeatedly tried to put their submission on the topic.

(d)    The primary judge refused to explain to counsel the meaning of the term his Honour was referring to, or explain the source of his knowledge as to that meaning. His Honour only said that he had “heard these terrible epithets” because of his background as a Crown Prosecutor. His Honour repeatedly asserted that his understanding was common knowledge and that counsel “just [didn’t] understand it”. The primary judge was well aware that neither party understood the meaning of the term “pumpkin eater”, stating:

… I understand that, you know, I may be a bit more worldly than you are, and I may understand how those things affect sections of the community more than you are, but that’s the way it is. That’s why, you know, I’m asked to be a judge because (a) there are things that I have in my experience that allows me to look at these things and see what it is, even if it something that escapes, you know, both counsel, but anyway, all right.

(e)    The appellants’ submissions included that there was no material before the Court to enable the primary judge to make the finding that the term “pumpkin eater” is a homophobic slur.

(f)    The primary judge responded to the appellants’ submissions, inter alia, by saying that they had not put on any evidence as to the meaning of the conduct. That is, they had not led evidence that the term was not a homophobic slur.

(g)    The respondent did make the submission that it was not alleged by them, and that it was not their case, that “pumpkin eater” was a homophobic slur. It was apparent that the respondent also did not understand the meaning of the conduct to be as asserted by the primary judge.

(h)    The appellants submitted that the allegation that the comment made by the second appellant in the toilet block had some homophobic character was not understood from the pleadings and was not the case advanced against him. They also reiterated that the second appellant had not had the opportunity to consider whether he might want to rebut that reading or understanding of the conduct. The primary judge took issue with that, asserting that “he has had the opportunity” and that he had just not taken it.

26    Simply put, as apparent from the grounds of appeal, it is contended that: there was no evidence and there were no pleaded facts to make the finding in relation to “pumpkin eater” being a homophobic slur; the primary judge did not comply with s 144 of the Evidence Act if his Honour was taking judicial notice of the meaning of “pumpkin eater”; the appellants were denied procedural fairness by the primary judge’s refusal to disclose the meaning of “pumpkin eater”; and there were no pleaded facts to make the finding in relation to the second appellant’s comment in the toilet block being a homophobic slur.

27    In the circumstances described above, it was obvious to the primary judge from their repeated statements that counsel did not understand or agree with his Honour’s approach to the meaning of the term “pumpkin eater”. In that light, the primary judge refused to provide the meaning his Honour was referring to, or the basis of his knowledge. There was nothing in the pleadings or evidence that indicated that meaning, or that it was the case the appellants had to meet. It was not admitted by the appellants and was positively disavowed by the respondent. Further, the primary judge did not raise s 144 of the Evidence Act with counsel. In any event, given counsel’s lack of knowledge as to the meaning of the term, the primary judge could not proceed under that provision (on the basis that the meaning of the term was common knowledge). That is particularly so given that s 144(4) requires the judge to give the parties an opportunity to make submissions, and to refer to relevant information, relating to acquiring or taking into account knowledge of that kind as is necessary to ensure that a party is not unfairly prejudiced. His Honour did not do so. To proceed to make the adverse findings his Honour did, without informing the parties of the meaning of the term, and the basis of his Honour’s knowledge as to that meaning, to enable them to address the issue was an obvious denial of procedural fairness. I note that even the annexure to the primary judgment, which describes a sexual act, does not identify a source and the definition there given, without more, does not support the conclusion drawn by the primary judge.

28    It is plain the impugned findings impacted on the assessment of the penalties imposed.

29    Accordingly, the appeal must be allowed.

Redetermination of the penalty

30    As I have concluded that the penalties imposed by the primary judge are to be set aside, the Court must determine the appropriate penalties for itself: Australian Competition and Consumer Commission v Cement Australia Pty Ltd [2017] FCAFC 159; (2017) 258 FCR 312 at [573].

31    Each of the second and third appellants committed one contravention of s 500 of the FW Act, covering the entirety of each of their respective conduct. As a result, the first appellant committed two contraventions of s 500 of the FW Act.

Relevant principles

32    The primary purpose of any civil penalty regime is to ensure compliance with the statutory regime by deterring future contraventions: Commonwealth of Australia v Director, Fair Work Building Industry Inspectorate [2015] HCA 46; (2015) 258 CLR 482 (Agreed Penalties Case) at [24]. Civil pecuniary penalties are “primarily if not wholly protective in promoting the public interest in compliance [with the statute]”: Agreed Penalties Case at [55] and [59], [68], [110], also see Australian Building and Construction Commissioner v Pattinson [2022] HCA 13; (2022) 175 ALD 383 (Pattinson (High Court)) at [15]-[16], [43] and [45]. The principal object of a pecuniary penalty is directed to deterrence. That is, specific deterrence of the contravenor and, by that example, general deterrence of other would-be contravenors: Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union [2018] HCA 3; (2018) 262 CLR 157 at [116].

33    The process of assessing a penalty is guided by a consideration of a number of well-accepted factors: Kelly v Fitzpatrick [2007] FCA 1080; (2007) 166 IR 14 at [14], and see Trade Practices Commission v CSR Ltd [1990] FCA 762; (1991) ATPR 41-076 at 52,152-52,153; Rojas v Esselte Australia Pty Ltd (No 2) [2008] FCA 1585; (2008) 177 IR 306 at [64]-[65]. It is important to remember that those lists of factors are judicial descriptions of likely relevant considerations applicable to the task of coming to the appropriate penalty, and such lists are useful as long as they “do not become transformed into a rigid catalogue of matters for attention”: Australian Opthalmic Supplies Pty Ltd v McAlary-Smith [2008] FCAFC 8; (2008) 165 FCR 560 at [91]; Pattinson (High Court) at [19]. Relevant factors in a case of this nature include:

(a)    the nature and extent of the contravention;

(b)    the circumstances in which the contravention took place;

(c)    the nature and extent of loss and damage suffered as a result of the contravention;

(d)    whether the contravenor has engaged in any similar conduct in the past;

(e)    the size and nature of the contravenor;

(f)    whether the contraventions involve senior management;

(g)    any contrition or corrective action taken; and

(h)    any cooperation with authorities which has been shown.

34    The principle of totality requires the Court to make a “final check” of the penalties to be imposed on a wrongdoer, considered as a whole, to ensure that the total penalty does not exceed what is proper for the entire contravening conduct: Australian Competition and Consumer Commission v Australian Safeway Stores Pty Ltd [1997] FCA 450; (1997) 145 ALR 36 at 53, citing Mill v The Queen [1988] HCA 70; (1988) 166 CLR 59.

35    Finally, I note that the maximum penalty for each of the second and third appellants is $12,600. For each of the two contraventions by the first appellant, it is $63,000.

Consideration

36    There is significant dispute between the parties as to the proper characterisation of the seriousness of the contravening conduct.

37    On the one hand, the appellants submitted that the conduct is at the very bottom of the range of seriousness. On the other hand, the respondent contended that the conduct is objectively very serious, as reflected by the amounts of the pecuniary penalties sought.

Nature and circumstances of the contraventions

38    In summary, the appellants submitted that although their conduct was deliberate, the behaviour of the second and third appellants did not show any hallmarks of prior planning. It was submitted that the conduct occurred over a period of less than two hours. While the contravening conduct caused aggravation and inconvenience to the CPB staff involved, it was said not to have caused any stoppage of work or financial loss. It was also said that none of the appellants profited or benefitted in any way from the contraventions. It was said to be a one off event. It was also submitted that the conduct of the third appellant was of a significantly more limited scope, and less serious than that of the second appellant.

39    The appellants submitted that the conduct did not involve senior management. It was also submitted that there is no evidence that anybody at the CFMMEU other than the second and third appellants, who were involved, had any knowledge that the conduct was going to take place or that it was in any way directed by anybody in senior management.

40    The respondent accepted that the second and third appellants held entry permits under both the relevant Commonwealth and State legislation. It was also accepted that in the course of their activities on the day in question they were seeking to exercise those rights of entry. The respondent submitted that the entry powers that are given to such officials provide them with an important power under the law, namely to enter the premises of another without the permission of another and to inspect the premises. With that important right was said to come responsibility. It was also submitted that, notwithstanding that the appellants’ interest in attending the site that day was to conduct a right of entry in respect of alleged or suspected contraventions of the WHS Act, they actually engaged in belligerence and game-playing over a considerable period of time. The conduct was said to have involved: breach of safety directions; rude and aggressive behaviour; and simply a wasting of the time of the appellants and the employees of CPB. The respondent submitted that the conduct can only be described as “rank irresponsibility and recklessness on behalf of persons acting pursuant to a right to enter”. The respondent also submitted that it is difficult to understand what was to be achieved by the conduct, apart from seeking to bully and dominate the employees of CPB and the situation.

41    The respondent described the conduct as follows. Upon entry to the site, the second and third appellants met with representatives of CPB and:

(a)    refused to provide their entry permits despite multiple requests;

(b)    made patronising counter-requests for excessive description of the entry permits, coupled with comments such as “I thought CPB would have trained you better to know what permits to ask for being requested, unless you tell me what specific permits, I am not going to show them”;

(c)    made insultingly childish comments to Mr Cullen, referring to him as “Pete, Pete Pumpkin eater”;

(d)    refused to deal with the industrial relations advisor because “[w]e don’t deal with IR”;

(e)    in breach of the site OHS requirements and, contrary to the instructions of CPB representatives, entered the construction area of the site unaccompanied, and refused to return to the pre-start area;

(f)    in the case of the second appellant, stood in the path of a truck so as to delay it from proceeding down a road, and refused requests to leave the area, claiming “I am just stretching my legs”;

(g)    in the case of the second appellant, aggressively “chested” the senior supervisor;

(h)    in the case of the second appellant, made a comment in offensive terms to Mr Cullen that suggested Mr Cullen was trying to look at his penis while in the toilet;

(i)    in the case of the second appellant, accessed and inspected crib rooms and meeting rooms, and in doing so interrupted a site induction that was taking place; and

(j)    in the case of the third appellant, in response to a request that he return to the pre-start area, turned out his pockets and said “what do you think I am a dog? You want me to pull my pocket out and lead me around like a dog?”.

42    I accept that description.

43    The second and third appellants’ presence was based on their entry permits pursuant to Part 3-4 of the FWA. There is no proper basis to suggest that there was any confusion on their part as to the permits being requested. There is no requirement for an occupier to identify the legislation under which entry permits are issued when requesting to see them. Given the events that occurred, the appellants’ submission that the conduct of the second and third appellants was directed to testing the knowledge of the CPB managers as to the industrial relations system cannot be accepted. In context, the submission that they were testing the managers about the precise permits they were seeking to examine is rather disingenuous. In any event, it was not for them to do so.

44    There is no dispute that the second and third appellants held both Commonwealth and State entry permits and that they were seeking to exercise those rights of entry in respect of alleged or suspected contraventions of the WHS Act. There is no suggestion that those concerns were not genuinely held. It is a significant power to have a right to enter premises to investigate suspected issues relating to workplace safety. If concerns are genuinely held, it is a serious matter.

45    Yet in that context, instead of going about their business in a responsible manner commensurate with the task at hand, the second and third appellants chose to act in a manner which was at times belligerent, antagonistic, obstructionist and childish, and did involve game-playing for no apparent purpose, other than that it appears they chose to behave in that manner. By their actions, they attempted to exercise control over the situation, in an intimidatory manner. They ignored reasonable requests and breached safety requirements. The underlying admitted conduct was deliberate. Their conduct was also not conducive to facilitating the purpose of their attendance.

46    It may be accepted, as advanced by the appellants, that the conduct did not carry with it features which aggravate the conduct in some other cases. That said, the absence of those aggravating features is not a matter of mitigation. Rather, the appellants are to be penalised for the conduct undertaken, considered in its proper context.

47    The appellants also submitted that the behaviour of the third appellant was less significant than that of the second appellant. It is unclear what the purpose of that submission is, as it was not suggested that different penalties should be imposed on each of them as a consequence. In any event, that approach, given the conduct undertaken, is artificial.

48    It may also be accepted that there was no senior management involved in this conduct. It was conduct undertaken by the second and third appellants. That said, as explained below, the nature and number of prior contraventions by the first appellant, as reflected in a schedule prepared by the respondent, bespeaks an organisational culture, where contraventions are normalised, and condoned: see, for example, Director of the Fair Work Building Industry Inspectorate v Construction, Forestry, Mining and Energy Union [2015] FCA 1173 at [29].

Admissions and cooperation

49    The appellants submitted that they should be entitled to a utilitarian benefit based on their cooperation and admission to the contraventions which, it was submitted, occurred promptly on an amended statement of claim being filed by the respondent. The amendments to that pleading withdrew a number of the previous allegations. The appellants noted that utilitarian value was not a matter taken into account by the primary judge.

50    The respondent submitted that although the appellants did ultimately cooperate and admit contraventions, such admissions were made only two weeks before the hearing of the proceeding (which was instituted in 2020) was to commence. It was also submitted that it does not explain the approach taken by the appellants up until that point, which included putting on a positive defence. The respondent accepted that the late admissions must be taken into account, and may operate to reduce the penalty that would otherwise be imposed. However, it was said that “[a]ny mitigation of penalty should be small at best”. The respondent also submitted that absent evidence of contrition, an agreement to settle the proceeding by making admissions implies a forensic and pragmatic decision, as distinct from any acceptance of wrongdoing or a willingness to facilitate the course of justice.

51    Further, the respondent stressed that in respect of the extent to which a discount ought to be given for cooperation, there are a number of features missing that a court would ordinarily expect were there to be a significant discount given. That is, evidence of: remorse or contrition; any corrective action undertaken; any explanation of the conduct; the first appellant’s attitude to the actions of the second and third appellants or the contraventions; or any education program going forward.

52    It may be accepted that there is an absence of evidence of those factors. However, that is not relevant to whether a discount for the utilitarian value of the plea should be given and if so, to what extent. Those factors, if there was evidence of them, would be relevant to the assessment of the appropriate penalty. However, the utilitarian value is based on the saving of court time, regardless of the existence of the matters identified by the respondent. It is based on the advantages to the administration of justice that flow from the admissions. It may be impacted by the stage of the proceedings that the admissions are made, meaning the closer to the hearing it occurs, it may result in a lesser discount than an early admission: see, for example, Pattinson v Australian Building and Construction Commissioner [2020] FCAFC 177; (2020) 282 FCR 580 (Pattinson (Full Court)) at [207]-[209] (on a ground which was not the subject of a grant of special leave). That authority requires that the utilitarian value of admissions, even unaccompanied by contrition, must be taken into account and may operate to reduce the penalty that would otherwise have been imposed, accepting Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union [2017] FCAFC 113; (2017) 254 FCR 68 at [163]-[165] and NW Frozen Foods Pty Ltd v Australian Competition and Consumer Commission [1996] FCA 1134; (1996) 71 FCR 285 at 291. Accordingly, that the decision to make the admissions which settle the proceedings may be a pragmatic forensic choice (as submitted by the respondent), does not reduce their utilitarian value.

53    I accept that although the admissions were made close to the date this matter was listed for hearing, they followed promptly after an amended statement of claim was filed, where that pleading withdrew a number of the allegations previously made.

54    I propose to give a discount for the utilitarian value of the admissions and cooperation.

Antecedents

55    A penalty has been imposed on the second appellant on two prior occasions: in Australian Building and Construction Commissioner v Construction, Forestry, Maritime, Mining and Energy Union [2022] FedCFamC2G 40 on 3 February 2022, in respect of conduct on 5 November 2020, with the pecuniary penalties re-determined on 10 February 2023 in Construction, Forestry, Maritime, Mining and Energy Union v Fair Work Ombudsman [2023] FCA 72; and in Australian Building and Construction Commissioner v Construction, Forestry, Maritime, Mining and Energy Union [2022] FedCFamC2G 156, on 11 March 2022, in respect of conduct on 30 April 2020. The conduct the subject of the present proceeding occurred prior to the imposition of any penalty on the second appellant. He submitted that his conduct in the present matter could not be said to evidence defiance in the face of the penalties imposed by the Court on each occasion, which would warrant further specific deterrence.

56    As the respondent submitted, although these are not prior contraventions, it is notable that the conduct on 30 April 2020 was only 15 days after the conduct the subject of this case. On 30 April 2020, the second appellant contravened s 500 of the FW Act by entering areas of a site without authorisation (an exclusion zone) and standing behind concrete trucks, blocking the delivery of concrete to pumps. In that case, a penalty of $7,000 was imposed on the second appellant: Australian Building and Construction Commissioner v Construction, Forestry, Maritime, Mining and Energy Union [2022] FedCFamC2G 156. Further, the conduct on 5 November 2020 occurred after the proceedings in relation this matter had been commenced. There, the second appellant contravened s 500 of the FW Act by: entering a site without giving 24 hours’ notice as required by the FW Act; entering and remaining on the site when he had no lawful basis to do so; failing to comply with OHS requirements; attending a meeting which was not authorised to be held on site (in direct contradiction to the occupiers’ request that the meeting be conducted off-site); and facilitating the entry of approximately 10 to 12 people onto the site where he knew they were not authorised to be on site. Upon redetermination, a penalty of $6,000 was imposed on the second appellant: Construction, Forestry, Maritime, Mining and Energy Union v Fair Work Ombudsman [2023] FCA 72.

57    The Fair Work Commission revoked the second appellant’s entry permit as a result of his conduct on 5 November 2020, describing it as objectively serious: In the matter of the Entry Permit of Andrew Robert Blakeley [2022] FWC 1730 at [44].

58    The third appellant was also involved with the second appellant in the contravention on 30 April 2020, for which he had a penalty of $10,000 imposed on him in Australian Building and Construction Commissioner v Construction, Forestry, Maritime, Mining and Energy Union [2022] FedCFamC2G 156. The conduct the subject of the current proceeding occurred prior to the imposition of that penalty on him. It also involved him entering areas of a site without authorisation (an exclusion zone) and standing behind concrete trucks, blocking the delivery of concrete to pumps.

59    The third appellant was also found to have contravened s 497 of the FW Act on 11 and 12 April 2018 in Fair Work Ombudsman v Construction, Forestry, Maritime, Mining and Energy Union (The Bruce Highway Caloundra to Sunshine Upgrade Case) (No 3) [2023] FCA 219. The contravening conduct involved entering and remaining on a site without producing an entry permit issued under the FW Act. The third appellant was found to have had a genuine and reasonable belief that his conduct was lawful, at least in relation to entry to the site: see [28]. The appellants submitted that, given that formed part of a legal issue that was not resolved until 2023, the third appellant has never demonstrated defiance of an earlier attempt to deter him from contravening the FW Act. The Court found that the third appellant’s two contraventions were each in the low to mid-range, and imposed a penalty of $3500 in respect of each (a total of $7,000). Although the pecuniary penalties imposed in respect of that conduct were not imposed until March 2023, as the respondent submitted, in October 2019 there was a finding by this Court that the third appellant had contravened s 500 of the FW Act: Australian Building and Construction Commissioner v Construction, Forestry, Maritime, Mining and Energy Union (The Bruce Highway Caloundra to Sunshine Upgrade Case) (No 2) [2019] FCA 1737; (2019) 292 IR 259 at [128]-[131]. The contraventions the subject of this case occurred only a few months later, in April 2020. Further, the conduct the subject of that case was not dissimilar to at least some of the conduct in this matter. It involved: refusing a request to produce for inspection his entry permit; refusing a request to leave a site; refusing to comply with site OHS requirements (by walking around the site without supervision or accompaniment); and failing to comply with requests from police to leave the site, resulting in his arrest for trespassing.

60    The conduct by the third appellant led to the Fair Work Commission suspending his entry permit, describing his contravening conduct as “serious, deliberate, abusive, intimidatory” and involving “a flagrant abuse of the power and a blatant flouting of the Project site safety rules”: In the matter of the Entry Permit of Luke Johannes Gibson [2022] FWC 1692 at [19].

61    Although the conduct referred to above, of both the second and third appellants, did not result in prior contraventions, in that it had not occurred or the contravention had not been penalised before the conduct the subject of this case, it is nonetheless relevant. In R v McInerney (1986) 42 SASR 111 at 112-113, King CJ observed the following (citations omitted):

As to convictions recorded after the offence for which sentence is being imposed, for offences committed before that offence, it is pertinent to observe that the Full Court has treated admitted offences for which there has been no conviction, as operating to impair the good character for which the offender could otherwise have been allowed credit. The Queen v. Carbone, per White J. at pp. 310 and 315.

If an offence for which no conviction is recorded has that effect, it must follow that the same offence must have the same effect where there is a conviction but that conviction is subsequent to the offence for which sentence is being passed.

In my opinion the true rule is that a sentencing court may take into account in an appropriate way and for appropriate purposes, offences committed by an offender whether such offences were committed before or after the commission of the offence for which sentence is being passed and whether the convictions for such offences occurred before or after the commission of the offence for which sentence is being passed.

…

Where the other offences have been committed before the commission of the immediate offence, their relevance is clear in the generality of cases. The offender has committed the offence not as a first offender but as a person whose character is affected by previous offending. He must be sentenced against the background of his record: Director of Public Prosecutions v. Ottewell. The effect of the prior offences is 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.

Where the other offences have been committed after the immediate offence, they are relevant only in special circumstances. The offender has not committed the immediate offence with his character already affected by the offences nor after the experience of conviction. In circumstances, however, in which the offender might otherwise have been given credit for having lived a law abiding life in the period between crime and sentence, it is relevant that he has not so lived but has committed an offence or offences in that period. In some circumstances, the nature of the subsequent offences may be such as to suggest that a greater degree of personal deterrence than would otherwise have been contemplated, is required. It seems to me that the circumstances in which offences subsequent to the commission of the offence for which sentence is being passed, are relevant to the sentence, are more restricted than those in which prior offences are relevant. No doubt that is what Wells J. meant by his reference to “special circumstances” in McAllisters case.

62    Although King CJ was discussing those principles in a criminal context, the observations are equally applicable to the imposition of a civil penalty: see, for example, Civil Air Operations Officers’ Association of Australia v Airservices Australia (No 2) [2023] FCA 104 at [32] and Construction, Forestry, Maritime, Mining and Energy Union v Fair Work Ombudsman [2023] FCA 72 at [120].

63    As to the first appellant, the table annexed to the respondent’s submissions reflects that it has been found to have contravened industrial legislation on very many occasions since around 2002. The respondent also extracted from that table what it submitted were 53 separate proceedings in which the first appellant and its officials have been found to have contravened s 500 of the FW Act. It is unnecessary to detail those cases here. The contravention record speaks for itself in evidencing the first appellant’s recidivism. Its repeated failure to obey Commonwealth workplace relations legislation is self-evident.

64    In Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union [2017] FCAFC 113; (2017) 254 FCR 68, the Full Court observed at [159]:

[159]    The most significant point to emerge from the schedules of past cases is that the CFMEU is a recidivist when it comes to contravening industrial laws. No penalties that have been imposed in the past have appeared to reduce its willingness to breach the law. It continues to thumb its nose at the industrial laws, including the BCII Act. The Court should nevertheless not shy away from imposing stern sentences with a view to attempting to deter the CFMEU from engaging in, or encouraging others to engage in, further unlawful industrial action. Considerations of deterrence, both specific and general, undoubtedly loom large in fixing the appropriate penalties.

65    Also see Pattinson (Full Court) at [20]-[21].

The size, status and resources of the CFMMEU

66    As the respondent submitted, this Court has previously observed that the first appellant is large, asset-rich and well-resourced: see Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union (the Webb Dock case) [2017] FCA 62 at [65] and Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union (Werribee Shopping Centre Case) [2017] FCA 1235 at [25]. The first appellant accepted that the Court may legitimately observe that it is well-resourced.

67    The respondent also drew attention to the observation in Pattinson (High Court) at [60] (citations omitted):

[60]    … it is simply undeniable that, all other things being equal, a greater financial incentive will be necessary to persuade a well-resourced contravenor to abide by the law rather than to adhere to its preferred policy than will be necessary to persuade a poorly resourced contravenor that its unlawful policy preference is not sustainable. It is equally obvious that, the more determined a contravenor is to have its way in the workplace and he more deliberate its contravention is, the greater will be the financial incentive necessary to make the contravenor accept that the price of having its way is not sustainable.

68    That said, the second and third appellants submitted there is no basis to reason that way in relation to them, as individuals. I accept that submission.

Other matters

69    The appellants relied on a number of other submissions.

70    First, it was submitted that as the second and third appellants no longer have entry permits (because they have been suspended or revoked), the element of specific deterrence has less significance in this case. That is, those appellants are not in a position to commit further contraventions of a like nature.

71    The respondent took issue with that submission, contending that the fact the second and third appellants no longer hold entry permits is not a matter that should result in a reduction of the penalties to be imposed on them. That submission was based on their serious and egregious conduct, and both of them being able to re-apply for entry permits in the future.

72    However, the fact that the second and third appellants may be able to apply for permits in the future is not a relevant matter as it is entirely speculative (both as to the application for a permit and that it would be granted). Noting the nature and extent of the other contraventions involving the second and third appellants, together with these contraventions, a pattern of behaviour has been demonstrated. The second and third appellants have shown no remorse or contrition for any of their conduct. No doubt if an application was made for a permit, this would all factor into deciding whether it would be granted.

73    In any event, in Construction, Forestry, Maritime, Mining and Energy Union v Fair Work Ombudsman [2023] FCA 72, the respondent had conceded it was an error for the primary judge not to have taken into account an argument that the contravenor no longer held a permit (which was said to reflect on specific deterrence): see [54]. Rangiah J observed at [55]:

[55]    It was an agreed fact before the primary judge that [the contravenor] no longer held an entry permit under Pt 3-4 of the Act. In Pattinson (HC), the plurality observed at [47] that a penalty may be moderated by changes in the membership of an industrial organisation which reduce the risk of similar contraventions arising in the future. That [the contravenor] no longer had an entry permit and could no longer contravene s 500 of the Act was a matter that could bear upon the need for specific deterrence and, consequently, the appropriate penalty. It is apparent that the primary judge overlooked that argument. The respondent’s concession was correctly made.

74    I note that his Honour did take the matter into account on the redetermination: see [145]. It is a matter relevant to specific deterrence.

75    Second, the appellants submitted that it was relevant to take into account that there has been a significant delay in the resolution of the proceedings, and that specific deterrence has less work to do in such a case where there is a three-year delay between the action and the imposition of the penalty. It was submitted that the proceedings had been hanging over the appellants’ heads for three years and that they have faced penalties for that period. The appellants were not aware of any authority to support their submission on this topic.

76    I do not accept that these proceedings have been delayed in any relevant sense. It is also important to recognise that a civil penalty is not about punishment, and therefore concepts such as having the proceedings hang over a person’s head, as referred to in the criminal context and in the appellants’ submissions in this case, may not have the same resonance in this context. That said, what has occurred in the time between the contraventions and the imposition of the penalty may be relevant. Apart from the appellants’ permits having been revoked or suspended (which is taken into account as described above), nothing else is relied on by the appellants that occurred during that time and that could be said to lessen the need for specific deterrence. In fact, each appellant committed other contraventions during that time and there is still no expression of remorse or contrition for the conduct the subject of this case. I note that although the appellants contended that they had penalties imposed for the other contraventions and had learnt their lesson and been deterred from such conduct, there is no evidence to support that submission. The fact of three years having passed, by itself, does not assist the appellants.

77    Third, the second and third appellants each affirmed an affidavit which addresses the impact of the primary judge’s erroneous findings on them. This includes matters personal to the appellants, and the experience of being found by the primary judge to have engaged in homophobic conduct. The appellants submitted that it cannot be assumed they have not been deterred by that. It was said to be extra-curial detriment from the contraventions, referring to Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union [2017] FCAFC 113; (2017) 254 FCR 68 at [104]. I note that passage is one that deals generally with factors for consideration, rather than specifically to this topic. After the hearing, I was also referred to Fair Work Ombudsman v Construction, Forestry, Maritime, Mining and Energy Union (Kiama Aged Care Centre Appeal) [2023] FCAFC 63 which does address the topic of extra-curial detriment: see, for example, [49]-[50]. However, as the respondent submitted, there is nothing in the affidavits that supports the submission that the erroneous findings of the primary judge have deterred the second and third appellants, or any like statement. The appellants’ submission that it should not be assumed that they have not been deterred, is not supported by any evidence. This is in a context where the affidavits were read, but are silent on what is said to be a significant matter. It would have been expected that the matter would have been addressed, given what is now said to be the relevance of the affidavits.

Further analysis

78    As explained above, there is a dispute between the parties as to the seriousness of the appellants’ conduct.

79    The respondent contended that the conduct is objectively very serious. The penalties sought were: in respect to each of the second and third appellants, $10,000; and in respect to the first appellant, two penalties of $59,850.

80    The reasons advanced in support were: in respect of the first appellant, the inability of prior penalties to drive any behavioural change; the deliberateness of the contraventions and the vulnerability of the victims of those contraventions considering the nature of the Part 3-4 entry regime; the separate and distinct obligations on the second and third appellants in respect of each of their permits, and their differing conduct, which is such that no discount for totality ought be made in respect of the first appellant; that the contravening conduct of the first appellant must be viewed as another manifestation of allowing its officers and employees to contravene workplace laws of this kind without taking any meaningful steps to address an organisational culture that tolerates and normalises such unlawful conduct by its permit holders; the need for specific deterrence given the first appellant has not demonstrated contrition, is a recidivist offender and is large, asset-rich, and well-resourced, meaning a small penalty risks being ineffective as a deterrent; and a small discount for admissions, bearing in mind the lack of contrition.

81    It was submitted that no reduction in respect of totality is warranted. The deliberate nature of the contraventions and the particular history of the first appellant were said to be such that the total penalties are “just and appropriate”.

82    The appellants submitted that the contraventions were nowhere near a high level of objective seriousness, as contended by the respondent. They submitted that the second and third appellants: held permits, albeit which they did not produce; produced the notices of entry; indicated that they were going to call the regulator; were on site for a legitimate reason (as there is no suggestion that when the regulator arrived they did not point out the matters of interest to them which, on the pleadings, were set out in the notices of entry); and did not engage in further contravening conduct after the regulator arrived at the site. It was submitted that those facts significantly impact on the question of the objective seriousness of the appellants’ conduct, which should be considered to be “quite low”.

83    The appellants submitted that the appropriate penalty on each of the second and third appellants should be less than half of the $10,000 sought by the respondent. In relation to the first appellant, it was submitted that a penalty which reflects totality should be no higher than half of the maximum in respect of each contravention.

84    It is appropriate to return to consider how Pattinson (High Court) has been applied. It will be recalled that in that case, the High Court considered the scope of the power conferred by s 546 of the FW Act to order a person to pay a pecuniary penalty that the court considers “is appropriate”.

85    In Construction, Forestry, Maritime, Mining and Energy Union v Fair Work Ombudsman (The Botany Cranes Case) [2023] FCAFC 40 at [142], the Full Court observed that:

[142]    … it is incumbent upon the Court to proceed on the basis of the admissions made, not least because the focus of deterrence, both general and specific, needs to be on the conduct proven or agreed to have been engaged in, including the state of mind, and therefore sought to be deterred. To do otherwise may be seen to breach the proscription on oppression articulated by the High Court in Australian Building and Construction Commissioner v Pattinson [2022] HCA 13; 399 ALR 599 at [46] that the penalty imposed “strikes a reasonable balance between oppressive severity and the need for deterrence in respect of the particular case”.

86    At [207], the Full Court further observed:

[207]    In that respect, whilst not intended to be exhaustive of the guidance provided by Pattinson, we consider the following observations made in Pattinson by Kiefel CJ, Gageler, Keane, Gordon, Steward and Gleeson JJ as of most significance to our present task:

(a)    The purpose of a civil penalty is primarily, if not solely, the deterrence (both specific and general) of future contraventions (at [9]);

(b)    The maximum available penalty is not to be reserved for only the most serious examples of offending but is available to be imposed where it is reasonably necessary to achieve the deterrence of future contraventions (at [10]). However, it does not follow that the power to impose a penalty “must be taken to require the imposition of a penalty approaching the maximum in relation to any and every contravention by a recidivist offender” (at [46]);

(c)    An “appropriate” penalty is one that strikes a “reasonable balance between oppressive severity and the need for deterrence in respect of the particular case” (at [46]);

(d)    Both the circumstances of the contravener and the circumstances of the contravention (i.e. the seriousness of the contravention) may be relevant to the assessment of the appropriate penalty (at [19] and [57]);

(e)    The penalty appropriate to protect the public interest by deterring future contraventions may be “moderated” by a range of factors of the kind adverted to by French J in Trade Practices Commission v CSR Limited (1991) ATPR 41–076 (at [47]). However, the list of possible relevant considerations set out by French J ought not be treated as if it were a legal check list (at [19]).

87    The appellants downplay the seriousness of the contravening conduct.

88    Although the features relied on by the appellants, as referred to above at [82], are relevant, they serve to highlight the unnecessary and pointless nature of their contravening conduct. The second and third appellants attended the site for proper reason. That they chose to conduct themselves in this manner is inconsistent with carrying out the responsibilities granted to them as permit holders. The contravening conduct occurred over a period of about two hours. That no such conduct is alleged to have occurred after the regulator arrived is not a matter of mitigation. Again, it reflects the deliberateness, and churlish nature of the conduct, directed to those on the site. The inference open is that the conduct was to belittle or intimidate those at the site. It involved childish games inconsistent with effectively achieving the purpose of their entry.

89    As the respondent submitted, being entrusted with an entry permit, with what that entails, involves responsibility. That said, the respondent’s submissions as to the appropriate penalties in respect to the second and third appellants overstate the seriousness of their conduct, and fail to properly reflect what are, albeit limited, factors which may moderate the penalty in this case. For example, as discussed above, in this case there is the utilitarian effect of the appellants’ admissions. Further, although the second and third appellants’ other contraventions, as described above at [55]-[60], are relevant in the manner previously described, nonetheless they are not prior contraventions such that the conduct the subject of this matter was committed in the face of penalties having been previously imposed by the Court. I also accept that the fact of revocation of the permits is relevant to issue of specific deterrence.

Conclusion

90    I recognise that the penalty imposed should strike “a reasonable balance between oppressive severity and the need for deterrence in respect of the particular case”: see Pattinson (High Court) at [46]. Taking into account all of the relevant circumstances, I impose a penalty of $7,000 on each of the second and third appellants for their respective admitted contravention of s 500 of the FW Act.

91    In relation to the first appellant, the importance of general and specific deterrence in imposing this penalty is unquestionably high. The conduct occurred in a context where such conduct is plainly condoned. The only relevant fact in mitigation is the admission. Taking into account the relevant circumstances of the contraventions and the contravenor, I impose a penalty of $50,000 in relation to each contravention, resulting in a total penalty of $100,000. The fact that there are two people who committed the same contravention, is not, contrary to the appellants’ submission, a basis in this case to reduce the penalty having regard to the principle of totality. The penalty to be imposed on the first appellant is not reduced simply because more people are involved. To do so would undermine the notion of general deterrence.

92    I also vary the declarations in the manner and terms referred to above at [8].

Associate:

Dated:    25 May 2023