21 September 2017

In the recent Federal Circuit Court decision of Australian Building and Construction Commissioner v Dig It Landscapes Pty Ltd [2017] FCCA 2128, Judge Vasta made some scathing remarks about the conduct of the CFMEU on a Brisbane construction site.

Facts

The first respondent was Dig It Landscapes Pty Ltd. Dig It subcontracted with Polyseal Waterproofing Qld Pty Ltd  to undertake waterproofing works at a construction site in Fortitude Valley in 2014. Polyseal had its own Enterprise Bargaining Agreement (EBA), which was registered by the Fair Work Commission. However, that EBA did not have the CFMEU (the fourth respondent) as a party.

Polyseal employees arrived on site. They were approached by Mr Pauls, a CFMEU delegate (and employee of the head contractor) who told the Polyseal staff that they could not work on the site because their EBA did not include the CFMEU. The project manager for Dig It then terminated its contract with Polyseal.

Decision

The respondents accepted the Australian Building and Construction Commissioner’s allegations that this conduct constituted breaches of sections 340 and 354 of the Fair Work Act 2009 (Cth). These provisions respectively relate to adverse action and discrimination on the basis of enterprise agreements.

Polyseal had a valid EBA and were ready, willing and able to perform the relevant work. The respondents took adverse action against Polyseal because the company exercised a workplace right to have its own EBA. Polyseal were also discriminated against because its employees were covered by an enterprise agreement that did not cover the CFMEU.

Therefore, the only question for the Court was the appropriate penalty to impose in the circumstances. Judge Vasta had regard to factors in favour of the respondents, such as the lack of violence, abusive language or property damage inflicted by Mr Pauls.

However, his Honour held that the breaches were ‘deliberate’ in order to illustrate to Polyseal and its officers that ‘it was the CFMEU who alone decide who worked on that particular site’. His Honour went on to strongly denounce the CFMEU’s actions:

There was no reason that Polyseal could not have worked on that site. Polyseal had the right to work on that site. No entity should ever interfere or take away that right. This goes to the heart of the industrial relations regime of this country. It beggars belief that the CFMEU believe that they can act in a manner where they are the ones who dictate who can or cannot work on a construction site. The Parliament is the only entity that sets the law in this country and the Parliament is directly responsible to the people of this country. It seems that the CFMEU feel that they can usurp Parliament and that they can set the law in this country. There is no place for such an attitude in Australian society.

Dig It was ordered to pay a pecuniary penalty of $40,800 and the CFMEU was ordered to pay $47,175. Mr Pauls was ordered to pay $7,650 while the project manager of Dig It was ordered to pay $6,120.

Learnings

We are often told by our clients that they avoid large construction projects because of unreasonable union interference and unlawful tactics. However, this decision demonstrates the readiness of the ABCC to enforce the provisions in the Fair Work Act 2009 (Cth) when unions and their delegates act unlawfully. It also indicates that the courts are willing to impose substantial penalties against individuals and companies so as to ensure that the law is strictly applied on building sites.

 

This publication is for information only and is not legal advice. You should obtain advice that is specific to your circumstances and not rely on this publication as legal advice. If there are any issues you would like us to advise you on arising from this publication, please let us know.