[2011] FWAFB 3658

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Fair Work Act 2009
s.604 - Appeal of decisions

Construction, Forestry, Mining and Energy Union
Hooker Cockram Projects NSW Pty Ltd


SYDNEY, 21 JUNE 2011

Appeal against order PR504969 of Senior Deputy President Cartwright at Sydney on 10 December 2010 in matter number C2010/766.

[1] This decision concerns an appeal by the Construction Forestry Mining and Energy Union (CFMEU or the appellant) against an interim order made by Senior Deputy President Cartwright under s.420(2) of the Fair Work Act 2009 (the Act). The interim order relates to an application made by Hooker Cockram Projects NSW Pty Ltd (the company) under s.418 of the Act seeking the cessation of industrial action occurring at a construction site in Tempe in the state of New South Wales (the Tempe project). Master Builders Association of New South Wales (MBA-NSW) filed the application on behalf of the company and represented it before the Senior Deputy President.

[2] The CFMEU and the company submitted that the appeal did not require a hearing in court before the Full Bench and that it could be dealt with on the written submissions filed by them. We consented to that course. Master Builders Australia Limited (MBA) sought permission to intervene and identified ss.589(1) and 590(1) as conferring power on this Full Bench to allow it to make submissions in opposition to the appeal. The appellant did not object to the MBA application and the company supported it. We note that the MBA-NSW, which appeared before His Honour, is a member of the MBA. We accept the status of the MBA as a major representative of employers within the building and construction industry in Australia. We have decided it has a sufficient interest in the order under appeal and the matters raised by the appeal grounds to allow it to make submissions.

[3] Although this decision concerns an interim order made under s.420 of the Act the terms of the substantive application made under s.418 and the grounds detailed in it, assume some importance in this appeal. It is appropriate we should first refer to its content and the steps taken by the company to serve it. The application was lodged on 10 December 2010. It was served by email that day on three persons each with a CFMEU email address. The endorsement on the accompanying email identified it as a s.418 application made in relation to the Tempe project. The appellant accepted that the email (and attachments) were provided to the three addressees. The attachments were firstly a facsimile from the WorkCover Authority of New South Wales (WorkCover) to the company with an improvement notice directed to Ikea Pty Limited (Ikea) and secondly a statement of Mr Cameron Powell, the company’s Construction Manager.

[4] The grounds in support of the application were detailed and we do no more than give a summary that should be adequate for the purposes of us dealing later with the grounds of appeal. The application referred to the status of the company as having been engaged by Ikea as the principal contractor on the Tempe project. Various actions taken by the appellant, commencing in November 2010, are referred to. Those actions resulted in employees ceasing work. There had been a combination of complete stoppages of work on the entire project through to stoppages in defined areas. The grounds describe the nature of the concerns justifying the stoppage of work. In short, they were principally associated with health and safety issues. It is accepted by the company that the Tempe project has generated such concerns. The company detailed action it had taken by way of identifying risks and undertaking remediation work. Work stoppages continued. Numerous meetings were held however the appellant and employees continued to have concerns about health and safety risks. The company was of the view that adequate steps had been taken to warrant the resumption of normal work.

[5] In early December WorkCover inspected the site and issued an improvement notice. By that time the company was of the opinion the site was in a condition so as to allow the resumption of normal work. As at the day before the application was lodged work had not resumed and the appellant refused to allow employees to return to work. The company asserted that at that stage the concern of the union and employees could not properly be said to relate to the earlier health and safety issues but rather issues associated with the content of the improvement notice and the identification in it that the company was not responsible for construction work at all times. It had noted that Ikea had engaged subcontractors and paid them directly. We here note that we will refer to this disagreement as the principal contractor issue. The application also referred to occasions when officers of the appellant had entered premises acting on powers under state occupational, health and safety legislation in a manner which was said to have exceeded their powers of entry. The application set out the terms of the orders that were sought being directed to the appellant, its officers, employees, agents and delegates and to “Each Employee”.

[6] A notice of listing was issued by His Honour’s chambers at 2:44pm on 10 December 2010, giving notice of a hearing that would commence that day at 3:30pm. The hearing concluded at 5:02pm. The interim order was made by His Honour at the close of the hearing and his reasons for it were given in transcript. The matter was adjourned to 13 December 2010 and was part heard at the conclusion of the hearing on that day. It was intended that it would come on again for hearing on 21 December 2010 however on 15 December 2010 the company withdraw its s.418 application. Accordingly, there was no further hearing and the file was closed. The consequence of the company withdrawing its application was to terminate the operation of the interim order.

The legislation

[7] Before we consider what was said in the proceedings which led to the interim order being made we should reproduce the provisions of ss418 and 420 of the Act.

[8] In considering the above sections regard must also be had to the definition of industrial action which is in s.19. We do not reproduce it in full here however it is important to note one aspect of the definition. After describing several kinds of action that may be taken by an employee or by an employer which may comprise industrial action there is then a list of other action which does not. Of particular relevance to this appeal is the exclusion contained in s.19(2). In summary, it excludes action taken by an employee based on his or her concern about an imminent risk to their health or safety and where they have not unreasonably failed to comply with an employer’s direction to perform other available work. This exclusion was referred to numerous times in proceedings before His Honour. We will refer to it as the health and safety exclusion.

The hearing before the Senior Deputy President

[9] Mr Thomas of the MBA-NSW appeared for the company and Mr Roberts appeared for the appellant. Mr Thomas referred to the contract between Ikea and the company and the nature of the activities being carried out on the Tempe project. This project is at a site which was described as a former tip. He referred to the grounds set out in the application indicating that the site was closed due to industrial action. He submitted that the action was not such as to enliven the health and safety exclusion. The principal contractor issue was also referred to. He described the disagreement between the company and the appellant over this issue and submitted it was the reason for work not resuming as there was no remaining justification for industrial action which properly related to health and safety issues. He submitted that an interim order should issue allowing work to recommence and this would not detract from the parties continuing to discuss whether legislative responsibilities under state legislation were those of the company or Ikea. He submitted that workers on the site were prepared to resume normal work but that the appellant had refused to allow them to do so. He said this situation still remained and, after an initial period of inclement weather earlier that day work could have reasonably and safely resumed but had not due to the disagreement on the principal contractor issue. He submitted that in those circumstances it was appropriate that His Honour issue an interim order which would allow work to be done. 1 The statement of Mr Powell was referred to and Mr Thomas indicated he wished to call him and rely upon his statement.2

[10] Mr Roberts said that he would wish to cross-examine Mr Powell and that he did not make any concession in relation to the allegations of unprotected industrial action Mr Thomas had raised. 3 Mr Roberts then asked His Honour to adjourn the proceedings. He said he had no instructions in relation to the matter and had insufficient notice of the hearing and had not been able to obtain instructions in relation to any of the evidence the company proposed to rely upon. He asked for the matter to be adjourned “to another day”.4 Mr Thomas opposed an adjournment indicating it would result in a further delay to the recommencement of work. If there was to be an adjournment then the company sought an interim order until the matter was to be heard with any order having the usual health and safety exclusion in it. His Honour confirmed that what he understood to be the company’s position was it would not oppose the adjournment provided an interim order was made in the meantime until the matter could be determined.5 He then adjourned the proceedings indicating he needed to consider the submissions and decide what he should do. When His Honour resumed Mr Roberts said that he was unable to give any undertakings about work at the site and that he could be in a position to have the matter proceed on the following Monday morning. He opposed the making of an interim order and made no concessions about what had been said by Mr Thomas. He referred to the consideration of procedural fairness and that he was in no position to respond to the evidence. His Honour then gave his decision about whether he was obliged to issue an interim order and said that neither party suggested he could deal with the application that afternoon. He said that the application was a valid one and in those circumstances s.420 of the Act was relatively clear. He noted that the terms of the interim order sought contained a health and safety exclusion so if any employee genuinely had such a concern they would be protected. He said the parties should now address him on whether it may be contrary to the public interest to issue the order. Mr Thomas made submissions similar to those he had earlier made and said nothing had been put that would enliven the public interest exclusion in s.420. Mr Roberts then said he would undertake to have the union attend a hearing over the weekend. He said that if His Honour needed to make a finding about an interim order then the public interest would be better served by no such order being issued. His Honour commented that given the health and safety exclusion in the order he would make it was hard to see how it could be said it was contrary to the public interest to make the order. His Honour again referred to s.420 and noted that these applications were all dealt with at short notice, a fact the parties were all aware of. They had all been around the “mulberry bush” a few times and were used to these types of applications coming in on a Friday afternoon and the usual arguments run in these circumstances.6

[11] His Honour said the matter would be listed again on the Monday morning and an interim order would be made. He was not satisfied it would be contrary to the public interest to do so. As we have earlier noted, the interim order issued later that day.

The grounds of appeal

[12] The first ground is that His Honour exceeded his jurisdiction in making an interim order in the absence of any evidence relating to any alleged industrial action. It submitted that in this case no evidence was called by the company, the appellant had opposed the application and made no concessions in relation to matters submitted by the company’s advocate or contained in the application. The second ground is related to the first and is that the interim order was made in error as there was no evidence of any industrial action. The third ground asserts that His Honour erred in denying the appellant procedural fairness and natural justice. This ground relates to the limited notice given to the appellant and its inability to obtain instructions. It also asserts that His Honour was in error in refusing the appellant an adjournment without an interim order being made. The final ground of appeal challenges several aspects of the terms of the interim order.

[13] Each of the grounds of appeal have been considered in the context of the making of an interim order. We are not required in this appeal to also consider the issues raised in the context of an application for a final s.418 order.

[14] We can deal with the first and second grounds together. We have set out s.420 earlier. It is useful to contrast the terms of that section with its predecessors in the Workplace Relations Act 1996 (the WR Act). We will only go back to the legislation as it was in 2004. Section 127 of the WR Act empowered the Australian Industrial Relations Commission (the Commission) to make orders to stop or prevent industrial action. Section 127(3) required the Commission to hear and determine an application as quickly as practicable. Section 127(3A) provided that “The Commission may make an interim order under this section”. It is clear that this granted a discretionary power whether or not to issue an interim order. Subsequently, in 2006, s.496 of the WR Act came into operation. Subsections 496(5) and 496(6) were relevant to the power to issue of an interim order. Section 496(5) provided that “As far as practicable, the Commission must hear and determine an application for an order under subsection (1) or (2) within 48 hours after the application is made”. Section 496(6) provided that “If the Commission is unable to determine an application for an order under subsection (1) or (2) within the period referred to in subsection (5), the Commission must (within that period) make an interim order to stop and prevent engagement in, and organisation of, the industrial action referred to in subsection (1) or (2)”. This section imposed both outer time limits on the Commission and also linked the interim order to be one stopping etc the industrial action by reference, relevantly, to s.496(1). The counterpart to that section is now the current s.418(1). It can be seen that the time limit is now described as being “within 2 days” but there is no reference back to the industrial action referred to in s.418(1). The focus now in s.420(2) is on the industrial action “to which the application relates”.

[15] From our reading of the transcript His Honour was well aware of his obligations under s.420. When it was clear the s.418 application could not be determined within two days of it being filed he was obliged to turn his attention to the interim order requirements. It was then only if the application had not been in terms that identified industrial action as defined in s.19 or if he was persuaded as to the public interest proviso that an interim order would not issue. Accordingly, it was the industrial action as described in the application which was the focus of submissions and comment by His Honour. The parties did not make submissions to him about what might be the level of satisfaction he needed to have as to whether the action described in the application (and the additional submissions of the parties in the hearing) was to be such as to establish a prima facie or arguable case or that there was a serious issue to be tried. It is not at all readily apparent any of these tests, which are commonly adopted in respect to stay orders or interim injunctions, might be applicable to s.420. The fact this consideration was not raised below and not sufficiently developed in the written submissions before us inclines us to the view this is not the occasion to consider it further.

[16] It is adequate for the purposes of this appeal for us to indicate that the action described in the application and addressed by the company’s advocate in the hearing was such as to be of a kind which came within the definition of industrial action in s.19 of the Act. We can envisage an application which has inadequate grounds or insufficient detail which would not meet this description. Equally, it may be that the application’s grounds or the submissions made strongly suggest the action might be protected action. Further, it is not uncommon, for example, for industrial action to be taken by employees and contrary to a unions recommendation. In cases such as these it will be for the member to decide if the pre-requisites of s.420(2) are established and, if so, the scope of any interim order which should be made. These considerations will also inform the member as to whether the public interest suggests the order sought not issue. These considerations did not arise in this matter.

[17] We are satisfied that in this matter the application, and the submissions made to His Honour, sufficiently identified for the purposes of s.420(2) that industrial action was happening on the day of the hearing, that further such action was probable and that the appellant was organising it. Accordingly, in making the interim order we are not persuaded His Honour was in error as asserted in the first two grounds of appeal.

[18] We turn next to the third ground of appeal which pleads that the order was made in circumstances which denied the appellant procedural fairness and/or was in breach of the rules of natural justice. It is accepted that those principles apply to the exercise of powers under the Act. The Act does not exclude those principles and ss577 and 578 for example reflect aspects of them. However the particular rulings, actions or steps which may be considered necessary to have afforded procedural fairness or natural justice to the appellant need to be considered in the context of s.420 and not be such as to effectively defeat the operation of that section. The question which needs to be considered is what does the duty to act fairly require in the circumstances of the application before His Honour. 7 This approach was described by Justice Brennan in Kioa and West in these terms:

[19] We have closely reviewed the transcript and are not persuaded His Honour was in error in declining to grant the adjournment sought by the appellant. We note that in fact His Honour did grant an adjournment but it is the additional grant of the interim order that is complained of. We do not overlook the very limited time given to the appellant to attend the hearing but the requirements of s.420 are such that unless agreement is reached between parties these applications are always listed at short notice. Also, in this context, we have taken into account the fact this application was filed on the last working day of the week and a decision had to be made on that day about when it could resume. We know ourselves that it is not uncommon for members to hear these types of matters on a weekend. In considering how this application proceeded we give His Honour the benefit of his knowledge of these parties and the dynamics of the building and construction industry which industry is in the panel of which he was a member. These factors are what we take he was referring to when he talked about these matters coming in on a Friday and then the parties running the usual arguments.

[20] In respect to this ground we also think the appellant places too little weight on the two day deadline and there being no basis for His Honour to be confident the matter could come on again for hearing prior to that deadline being reached. In this respect we note the various ways in which the appellant indicated the nature of the adjournment it sought. When the application for an adjournment was first made it was to be until “another day” and there was no suggestion this would be either of the following two days. Subsequently, it was for an adjournment to the following Monday. In neither case did the appellant make any submission about the fact that within the adjourned period the two day deadline would expire and His Honour was obliged to address the requirements of s.420(2). The appellant’s advocate made no application for a short adjournment so as to enable him to obtain firm instructions nor to put some other alternative proposal to the company and His Honour. We agree with the company’s submission that it was not until after His Honour had adjourned to consider the submissions that had been made and then resumed and indicated he was obliged to make an interim order, and would do so unless persuaded it was not in the public interest, that the appellant’s advocate said he would have representatives attend a hearing on the weekend. In those circumstances His Honour was not in error in refusing the adjournment and declining to make the interim order.

[21] We turn now to the fourth ground of appeal. At the outset we should observe that the appellant said little to His Honour about the terms of the draft order which was sought by the company. The focus of its submission was that no order should issue. It did not put submissions in the alternative that, if an order was to issue, it should not be in the broad terms contained in the company’s draft. This consideration would make us less inclined to entertain a challenge on appeal raising for the first time matters which should have been raised at first instance. However, we are concerned about the scope of the order which issued. The order places obligations on all employees of the company both those who are members of the appellant and those who are not. In this respect we think it reasonable to read the reference to all employees as confined only to those described in the application and working on the Tempe project. In the hearing before His Honour the appellant did not indicate it did not appear for all employees referred to in the application. The company’s submissions to His Honour suggested the appellant was coordinating the stoppages and all employees had ceased work in accordance with its advice to do so.

[22] As we have earlier indicated service of the application (and notice of the hearing) was only made on the CFMEU. This was not in accordance with the rules and no order for substituted service was sought. It would seem no attempt was made by the company to bring the application to the attention of its employees. Before His Honour the appellant did not raise any concerns about the lack of notice to employees who were not its members nor did the company refer to these persons either.

[23] It will be a question of fact as to whether in any given case a union adequately represents the interests of employees who may be affected by any order which may issue. In this context a members knowledge of the industry, the parties, and the work in question will inform their view as to whether service on a union in a particular matter is adequate. However, there is nothing in the application or transcript to show that His Honour considered any of these matters nor how he was satisfied the appellant represented all employees or that service on it was, in the circumstances, adequate for all employees to whom the order would apply. In our opinion, if there is nothing before a member to satisfy them that reasonable attempts have been made to notify non union employees who are taking industrial action then serious consideration needs to be given to whether it is appropriate for an interim order to extend to those persons.

[24] Our concern about this issue is increased in light of the provisions of clause 6 of the order. That clause provides that whenever a person seeks to rely on the health and safety exclusion clause that person has the burden of proving the exemption applies. Such a clause may well have been appropriate in orders issued under s.496 of the WR Act as there was a burden of proof provision in s.420(4). We cannot identify a counterpart to this provision in the definition of industrial action in ss.19 nor in sections 418 and 420.

[25] We are concerned about how we should deal with this ground of appeal. On the one hand these considerations may warrant the grant of permission to appeal and constitute an appealable error which should be rectified by a variation to the interim order. The variation would only be to the order extending to employees who were not members of the appellant and also to the reverse burden of proof clause. On the other hand, the order has expired and there was nothing before us to suggest the company or any other person alleged it had been breached and that proceedings may issue to enforce it. Those considerations, in the context of all the other reasons we have given in this decision, may suggest the appropriate outcome is that permission to appeal not be granted.

[26] With the exception of the issues raised by the fourth ground we are not persuaded the grounds of appeal warrant the grant of permission to appeal. There is no public interest enlivened by the grounds of appeal which would oblige us to grant permission. Nor, in the circumstances of this appeal, are we persuaded that the other traditional tests for the grant of permission to appeal are made out.  9

[27] In relation to the fourth ground of appeal, and to the extent only we have identified in paragraph 25, the appellant and the company should confer. If they are able to reach agreement as to the order this Full Bench should make we should be advised within the next 14 days. If they are unable to reach agreement, directions for the filing of short submissions will issue. Any submissions should be sent to the chambers of Senior Deputy President Harrison by email at chambers.harrison.sdp@fwa.gov.au.


T Roberts for the Construction, Forestry, Mining and Energy Union.

T Lange for Hooker Cockram Projects NSW Pty Ltd.

R Calver for Master Builders Australia Limited.

 1   PN 18 to 50

 2   PN 54

 3   PN 62

 4   PN72

 5   PN79

 6   PN139-141

 7   Kioa and others and West [1985] 159 CLR 550 at page 585, Justice Mason

 8   Ibid at 614

 9   Eg whether the decision is attended with sufficient doubt to warrant its reconsideration or whether substantial injustice may result if leave is refused - Wan and Australian Industrial Relations Commission [2001] FCA 1803

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