On 14 February 2018, the High Court handed down judgement in the case of Australian Building And Construction Commissioner v Construction, Forestry, Mining And Energy Union  HCA 3. The majority of the Court allowed the appeal, which concerned the issue of whether a judge has power to order that a union not indemnify a union official against a pecuniary penalty (‘a non-indemnification order’), or that a union official not seek or accept an offer of indemnity from the union in respect of a pecuniary penalty imposed on the union official (‘personal payment order’).
Mr Myles (‘the second respondent’) was an official of the Construction, Forestry, Mining and Energy Union (CMFEU) (‘the first respondent’). In 2013 the second respondent and about 20 associates carried out a blockade that disrupted a concrete pour at a construction site. The aim of the blockage was to coerce compliance with the second respondent’s requests that a delegate of the first respondent be positioned on the site. At the end of the blockade the second respondent called to the General Superintendent words to the effect of: ‘I’ll be back tomorrow to stop the concrete pour”, and “you won’t pour again until you put a delegate on.” The next day the second respondent returned and said to the General Superintendent words to the effect of: “If you don’t want to put a delegate on then we will have a war.”
After the aforementioned events, proceedings were instituted against the respondents in the Federal Court. Both respondents admitted to contravening Fair Work Act 2009 (CTH) (‘the Act’) section 348. The primary judge in that case ordered that under Section 546 of the Act, the second respondent must pay pecuniary penalties of $18,000 and the first respondent must pay pecuniary penalties of $60,000. The primary judge also made a non-indemnification order under Section 545(1) of the Act. After this the respondents appealed to the Full Federal Court, which held that the primary judge had no power to make the non-indemnification order, because this order would add to the penalty authorised under section 546 of the Act, and there was no clear or express power to do so.
By grant of special leave, the appellant appealed to the High Court on whether section 545(1) of the Act, or Section 23 of the Federal Court of Australia Act 1976 (CTH) empowered a judge to make a non-indemnification order, and the appellant was additionally granted leave to amend the notice of appeal to add the question of whether Section 546 of the Act empowered a judge to make a non-indemnification or personal payment order.
The High Court unanimously held that neither section 545(1) of the Act, nor section 23 of the Federal Court of Australia Act 1976 (CTH) empowered a judge to make a non-indemnification order, as such an order is penal and beyond the scope of those sections. Justices Keane, Nettle and Gordon framed the issue as thus:
Furthermore, the Court unanimously held that section 546 of the Act could not support a non-indemnification order. Justices Keane, Nettle and Gordon stated:
The majority of the court held that a personal payment order could be made under Section 546. This was held to be because the power to make such an order was within the implied power to make such orders as reasonably required, or the power was legally ancillary to the accomplishment of the effect that the pecuniary penalty is aimed at achieving.
The appeal was thus allowed and the matter was remitted to the Full Federal Court for the imposition of penalties.
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Australian Building and Construction Commissioner v CFMEU  HCA 3, and associated judgement summary.
Fair Work Act 2009 (CTH).
Federal Court of Australia Act 1976 (CTH).
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