Employment Law Update - Australian Building and Construction Commissioner v Powell [2017] FCAFC 89

Employment & Industrial
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On 2 June 2017, the Full Court of the Federal Court in Australian Building and Construction Commissioner v Powell [2017] FCAFC 89 unanimously upheld an appeal that examined the interaction between what are known as the right of entry provisions in Part 3-4 of the Fair Work Act 2009 (the FW Act) and entry provisions contained in the Victorian Occupational Health and Safety Act 2004 (the OHS Act).  

Background

The FW Act authorises union officials to enter an employer’s premises under certain circumstances and for certain stated purposes. Official who exercise these rights exercise public power for the protection of their members and for the enforcement of agreements and awards. Unions have standing to sue for contraventions of these instruments under the FW Act (and its predecessors) and the rights of entry conferred by Part 3-4 are one means by which the FW Act facilitates that function. When engaged, they override the common law right of an occupier to deny entry. However, Part 3-4 rights may only be exercised by those union officials who hold a right of entry permit issued by the Fair Work Commission. An uninvited union official who enters and remains on an employer’s property without a permit commits trespass and in Victoria may also commit an offence.

The OHS Act also confers entry rights on union officials which are additional to those contained in the FW Act. However, ever since it was enacted the FW Act has through s. 494(1) prohibited the exercise of these rights (and those contained in the occupational health and safety statutes of other States and Territories) unless the official is a Commonwealth permit holder, on pain of civil penalty. On this subject, the FW Act expresses the Commonwealth’s intention to cover the field by excluding State and Territory laws that “entitles a representative of a trade union to enter premises”. Otherwise, the subject matter of occupational health and safety remains a corner of the field that States and Territories may occupy.

The OHS Act confers certain safety functions on employees elected as health and safety representatives (HSR) and arms them with certain powers. One of these powers, contained in s. 58(1)(f), is to “whenever necessary, seek the assistance of any person”. By s. 70(1) an employer must allow the HSR’s assistant access to the workplace (unless the employer considers the assistant is unsuitable due to insufficient health and safety knowledge). If the employer refuses, s. 70(2) empowers the Magistrates Court to direct the employer to give access at the suit of the HSR and also to specify terms and conditions of the access.

Against this statutory background, Powell was decided. The facts were straightforward. Mr Powell is an official of the Construction, Forestry, Mining and Energy Union (CFMEU). On four occasions, he entered and remained on a Kane Constructions site in Ringwood in response to a request from an HSR, a Mr Curnow, to assist him.  On each occasion, Mr Powell was asked by representatives of Kane Constructions to produce his permit. He didn’t have one and said so, but refused to leave the site stating that he was on site to assist the “site rep” with “OHS issues” and didn’t require a permit.

Basis of proceedings

The regulator issued proceedings against Mr Powell under s. 494(1) of the FW Act seeking the imposition of civil penalties. The provision is expressed simply: a union official “must not exercise a State or Territory OHS right unless the official is a permit holder”. A “State or Territory occupational health right” is defined by s. 494(2), and includes a right conferred by the State or Territory law to enter premises occupied or controlled by a constitutional corporation. Mr Powell contended that he had not contravened s. 494(1) on the ground that he not exercised a State or Territory OHS right, pointing in that regard to s. 58(1)(f) and to s. 70(1) of the OHS Act. The trial judge, Bromberg J, in Director of the Fair Work Building Inspectorate v Powell [2016] FCA 1287 agreed. The Full Court, which consisted of the Chief Justice, Allsop CJ, White and O’Callaghan JJ, disagreed.

Section s. 58(1)(f) of the OHS Act is broadly expressed. An HSR is entitled to seek the assistance of “any person” and for this purpose have that person access the workplace. Mr Powell was such a person. His status as an official of the CFMEU was irrelevant to s. 58(1)(f) and to s. 70(1), and was only relevant at all if, by his access, he had exercised a State Occupational Health and Safety right within the meaning of s. 494(1) of the FW Act. What then was the “right” that Mr Powell “exercised”?

Defining the 'exercise of a State Occupational Health and Safety right'

The trial judge addressed this issue by first analysing jurisprudence concerning the legal uses of the word “right” and considering this in light of its statutory setting in the FW Act. Bromberg J’s conclusion was that the “right” referred to in s. 494(1) was a legal right capable of legal enforcement; one that his Honour characterised as a strict legal right, as opposed to a right that amounted to “merely a liberty, a permission or privilege lawfully given”. Viewed in this way, the access the employer is obliged to give under s. 70(1) of the OHS Act fell short, in his Honour’s view, because the “right” belonged to the HSR, not the assistant; in that it was conferred by s. 58(1)(f) of the OHS Act for the HSR’s benefit and was enforceable against an unwilling employer only by the HSR. The assistant’s access to the premises may be seen, on this reasoning, as simply the outcome of the exercise of a right held the HSR, with s. 70(1) and (2) of the OHS Act as merely ambulatory of it.  On appeal, the Full Court took a different path.

The reasoning of the Full Court looked past the HSR, focusing instead on the position of the assistant once the HSR had invoked s. 58(1)(f). By doing so, their Honours concluded that the HSR placed the assistant, here Mr Powell, in the position of being able to legitimately say that he or she has a “right” to be on the employer’s premises because the employer is obliged to give access by reason of s. 70(1). The right is exercised by the assistant’s entry.

The “right” posited by the Full Court has the appearance of a permission or privilege (conceptions rejected by Bromberg J) that is conferred by the statute once an HSR pulls the statutory trigger. Indeed, their Honours expressly characterise the employer’s obligation to allow access as a legal authorisation to or a legal entitlement of the assistant to enter the premises and have access to the extent that it is necessary to give assistance to the HSR. Upon this foundation, the Full Court turned to whether this species of right was captured by s. 494(1) of the FW Act.

Scope of Part 3-4 of the Fair Work Act 2009

The controversy on this branch of the case was whether Part 3-4 was limited to rights that spring from the representational function performed by union officials, or went further to capture a right of entry engaged by a union official regardless of the capacity in which he or she did so. Below, Bromberg J, had, by reference to the statutory history of Part 3-4, and an analysis of the text, context and purpose of these provisions, concluded that s. 494(1) addressed an industrial right conferred upon trade union officials for representational purposes. His Honour drew expressly upon s. 6 of the FW Act, which summarises the content of Chapter 3 of the FW Act. Sub-section (5) states in terms that Part 3-4 (where s. 494(1) is situated) is “about the rights of officials of organisations who hold entry permits to enter premises for purposes related to their representational role under this Act and under State or Territory OHS laws. In exercising those rights, permit holders must comply with the requirements set out in the Part”. The objects of Part 3-4 in s. 480 of the FW Act express a similar purpose.

On the trial judge’s construction, (undertaken on the assumption that s. 70(1) did confer a strict legal right), s. 494(1) did not touch the s. 70(1) right because its subject matter was not representational. The Full Court reached a different conclusion. Their Honours held that Part 3-4 was not strictly representational because it was not just about the representational functions performed by union officials. The plain text of s. 494(1), the Full Court held, supported this view, and the constructional reference points that had informed the reasoning of Bromberg J did not, it was said, support a reading down of the text of s. 494(1). Central to this reasoning was the absence, in their Honours view, of a policy or common sense justification for differentiating between a union official who entered workplaces to investigate breaches of occupational health and safety laws and officials who entered premises to assist an HSR. In both situations there is, on the conception applied by the Full Court, a right to enter an employer’s premises that overrides its common law right to resist entry. Respectfully, some observations may be made about this approach that point in a different direction.

First, the comparator utilised by the Full Court, namely the union official who enters a workplace to investigate occupational health and safety breaches, is not functionally equivalent to the HSR’s assistant.

Section 87(1) of the OHS Act entitles an “authorised representative” of a union to enter a workplace for the purpose of investigating contraventions of the OHS Act. Features of this power (which is conferred by the words “may enter”) include:

  • The representative may only exercise the entry right in respect of work carried out by union members, those eligible to be members or work carried out by persons subject to an industrial agreement that applies to the union.
  • The authorised representative may only exercise the entry right if he or she holds a particular state of mind, namely; a reasonable suspicion of contravention.
  • Entry by the authorised representative may only be “for the purpose only of enquiring into the suspected contravention”. The powers that may be exercised for this purpose are contained in s. 89 of the OHS Act and must be performed by the authorised representative himself or herself and only to “the extent it is reasonable for the purpose of enquiring into the suspected contravention”.

In contrast, by s. 70(1).

  • The employer must allow the HSR’s assistant to enter the premises. Implicit in this obligation is perhaps that it is responsive to some request for entry, but there is no specification in the provision of who that must be from or how is it to be exercised. Necessarily, an exercise of the right found by the Full Court is engaged by the assistant in that capacity -  as a person selected by the HSR as their assistant.
  • Other than the provision of assistance, none of the functions conferred by s. 58(1) of the OHS Act can be performed by the assistant, they are conferred on the HSR.
  • There is no requirement that the assistant who is a union official be authorised by their union to act as an assistant and the official is not limited to assisting HSRs who are members of their union, or eligible to be so, or who perform work covered by an agreement that applies to his or her union. The choice of assistant lies with the HSR, as do the functions performed by the assistant in that capacity.
  • The purpose for the entry of the assistant is the purpose held by the HSR. The assistant holds no different or greater purpose.
  • The assistant need not hold any particular state of mind to ground the entry, it is enough they do so clothed in the authority conferred by the HSR.
  • Any HSR assistant, no matter who they are, must exercise entry under the OHS Act bona fide for the purposes of the statute. The assistant who is a union official has no greater or lesser obligation to do so than anyone else appointed under s. 58(1)(f), nor does such a person have any greater power.

There is no obvious policy rationale expressed in the OHS Act for treating one kind of assistant who happens to be a union official differently from someone else.

Second, it is apparent from the provisions of Part 3-4 that concern State and Territory occupational and safety laws that the FW Act take these laws as it finds them. That this is so is stated expressed in the Explanatory Memorandum of the FW Act, a point made by the Solicitor-General for Victoria before the Full Court. Self-evidently, the “right” that s. 494(1) speaks of is one contained in the State or Territory law itself. Whilst the Full Court was not persuaded that the Explanatory Memorandum justified reading downs. 494(1) of the FW Act, it seems open to say that, quite apart from the Explanatory Memorandum, the Commonwealth Act adopts the policy choices applied by State and Territory Parliaments by picking up the entry rights their occupational health and safety laws create. When comparing the position of a union official who enters a workplace to investigate breaches of occupational health and safety laws and an official who does so to assist an HSR, the policy that be discerned from the OHS Act is one of differentiation.

To exercise the powers of entry under s. 87(1), an authorised representative must (a) be an officer or employee of a union and (b) must hold an entry permit issued under the OHS Act to exercise rights of entry (and by dint of s. 494(1) must also hold a Commonwealth permit). Neither requirement applies to an HSR assistant.  Notably, by reason of the Full Court decision, the HSR assistant who is an official must now hold a Commonwealth permit, but need not hold a State permit. There are at least two additional points of difference.

Below, Bromberg J observed, by reference to authority, that when a Commonwealth permit holder exercises an occupational health and safety right under State or Territory law, he or she must observe the conditions specified in Part 3-4 of the FW Act for the exercise of those rights, for example providing 24 hours written notice of entry. Section 70(1) by contrast merely obliges an employer to allow access to an HSR’s assistant. There are no additional conditions specified that qualify that obligation, other than a right to refuse someone insufficiently qualified in health and safety. If access is refused, s. 70(2) leaves it to the Magistrates Court upon application of the HSR to specify terms and conditions of access.

The civil power to direct may be contrasted with the criminal penalty for refusing access to, hindering, obstructing, intimidating or obstructing an authorised representative exercising entry powers under s. 87(1) imposed by the OHS Act. In terms, the OHS Act appears to view obstruction of union officials enquiring into suspected contraventions of the OHS Act with greater concern.

Third, the “right” in s. 87(1) of the OHS Act (and those in Part 3-4 of the FW Act) and the “right” in s. 58(1)(f) and s. 70(1) of the OHS Act are not identical. The Full Court accepted that the employer’s obligation under s. 70(1) to give access to an assistant was derivative, but that fact held no significance for their Honours view of the provision. Yet the HSR is central to the rights s. 58(1)(f) and s. 70(1) establish; the assistant has no interest in access that is greater than, independent of or distinguishable from the HSR. Indeed, it most closely resembles an invitee: the HSR opens the door to the premises under a limited power of invitation (limited to a particular purpose) that, so far as it goes, appears equivalent to that of the owner or occupier; the assistant merely walks through it.

Nothing in Part 3-4 of course prevents an employer inviting a union official without a permit to enter its premises. It might be thought that the employer stands in a different position from the HSR in this situation because the employer is a volunteer, whereas under s. 70(1) the employer must put up with the choice made by the HSR, subject to a limited right of refusal. If so, the employer has the potential inconvenience of a third party entering its premises. However, that inconvenience would be incurred in equal measure whether the assistant is a union official without a permit, one with a permit or someone who was neither, and has been observed above the activities that s. 58(1) authorises could be (and must be) performed by the HSR anyway. It is in any event an inconvenience that appears to be countenanced by the text of s. 58(1)(f) and s. 70(1) of the OHS Act.

Conclusion

Regardless of these observations, the legal position is now that if an HSR invites a union official to be their assistant the official must have a Commonwealth permit. It may also be thought that an employer (or other person) who refuses entry or hinders or obstructs that official is now also liable to orders under Commonwealth law, including a civil penalty, for contravention of s. 501 or 502(1) of the FW Act at the suit of the permit holder or HSR, as the persons affected. Interesting questions may arise in this situation given that the OHS Act establishes a particular mode of enforcement for such refusals by means of a civil power under s. 70(2) of the OHS Act in the Magistrates Court to direct the employer to give access and to specify the terms and conditions of that access.

The Full Court decision in Powell is one to watch.

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Malcolm Harding practises mainly in employment and industrial law and anti-discrimination law

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