Australia’s largest construction union has been convicted and fined $1.25 million in a landmark Supreme Court decision for its role in stopping work at Grocon’s Emporium project in central Melbourne.
Already the fines for criminal contempt against the Construction, Forestry, Mining and Energy Union (CFMEU) for the blockade in August and September 2012 are some of the heaviest against a union.
Financial damages for Grocon are yet to be determined with separate cases ongoing.
Supreme Court justice Tony Cavanough said ‘‘the pattern of repeated defiance by the CFMEU’’ in this case and previous cases was ‘‘very troubling’’. He said the nature of the union’s defiance of the court orders meant he found it in criminal contempt.
‘‘I regard these contempts as exceptionally serious,’’ he said.
‘‘So much so, that they warrant explicit classification as criminal contempts perhaps for the first time in an Australian industrial context.’’
He said the presence of so many senior CFMEU officials at the blockade of the Emporium site was ‘‘unusual’’ and was ‘‘a further demonstration of the depth of the CFMEU’s determination to maintain its stance.
‘‘The end does not justify the means. The means involved flagrant, prolonged, deliberate defiance of the orders of the court.’’
Justice Cavanough said the CFMEU had ‘‘substantial financial means’’ with cash of more than $12 million and net assets of nearly $52 million.
The union has also been ordered to pay substantial legal costs. Justice Cavanough estimates the costs to Grocon will likely be more than $1 million. The Victorian government will not receive costs.
The Myer Emporium site was subject to a bitter industrial dispute, largely between Grocon and the CFMEU. Central to the dispute was disagreement over the appointment of shop stewards.
The CFMEU was fined $250,000 for contempt on a number of separate days at the Emporium site.
It was also fined $150,000 for preventing access to a Grocon site in Footscray and from preventing suppliers from entering a Grocon site in Collins Street.
Grocon described the decision as a ‘‘defining moment’’ for the construction industry.
‘‘It should be clear to the Victorian CFMEU that old-style bullying and intimidation has no place in a modern workplace or the broader union movement,’’ the company said.
‘‘The construction industry must take a stand to eradicate this sort of lawless behaviour and require all players to simply obey the law.”
Federal Employment Minister Eric Abetz said the fines were ‘‘unprecedented’’.
‘‘Today’s decision sends a clear message that the sort of behaviour engaged in by the CFMEU is unacceptable,’’ he said.
‘‘Today’s penalty is yet one more reason why Bill Shorten and Labor must stop running a protection racket for union bosses engaged in illegal and unlawful behaviour.’’
State Planning Minister Matthew Guy said the unprecedented ruling by the court sent a strong message to the CFMEU and the wider union movement.
‘‘It obviously sends a very clear message to the union that they are not above the law, they must adhere to the law,’’ Mr Guy said.
‘‘It also sends a clear message to Daniel Andrews and the Labor party that they must sack the CFMEU and not back them.
‘‘This is a massive test of his leadership. He must sack the CFMEU, anything less shows he is not fit to govern.’’
Despite seeking a larger financial penalty the Napthine government is comfortable with the decision because of the message it sends to the union about their behaviour.
The CFMEU are yet to comment. In 2010 the CFMEU paid $1 million in penalties for its role in the West Gate dispute and the Australian Manufacturing Workers Union was made to pay $325,000 for tis role in the same dispute.
With Richard Willingham