Industrial Relations Commission New South Wales

• Medium Neutral Citation: Fire and Rescue NSW on behalf of Department of Premier and Cabinet v New South Wales Fire Brigade Employees' Union [2012] NSWIRComm 76
• Hearing dates: 2 July 2012
• Decision date: 19 July 2012
• Jurisdiction: Industrial Court of NSW
• Before: Boland J, President

Decision

(1) The Fire Brigade Employees' Union is guilty of contravening the dispute orders made by Ritchie C on 21 October 2011 in IRC Matter No 1631 of 2011.

(2) The Fire Brigade Employees' Union is fined an amount of:

(a) $7,500 in relation to the contravention on 21 October 2011; and

(b) $3,500 in relation to the contravention on 22 October 2011.

(3) The penalties imposed by order 2(a) and 2(b) hereof are payable within 28 days of the date of this judgment.

• Catchwords: OFFENCES - Dispute orders - Contravention of dispute orders by Fire Brigade Employees' Union - Contravention admitted - Principles to be applied in fixing penalty - Matters to be taken into account in mitigation - Serious contravention - Penalties imposed
• Legislation Cited: Industrial Relations Act 1996
• Cases Cited: Australian Workers' Union (NSW) v Bluescope Steel (AIS) Pty Ltd [2006] NSWIRComm 71; (2006) 151 IR 153; Bluescope Steel (AIS) Ltd v AWU and Anor (No 2) [2005] NSWIRComm 210; Director-General, NSW Department of Education and Training v NSW Teachers Federation [2010] NSWIRComm 44; Director General, NSW Department of Education and Training and the Managing Director of TAFE v NSW Teachers Federation [2010] NSWIRComm 77; Director-General of the NSW Department of Education and Communities and Managing Director of TAFE NSW v New South Wales Teachers Federation [2012] NSWIRComm 58
• Category: Principal judgment
• Parties: Fire and Rescue New South Wales on behalf of Department of Premier and Cabinet (Applicant); New South Wales Fire Brigade Employees' Union (Respondent)
• Representation: Mr R Reitano of counsel (Applicant); Mr J Nolan of counsel (Respondent)
• File Number(s): IRC 1662 of 2011

Judgment

1 This matter concerns an application by Fire and Rescue NSW on behalf of the Department of Premier and Cabinet for orders in connection with the alleged contravention of dispute orders by the New South Wales Fire Brigade Employees' Union ("FBEU"). The principal order sought is one imposing a penalty on the respondent pursuant to s 139 of the Industrial Relations Act 1996 ("the Act").

2 The application was supported by two affidavits, the first by Mr Bernard King, Assistant Director Employee Relations for Fire and Rescue NSW and the second by Mr Mark Maxwell Brown, Assistant Commissioner with Fire and Rescue NSW. For the FBEU reliance was placed on the affidavit of Mr Chris Read, Senior Industrial Officer with the FBEU.

Background

3 The origin of the application before the Court lies in an industrial dispute concerning the staffing of Logistic Support Vehicles ("LSVs"). On 19 February 2010 the Commissioner for the New South Wales Fire Brigades, Mr Greg Mullins, wrote to the State Secretary of the FBEU, Mr Jim Casey, proposing a "package of actions" to resolve a dispute involving staffing in the Newcastle area. An element of the package was proposed as follows:

2. The LSVs in Newcastle and the Illawarra will be staffed by personnel on suitable duties or local Retained Firefighters. Permanent Station Officers and Firefighters on suitable duties tasked to staff LSVs will work the 10/14 roster. The staffing of LSVs in Sydney requires further development and this will be done in consultation with the FBEU, however, where there are insufficient suitable duties staff available, overtime will not be worked to fill the positions.

4 On 25 February 2010, Mr Casey responded to the proposed package and, inter alia, agreed in principle to element 2 of the package. It appears that there was some difference of opinion over the meaning and intent of element 2 during 2010 and on 27 October 2010 Mr Casey wrote to Mr Mullins stating:

...

Clearly, it was understood by both parties that the LSVs would in future be primarily staffed by permanent firefighters and officers on alternative duties. It was also understood that in the event of insufficient alternative duties permanents, other "spare" permanent firefighters could be used to staff the LSV and failing that, that the LSV in question would effectively be grounded until:

a) it could again be staffed by a permanent firefighter or officer on alternative duties; or

b) it could again be staffed by a "spare" permanent firefighter;

c) it was required immediately for urgent duties, in which case it could be staffed by a retained firefighter who would respond to the LSV station as he/she would respond to any other incident.

It follows it was neither expected nor agreed that retained staff could be assigned to perform routine LSV functions. To avoid doubt, the correspondence of 13 August [from the Fire Brigade] made clear the Department's agreement that retained staff "could [only] be used for those infrequent situations where there is an urgent job and it is not possible to use another LSV". That same letter was equally clear in agreeing that this arrangement would apply equally to all six LSVs, including those situated at Newcastle, the Central Coast and Wollongong.

The Union now understands that, contrary to the agreed position, the LSVs are regularly being staffed by retained firefighters in order to perform routine LSV work. This is both disturbing and provocative.

...

5 According to Mr Read's affidavit, negotiations with the applicant continued following the letter of 27 October 2010 and the Union proposed a trial of new arrangements in correspondence dated 8 July 2011. The applicant rejected the Union's proposals and proposed its own trial.

6 On 29 September 2011, the FBEU wrote to Acting Commissioner John Benson requesting written confirmation by 5.00 pm the following day that the applicant would respect and observe the "2010 LSV staffing arrangement", which the FBEU had interpreted in the terms set out in its letter of 27 October 2010.

7 The applicant responded on 4 October 2011, stating:

...

While your letter states that there was a formalised agreement between the Union and the Service following from Mr Casey's letter of 27 October 2010, such an assertion fails to take into account additional correspondence between the parties including: 3 November 2010 (the Service), 15 November 2010 (FBEU), 22 November 2010 (the Service), 3 June 2011 (the Service), 8 July 2011 (FBEU) and 14 September 2011 (the Service). These letters indicate that a series of discussions took place between us following the October 2010 letter that you have referred to.

The arrangements identified by the Acting Commissioner in correspondence dated 14 September 2011 will be placed on trial, due to my concerns about critical operational needs that must be able to be met on a 24/7 basis. Plans are in place to publish a suitable expression of interest this week.

...

8 Mr Casey wrote again to Mr Mullins on 12 October 2011 seeking a meeting "as soon as possible" to discuss the Brigade's "intention to unilaterally abandon a recently agreed position for staffing of LSVs" and not to take steps to depart from the agreed position prior to the meeting taking place. It was Mr Read's evidence that there was no response. Instead, he deposed that the applicant "authorised the publication of a job ad for permanent members to apply to staff the LSV, on day shift only, on a six month secondment to the fleet."

9 Mr Read deposed that it was this "final provocation" that led the Union to commence industrial action in accordance with a "Code Red" announcement to its members on 20 October 2011. After explaining what it regarded as the abandonment by the Fire Brigade of an agreed position regarding the staffing of LSV, the "Code Red" stated:

Accordingly, all members are hereby instructed that effective from 0800 hours today, Thursday 20 October 2011:

• no member is to perform any relieving, stand-bys or out-duties. Members are to return to and remain at their base station, save for GSA-based members who are currently relieving out of GSA, who should remain at their present location. (For clarification regarding the operation of relieving bans, see the extended version of this Code Red notice on the Union's website); and

• no member is to perform any paperwork or administrative duties (including fire reports, BRIMS, PIP's, CARS, FANS, etc.) other than for firefighter pay or leave related matters; and

• no member, other than a dedicated LSV coordinator, is to direct, instruct or oversee the operation of the LSVs based at No 1 Station City of Sydney, No 21 Station Kogarah and/or No 27 Station Parramatta.

These bans are to remain in place until further notice from the State Secretary.

(signed)

Jim Casey

State Secretary

10 Following the imposition of the bans the applicant filed an urgent notification under s 130 of the Act later in the day on 20 October 2011 (Matter No IRC 1631 of 2011). On the same day Walton J, Vice-President convened a Compulsory Conference by way of a teleconference. His Honour made recommendations to the following effect:

a. the parties were to confer urgently;

b. the status quo was to apply to the LSVs until Monday 24 October 2011 when the matter would be relisted before Ritchie C;

c. the bans and limitations imposed by the FBEU were to be lifted immediately;

d. officers and employees of the FBEU were to make all reasonable efforts to see that the recommendations were given effect.

In addition to the recommendations, the parties were to inform the Industrial Registrar by 4.00 pm on 20 October 2011 of their acceptance or otherwise of his Honour's recommendations.

11 Subsequently, the applicant advised the Registrar of its acceptance of the recommendations. At approximately 5.00 pm the Registrar phoned Mr King at the applicant and advised him that the FBEU had informed the Registrar it would not be complying with the recommendation to lift the bans and work limitations.

12 In anticipation of the FBEU response the applicant had filed with the Registrar, at about 4.50 pm on 20 October 2011, a notice of motion seeking dispute orders pursuant to s 137(1)(a) of the Act and directions pursuant to s 136(1)(a) to the effect that the industrial action cease immediately and that the FBEU its officers and employees take steps to ensure the proposed orders were complied with. The notice of motion was listed before Ritchie C on Friday, 21 October 2011.

13 On 20 October 2011, Mr Casey wrote to Mr Mullins advising him the Union's State Committee of Management had met and resolved the following:

...

"That the State Secretary's report of the proceedings at midday today before the IRC's Vice President Walton, as conveyed to him by the Union's Senior Industrial Officer who appeared with Jim Nolan of counsel on behalf of the Union be received and noted, in particular VP Walton's concluding recommendations that:

1) The parties are to urgently confer;

2) The status-quo shall operate until such time as the matter is re-listed on Monday 24 October 2011;

3) The bans and limitations the subject of notification shall be lifted immediately; and

4) The officials and employees of the Union and the employer are to take all reasonable steps to give effect to the recommendation, with the parties to provide the Registrar with a status update by 4pm today;

and having regard to all relevant considerations and developments to date, including that:

a) The matter of LSV staffing was comprehensively negotiated and clearly settled as part of the "Waratah dispute" (IRC Matter No. 2029 of 2009) by agreement between the parties in 2010;

b) The matter of LSV staffing is only now in dispute because the employer has unilaterally abandoned that agreed settlement;

c) This dispute now has far wider implications than was understood in 2009/10 given the employer's concurrent attempt to terminate the employment of numerous members on alternative duties (IRC Matter No. 1372 of 2011), a most serious dispute and one that remains unresolved;

d) The IRC should not review the agreed position given that in the absence of any Union counter-claim the best possible outcome for the Union would be the preservation of the status-quo (sic) whereas the employer has absolutely nothing to lose;

e) To lift the bans without an undertaking from the employer to abide by the agreed position would simply serve to encourage further bad behaviour from the employer, thereby sowing the seeds for even more industrial disputes than already underway; and

f) The Department rejected the Union's attempt to arrange a meeting this afternoon, as was directed by VP Walton without the pre-condition that the bans be lifted;

this meeting resolves that the current bans and limitations should continue until such time as the Department unambiguously agrees to respect and observe the agreed position reached in 2010."

I therefore again invite you to reconsider your position in this dispute and to respect and observe the agreement reached between the parties in 2010. Your commitment to do so will result in the immediate lifting of all bans and limitations imposed at 0800 hours this morning.

14 On 21 October 2011, the applicant pressed for the orders in its notice of motion. After issuing a certificate of attempted conciliation pursuant to s 135(2) of the Act, Ritchie C made dispute orders in the following terms:

1 (a) That all employees of Fire & Rescue NSW within the coverage of the Fire Brigade Employees' Union immediately cease taking industrial action, including cease taking industrial action, including the cessation of any ban or limitation upon work as expressed in the Code Red dated at 20 October 2011 headed "Department walks away etc"

(b) That all employees of Fire & Rescue NSW within the coverage of the Fire Brigade Employee's Union immediately cease and refrain from authorising, organising, supporting, encouraging or inciting industrial action, including any bans or limitations upon work within the period 20 October 2011 to 20 November 2011.

2(a) The Fire Brigade Employees' Union, its office holders and employees, are hereby Directed to take all reasonable steps to ensure that all employees of Fire & Rescue NSW within the coverage of the Fire Brigade Employees' Union comply with Orders 1(a) and (b) and that they also immediately notify Fire Brigade Employees' Union members of the said Orders by way of a Code Red (being an FBEU newsletter) or other effective method.

3 These Orders and Directions shall take immediate effect and shall remain in force until 20 November 2011 unless on formal application, they are varied or rescinded in the interim.

In making the dispute orders the Commissioner declined to order that the applicant comply with the 2010 LSV staffing agreement.

15 At about 1:13 pm on 21 October, the applicant advised staff that dispute orders had been made. At about 6:03 pm on the same day the FBEU issued a "Code Red" indicating that the bans would have been lifted if the applicant had agreed to comply with the 2010 agreement regarding the staffing of LSVs, but in light of the applicant's refusal to do so, the bans would stay in place and additional bans would be imposed. The additional bans were that:

• no member is to leave their station on any appliance for any reason, unless that appliance has its safe and effective crewing present and available (for pumpers, no less than S/O & 3).

• no senior officer member (ie Inspector, Superintendent or Chief Superintendent) is ride (sic) on any pumper or specialist appliance.

16 The Code Red indicated the bans were to remain in place until further notice from the State Secretary. Mr Casey signed the Code Red.

17 There was further correspondence between the applicant and the FBEU on 21 and 22 October 2011. Each side put proposals as to how the dispute regarding LSV staffing might be resolved. It appears both sides gave some ground. The FBEU issued a further Code Red lifting all bans and limitations from 6.00 pm on 22 October 2011.

18 In his affidavit, Mr Brown deposed to the alternative arrangements that were required to be put in place as a consequence of the FBEU's bans and the cost of necessary additional overtime worked during the period of the bans. This was estimated to be approximately $82,000 for Thursday 20 October 2011, $59,000 for Friday 21 October 2011 and $42,000 for the day shift only on Saturday 22 October 2011.

19 A summons to show cause why the Court should not take action against the FBEU for contravention of Commissioner Ritchie's dispute orders and the application in connection with the alleged contravention were served on the FBEU on 27 October 2011.

20 The grounds in support of the application were in the following terms:

The Respondent is an industrial organisation. The Respondent contravened dispute orders made by Commissioner Ritchie and have continued industrial action.

F. Particulars:

1. The respondent is an industrial organisation.

2. On or about 6:30am on Thursday 20 October 2011, Mr Jim Casey (State Secretary), with the authority of the Respondent, issued an "instruction" to members that included the following terms:

"Accordingly, all members are hereby instructed that effective on and from 0800 hours today, Thursday 20 October 2011: no member is to perform any relieving, stand-bys or out-duties. Members are to return to and remain at their base station, save for GSA-based members who are currently relieving out of the GSA, who should remain at their present location; and no member is to perform any paperwork or administrative duties...other than for firefighter pay or leave related matters; no member other than a dedicated LSV Coordinator, is to direct, instruct, or oversee the operation of the LSVs at No.1 Station City of Sydney, No. 21 Station Kogarah and/or No. 27 Station Parramatta.

These bans are to remain in place until further notice by the State Secretary".

3. Industrial action in the form of bans on relieving, stand-bys, out-duties and administrative functions ("the Bans") commenced at 8:00am on Thursday 20 October 2011.

4.On 21 October 2011 in IRC Matter No. 1631 of 2011, Commissioner Ritchie made Dispute Orders pursuant to s139 of the Industrial Relations Act (NSW) ("the Act")

5.The Order made by Commissioner Ritchie ("the Order") was in the following terms:

"1 (a) That all employees of Fire & Rescue NSW within the coverage of the Fire Brigade Employees' Union immediately cease taking industrial action, including cease taking industrial action, including the cessation of any ban or limitation upon work as expressed in the Code Red dated at 20 October 2011 headed "Department walks away etc"

(b) That all employees of Fire & Rescue NSW within the coverage of the Fire Brigade Employee's Union immediately cease and refrain from authorising, organising, supporting, encouraging or inciting industrial action, including any bans or limitations upon work within the period 20 October 2011 to 20 November 2011.

2(a) The Fire Brigade Employees' Union, its office holders and employees, are hereby Directed to take all reasonable steps to ensure that all employees of Fire & Rescue NSW within the coverage of the Fire Brigade Employees' Union comply with Orders 1(a) and (b) and that they also immediately notify Fire Brigade Employees' Union members of the said Orders by way of a Code Red (being an FBEU newsletter) or other effective method.

3 These Orders and Directions shall take immediate effect and shall remain in force until 20 November 2011 unless on formal application, they are varied or rescinded in the interim."

6.The Prosecutor is the person who applied for the Order.

7.In contravention of the Orders, the Bans did not immediately cease on 21 October 2011.

8.On the evening of 21 October 2011 the FBEU published a SITREP entitled "Relieving bans remain in place" which included the following:

"Accordingly, all members are hereby instructed that the bans introduced yesterday remain in force, and further, that:

·No member is to leave there station on any appliance, for any reason, unless that appliance has its safe and effective minimum crewing present and available (for pumpers, no less than SO & 3).

·No senior officer member (i.e. Inspector, Superintendent or Chief Superintendent) is to ride on any pumper or specialist appliance."

9.The contravention of the Order was undertaken in knowing defiance and disregard of the Orders. The Respondent made a conscious decision to continue Bans in the face of the Orders.

10.As a result of the contravention, the Prosecutor incurred financial loss of up to $80,000 per day.

11.The prosecution relies on the affidavit of Bernard King sworn on 26 October 2011 and the affidavit of Mark Maxwell Brown sworn on 25 October 2011.

Consideration

21 The application in this matter is brought under s 139 of the Act which is in the following terms:

139 Contravention of dispute order

(1) The Commission, on application, must deal expeditiously with an alleged contravention of a dispute order. The application may be made by the person who applied for the order or any other person who was authorised to apply for the order.

(2) Before dealing with an alleged contravention of the order, the Commission is required to summon the person alleged to have contravened the order to show cause why the Commission should not take action for the contravention.

(3) The Commission may, after hearing any person who answered the summons to show cause and considering any other relevant matter, do any one or more of the following:

(a) dismiss the matter if it finds that the dispute order was not contravened or if it finds that the circumstances were such that the Commission should take no action on the contravention,

(b) cancel the approval of an enterprise agreement,

(c) suspend or modify for any period all or any of the entitlements under an industrial instrument,

(d) cancel the registration of an industrial organisation or take any other action authorised by Division 2 of Part 3 of Chapter 5,

(e) impose a penalty on an industrial organisation or an employer as provided by subsection (4),

(f) make any other determination that the Commission considers would help in resolving the industrial dispute.

(4) The maximum penalty that may be imposed on an industrial organisation or employer is:

(a) except as provided by paragraph (b)-a penalty not exceeding in total $10,000 for the first day the contravention occurs and an additional $5,000 for each subsequent day on which the contravention continues, or

(b) if a penalty has previously been imposed on the industrial organisation or employer for a contravention of an earlier dispute order-a penalty not exceeding in total $20,000 for the first day the contravention occurs and an additional $10,000 for each subsequent day on which the contravention continues.

(5) Any such penalty may be recovered in the same way as a penalty imposed by the Commission for an offence against this Act.

Contravention admitted

22 There was no issue as to whether the FBEU contravened the dispute orders made by Ritchie C. The FBEU acknowledged this was so. The Court finds that the FBEU contravened the dispute orders made by Ritchie C on 21 October 2011 in IRC Matter No 1631 of 2011 in that the bans referred to in the dispute orders did not immediately cease on 21 October 2011, that on 21 October 2011 the Secretary of the FBEU authorised additional bans to be imposed and that industrial action by the FBEU and its members including the bans covered by the dispute orders did not cease until approximately 6.00 pm on 22 October 2011.

Penalty - principles

23 The only issue for the Court to determine is the question of penalty. The law in that respect is reasonably well settled: see Bluescope Steel (AIS) Ltd v AWU and Anor (No 2) [2005] NSWIRComm 210; Australian Workers' Union (NSW) v Bluescope Steel (AIS) Pty Ltd [2006] NSWIRComm 71; (2006) 151 IR 153; Director-General, NSW Department of Education and Training v NSW Teachers Federation [2010] NSWIRComm 44 ("Teachers No 1"); Director General, NSW Department of Education and Training and the Managing Director of TAFE v NSW Teachers Federation [2010] NSWIRComm 77 ("Teachers No 2)"; Director-General of the NSW Department of Education and Communities and Managing Director of TAFE NSW v New South Wales Teachers Federation [2012] NSWIRComm 58 ("Teachers No 3)".

24 In Bluescope (No 2) at [37], the Court identified a list of matters that may be relevant in respect of contraventions of dispute orders under s 139 where the conduct constituting a contravention called for the imposition of a penalty under s 139(3)(e). In the Court's opinion, the matters that may be considered to be relevant and appropriate were:

(a) The circumstances in which the relevant contravention took place (including whether the contravention was undertaken in deliberate defiance or disregard of the dispute order);

(b) Whether the person found to have been in contravention of a dispute order has previously been found to have engaged in conduct in contravention of an earlier dispute order (in this respect see s 139(4)(b), which provides for higher maximum penalties where there has been an earlier contravention);

(c) The consequences of the conduct found to be in contravention of the dispute order;

(d) The need, in the circumstances, for deterrence;

(e) Any relevant subjective factors including undertakings regarding future conduct.

25 The Court did not suggest the list was exhaustive. In Teachers (No 1) Staff J adopted what the Court had said in Bluescope (No 2). In Teachers (No 1) Staff J added at [36]-[37]:

[36] In exercising the discretion as to an appropriate penalty under s 139(3)(e) of the Act, it is necessary for the Court to consider the overall culpability of the guilty person, whilst noting that the imposition of a penalty under s 139 is not an application of the criminal law: see BHP Steel Ltd v The Australian Workers' Union, New South Wales (at [94] - [99]). Regard must also be had to the fact that the legislature has provided for a higher maximum penalty for the first day of the contravention and a lower penalty for each subsequent day the contravention occurs.

[37] In my view, contrary to the Federation's submissions, this is plainly a serious offence. In deciding what approach to take in the fixing of a penalty, I take into account the following:

(a) the circumstances in which the contravention took place must result in a conclusion that the contravention was undertaken in blatant and deliberate defiance of the dispute order made by Boland J. The executive of the Federation took a conscious decision in the face of the dispute orders to proceed with "a 24 hour stoppage of all TAFE members on Thursday 11 February 2010";

(b) the contravention of the dispute order resulted in approximately 4,000 employees of the Managing Director of TAFE taking 24 hour strike action;

(c) the inconvenience to students through the cancellation of classes;

(d) that it is absurd to contend that a financial benefit was obtained by TAFE from the illegal strike action because of the savings in the salaries of teachers who took industrial action;

(e) the observations of Boland J that the industrial action planned by the Federation was entirely without justification (at [20]);

(f) that the making of a dispute order is a serious step given the consequences for contravention and persons against whom a dispute order is made are bound to take it seriously, especially members, officials and employees of organisations who may be putting in jeopardy the very existence of their organisation: see observations of Boland J (at [26]);

(g) the failure of the Federation to apologise to the Court for the breach and to make a public declaration of belief in, and a willingness to uphold the integrity of the Commission: Director-General, Department of Education and Training v New South Wales Teachers' Federation (at [8] - [9]). To the extent that the Federation submitted that its contrition should be taken to have included such factors, I am not prepared to interpret the Federation's contrition as embracing such broad terms;

(h) that there was no evidence, nor could there have been, that the Federation had been labouring under a misapprehension as to the scope of the dispute orders;

(i) that the Federation committed a single breach of the dispute order.

26 In Teachers (No 2) Marks J, after referring to Teachers (No 1), stated:

[14] However, it is also necessary to make reference to one additional matter, namely the context in which dispute orders are made and the part that dispute orders play in the overall regulation of industrial matters in New South Wales. Chapter 3 of the Industrial Relations Act deals with industrial disputes and provides for mandatory conciliation and then arbitration. There is provision in the Act for the enforcement of awards and determinations made by the industrial tribunal. Furthermore, the tribunal is empowered to make dispute orders (s 136) of a kind described in s 137 and subject to conditions set out in s 138. Section 139 empowers this Court to impose a penalty for breach of a dispute order. Accordingly, the regulation of industrial disputes in New South Wales involves the empowerment of a third party umpire to make binding orders on parties which can be enforced through mechanisms established by the State and which include the creation of civil penalties as part of the armoury of measures that may be taken to ensure compliance with and enforcement of awards, orders and determinations.

[15] The existence of a system such as that established by the Industrial Relations Act 1996 reflects a sophisticated and civilised approach to dealing with industrial disputation, including differences of opinion which do not necessarily manifest themselves in any industrial action. In any sophisticated and civilised regime that regulates the manner in which persons, and entities that represent them, conduct their affairs, it is necessary to provide an overarching structure to ensure that the regime works in practice. Without such an overarching structure, there would be no means of compelling obedience to authority and this would lead to anarchy. So that any teacher who might read this judgment may fully understand the situation to which I am referring, the need for a hierarchical structure of authority, and means of implementing it, is replicated in TAFE and school campuses.

27 In Teachers (No 3) Haylen J referred to Teachers (No 1) and Teachers (No 2). In respect of the latter case, Haylen J distinguished the factual situation that there existed from the circumstances his Honour was required to deal with:

[35] The present case is distinctly different. As indicated by Marks J in the compulsory conferences held on 5 and 6 September 2011, the underlying issue was not an industrial matter which the Commission had jurisdiction to entertain or in relation to which it could make an order or award. His Honour pointed out that, in the normal case, he would not hesitate to give a direction or a Recommendation that no industrial action take place and would then attempt to conciliate the matter and if conciliation was unsuccessful, the matter would be open to arbitration. This was not such a case and there was nothing that Marks J could do to influence the Federation from taking industrial action by joining Unions NSW and other public sector unions in their protest rally against Government industrial policy and amendments made to the Industrial Relations Act. Because the Commission lacked jurisdiction, there could be no serious challenge to its authority by the Federation rejecting any recommendation or direction regarding this industrial action: indeed, Marks J made neither a recommendation nor gave a directions regarding the strike. Although his Honour issued a certificate of failed conciliation at the request of the Director-General, he accepted that he had not undertaken conciliation in the usual manner when dealing with an industrial matter otherwise within jurisdiction. He concluded the dispute proceedings by indicating that he would not relist the matter again unless the parties required assistance with a matter within the jurisdiction and power of the Commission and that might be made by way of a fresh notice of dispute.

...

[40] Having regard to the circumstances surrounding the lateness of the application and the period of notice given by the Federation, the Court is unable to conclude that these breaches are of the same order of seriousness as the previous two breaches by the Federation. This industrial action involved protest rallies against Government policy, not open to arbitration: the rally itself was supported by all public sector unions under the auspices of Unions NSW, the State peak council for employees under s 215 of the Act. Further, it is appropriate that the penalty for each day encompass the entirety of the actions taken by the Federation in breach of the dispute order - this approach appears to reflect the structure of s 139.

Circumstances of the contravention

28 In considering the circumstances in which the contravention took place I note the FBEU's submission that there were "special and extraordinary" circumstances to be taken into account in assessing the Union's culpability. It was submitted the dispute was "provoked" by the applicant reneging on an agreement regarding the staffing of LSVs.

29 The FBEU submitted that it was always prepared to lift the bans it had imposed if the applicant complied with the 2010 LSV agreement. It submitted the bans were lifted immediately once the applicant agreed to observe the 2010 agreement, a step it should have taken from the outset.

30 It was submitted for the FBEU that although the contravention was admitted it was not in the same class of the serious contraventions considered in Bluescope (No 2) or Teachers (No 1) and Teachers (No 2). Mr J Nolan of counsel for the FBEU submitted that the consequences of the FBEU's conduct was to be measured against the fact that the solution to the dispute was at all times in the hands of the applicant - by simply abiding by the industrial agreement it had made with the Union.

31 The FBEU contended that when Justice Walton ordered the "status quo" to apply in relation to the LSVs until 24 October 2011 when the matter was to come before Ritchie C, the status quo was the 2010 agreement. However, the applicant refused to recognise that was the case.

32 There seems to have been an initial difference of opinion between the parties as to what exactly the Vice-President meant by "status quo". The applicant obviously did not believe the status quo was the 2010 LSV agreement because if it had, one could reasonably have expected the bans to be lifted shortly after his Honour made his recommendations on 20 October 2011. However, in his letter to Mr Casey late on 21 October 2011 (and after Ritchie C had made the dispute orders) Commissioner Mullins agreed to observe the "status quo", which he belatedly said was "essentially the same as the 2010 arrangements". It is apparent that the applicant's position outlined in the Commissioner's letter of 21 October 2011 could have been put to the FBEU at an earlier time and any bans could have been entirely avoided.

33 Whilst this might be a matter taken into account in mitigation, it by no means excuses the FBEU's conduct.

34 The fact is that when Walton J made his recommendations on 20 October 2011 he arranged for Ritchie C to further deal with the matter on 24 October. If the bans had been lifted in the meantime, undoubtedly conciliation would have ensued and in the event that was unsuccessful, arbitration could have followed.

35 In other words, there was at the FBEU's disposal a "sophisticated and civilised" regime for dealing with its grievance against the applicant that rendered entirely unnecessary resort to industrial action.

36 The issue for the FBEU was whether the applicant had reneged on an agreement made in 2010 regarding the staffing of LSVs. It was a classic industrial matter within the Commission's jurisdiction. The dispute could have been notified to the Commission by the Union and the conciliation and arbitration processes set in train. The Commission gives such matters priority as the Vice-President's recommendations show.

37 If the Union had demonstrated the applicant had unreasonably or without justification reneged on an agreement regarding the LSVs the Commission could have recommended to the applicant that it observe the agreement or the Commission could have made an award to settle the dispute by arbitration. There was no compelling force at work such that a reasonable person would consider there was an imperative to force the applicant to concede immediately by resort to industrial action.

38 In compounding the seriousness of the contravention and in a gesture confirming the FBEU was thumbing its nose completely at the Commission's orders, the Union not only maintained the bans in place after the dispute orders were made, but it put in place additional bans.

Whether any prior penalty

39 It was common ground that a penalty had not previously been imposed on the FBEU for a contravention of an earlier dispute order: s 139(4)(b). In that case the maximum penalty is one not exceeding in total $10,000 for the first day the contravention occurred and an additional $5,000 for the second day: s 139(4)(a).

Consequences of the contravention conduct

40 As noted earlier it was Mr Brown's evidence, not effectively challenged, that there was a cost of necessary additional overtime worked during the period of the bans. This was estimated to be approximately $183,000. It is accepted this consequence does not fall into the same class as the fallout of the teachers' strikes in Teachers (No 1) and (No 2), which caused widespread disruption. Moreover, the bans did not affect the Brigade's ability to deal with any outbreak of fire.

Deterrence

41 One of the objectives of imposing a penalty under s 139 is to deter the offender from contravening the Act in future as well as others that might contemplate similar offences. In relation to the FBEU, regrettably there is no evidence that it will not engage in similar conduct in the future; there is no evidence of any remorse or contrition on its part. Indeed, I fear that the Union believes that its conduct was justified. There is a strong case for including in the penalty an element for specific deterrence. The penalty will also include an element of general deterrence.

Subjective factors

42 An important mitigating factor is that despite the Unions' long history of involvement in the State's system of industrial relations, this is the first time it has been found that the FBEU contravened a dispute order. It is regrettable the Union has tarnished that fine record, particularly because it did so in circumstances where it was completely unnecessary and where after having had a disputes order made against it, the Union escalated the bans.

43 Another mitigating factor is the applicant declining to acknowledge there was any agreement of the nature claimed by the FBEU, only to accept on 22 October that it would accept a status quo that was "essentially the same as the 2010 arrangements". I am prepared to take that into account, but for the reasons I have given, it cannot carry a great deal of weight.

44 The only other mitigating factor is that the FBEU admitted the contravention. Any penalty should accordingly be discounted for the utilitarian value of the admission, although it must be said that there was a very strong case against the FBEU.

Conclusion

45 I have concluded that in all the circumstances the contravention was serious. In the words of counsel for the applicant it was also "contumacious". It should attract a penalty of $7,500 for the first day the contravention occurred, namely, 21 October 2011 and $3,500 for the second day, namely, 22 October 2011, making a total penalty of $11,000.

Orders

46 The Court makes the following orders:

(1)The Fire Brigade Employees' Union is guilty of contravening the dispute orders made by Ritchie C on 21 October 2011 in IRC Matter No 1631 of 2011.

(2)The Fire Brigade Employees' Union is fined an amount of:

(a)$7,500 in relation to the contravention on 21 October 2011; and

(b)$3,500 in relation to the contravention on 22 October 2011.

(3)The penalties imposed by order 2(a) and 2(b) hereof are payable within 28 days of the date of this judgment.

**********

Decision last updated: 19 July 2012