Industrial Relations Legal Advice: A 2015 Review Revisited

More than a decade later, many of the industrial relations issues raised in this 2015 review remain relevant for unions, workers, employers and industrial relations lawyers in Australia.

In this specialist Q&A, Hall Payne Lawyers Principal and Employment/Industrial Law Accredited Specialist Joseph Kennedy reflected on Fair Work Act contraventions, individual liability under the Fair Work Act, employer compliance with workplace laws, union legal advice and key industrial relations decisions from 2015.

While the legal landscape has continued to change, the themes discussed here remain important for anyone seeking industrial relations legal advice or trying to understand the role of unions, workplace rights and employment law in Australia.

A Specialist’s 2015 Industrial Relations Review

Hall Payne Lawyers Principal and Employment/Industrial Law Accredited Specialist Joseph Kennedy is a key player in our Industrial Relations team. As 2015 comes to a close, read about the year that was in his Industrial Relations review.

Individual Liability Under the Fair Work Act

What do you think is the biggest emerging issue in employment and industrial law from 2015?

In my view, the biggest emerging issue is the rising prevalence of individuals being found liable by courts for contraventions of the Fair Work Act. This has largely been caused by regulators, unions and employers showing an increasing desire to pursue the individual persons involved, for the purpose of s.550 of the Fair Work Act, in contraventions, whether they be union officials and permit holders, or company directors and managers.

The consequences of such a finding can lead to the imposition of significant pecuniary penalties on the individual and even orders to pay compensation caused by the contravention. The imposition of pecuniary penalties now has the potential for more serious consequences for the individual, in light of the Federal Court decision of Director of the Fair Work Building Inspectorate v Bragdon Ors (No. 2) [2015] FCA 998.

That judgment, presently on appeal to the Full Court, stands for the proposition that an individual right of entry permit holder found to have contravened the Act can be ordered by a court to pay the penalty personally and not seek or receive reimbursement from their union or a related party.

In my view, this principle is equally applicable to company directors and managers found to have contravened the Fair Work Act, for example by failing to pay wages or entitlements, and may even be the subject of legislative amendment in 2016.

Union Legal Advice and Fair Work Act Contraventions

What role do you think unions can play in this issue?

Unions need to continue to be vigilant in their approach to contraventions of the Fair Work Act, both in relation to their own compliance but also when pursuing companies.

They should not miss the opportunity to pursue company directors or managers, where possible, for contraventions of the Fair Work Act. Whether the Court will be likely to make similar orders as those made in Bragdon will likely be settled either on appeal or by the Commonwealth Parliament.

Employer Compliance With Workplace Laws

Compared to 2014, do you think there’s anything that has taken a back seat when it comes to IR? 

The monitoring of employer compliance with employment and industrial laws.

Regulators also appear to have shown a lower willingness to pursue employers in the courts, preferring instead to receive undertakings or settlement agreements. This, unfortunately, has the potential to create an expectation amongst employers that non-compliance has a negligible real cost. The 7-Eleven scandal that emerged a few months ago is but one example.

Key Industrial Relations Decisions for Unions and Workers

This year has seen some incredible decisions come down in favour of HPL clients. When you look back in five years’ time, what do you think will be the standout?

Our High Court victory in CEPU v Queensland Rail would have to be a highlight of 2015. That decision has the potential to fundamentally alter the way state governments go about structuring their various entities in the future and typifies the inherent value in strategic and well-executed litigation for unions.

Our other High Court success in Commonwealth v Director, Fair Work Building Industry Inspectorate & CFMEU [2015] HCA 46 means unions and the regulator will be able to continue to reach common-sense resolutions to prosecutions and highlights the inherent distinction between criminal and civil prosecutions.

Finally, our recent success in achieving a stay in our appeal of the above first instance Federal Court decision in Bragdon, in relation to personal payment of penalties and right of entry purpose when entering sites, may prove to be a standout, along with the outcome of the substantive appeal, in relation to those two emerging legal issues.

Employment Law Australia: Sham Contracting and Worker Rights

Stepping outside the firm, what do you think have been the big decisions affecting unions and workers?

The recent sham contracting case in the High Court, Fair Work Ombudsman v Quest South Perth Holdings Pty Ltd [2015] HCA 45, reinforces the increasing prevalence of such sham arrangements in the industrial relations landscape.

It also highlights the potential liability for employers and litigious opportunities for employees in such situations, and the unions representing them.

Industrial Relations Reforms in Australia

Any predictions for 2016?

The Liberal government may take a suite of reforms in the industrial relations area to the next election, including increasing the maximum penalty for a contravention of legislation, with the aim of punishing unions, and providing courts with power to require personal liability for penalties. This may have unintended consequences for employers and managers found to have contravened such laws.

[2026 EDITOR’S NOTE] Since this 2015 review was first published, industrial relations reforms in Australia have continued to evolve, including changes to workplace laws, enterprise bargaining, civil penalties and underpayment enforcement. The Fair Work Ombudsman confirms that intentionally underpaying wages or entitlements can be a criminal offence from 1 January 2025, and current civil penalty settings can include significant penalties for individuals and companies, particularly for serious contraventions.

Get Industrial Relations Legal Advice

Hall Payne Lawyers has deep experience in employment and industrial law, including matters involving unions, workers, workplace rights, Fair Work Act contraventions, employer compliance and complex industrial disputes.

If you require industrial relations legal advice, union legal advice or support with an associated IR issue, Hall Payne Lawyers can help you understand your options and take the next step.