Full Court of the Federal Court varies civil penalties on the Transport Workers' Union of Australia

 

23 November 2018

On 21 November 2018, the Full Court of the Federal Court of Australia delivered judgment against the Transport Workers' Union of Australia (TWU), varying the amount of civil penalties imposed on the TWU for contraventions of the Fair Work (Registered Organisations) Act 2009 (the RO Act).

While the Full Court accepted on appeal that the TWU had been denied procedural fairness in the manner in which it was sentenced at trial, it rejected the TWU’s arguments that it was not open to the trial judge to impose a penalty higher than that sought by the Commissioner at trial (at [121]).

In exercising its discretion on resentencing, the Full Court ordered new penalties on the TWU totalling $163,000, reflecting the serious and on-going nature of the breaches.

The penalties comprise a total of $95,000 for failing to remove more than 20,000 unfinancial members from the TWU’s register of members after they had been unfinancial for more than two years (contrary to section 172 of the RO Act), and a total of $68,000 for failing to retain registers of members as at prescribed dates (contrary to section 231 of the RO Act).

The Full Court said that the rights, privileges and protections that registration under the RO Act confers upon registered organisations “come with serious obligations, including obligations to keep accurate records about their membership. It is important that registered organisations should understand that those obligations must be complied with and that non-compliance will attract substantial penalties” (at [130]).

The Full Court, in broadly agreeing with the trial judge’s views as to the seriousness of the contraventions, stated (at [131]) that “Registered organisations should have it made clear to them the importance of record-keeping of members”.

The Full Court found that “there certainly existed the potential for members and other persons to be misled as to the number of members that the TWUA had during the relevant periods” (at [134]).

The amount of the penalty reflected the Full Court’s view “as to the course of conduct and the seriousness and duration of the contraventions” (at [140]).

The Registered Organisations Commission (ROC) welcomes the Full Court’s decision, which again highlights the importance of unions and employer associations maintaining accurate membership records and meeting their record keeping obligations.

Registered Organisations Commissioner Mr Mark Bielecki said the Court’s decision serves as a timely reminder to registered organisations and their branches of the need to comply with their obligations under the RO Act, and that meeting these obligations helps to deliver high standards of financial accountability and transparency in the interests of their members.

Mr Bielecki said the ROC has extensive information on its website to help increase awareness of the operation of the RO Act. He encourages organisations, their office holders, members and employees to familiarise themselves with the information to assist them in understanding how the Act applies to them and, if in doubt, to contact the ROC for guidance.

A copy of the Full Court’s judgment is available here

Background

On 2 February 2018, Perram J imposed civil penalties on the TWU for contraventions of the Fair Work (Registered Organisations) Act 2009 (the RO Act) in the sum of $271,362.36 comprised of $200,000 for contravening s 172 (arising from the failure over a period of 12 years to remove 20,907 members from its membership register) and $71,362.36 for five separate contraventions of s 231(1) (failing to keep copies of required records for 7 years).

In his judgment at paragraph 79, Perram J noted that ‘Because of the democratic principles underpinning the RO Act, record keeping under this legislation is a significant matter’. And further that ‘It needs to be understood by registered organisations that this is a serious piece of legislation and the apparently mundane obligations it imposes are to be obeyed’. 

Media Contact:  Greg Russo - (03) 9603 0767 or greg.russo@roc.gov.au