The rise of unprotected industrial action in the construction sector has led to a resurgence in employers seeking civil and criminal redress against the instigators.

The much publicised Abigroup Children’s Hospital dispute in Brisbane and the Grocon Myer Emporium dispute in Melbourne illustrate that employers need not be at the mercy of unions; there are means for employers to hold the masterminds of unprotected industrial action to account for the disruption that they cause.

When community protests cross the line

In the industrial context, a community protest is an unprotected picket held by workers and other interested parties.

Because of their nature, it is often difficult for employers to pin point who is responsible for the “protest”. This difficulty is compounded by the tendency of unions to disassociate themselves from community protests, so as to avoid the harsh penalties that can be imposed on unions for non-compliance with orders and injunctions requiring workers to return to work.

Community protests can cause major disruptions and delays to projects, and as a result, can impose hefty financial burdens on employers. But, employers can and do have their own industrial muscle to flex against the threat of protracted unprotected industrial action.

The Abigroup example

Abigroup recently earned the ire of unions throughout Australia when it sought to prosecute Bob Carnegie, a former MUA official, for criminal contempt.

The Court found that Mr Carnegie was instrumental in organising the nine week-long picket at the construction site and Abigroup obtained ex-parte orders requiring his involvement to cease.

Despite the orders obtained it is now alleged that Mr Carnegie continued to act in breach of them. As a result in February 2013, Abigroup brought 54 counts of criminal contempt of court charges against him.

Two charges have been dropped and Abigroup declined to lead evidence on 34 charges, resulting in findings of not guilty. The verdict in relation to the remaining 18 charges is due to be handed down in April this year. If found guilty of the charges, Mr Carnegie may face jail time.

Drastic times call for drastic measures

Criminal contempt actions against striking workers, union officials or ‘community protest organisers’ such as Mr Carnegie are not for the faint-hearted.

The Abigroup action has been described by one union activist as ‘the fiercest assault upon a trade unionist and social justice activist in our nation’s history’ and by MUA trade unionist, Paddy Crumlin as ‘corporate bullying’, it does send a clear message that unprotected industrial action will not be tolerated.

In the wake of intense industrial disputes and the costly consequences arising from delays this is a remedy which employers may arm themselves with where there is a need to push back.

The financial cost of unprotected industrial action

Reminiscent of the industrial action that plagued Australian workplaces during the 1980s, the Grocon dispute is estimated to have caused losses of $500,000 per day. This highlights the potential financial damage that unions can inflict not only on a large employer like Grocon, but also on the wider construction sector and the Australian economy.

Grocon fight back illustrates options for organisations affected

Harnessing lessons learned from the past, Grocon has commenced proceedings in the Victorian Supreme Court against the CFMEU and its officials for, amongst other things, breaches of what are known as the ‘industrial torts’.

Industrial torts are a group of ordinary common law remedies relating to intentional interferences with trade or business. The common industrial torts that may be used to hold unions and individuals to account for economic loss caused by unprotected industrial action include:

  • Conspiracy, which arises where two or more persons, with the intention to harm the company, agree to and combine to do either an unlawful act or a lawful act by unlawful means, causing economic loss to the company
  • Intimidation, which arises where a person, with the intention to harm the company, threatens to commit an unlawful act to compel another to do something and that person succumbs, causing economic loss to the company
  • Interference with contractual relations, which arises where a person knowingly, intentionally and either directly or indirectly interferes with the company’s contractual relations or contractual rights, causing economic loss to the company

Grocon is claiming $10.5 million in compensatory damages from the CFMEU and its officials for, amongst other things, intimidation and interference with contractual relations.

In the same proceedings, Grocon also seeks exemplary damages for alleged breaches of the Victorian Supreme Court’s interlocutory orders restraining the CFMEU from, threatening persons proposing to enter or leave the sites and preventing, hindering or interfering with free access to or free egress from the sites or causing, inducing, inciting or procuring persons to do so.

Where to from here

The Abigroup and Grocon disputes have changed the nature of the modern industrial landscape. While the effectiveness of Abigroup and Grocon’s counter-offensive strategies is still to be determined, these proceedings are a reminder that employers need not be powerless against militant unions and their industrial tactics.