A contracts manager and a team leader of a construction company that took adverse action against a subcontractor it refused to hire because its enterprise agreement wasn’t endorsed by the CFMEU have been fined almost $2,000 each for the part they played in their employer’s contraventions.

FWBC director Nigel Hadgkiss said the case was an example of the “concerning” industry practice in which contractors refuse to engage subcontractors that don’t have union enterprise agreements.

Judge Salvatore Vasta fined the two J Hutchison Pty Ltd employees $1,800 for their s340 breaches and the company $25,575 for its conduct, which he said “strikes at the heart of freedom of association”.

He warned that Hutchinson’s conduct threatened the “whole fabric” of Australia’s IR laws.

“For subcontractors, such as C & K, a major pathway to growing their business is to be awarded contracts from large construction companies like [Hutchinson].

“If the only way in which they can break into those circles is to have made an agreement with the CFMEU, then the whole fabric of our industrial relations system will disintegrate,” Judge Vasta said in newly-released reasons for his August 9 extempore decision

Hutchinson took adverse action in 2012 when it told the tiling subcontractor, which was due to start work at Brisbane’s Nundah Village Shopping Centre, that without a union-endorsed agreement, it could not do the job

Judge Vasta said there was a “blatant case of discrimination” against the tiling company and reiterated that it was viewed “very seriously” by Parliament and the courts.

While the judge accepted that maintaining “industrial harmony” was a factor in determining which company Hutchinson engaged, he noted that there were problems with this approach because there is the “potential for improper practices to creep in” to the disadvantage of subcontractors.

Judge Vasta said that way that Hutchinson’s discriminated against the subcontractor made the breach one “that would fit into the worst category”.

However, due to the “spirit of cooperation” and contrition demonstrated by the two Hutchinson employees, Judge Vasta reduced their individual penalties.

He said the contracts manager and team leader were performing duties on behalf of the employer, rather than acting with disregard for the law, and had demonstrated some regret for their actions.

“Still, what they have done is serious and must be met with condign punishment,” Judge Vasta said.

Hadgkiss confirmed five other employers are currently before the courts to defend similar allegations of discrimination and adverse action against subcontractors.

Director, Fair Work Building Inspectorate v J Hutchinson Pty Ltd & Ors [2016] FCCA 2175 (9 August 2016)

Source Workplace Express