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15 April 2015 Unions are not above the law

By Warwick Ryan, Partner


In Brief

In a very recent decision of the Federal Court, the Maritime Union of Australia (MUA) had damages awarded against it of $482,000 and was ordered to pay a fine of $80,000 for refusing to allow a couple to start work with a labour hire company. The labour hire company that refused to place them was also fined.  


the facts

A couple had sought employment with a labour hire company as stewards on a ship.

The labour hire company, knowing the MUA's rigorous approach to such matters, required them to join the Union before hiring them. The Union refused their membership application because they wanted preference to be given to existing members for the roles on the ship.

Hence, the couple missed out on the opportunity for the (lucrative) roles.

Law and Findings

The Union argued that it was legitimate for it to give preference to union members.

The Court was completely unsympathetic to that argument and found that the Union's behaviour was unlawful and obstructed the right of the couple to find employment. 

Accordingly, the couple were successful in seeking damages totalling $800,000 against both the Union and the labour hire company.

Lessons

The lessons from this are that:

  • unions are not above the law
  • employees do not have any obligation to be Union members
  • companies do not have an obligation to adopt a particular type of enterprise agreement or follow any form of Union direction (beyond their express rights – ie. right of entry and WH&S)

In practice, of course, Unions exert practical power through basic intimidation and the misuse of work, health and safety legislation to obstruct company's operations where that company is not bowing to Union demands.  However, the risk of being sued is real both for the Union and you – if you accede to Union pressure to engage in unlawful conduct.

Furthermore, individual Union members can be joined as respondents in proceedings making them potentially liable for damages and potentially have their accreditation removed.

The best tactic in any proceedings where you want to resist cooperation with a Union's unreasonable demands is to appear mildly enthusiastic but be practically obstructive at the same time, ie. "I'd love to cooperate but I could be sued".
 
For further information, please contact:

Warwick Ryan, Partner  |  Phone: +61 2 9233 5544  |  Email: wpr@swaab.com.au

If you would like to republish this article, it is generally approved, but prior to doing so please contact the Marketing team at marketing@swaab.com.au

This article is not legal advice and the views and comments are of a general nature only. This article is not to be relied upon in substitution for detailed legal advice.

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