11 October 2012FWBC secures compensation for Queensland subcontractors

FWBC has secured compensation payments for subcontractors affected by unlawful industrial action taken by the CFMEU and CEPU, and officials at the Gold Coast University Hospital and Brisbane Supreme Court & District Law Court projects in 2011.

The deal struck by Fair Work Building and Construction will see the unions pay 95 per cent of losses incurred by ten Queensland subcontractors as a result of the unlawful strikes.

Following the action in early 2011, FWBC made a public call for companies that had suffered loss due to the strikes. Based upon that response, and from FWBC’s own investigations, action was taken to recover the losses of a number of affected subcontractors.

Ten subcontractors included in FWBC’s action will receive payments from the CFMEU and CEPU totalling $101,930 for loss of profit, plant and equipment hire costs, and wages for unproductive work.

"The subcontractors in the FWBC action received 95 per cent of their losses due to the illegal strike action” said FWBC Chief Executive Leigh Johns.

"This should send a clear signal that parties end up better off working with the regulator to secure a fair outcome.”

Traditionally, penalties imposed for unlawful strikes are paid directly to the Commonwealth.

"Civil penalties are just one part of the regulatory scheme. The recovery of commercial losses is of direct benefit to the industry participants affected.”

FWBC seeking compensation, in addition to civil penalties, returns lost income directly to affected subcontractors and employees who suffered during a strike.

"Too often, it is the small subcontractors that bear the brunt of disputes between large head contractors and the union. Holding wrongdoers to account for the direct commercial consequences of their actions should act as a deterrent to unlawful action in future,” Mr Johns said.

The CFMEU, CEPU and seven officials have also admitted to engaging in unlawful industrial action. FWBC and Lend Lease Project Management & Construction (Australia) Pty Ltd have sought the imposition of $590,000 in penalties for these breaches. A penalty hearing was held 1 February 2012. The decision on penalty in this matter has not yet been handed down by the Court. For more information see: Director, Fair Work Building Industry Inspectorate v CFMEU, Pearson, Vink, O’Doherty, CEPU, Hanna, Jarvis, Olsen & Malone.