A recent case before the Federal Court of Australia has provided further guidance regarding the calculation of penalties for contraventions of the right of entry provisions under the Fair Work Act 2009 (Cth) (FW Act), confirming that for the purposes of section 546 of the FW Act, in the absence of agreement between the parties, separate penalties must be determined for separate contraventions.

Background

Large Canberra construction company, Canberra Contractors, was prosecuted for obstructing union officials from investigating a suspected work health and safety (WHS) breach in contravention of sections 502 and 503 of the FW Act.

Director and Operations Manager, Mr Cerullo, and Manager, Mr Graham, were also prosecuted for their involvement in the contraventions.

At first instance, Canberra Contractors was found to have engaged in five contraventions of the FW Act, Mr Cerullo three contraventions of the FW Act, and Mr Graham two contraventions of the FW Act in connection with attempts by union officials to investigate a potential WHS breach at a construction site at the CIT campus in Woden in August 2021.

Canberra Contractors was ordered to pay a single penalty for the five contraventions of the FW Act of $45,000. Mr Cerullo and Mr Graham were each ordered to pay two penalties totalling $10,800 and $6,000 respectively, pursuant to section 546 of the FW Act.

The CFMEU appealed the penalties on the basis that the primary judge incorrectly imposed a global penalty for the contraventions of the FW Act by the company and Mr Cerullo. The CFMEU also argued that the penalties ordered were manifestly inadequate.

Appeal

On appeal, Justice Stephen McDonald of the Federal Court found (following concessions by the respondents) that the primary judge had erred in imposing fines cumulatively for Canberra Contractors and Mr Cerullo and that the consequence was that the Court should re-exercise the discretion to impose penalties for each of the contraventions ‘afresh‘.

His Honour also found that the primary judge had erred in concluding the obstruction caused by Mr Cerullo and Mr Graham in preventing the CFMEU from expeditiously investigating suspected WHS breaches had not been deliberate and noted (and saw no reason to depart from) the reservations expressed by the primary judge about Mr Cerullo and Mr Graham’s ‘degree of contrition’.

In reaching his decision McDonald J noted that while the delay in investigating the suspected WHS breach was only for a ‘short period of time’ and incurred no specific loss or damage, regard should be had to the importance of upholding industrial rights which have “as their object ensuring safety in the workplace” in assessing the severity of penalties to be imposed.

McDonald J ordered that Canberra Contractors pay five separate penalties totalling $60,000 for the contraventions, and Mr Cerullo pay three separate penalties totalling $11,200. Mr Graham’s penalties were also increased to a total of $6,600.

Key takeaways

A key takeaway from this decision is that even if contraventions of the FW Act arise from a single course of conduct, in the absence of prior agreement by the parties, a court imposing penalties for multiple contraventions must determine a separate penalty for each contravention.

The decision also serves to reinforce the significance that attaches to compliance with WHS obligations, and the level of genuine contrition demonstrated by the parties – bodies corporate and individuals alike – when they fail to meet their obligations, in determining the quantum of penalties to be imposed.

Further information on the judgement can be found at Construction, Forestry and Maritime Employees Union (CFMEU) v Canberra Contractors Pty Ltd [2025] FCA 440

Further information on the primary judgements can be found at CFMEU v Canberra Contractor [2023] FedCFamC2G 754 and CFMEU v Canberra Contractors [2024] FedCFamC2G 166

This article was written by Alison Spivey, Partner, Georgia Driels, Senior Associate, and Dominic Leal Smith, Law Graduate.