Eyes up: Ensuring proper conduct by right of entry permit holders

What you need to know

• Right of entry permit holders cannot "act in an improper manner" whilst exercising, or seeking to exercise, rights of entry.
• Permit holders have other specific obligations under Part 3-4 of the Fair Work Act 2009 (Cth).
• Permit holders can be held to account if they do not act in accordance with these obligations, either by your organisation or by a relevant regulator.
• Decisions regarding how to deal with a right of entry permit holder may need to be made at short notice (although potentially with no notice at all), and by frontline staff, who may have limited opportunities to consult others before acting.

What you need to do

• Consider providing training and instruction to frontline staff about the rights and obligations with respect to right of entry to ensure obligations are met and your rights against undue influence or disruption are protected.
• If a permit holder has not complied with their right of entry obligations, direct them to leave.
• If a permit holder is inappropriately raising safety issues to pressure or coerce you, record all of the particulars of the incident and consider what action you can take. Actions may include: (1) seeking an injunction to prevent the improper conduct; (2) claiming adverse action, unlawful interference with contractual relations and/or contraventions of the Competition and Consumer Act 2010 (Cth); and (3) reporting the permit holder's conduct (and union if they are a union official) to an employment regulator.
  

Obligations of right of entry permit holder

A recent decision of the Federal Court demonstrates how safety issues may be used for industrial purposes, and that employers need to remain vigilant to ensure union officials comply with their right of entry obligations. This is a perennial area for friction, where the right of employers not to be unduly inconvenienced in running their business is to be balanced with the right of entry onto premises by union officials for safety purposes - where that is lawfully done. In ABCC v McDermott (No 3) [2018] FCA 1105, the CFMMEU and three of its officials have been fined nearly $140,000 for unlawfully entering an Adelaide construction site on four separate occasions between April and July 2014. Three union officials were fined between $3,000 (for one contravention) and $17,800 (for four contraventions).

On one occasion, the Project Manager on site asked one of the officials why he was there, and he responded that he was "just catching up to have a chat with the guys at lunch time" and that he was "not exercising [his] right of entry". Despite this conversation, the official entered the site.

That official later admitted that he was seeking to exercise entry rights under the FW Act to hold discussions with employees, but did not provide any person at the site with an entry notice as required under the FW Act. In reaching its decision, the Court placed weight on the propriety expected of persons issued with entry permits under the FW Act, in particular the refusal of the union officials to leave the site when directed showed that they were "dismissive of the legitimate interests of an occupier of the site".

"Turn a blind eye"

Two of the officials had raised the spectre of "safety" issues in response to being challenged about their failure to comply with their obligations under right of entry laws. Despite already being on site, the first official had said "If I find anything on site I will use my WHS permit to gain entry"; and on another occasion, in response to a request to comply with the notice requirements, the second had responded: "Although we won't be looking at safety on site… and we will turn a blind eye to it, there's a sneak peak of what we will be looking at next time on site".

This approach was considered by the Court to be ignoring the requirements of the FW Act "when it suited" despite also impliedly threatening action pursuant to the same statute.

Based on the interactions extracted in the evidence, it appears that the Project Manager acted in a respectful, but firm way to ensure that the union officials' conduct did not proceed unchallenged. However, it is important to note that the Project Manager was required to take immediate action in response to finding union officials turning up without notice.

Permit holders must not act improperly

Section 500 of the FW Act provides that a permit holder "must not intentionally hinder or obstruct any person, or otherwise act in an improper manner".

The FW Act does not authorise a permit holder to enter or remain on premises where that person contravenes the requirements for right of entry. This means that where a person is in breach of any conditions of entry, the person can immediately be directed to leave the premises. If they refuse to do so, this would constitute a further breach of the FW Act (and potentially other common law rights of occupiers).

In ABCC v McDermott (No 2) [2017] FCA 797, the relevant conduct was four-fold, involving first, failing to provide an entry notice before entering the site; second failing to leave the site notwithstanding that the site manager gave a direction to leave; third holding discussions with employees on site in rooms or areas not agreed with the head contractor; and last, holding discussions with employees on site not during mealtimes or other breaks.

General protections are also available to employers

Adverse action protections under the FW Act also protect employers, who exercise workplace rights. Such rights may include:

• a right to require work in accordance with an enterprise agreement, without the consent or approval of the union;
• a right to require permit holders to exercise right of entry in accordance with the FW Act; and/or
• a right that no industrial action be engaged in, by the union or employees, prior to the expiry of an enterprise agreement (that has not reached its nominal expiry date).

Where an official has misused right of entry provisions or raised inappropriate or unfounded "safety" issues to hinder your business, or threatens to take such action, this could constitute adverse action.

What to do if a permit holder acts improperly

Before taking steps in respect of a right of entry permit holder, it is important to have a proper basis for doing so. Given the possibility of having to react immediately, decisions may need to be made on the basis of what has been verbally reported. In such cases, it is important to properly and formally record as soon as possible after the event(s) witnesses to the conduct and conversations of the permit holder(s). If closed circuit television (CCTV) or other workplace surveillance is available, this should also be backed up.

Based on this, you should then consider whether:

• your organisation has the willingness to prosecute the breaches of right of entry obligations. If not, you should report the conduct to a relevant regulator (such as the ABCC, FWC or FWO);
• the conduct is ongoing, and causing significant detriment. In such cases, you should consider whether an injunction and/or adverse action proceedings are warranted; and
• the conduct has impacted your ability (or another party's ability) to supply services or comply with contractual obligations, and whether it is advisable to commence proceedings on the basis of the Competition and Consumer Act 2010 and/or unlawful interference with contractual obligations.

Authors: Trent Sebbens, Partner; Geoffrey Giudice, Consultant; and Ed Carroll, Lawyer.