Overview — Common law

Industrial action has always been a particularly contentious aspect of the industrial relations process. In legal terms, virtually all industrial action is unlawful. Almost all such action is unlawful as either or both a tort and a breach of contract. In many instances, it will also be unlawful under statute.

See Liability in contract and tort.

Despite their very broad scope, the common law liabilities have never been extensively relied upon in practice, and the Fair Work Act 2009 (Cth) (FW Act) now provides protection against such liability in certain circumstances. Nevertheless, the torts can be of continuing relevance in relation to unprotected industrial action, even though chief reliance tends to be placed upon statutory remedies such as those provided under s 418 of the FW Act and s 45D of the Competition and Consumer Act 2010 (Cth).

This means that those who organise or participate in such action are almost invariably exposed to liability in contract, tort, and under statute. This would place workers and unions in a very weak position in the context of collective bargaining, and helps explain why most common law jurisdictions have introduced some form of statutory protection against legal exposure in connection with organising or participating in industrial action.

The principal form of employer industrial action is the lockout. That is, the exclusion of all or part of the workforce from the workplace, either as a pre-emptive tactic by the employer to exert pressure upon employees/unions with whom they are in dispute, or as retaliation for some form of industrial action (such as a partial work-ban) undertaken by employees.

Virtually all industrial action is unlawful as either, or both a breach of contract or a tort. (See Liability in contract and tort) It follows that, in principle, an employer (or other party) who has been the target of industrial action can seek damages to compensate for any loss they may have suffered in consequence of the unlawful conduct and/or may seek injunctive relief to prevent the unlawful conduct from commencing or continuing (as the case may be).

The FW Act now provides protection against common law and statutory liability in respect of protected industrial action. Nevertheless, common law remedies are of continuing relevance in relation to unprotected industrial action and other unlawful action, even though chief reliance tends to be placed upon statutory remedies such as those provided under s 418 of the FW Act.

An employer that has been the target of industrial action may suffer substantial loss as a consequence — especially where the action has been extensive and/or prolonged. In principle such damages would be calculated in accordance with normal common law principles and would be intended to place the employer as nearly as possible in the position they would have been in had the wrongful conduct not occurred. Punitive and/or exemplary damages may also be available in some instances.

Employers faced with ongoing or threatened unprotected industrial action are likely to accord a higher priority to ensuring that the action stop/not commence than to recovering damages if and when it does occur.

This helps explain why most common law cases concerning unprotected industrial action consist of an application for an interlocutory injunction to restrain action which is already occurring, or to prevent threatened or apprehended action from commencing. In cases of special urgency, relief may be obtained on an ex parte basis — ie, in the absence of the other party.

See Injunctions and other common law remedies.