Fair Work Ombudsman v Construction, Forestry and Maritime Employees Union (Kwinana Bulk Jetty Case) (Costs)
Citation: [2026] FCA 126
What happened
The Fair Work Ombudsman brought proceedings against the Construction, Forestry and Maritime Employees Union (CFMEU) and a second respondent under the Fair Work Act 2009 in relation to conduct at the Kwinana Bulk Jetty. The primary proceedings concluded with the court finding the first respondent (the CFMEU) not liable for the actions of the second respondent. Following that outcome, a costs application was made. The question before the Federal Court was whether the CFMEU's rejection of a settlement offer made during the proceedings amounted to an 'unreasonable act' under section 570(2)(b) of the Fair Work Act, which would allow a costs order to be made against it. The court considered the factors set out in Patrick Stevedores Holdings Pty Ltd v Construction, Forestry, Maritime in assessing whether the rejection of that offer was unreasonable.
What was decided
The source text does not provide the final ruling on the costs application. The judgment addresses the legal framework, including whether rejecting the settlement offer was an unreasonable act under section 570(2)(b) of the Fair Work Act, and applies the Patrick Stevedores factors to the circumstances. Because the CFMEU was ultimately found not liable in the primary proceedings, that finding was relevant to assessing whether its rejection of a settlement offer that raised liability issues was unreasonable. The full reasoning and conclusion of the costs decision are not available in the supplied source text.
What it means for employers
Employers and organisations involved in Fair Work proceedings should be aware that costs are not automatically awarded against a losing party. Under section 570 of the Fair Work Act, costs can only be ordered if a party acted unreasonably, including by unreasonably rejecting a settlement offer. When evaluating a settlement, parties should carefully consider the merits of the offer relative to their legal position, as rejecting an offer that foreshadows the actual outcome may later be scrutinised by a court.
What it means for employees
Employees and unions involved in Fair Work matters are generally protected from adverse costs orders unless they have acted unreasonably. However, if a party rejects a reasonable settlement offer and the final outcome reflects the terms of that offer, the court may find the rejection was an unreasonable act and award costs against them. Taking settlement offers seriously and seeking legal advice before rejecting them is important.
Every statement above is drawn from the published decision. Read the original here:
https://www.judgments.fedcourt.gov.au/judgments/Judgments/fca/single/2026/2026fca0126This summary was drafted by AI from the published decision and reviewed before publishing. It is general information, not legal advice. For your specific situation, speak to the Fair Work Ombudsman (13 13 94) or a qualified lawyer. About these summaries & corrections →