The rejection by Australian building firm Grocon of a compromise offer from the Construction, Forestry, Mining and Energy Union (CFMEU) has led to the return on Monday evening of the blockade at the Emporium construction site in Melbourne.

The police blocked Lonsdale Street and placed temporary fencing following the collapse of the Grocon and CFMEU talks at Fair Work Australia (FWA) and in anticipation of the return of the blockade.

Mounted police and the dog squad were reported brought in to the Grocon site to escort non-union employees who want to report for work. Monday was a rostered day off for the workers.

CFMEU State Secretary Bill Oliver asked Grocon Chief Executive Daniel Grollo to accept the FWA recommendation to resolve the two-week labour row. Mr Oliver pointed out that the union is no longer demanding for a 14-day cooling-off period.

"We believe that Daniel Grollo does not want to sit down and come and try to finish this blue we're having here at the moment. All we are asking is for him to suspend his legal action so that any time he felt we were being unreasonable he could bring back his legal action again," ABC quoted Mr Oliver.

In rejecting the FWA recommendation and CFMEU offer, Mr Grollo said the latest union proposal is worse than its previous offer.

"Last week the union offered to stop illegally blockading Grocon's business for 14 days and then reimpose them if they weren't getting what they wanted. This time they say that will only stop breaking the law 'for so long as the parties are engaged in productive discussions,'" The Sydney Morning Herald quoted Mr Grollo.

"In other words, the CFMEU will reimpose the illegal blockades on Grocon at any time it chooses. That is clearly impossible for any business to accept," he added.

Victorian Premier Ted Baillieu sided with Grocon and said if the blockade would return it would be totally unacceptable. He said the state government would not just "stand by and watch the rule of law trashed."

The state's Supreme Court has declared CFMEU's industrial action illegal and will resume the contempt hearing on Tuesday. The union did not show up at the court hearing on Monday, but said it would lift the blockade if Grocon agrees to resume talks.

Mr Grollo is threatening to file a lawsuit against the union for losses of $500,000 a day due to the work stoppage.

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