[2019] FWCFB 6077[Note: a correction has been issued to this document]
FAIR WORK COMMISSION

DECISION


Fair Work Act 2009
s.156 - 4 yearly review of modern awards

4 yearly review of modern awards
(AM2019/17)

JUSTICE ROSS, PRESIDENT
DEPUTY PRESIDENT CLANCY
COMMISSIONER BISSETT

MELBOURNE, 2 SEPTEMBER 2019

4 yearly review of modern awards – finalisation of exposure drafts – newly constituted Full Bench.

1. Introduction and background

[1] This Decision provides an overview of the status of the first 4 yearly review of modern awards (the Review) and sets out the process for finalising the exposure drafts and the consequent variation of each modern award. This Full Bench has been constituted to oversee this process (AM2019/17).

[2] Since January 2014, the Fair Work Commission (the Commission) has been conducting the Review in accordance with s.156 of the Fair Work Act 2009 (the Act).

[3] On 12 December 2018 s.156 of the Act was repealed by the Fair Work Amendment (Repeal of 4 Yearly Reviews and Other Measures) Act 2018 (the Amending Act) with effect from 1 January 2018. Under the application and transitional provisions of the Amending Act, a review of an award that commenced but was not completed before 1 January 2018 can continue under the terms of the repealed provisions.

[4] The conduct of the Review has been open and transparent and a dedicated 4 yearly review website part of the Commission’s website has been used to provide information to interested parties (including employers, employees, organisations, governments, individuals and representatives), in a timely manner. All material considered throughout the Review has been published on the 4 yearly review website (with the exception of material subject to confidentiality orders). Throughout the Review dedicated subscription services send daily emails when material is published on the website to all who have registered for either the Award matters service or the Penalty rates case service.

[5] The Commission has issued 189 decisions as part of the 4 yearly review and 280 procedural Statements. In excess of 1150 hearing days, mentions and conferences have been conducted throughout the course of the Review.

[6] As at 30 August 2019, the 4 yearly review website contained in excess of 22,000 documents relating to the Review, including approximately 13,500 submissions and pieces of correspondence. Other documentation posted to the website includes research and background papers, issues papers, notices of listing and transcripts.

[7] At the commencement of the Review in 2014, it was decided that the most efficient way of conducting the process was in three stages—an Initial stage to deal with any jurisdictional issues, an Award stage where each award would be reviewed in its own right and a Common issues stage where claims that would affect all or a number of awards would be dealt with by a dedicated Full Bench. Where an issue was more complex or parties were seeking a substantive change to current entitlements, it was referred to a separate Full Bench to hear evidence as to why the proposed change is necessary for the award to achieve the modern awards objective.

[8] There are a number of common issue matters and substantive claims that remain outstanding. The common matters that are yet to be finally determined are:

•  Annualised Salaries

•  Overtime for casuals

•  Payment of wages on termination of employment (award specific issues only)

•  Payment of wages

•  Terminology relating to annual leave loading

•  Shut down provisions

•  Drafting of casual conversion clause (in the 28 modern awards that had such clauses prior to the Review)

•  Span of hours (determinations to be finalised)

•  Reasonable overtime (limited awards only)

•  National Training Wage (3 awards only)

[9] A Statement issued on 24 December 2018 provided a status update about the Full Benches that are dealing with substantive claims. In total, 69 full benches have been constituted to hear and determine substantive claims arising in respect of modern awards. Some 42 of these Full Benches have now been heard and determined the claims before them (or the claims withdrawn), 7 Full Benches have reserved their decision and 20 are part heard.

[10] A plain language project has also been run as part of the Review. This involved a ‘light touch’ review of all modern awards, the redrafting of certain standard clauses and the more substantial plain language redrafting of a select number of awards.

Scope of Plain Language Light Touch

[11] At a conference on 29 April 2019 a number of parties sought an opportunity to file written submissions in relation to the scope of the light touch process. Interested parties were given an opportunity to file further submissions. As a number of matters to be implemented in the light touch process have already been determined the parties were asked to focus on:

•  Changes in wording that have resulted from an application of the plain language guidelines; and

•  Issues arising from the translation from the plain language re-drafting of the General Retail Industry Award 2010 and other awards that have been included in the plain language project.

[12] The issues raised in the submissions highlighted the risks inherent in adopting changes across the award system based on changes which have been made to those selected awards which have been completely redrafted in plain language. The general tenor of the submissions made urged the Commission to take a cautious, indeed minimalist, approach to changing existing award terms during the light touch process, on the basis that such changes may have unintended consequences.

[13] In a decision issued on 20 August 2019 1 the Plain Language Full Bench concluded that the risks involved in adopting changes across the award system – particularly the risk of changing the legal effect of an existing award term – outweighed the benefits of such an extensive ‘light touch’ approach. Consistent with the submissions advanced by ABI and Ai Group, the Plain Language Full Bench decided that the ‘light touch’ process will be confined to making changes to the structure of exposure drafts in Groups 1 to 3 awards (in accordance with the plain language structure completed for awards in Group 4); the insertion of plain language standard clauses and relevant key decisions dealing with common issues.

[14] The Plain Language Full Bench also invited any interested person to identify any term in any modern award that is ambiguous, uncertain or confusing so that the term could be considered for plain language re-drafting in the current Review. Any such proposal can be made at any time and is to be forwarded to chambers.ross.j@fwc.gov.au.

Plain Language review of selected awards

[15] A number of selected awards have been completely redrafted in plain language. The selection of these awards was based on a number of factors including:

•  industries or subsectors identified by the Fair Work Ombudsman as having high levels of non-compliance;

•  award reliance survey data regarding modern awards used by small businesses; and

•  the resources available to the Commission.

[16] The plain language re-drafting of the following awards is complete:

•  Pharmacy Industry Award 2010

•  Clerks – Private Sector Award 2010

•  Restaurant Industry Award 2010

•  Hospitality Industry (General) Award 2010

•  General Retail Industry Award 2010

•  Security Services Industry Award 2010

[17] There are two outstanding issues in relation to the plain language re-drafting of the Cleaning Services Award 2010 and these will be finalised in accordance with the process set out at in [2019] FWCFB 5409 at [42]. The plain language redrafting of the Fast Food award will commence in the coming weeks.

[18] As to the remaining awards, the plain language re-drafting of the Aged Care Award 2010, Children’s Services Award 2010, Hair and Beauty Industry Award 2010 and the Social, Community, Home Care and Disability Services Industry Award 2010 will commence after the substantive issues in respect of those awards have been heard and determined. A timetable for consultation on the re-drafting process will be issued in the latter part of 2019.

[19] The Review process is now nearing completion and this Decision outlines the process over the coming months.

2. Finalising the Award phase of the Review (Exposure Drafts)

[20] Three procedural Statements issued in early 2019 dealt with the process for finalising the Review:

•  A Statement setting out a timeline for finalisation of exposure drafts for 2019 (see [2019] FWC 932).

•  A Statement finalising a timetable for 2019 which outlines when specific Full Bench matters are to be heard (see [2019] FWC 717) (note a Statement was also issued on 24 December 2018 providing a status update about a number of Full Benches that are dealing with substantive claims).

•  A Statement providing an update about the status of matters before the Plain Language Full Bench and next steps in the plain language project (see [2019] FWCFB 1255).

[21] Exposure drafts for Groups 1, 2, 3 and 4 were republished throughout February and March 2019 on the dates set out below:

Group 1: published on 13 February 2019

Group 2: published on 15 February 2019 2

Group 3: Sub-group 3A: published 1 March 2019

Sub-groups 3B, 3C, 3D: published on 8 March 2019 3

Group 4: Sub-group 4A and 4B: published on 15 March 2019

Sub-group 4C and 4D: published on 22 March 2019

Sub-group 4E and 4F: published on 29 March 2019 4

[22] As set out in the Statement issued on 13 February 2019, 5 the exposure drafts that were republished in February and March 2019 contained the following updates:

•  technical and drafting decisions for each group (1–4) of the award stage;

•  common issues and plain language decisions including payment of wages on termination, standard clauses, National Training Wage, family and domestic violence leave, flexible working arrangements, part-day public holidays, casual conversion, minimum engagement and abandonment of employment; and

•  adjustments to rates and allowances resulting from the 2017-18 Annual Wage Review decision and any award variations operative since the last update.

[23] Interested parties were invited to comment on the revised exposure drafts and submissions were received throughout March and April 2019. We are conscious that parties have not yet had an opportunity to respond to issues raised in these submissions and we address that issue later.

[24] Submissions relating to 74 exposure drafts were received throughout March and April 2019. No submissions were received in relation to the following 44 Exposure Drafts:

[25] A number of submissions on the revised exposure drafts related to minor typographical errors, formatting errors, or omissions within the drafts. These minor errors have been corrected in the following exposure drafts:

•  Aged Care Award 2010 6

•  Aircraft Cabin Crew Award 2010 7

•  Airport Employees Award 2010 8

•  Cleaning Services Award 2010 9

•  Maritime Offshore Oil and Gas Award 2010 10

•  Meat Industry Award 2010 11

•  Poultry Processing Award 2010 12

•  Textile, Clothing Footwear and Associated Industries Award 2010 13

•  Graphic Arts, Printing and Publishing Award 2010 14

•  Nurses Award 2010 15

•  Road Transport (Long Distance Operations) Award 2010 16

•  Seafood Processing Award 2010 17

•  Business Equipment Award 2010 18

•  Labour Market Assistance Award 2010 19

•  Real Estate Industry Award 2010 20

•  Higher Education Industry – General Staff Award 2010 21

•  Local Government Industry Award 2010 22

•  Pastoral Award 2010 23

•  Building and Construction General On-site Award 2010 24

•  Joinery and Building Trades Award 2010 25

•  Plumbing and Fire Sprinklers Award 2010 26

•  Mobile Crane Hiring Award 2010 27

•  Hospitality Industry (General) Award 2010 28

[26] The remaining submissions raise more complex issues. A complete list of submissions received is set out at Attachment A to this decision. As mentioned earlier, we are conscious that parties have not had an opportunity to respond to issues raised in these submissions. Any interested party who wishes to file a reply to any submission listed at Attachment A to this decision is directed to do so by no later than 4.00 pm on Friday 20 September 2019. An oral hearing will be listed for 9 October 2019.

3. Revised process for finalising exposure drafts

[27] Exposure drafts will be published one final time for comment (prior to their translation into varied modern awards). We are proposing to publish exposure drafts and draft variation determinations over the coming months in three tranches. The exposure drafts contained in each tranche are listed at Attachment B to this Statement.

[28] A series of amendments have been made to the exposure drafts that were published throughout February and March 2019. The following amendments have been applied:

•  adjustments to rates and allowances as a result of the 2018-19 Annual Wage Review decision; 29

•  the plain language ‘light touch’ restructure which includes structural changes to exposure drafts in Groups 1-3 (these structural changes have already been made to exposure drafts in Group 4);

•  changes resulting from parties submissions on exposure drafts that were published throughout February and March 2019;

•  changes resulting from any substantive claims heard by separately constituted full benches; and

•  recent common issue decisions including:

•  the decision relating to various issues referred to the plain language project issued on 20 August 2019 30 (including issues relating to hourly rates of pay schedules; terminology of rates; cross references in coverage clauses; annual weekly and hourly rates in minimum wages tables; reasonable overtime);

•  Family and Domestic Violence Leave; 31

•  Payment of Wages on termination of employment; 32

•  Standard clauses; 33

•  Substitution of public holidays. 34

[29] As requested by Ai Group in its submission of 9 May 2019 35, each revised exposure draft will be published using the tracked changes function so the changes are easily identifiable by interested parties. History notes will also be used at each updated clause, as has been done throughout the Review.

[30] In each of the three tranches a draft variation determination will also be published for each modern award. 36 Parties are directed to comment on the contents of the draft determinations in accordance with the timeline set out at [36] below. Final variation determinations will be issued following the consultation process.

[31] Specific clauses in exposure drafts that relate to any outstanding issues (including those that are the subject of substantive claims) will be quarantined and a note inserted into the relevant clause of the exposure drafts during the publication process. Any outstanding substantive claims that have not been determined when the awards are varied to reflect the contents of the final exposure drafts will be incorporated by way of a subsequent variation determination.

4. Provisional view: Tranche 1

[32] As previously mentioned, a large number of decisions have been issued as part of the 4 yearly review of modern awards. A complete list of these decisions is set out at Attachment C to this decision.

[33] It is our provisional view that the variation of the modern awards in tranche 1 in accordance with the draft variation determinations set out at Attachment D is, in respect of each of these awards, necessary to achieve the modern awards objective. In reaching that conclusion we have adopted the reasons set out in the decisions at Attachment C insofar as they are relevant to each of the awards in tranche 1 and, in particular, to the considerations in s.134(1)(a) to (h),which are addressed in each of those decisions.

[34] Interested parties are directed to comment on this provisional view in accordance with the timeline set out at [36] below.

5. Next steps

[35] The first tranche of exposure drafts will be published by close of business on Monday 2 September 2019. Interested parties will have the opportunity to comment on the contents of the exposure drafts. Submissions are to be filed by no later than 4.00 pm on 20 September 2019. Parties will then be provided an opportunity to reply to a submission filed by any other party. Submissions in reply are to be filed by no later than 4.00 pm on 2 October 2019. All submissions must be sent electronically to amod@fwc.gov.au. A Full Bench hearing will be listed to determine any issues raised in submissions if necessary. Such hearing will be listed for 11 October 2019.

[36] A similar publication process will follow for the exposure drafts listed in Tranche 2 and Tranche 3. A timeline with relevant dates is set out below:

[37] The dates in relation to tranches 2 and 3 are indicative only. We will confirm the dates in due course. There may also be some changes to the awards listed in tranche 2 and 3 depending on the determination of related proceedings. Any party who wishes to express a view about the awards listed in tranches 2 and 3 should forward any comments to chambers.ross.j@fwc.gov.au.

PRESIDENT

Printed by authority of the Commonwealth Government Printer

<PR711893>

LIST OF ATTACHMENTS

A. List of all submissions received in response to exposure drafts published February and March 2019

B. Exposure Drafts to be finalised

C. List of decisions issued as part of the 4 yearly review of modern awards

D. Draft variation determinations

ATTACHMENT A - List of all submissions received in response to exposure drafts published February and March 2019

ATTACHMENT B – TRANCHES 1-3

Note that these lists do not contain the Hair and Beauty Award, the Fast Food Award, the Social, Community Home Care and Disability Services Industry Award, the Children’s Services Award or the Aged Care Award.

The above awards will be the subject of the plain language re-drafting process.

FIRST TRANCHE OF EXPOSURE DRAFTS TO BE FINALISED

(40 exposure drafts)

SECOND TRANCHE OF EXPOSURE DRAFTS TO BE FINALISED

(43 exposure drafts)

THIRD TRANCHE OF EXPOSURE DRAFTS TO BE FINALISED

(33 exposure drafts)

ATTACHMENT C—List of decisions issued as part of the 4 yearly review of modern awards

ATTACHMENT D – draft variation determinations

Note that these lists do not contain the Hair and Beauty Award, the Fast Food Award, the Social, Community Home Care and Disability Services Industry Award, the Children’s Services Award or the Aged Care Award.

The above awards will be the subject of the plain language re-drafting process.

FIRST TRANCHE OF EXPOSURE DRAFTS TO BE FINALISED

(40 exposure drafts)

 1   [2019] FWCFB 5409.

 2   The exposure drafts for Fire Fighting and Nurses were published on 22 February 2019.

 3   The exposure drafts for Pastoral and Horticulture were published on 15 March 2019.

 4   The exposure drafts for Mannequins, Registered and Licensed Clubs, Fast Food and General Retail were not published in line with this process. The exposure draft for Live Performance was published on 5 April 2019.

 5   [2019] FWC 932.

 6   Aged Care Employers submission, 15 April 2019 at paras 8-9 regarding typographical error at clause 32.1(e).

 7   FAAA submission, 23 April 2019 at para 18 regarding typographical error at Sched B.1.2(a).

 8   AMWU submission, 5 April 2019 at para 11 regarding cross referencing error at clause 29A.6(b).

 9   United Voice submission, 13 March 2019 at p.1 regarding typographical error at example 1 in clause 23.3.

 10   CFMMEU submission, 13 March 2019 regarding typographical error at clause 7.1(c).

 11   AMIEU submission, 15 March 2019 at para 15 regarding typographical error at clause 8.3(d).

 12   ABI submission, 13 March 2019 at para 27 regarding typographical error at clause 3.2.

 13   ABI submission, 13 March 2019 at paras 50-51 regarding typographical error n Sched C.3.2 and cross referencing error in Sched F.5.8 at paras 46-49.

 14   ABI submission, 15 March 2019 at para 7 regarding typographical error at clause 24.9(j).

 15   ANMF submission, 27 March 2019 at para 2 regarding typographical error at clause 15.3(b) and (c).

 16   NatRoad submission, 4 March 2019 at paras 6, 7 14 and 15 regarding typographical and formatting errors at clauses 3.3, 6.3, 11A.1 and 11.7.

 17   AMWU submission, 13 March 2019 at para 7 regarding typographical error at 12.3(c).

 18   ABI submission, 29 March 2019 at para 9 regarding typographical error at clause 7.8.

 19   CPSU submission, 29 March 2019 at para 3 regarding formatting error at clause 8.4(b).

 20   REEF submission, 27 March 2019 and RESA submission 1 April 2019 regarding a number of formatting and typographical errors.

 21   Group of 8 Universities submission, 5 April 2019.

 22   LGA submission, 5 April 2019 at para 9-10 regarding cross referencing error at clause 23.6.

 23   ABI submission, 29 March 2019 at para 25 and NFF submission at p.1 regarding cross referencing error at clauses 6.7(b)(i) and 30.1(a).

 24   ABI submission, 12 April 2019 at para 3.1(a) regarding cross referencing error in Sched C.1.1.

 25   ABI submission, 12 April 2019 at para 4.1(a) regarding cross referencing error in Sched C.1.

 26   ABI submission, 12 April 2019 at paras 2.1-2.2 regarding cross referencing error at clause 27A.7(a) and typographical error in Sched F.1.1.

 27   ABI submission, 12 April 2019 at paras 5.1-5.2 regarding cross referencing errors at clause 27A.7(a) and in Sched C.1.

 28   AHA submission, 26 April 2019 at p.1 regarding typographical errors at clauses 6A.3 and 15.1(d).

 29   [2019] FWCFB 3500.

 30   [2019] FWCFB 5409.

 31   [2019] FWCFB 5144.

 32   [2019] FWCFB 5146 and [2019] FWCFB 5868.

 33   [2019] FWCFB 2548.

 34   [2019] FWCFB 5145.

 35   Ai Group submission, 9 May 2019 Plain Language re-drafting – light touch.

 36   Note that the Full Bench in a December 2014 decision determined to make variations to existing modern awards during the Review, rather than ‘superseding’ awards. See [2014] FWCFB 9412 at [7]–[9].