AUSTRALIAN INDUSTRIAL RELATIONS COMMISSION AWARD ... · AIRC – Award Modernisation –Stage II 8. In short, whether at the stage of producing exposure draft award awards, or in

LEADING AUSTRALIAN BUSINESS

AWARD MODERNISATION STAGE II

ACCI SUBMISSION STAGE II EXPOSURE DRAFTS

February 2009

AUSTRALIAN INDUSTRIAL RELATIONS COMMISSION

AIRC – Award Modernisation –Stage II

ACCI Submission - February 2009


TABLE OF CONTENTS

1. INTRODUCTION............................................................................... 1

2. AWARD FLEXIBILITY CLAUSE .................................................... 5

3. NES FLEXIBILITY .......................................................................... 17

4. SUPERANNUATION....................................................................... 25

5. TRAINING WAGE SCHEDULE..................................................... 33

6. SUPPORTED WAGE SCHEDULE ................................................. 35

7. OTHER MATTERS .......................................................................... 43

ACCI MEMBERS................................................................................. 53

ACCI Submission - February 2009 Page - i


ACCI Submission - February 2009 Page - ii


1. INTRODUCTION

1. This is ACCI’s submission to Stage II of the modernisation process, responding in particular to:

a. The issues raised in the 23 January 2009 statement1.

b. Issues raised by the Minister’s revised and consolidated requests of 18 December 2008.

c. Cross award and general matters (training and supported wages).

2. We have also reviewed issues arising from the 19 December 2008 decision on Stage I awards2 as appropriate.

3. Again, the respective roles of ACCI and ACCI member submissions should be clarified. ACCI members are direct participants in the modernisation of particular award groupings, whilst ACCI as their peak organisation addresses cross award, preliminary and general issues.

4. It remains for ACCI members who are engaged with the formulation, scope and content of particular matters, including the application of centrally set provisions and approaches to particular awards (for example on training wages).

REASONS FOR DECISION

5. ACCI members have been closely involved in individual industry and occupational award modernisations, and the ACCI Secretariat has been involved in various cross award considerations (such as the flexibility clause, training wage schedule, supported wage schedule etc).

6. Based on feedback from members and our analysis of approaches to date, there appears an opportunity to improve upon an element of the modernisation process, in particular as we undertake Stages III and IV.

7. The Commission, all parties and final modern awards could benefit from parties being able to better engage with the approaches being taken to particular matters and the detail of decisions in drafting and finalising award terms.

1 [2009] AIRCFB 50 2 [2008] AIRCFB 1000

ACCI Submission - February 2009 Page - 1


8. In short, whether at the stage of producing exposure draft award awards, or in “finalising” awards, more detailed reasons for decision could be provided for submitting parties to engage with.

9. Both the request documents and the legislation support the publication of detailed reasoning for both draft and finalised approaches, and for the individual decisions, discriminations, delineations and derivations which give rise to a particular form of a clause.

10. Section 576Z emphasises the role written reasons are to play in this process.

576Z Modern awards and variation orders must be published

(1) As soon as practicable after the Commission makes a modern award or an order varying a modern award, the Commission must give to a Registrar:

(a) a copy of the modern award or order; and

(b) written reasons for the modern award or order; and

11. The latest consolidation of the request contains the following:

The Commission is to publish exposure drafts of each modernised award for the purpose of further consultation and to ensure that all stakeholders and interested parties have a reasonable opportunity to comment upon the exposure drafts. In so far as practicable, the exposure drafts will be electronically published for comment.

Consultation on exposure drafts of modern awards will be open and transparent.

12. This is exactly what has occurred to date. Materials have been published and there has been extensive and open consultation; a process which the Commission and parties have put a great deal of effort into.

13. However, the benefit of this consultation and the input the Commission receives could be improved upon if there were greater indications of why particular approaches are being taken. This would in particular allow parties to make superior and more useful responses to exposure drafts.



14. We are concerned that in some areas, parties cannot sufficiently engage with the decisions and approaches being undertaken in the awards, even at the draft stage, where they cannot properly analyse the reasoning or determinations which have given rise to decisions on particular matters. Some examples might include:

a. The decision to standardise casual loadings to 25%.

b. The decision to apply a standard vehicle allowance.

c. The inclusion of the “Absence from work” sub-clause in 80% of superannuation clauses, without an identification of where such a pre-modernisation obligation may have been derived from for each award (See Section 4 for more information on this issue).

15. We are concerned that a union or employer association cannot properly respond to such matters without knowing the derivation of the approach taken. For example, the car allowance now imposed may reflect different fuel pricing, may have solely been based on costs in one state capital, may reflect car prices which have fallen. There is no way to know from the published decisions and statements what the issues are or the veracity of the approach taken, or to contest them.

16. We are concerned that the investment of time and effort into this process be met with an opportunity to provide the best possible input and responses.

17. The modern awards will be better for parties, both union and employer, being able to better engage with the Commission on the reasoning behind the terms of each award. There appears an opportunity to improve the input the Commission receives by providing a more extensive explanation of determinations and approaches, including the treatment of different arguments.

18. We ask the Commission consider current and future modernisations (at least) being undertaken on the basis of providing more fulsome decisions and reasoning for the approaches taken, which will allow (and then engage with) a superior level of input from parties.





2. AWARD FLEXIBILITY CLAUSE

19. Paragraph [6] of the Stage II Statement of 23 January 2009 is as follows:

[6] Clause 11AA of the consolidated request now provides that the Commission must ensure that a flexibility term in a modern award:

“• requires the employer to ensure that any individual flexibility arrangement must result in the employee being better off overall; …

• prohibits an individual flexibility arrangement agreed to by an employer and employee from requiring the approval or consent of another person, other than the consent of a parent or guardian where an employee is under 18.

20. Of the seven dot points in new Para 11AA of the consolidated request the Full Bench has above identified two of them as relevant or material alternations to what have been done to date (and not taken into account in the flexibility clauses in modern awards issued to date).

21. ACCI agrees that this reflects the scope of potential changes to be considered to the existing formulations of award flexibility, save for any issues which may further emerge from submissions / exposure of the issues concerned.

BETTER OFF OVERALL

22. The best target for redrafting the award flexibility clause to reflect the revised request appears is following (from the clause as included in the Stage I awards):

7.3 The agreement between the employer and the individual employee must:

(a) be confined to a variation in the application of one or more of the terms listed in 7.1; and

(b) not disadvantage the individual employee in relation to the individual employee’s terms and conditions of employment.3

7.4 For the purposes of clause 7.3(b) the agreement will be taken not to disadvantage the individual employee in relation to the individual employee’s terms and conditions of employment if:

3 Example from the Clerks—Private Sector Award 2010 (MA000002) (Exposure Draft—January 2009).



(a) the agreement does not result, on balance, in a reduction in the overall terms and conditions of employment of the individual employee under this award and any applicable agreement made under the Act, as those instruments applied as at the date the agreement commences to operate; and

(b) the agreement does not result in a reduction in the terms and conditions of employment of the individual employee under any other relevant laws of the Commonwealth or any relevant laws of a State or Territory.

23. The two new dot points of Paragraph 11AA of the consolidated request highlighted in the Stage II statement of 23 January (para [6]), do not require any significant change of architecture or approach in the model flexibility clause.

24. ACCI considers that the clause can and should operate essentially at the level of detail contained in the modified and now consolidated request, and that the formulation and operation of the clause can remain essentially generic across the award system.

25. On this basis, subclause 7.3 and 7.4 might be redrafted to read as follows:



(b) result in the employee being better off overall in relation to the individual employee’s terms and conditions of employment.

7.4 For the purposes of clause 7.3(b) the agreement will be taken to result in the employee being better off overall in relation to his or her individual terms and conditions of employment if:

(a) the agreement assists in meeting, reflects or responds to an employee request;

(b) the agreement is mutually agreed to result in the employee being better off overall in relation to the individual employee’s terms and conditions of employment;

(c) the agreement does not result, on balance, in a reduction in the overall terms and conditions of employment of the individual employee under this award and any applicable agreement made under the Act, as those instruments applied as at the date the agreement commences to operate; and



(d) the agreement does not result in a reduction in the terms and conditions of employment of the individual employee under any other relevant laws of the Commonwealth or any relevant laws of a State or Territory.

26. Subclause 7.3 addresses the requirement in dot point 3 of Paragraph 11AA of the consolidated request that the employer ensure any individual flexibility arrangement results in the employee being better off overall. It directly reflects the existing individual flexibility clause and does not require amendment in light of revisions to the request.

27. Paragraph 7.3(a) sets the context ensuring that the subject matter of the agreement is limited to terms set out in subclause 7.1.

28. Paragraph 7.3(b) sets out the requirement that the employee entering into an individual flexibility agreement must be better off overall in relation to the individual’s terms and conditions. It simply replaces the existing no disadvantage formulation with the better off overall formulation.

29. Subclause 7.4 sets out the conditions under which the terms of subclause 7.3(b) will be met, just as it did prior to the consolidated request.

30. There are two avenues to the use of the flexibility clause:

a. Where the employee seeks the flexibility (proposed 7.4(a)).

b. Where the flexibility otherwise arises, including where proposed by the employer (proposed 7.4(b), which also applies to employee requests).

31. Paragraph 7.4(a) caters for an agreement in response to an employee request. Such a request may include a number of matters not all of which are able to be accommodated by the employer.

32. Paragraph 7.4(b) caters for an agreement between the employee and the employer over the terms of the agreement subject to the employee being better off overall in relation to the individual’s terms and conditions of employment.



33. It effectively ensures that the employee believes they are benefitting from the arrangement above and beyond the ordinary operation of the award. This is important for ensuring that the better off overall test can be operationalised and that non-monetary benefits can be taken into account (such as delivering capacity to manage working and family life).

34. Importantly an indication by the employee that they believe the agreement benefits them does not mean that the employer does not need to meet financial obligations – as is made clear by 7.4(c) which retains the existing protection to ensure that where it comes to money – the employee is no worse off.

35. In toto, Paragraph 7.4 provides for a request for a non-monetary benefit with the protection of the employee being no worse off (and the better off component coming from the gain for their personal or family life). An example illustrates this point:

a. An employee’s request seeks an alteration to her contracted ordinary hours.

b. Her contracted ordinary hours are from 9am – 5pm.

c. The award under which she is employed requires payment of a penalty for ordinary hours worked prior to 9am.

d. She seeks to vary her ordinary hours to 7am-3pm to collect children from school. Her employer is agreeable to the request on the basis that there is no additional cost to the employer and the employee agrees she will continue to receive the same wages for the same number of hours worked without payment of penalties.

e. Under the agreement made the employee is better off overall because she has obtained the arrangement that she wants through a non-monetary benefit while still receiving the same monetary payment she has been receiving while working from 9am-5pm.



f. She is better off under 7.4(b) because she makes her own judgment about her family priorities and the benefits of such a change of hours, and she is protected by 7.4(c) and (d) from any cut in her pay from her preceding pattern of hours.

THIRD PARTY APPROVAL OR CONSENT

36. The second relevant revision in the consolidated request is

[6] Clause 11AA of the consolidated request now provides that the Commission must ensure that a flexibility term in a modern award:

• prohibits an individual flexibility arrangement agreed to by an employer and employee from requiring the approval or consent of another person, other than the consent of a parent or guardian where an employee is under 18.

37. This could be implemented by the following addition to the terms of the standard award flexibility clause.

38. Using the Clerks—Private Sector Award 20104 example, after subclause 7.5, insert a new subclause 7.6 as follows:

7.6 An individual flexibility arrangement agreed to by an employer and employee does not require the approval or consent of any other person, other than the consent of a parent or guardian where an employee is under 18 (see 7.5(a)).

39. Again, closely following the wording of the Minister’s revised request to the extent possible seems the simplest and most logical approach to revising the overall clause.

INTERACTION OF INDIVIDUAL FLEXIBILITY AND PRE-MOD FACILITATION

40. In the Full Bench’s Statement ([2008] AIRCFB 1000), it was said in relation to award flexibility:

[35] A number of interested parties asked us to modify the operation of the model award flexibility clause. The ACTU and a number of unions drew our attention to the potential conflict between the model award flexibility provision which we published in our decision of 20 June 2008 7 and provisions for majority facilitation which are contained in a number of existing awards. In particular it was suggested that the model clause could undermine the operation of provisions which permit certain award provisions to be altered by agreement with the majority of employees. It was submitted that if an employer was unsuccessful in obtaining the agreement of the majority of the

4 As issued to date.



employees, agreement could be pursued and obtained on an individual basis under the award flexibility clause.

[36] We do not think it is appropriate that we review our decision at this early stage. Similar arguments were advanced in the proceedings leading to the publication of the model clause on 20 June 2008. In our decision of that date we said, in dealing with some similar questions:

“[164] We deal first with some issues concerning the nature of agreements to be permitted by the model clause and some questions concerning collective arrangements. It is evident from the terms of cll. 10 and 11 of the request, which we have set out above, that the clause should provide for agreements between an employer and an individual employee. It is not intended that the clause should deal with collective agreements such as those with a majority of employees. The use of terms such as “individual employee” and “individual needs” and “the individual employee” leave no room for doubt on the issue. For this reason the model clause should not provide for agreements between an employer and a majority of employees. Nor should the ability of an employer and an individual employee to make an agreement under the clause be in any way conditional on an agreement with a majority of employees in the area concerned.”

[37] While the notion of an individual flexibility agreement might conflict with a provision for majority agreement in some circumstances, it would be contrary to our understanding of the requirement for individual flexibility that majority approval should be given precedence over individual agreement. To remove any doubt on the issue, it is our view that the operation of the individual flexibility provision should not be subject in any way to a requirement for majority agreement.

41. Given the apparent indication that majority clauses are not intended to override individual flexibility arrangements, ACCI notes that some priority awards and Stage 2 exposure draft awards contain a mix of individual and majority “facilitation” clauses, which may be confusing.5

42. For example, Part 2 of the Manufacturing and Associated Industries and Occupations Award 2010 states:

8. Facilitative provisions 8.1 Agreement to vary award provisions (a) This award also contains facilitative provisions which allow agreement between an employer and employees on how specific award provisions are to apply at the workplace or section or sections of it. The facilitative provisions are identified in clauses 8.2, 8.3 and 8.4.

5 Clause 8 of the Graphic Arts, Printing, Publishing and Associated Industries and Occupations Award 2010 exposure draft; Clause 8 of the Textile, Clothing, Footwear and Associated Industries Award 2010 (MA000017).



(b) The specific award provisions establish both the standard award condition and the framework within which agreement can be reached as to how the particular provisions should be applied in practice. Facilitative provisions are not to be used as a device to avoid award obligations nor should they result in unfairness to an employee or employees covered by this award. 8.2 Facilitation by individual agreement (a) The following facilitative provisions can be utilised by agreement between an employer and an individual employee: Clause number Provision 13.2 Minimum engagement for part-time employees 13.4 Variation to hours of part-time employment 14.2 Minimum engagement for casuals 24.1(g) Annualised salary arrangement 32.1(c)(iii) Tool allowance 36.7 Make-up time 38.5 Meal break 40.1(d) Time off in lieu of payment for overtime 40.4 Rest period after overtime 40.10 Rest break

(b) The agreement reached must be kept by the employer as a time and wages record.

8.3 Facilitation by majority or individual agreement (a) The following facilitative provisions can be utilised by agreement between the employer and the majority of employees in the workplace or a section or sections of it, or the employer and an individual employee:

Clause number Provision 14.4(j) Period for casual election to convert 34.1(b) Payment of wages 36.2(b) Ordinary hours of work for day workers on

weekends 36.2(c) Variation to the spread of hours for day workers 36.5(a) Methods of arranging ordinary working hours 37.2 Variation to the spread of hours for shiftworkers 38.1(b) Working in excess of five hours without a meal

break 44.3 Substitution of public holidays

(b) Where agreement is reached between the employer and the majority of employees in the workplace or a section or sections of it to implement a facilitative provision in clause 8.3(a), the employer must not implement that agreement unless:



(i) agreement is also reached between the employer and each individual employee to be covered by the facilitative provision; and (ii) the agreement reached is kept by the employer as a time and wages record. (c) Where no agreement has been sought by the employer with the majority of employees in accordance with clause 8.3(b), the employer may reach agreement with individual employees in the workplace or a section or sections of it and such agreement binds the individual employee provided the agreement reached is kept by the employer as a time and wages record and provided the agreement is only with an individual employee or a number of individual employees less than the majority in the workplace or a section or sections of it.

8.4 Facilitation by majority agreement (a) The following facilitative provisions may only be utilised by agreement between the employer and the majority of employees in the workplace or a section or sections of it: Clause number Provision 36.3(c) Ordinary hours of work, continuous

shiftworkers 36.4(b) Ordinary hours of work, non-continuous

shiftworkers 36.5(c) 12 hour shifts 37.5(d) Public holiday shifts 41.2 Conversion of annual leave to hourly

entitlement 41.8(g) Annual close down (c) Additional safeguard (i) An additional safeguard applies to:

Payment of wages Ordinary hours of work, continuous shift workers Ordinary hours of work, non-continuous shift workers.

(ii) The additional safeguard requires that the unions which have members employed at an enterprise covered by this award must be informed by the employer of the intention to use the facilitative provision and be given a reasonable opportunity to participate in the negotiations regarding its use. Union involvement in this process does not mean that the consent of the union is required prior to the introduction of agreed facilitative arrangements at the enterprise. 8.5 Majority vote at the initiation of the employer A vote of employees in the workplace or a section or sections of it which is taken in accordance with clauses 8.3(a) and 8.4 to determine if there is majority employee support for the implementation of a facilitative provision, is of no effect unless taken with the agreement of the employer.



43. Question: How do the above clauses, particular 8.4 (majority facilitation clause only) work in relation to individual flexibility arrangements (IFAs)?

44. It is not clear that an employer would be able to enter into an IFA which would override a majority determination or indeed, how it would interact with individual facilitation determinations in clause 8.

45. ACCI’s understanding is that the five terms an employer and employee can agree to vary the application of under the first sub-clause of the award flexibility clause, are generally open to agreed flexibility under the IFA clause. Thus, matters such as “arrangements for when work is performed” or “overtime rates” can be agreed flexibly under the generic Individual Flexibility Clause.

46. What then is an employer or employee to make of another clause of the award which apparently restricts agreed flexibility to majority agreement on precisely the same matters?

47. If it is intended for IFA’s to override majority flexibility/facilitative clauses in modern awards (which ACCI submits should be the case), then any facilitation clauses should have a provision that expressly states, for the avoidance of doubt, that the IFA will override a majority facilitation clause.

HOW TO PROCEED

48. As the decision indicates, the terms of the revised request were not able to be taken into account in formulating the award flexibility clause formulated to date (that included in the Stage I or Stage II drafts).

49. The next step in this process should therefore be the issuing of a revised model Award Flexibility term in the terms outlined above, and its inclusion in both Stage I and Stage II award drafts.

50. This is such a consolidation based on the Clerical Award draft issued on 23 January 2009, reflecting the preceding proposals:



7. Award flexibility

7.1 Notwithstanding any other provision of this award, an employer and an individual employee may agree to vary the application of certain terms of this award to meet the genuine individual needs of the employer and the individual employee. The terms the employer and the individual employee may agree to vary the application of are those concerning:

(a) arrangements for when work is performed;

(b) overtime rates;

(c) penalty rates;

(d) allowances; and

(e) leave loading.

7.2 The employer and the individual employee must have genuinely made the agreement without coercion or duress.



(b) result in the employee being better off overall in relation to the individual employee’s terms and conditions of employment.

7.4 For the purposes of clause 7.3(b) the agreement will be taken to result in the employee being better off overall in relation to his or her individual terms and conditions of employment if:

(a) the agreement assists in meeting, reflects or responds to an employee request; or

(b) the agreement is mutually agreed to result in the employee being better off overall in relation to the individual employee’s terms and conditions of employment; and

(c) the agreement does not result, on balance, in a reduction in the overall terms and conditions of employment of the individual employee under this award and any applicable agreement made under the Act, as those instruments applied as at the date the agreement commences to operate; and

(d) the agreement does not result in a reduction in the terms and conditions of employment of the individual employee under any other relevant laws of the Commonwealth or any relevant laws of a State or Territory.



7.5 The agreement between the employer and the individual employee must also:

(a) be in writing, name the parties to the agreement and be signed by the employer and the individual employee and, if the employee is under 18 years of age, the employee’s parent or guardian;

(b) state each term of this award that the employer and the individual employee have agreed to vary; (c) detail how the application of each term has been varied by agreement between the employer and the individual employee; (d) detail how the agreement does not disadvantage the individual employee in relation to the individual employee’s terms and conditions of employment; and (e) state the date the agreement commences to operate.

7.6 An individual flexibility arrangement agreed to by an employer and employee does not require the approval or consent of any other person, other than the consent of a parent or guardian where an employee is under 18 (see 7.5(a)).

7.7 The employer must give the individual employee a copy of the agreement and keep the agreement as a time and wages record.

7.8 An employer seeking to enter into an agreement must provide a written proposal to the employee. Where the employee’s understanding of written English is limited the employer must take measures, including translation into an appropriate language, to ensure the employee understands the proposal.

7.9 The agreement may be terminated:

(a) by the employer or the individual employee giving four weeks’ notice of termination, in writing, to the other party and the agreement ceasing to operate at the end of the notice period; or

(b) at any time, by written agreement between the employer and the individual employee.

7.10 The right to make an agreement pursuant to this clause is in addition to, and is not intended to otherwise affect, any provision for an agreement between an employer and an individual employee contained in any other term of this award.





3. NES FLEXIBILITY

ACCI POSITION

51. ACCI maintains our previously stated position that a fulsome and comprehensive range of NES flexibilities needs to be available under each modern award, in the ordinary operation of the award system (i.e. accessible without a requirement for a registered collective agreement).

52. The NES and request envisage flexible application of the NES for a reason, and the Minister has in employers’ view taken into account the range of possible employment across award and non-award areas.

53. ACCI can see no reason for modern awards to deny the flexible application of the NES which Parliament has endorsed as properly accessible to employees (by agreement and free from duress)6. We are reinforced in this view by the most recent variations to the Minister’s request.

54. Further we remain concerned that unless an award includes options for the flexible application of the NES, it will not be possible to enter into an agreement delivering such flexibility – even where quite legitimate and explicitly possible under the NES in the statute.

55. This will be overcome by ensuring each of the NES flexibilities is available under each modern award, and is able to operate by agreement at the workplace level.

REVISED REQUEST

56. At paragraph [8] of the 23 January 2009 statement, the Full Bench identifies changes to the NES flexibility arrangements under the Minister’s most recent variations to her modernisation request.

57. We have compared the latest consolidation (18 December 2008) to the preceding one (June 2008) in detail and can provide the following input to the revision of draft awards as envisaged in the most recent statement.

6 Or will have done so by the time this process completes.



58. Whilst employers do not necessarily agree with all the revisions to the request, this is not the forum to raise any concerns and we have not engaged with arguments against the terms of the revised request.

59. The balance of this section responds to changes in the wording of specific matters in Paragraph 33 of the consolidated request (i.e. each of the dot points):

Trainee and apprentice loadings

Previous Request (June 2008) December 2008 Consolidation

• provision for loadings to be paid to school-based trainees and school-based apprentices in lieu of certain entitlements

• provide for loadings to be paid to school-based trainees and school-based apprentices in lieu of certain entitlements;

60. Unchanged. No change appears to be required based on the consolidated request.

Hours Averaging


• averaging of hours of work; • enable the averaging of hours of work over a specified period;

61. ACCI understands that the draft awards which provided for averaging also specified a period for averaging.

62. In light of this revision, the Full Bench should give additional and fresh consideration to including options for agreed averaging in all modern awards.

63. The latest consolidation strengthens ACCI’s position that there should be generic and universal access to NES flexibility. The notion of setting a specified period for averaging arguably provides greater security for such arrangements, and should give additional confidence for the inclusion of hours averaging options in more (if not all) modern awards.

64. The use of the word “enable” is also quite deliberate in our view. It should require awards to enable averaging, i.e. allowing agreed hours averaging under the ordinary operation of the award.



Annual Leave - Cashing Out


• cashing out of paid annual leave, provided that modem awards contain a prohibition on undue influence or undue pressure and require payment of cashed out leave at full value

• provide for the cashing out of paid annual leave by an employee, provided that such terms require: - the retention of a minimum

balance of 4 weeks’ leave after the leave is cashed out;

- the cashing out of each amount be by separate agreement in writing; and

- payment of cashed out leave be at least the full amount that would have been payable to the employee had the employee taken the leave that the employee has forgone;

65. All awards should include options to cash out annual leave consistent with the updated caveats and conditions in the December 2008 consolidated request. Considerations in support of this include:

a. It is the employee that cashes out the leave, free from coercion, duress or influence.

b. There must be 4 weeks remaining in the bank (an entire 12 months worth of leave). This protects employees from themselves and from any undue cashing out.

66. Again, the revisions to the request strengthen the case for providing generic and universal NES flexibility.

Annual Leave – Direction to Take Leave


• the taking of paid annual leave; • particular circumstances in which an

employee may be required to take paid annual leave averaging of hours of work;

• require employees, or allow employees to be required, to take paid annual leave, but only if the requirement is reasonable;

• otherwise deal with the taking of paid annual leave;

67. ACCI members will address the Full Bench on any revisions to specific awards which may be required or considered based on this revision.



68. However, again there is no reason why all awards should not contain provisions for directing employees to take leave. The addition of the reasonableness requirement should bolster the AIRC in adding such a capacity to all awards. It would also be open to the AIRC to interpret the word “reasonable” and construct a generic clause to apply where there is not an existing award formulation of such a provision.

69. ACCI also fails to see an industry basis for precluding directions to take leave at a certain point. Excessive leave balances remain a concern in all industries, and one (but not the sole) measure to address this is directing the employee to take excessive leave.

70. It is interesting to note that the ACCI network has recently supported the No Leave No Life Campaign to encourage the use of excessively accrued leave balances.

Personal Leave – Cashing Out


• cashing out of paid personal/carer's leave - provided that modem awards contain a prohibition on undue influence or undue pressure and require payment of cashed out leave at full value;

• provide for the cashing out of paid personal/carer’s leave, provided that such terms require:

- the retention of a minimum balance of 15 days’ leave after the leave is cashed out;

- the cashing out of each particular amount be by separate agreement in writing; and

- the payment of cashed out leave be at least at the full amount that would have been payable to the employee had the employee taken the leave that the employee has forgone;

71. Cashing out personal leave is never going to be a common phenomenon. It will only be used where an employee has an excessive balance and wants money or where the employer wants to control liabilities and encourage attendance rather than absenteeism. When this was more open ended under earlier iterations of agreement making it didn’t take off or become a common approach.



72. Again, the additional rules around this concept in the December 2008 revisions to the modernisation request should give the AIRC more confidence to include a provision on cashing out in all awards. There is a protection of 1½ years accrual / three weeks entitlement (15 days leave) which offers sufficient assumed protection of employee’s interests.

Personal Leave – Evidence


• the kind of evidence required to be provided by an employee when taking paid personal/carer's leave, unpaid carer's leave or compassionate leave:

• relate to the kind of evidence required to be provided by an employee when taking paid personal/carer’s leave, unpaid carer’s leave or compassionate leave;

73. This is an issue for particular awards. ACCI can see little difference between the two formulations.

Public Holiday – Substitution


• substitution of public holidays: • provide for the substitution of public holidays by agreement between an employer and employee;

74. There should be scope for substitution of holidays by agreement under all awards. Employee preferences do not line up neatly with their award coverage and ACCI can see no reason to deny flexibility to interested employees (perhaps with a particular religious observance which differs from the model in awards) purely as an accident of their award coverage.

Notice of Termination – Employee Notice


• the amount of notice an employee may be required to provide when terminating their employment:

• specify the period of notice an employee may be required to give when terminating their employment;

75. No change appears to be required based on the consolidated request.



ADDITIONAL CONFIDENCE FROM THE FAIR WORK ACT

76. We are reinforced in our position by returning to a question from Lawler VP during the course of proceedings:

VICE PRESIDENT LAWLER: Ms Gray, if the government moves in the legislation, that's a big if, to introduce protections against any sort of duress in relation to cashing out, doesn't it become in reality a benefit to employees, unless one takes a paternalistic view that employees can't make their own judgements about what is best for themselves about the amount of leave they need to take?7

77. The government has moved precisely as foreshadowed by the Vice President.

78. The following is defined as a ‘process or proceedings under a workplace law or workplace instrument’ for the purposes of the General Protections under Part 3-1 of the Fair Work Bill 2008 (clause 341(2)):

(h) agreeing to cash out paid annual leave or paid personal/carer’s leave;

79. This provides precisely additional protection from adverse action or coercion that may have been of concern. Its addition to the system should give the Commission additional confidence that options for cashing out can be added to all modern awards as a standard avenue for agreement between employers and employees.

80. Furthermore, it is material that the latest revisions to the request occurred after both the introduction of the Fair Work Bill 2008, and the Vice President’s question.

81. Being aware of the issue, the government has not only expressly provided the protection for employees upon which a general entitlement would rest, but it has then deliberately amended its request supporting the inclusion of NES flexibilities in awards.

BOTTOM LINE

82. The revisions to the Ministerial request place more controls and conditions on NES flexibility, but do so within a general paradigm of legitimising and accepting the role of NES flexibility.

7 [PN670] 21 October 2008, Sydney



83. The Full Bench can have more confidence in including NES flexibility more comprehensively in more awards based on the revised instructions.

84. This should not be a derivative process in which NES flexibility is only offered where it was included in pre-modernisation awards. The NES are new standards, and it is quite appropriate (and indeed required under the requests) that flexibility be considered and delivered within appropriate boundaries in the operation of these standards.

85. Offering NES flexibility solely where it was included in pre-modernisation awards would ignore the entirely new coverage and formulation of the NES.

86. Paragraph 33 of the request should be treated as a checklist of flexibilities that each award should deliver. The Full Bench should use the December iteration of paragraph 33 as a list of NES flexibilities it will ensure each and every modern award will contain.

MEMBER SUBMISSIONS

87. Again, for particular awards, this need be read in conjunction with detailed input from ACCI members, including in particular where there are issues or considerations arising from industry work patterns or particular award formulations.





4. SUPERANNUATION

88. ACCI and a number of other submitting parties have raised a number of issues regarding the superannuation provisions of modern awards. The 19 December 2008 decision contained a number of changes and clarifications following these arguments8.

89. An issue which ACCI wishes to raise at this juncture is the following from the December decision:

[92] The superannuation provision in some of the exposure drafts included an additional paragraph dealing with superannuation contributions during periods of paid leave or while an employee was absent from work due to injury or work-related illness. It is not our intention that the additional paragraph should be part of the standard clause. It may be appropriate, however, where it is necessary to maintain the pre-existing safety net.

90. We have reviewed the superannuation provisions of the Stage I awards issued in December against this paragraph. This indicates the following:

1. Clerks—Private Sector Award 2010 Super on paid leave Super on workers compensation

2. Fast Food Industry Award 2010 Super on paid leave Super on workers compensation

3. General Retail Industry Award 2010 Super on paid leave Super on workers compensation

4. Hair and Beauty Industry Award 2010 Super on paid leave Super on workers compensation

5. Higher Education Industry—Academic Staff—Award 2010

Super on paid leave Super on workers compensation

6. Higher Education Industry—General Staff—Award 2010


7. Hospitality Industry (General) Award 2010 Super on paid leave Super on workers compensation

8 [2008] AIRCFB 1000, from [89]



8. Manufacturing and Associated Industries and Occupations Award 2010


9. Pharmacy Industry Award 2010 Super on paid leave Super on workers compensation

10. Security Services Industry Award 2010 Super on paid leave Super on workers compensation

11. Textile, Clothing, Footwear and Associated Industries Award 2010


12. Horse and Greyhound Training Award 2010 Super clause but no mention of paid leave or workers comp.

13. Racing Clubs Events Award 2010 Super clause but no mention of paid leave or workers comp.

14. Racing Industry Ground Maintenance Award 2010 Super clause but no mention of paid leave or workers comp.

15. Black Coal Mining Industry Award 2010 No super clause

16. Mining Industry Award 2010 No super clause

17. Rail Industry Award 2010 No super clause

91. Basically:

a. 14 of 17 modern awards issued to date contain superannuation clauses.

b. Of the 14 awards containing superannuation, 11 contain the “absence from work” subclause which applies superannuation to all forms of paid leave and to workers’ compensation payments.

c. The only awards which address superannuation but don’t apply the obligation in regard to all paid leave and workers compensation are the three from the racing industry (broadly defined).

92. 11 of the 14 modern awards addressing superannuation contain the following subclause, which addresses the issue at [92] of the December 2008 decision.



20.5 Absence from work

Subject to the governing rules of the relevant superannuation fund, the employer must also make the superannuation contributions provided for in clause 20.2 and pay the amount authorised under clauses 20.3(a) or (b):

(a) Paid leave—while the employee is on any paid leave;

(b) Work-related injury or illness—for the period of absence from work (subject to a maximum of 52 weeks) of the employee due to work-related injury or work-related illness provided that:

(i) the employee is receiving workers compensation payments or is receiving regular payments directly from the employer in accordance with the statutory requirements; and

(ii) the employee remains employed by the employer.

93. Consider again the December decision:

[92] The superannuation provision in some of the exposure drafts included an additional paragraph dealing with superannuation contributions during periods of paid leave or while an employee was absent from work due to injury or work-related illness. It is not our intention that the additional paragraph should be part of the standard clause. It may be appropriate, however, where it is necessary to maintain the pre-existing safety net.

94. “It is not our intention that the additional paragraph should be part of the standard clause.”

a. 11 of 14 the awards issued (78%) contain the additional wording on ‘Absence From Work’.

b. It is not therefore exceptional or targeted as intended in the December 2008 decision, but has directly at odds with the stated decision, become a typical or assumed part of the standard clause.

c. The stated decision has not correctly translated into the text of the modern awards. It should be, and the superannuation clauses need to be amended as set out below.

95. “It may be appropriate, however, where it is necessary to maintain the pre-existing safety net”.

a. 11 of 14 awards issued (78%) contain the clause on ‘Absence From Work’.

b. There is no stated decision or indication on basis for any conclusion that this additional wording is “necessary to maintain the pre-existing



safety net”. The pre-existing safety net is not identified in any way ACCI is aware of in relation to the Stage I or Stage II awards.

c. Employers are unable to determine which awards or NAPSAs or state laws have given rise to a conclusion that there was a pre-existing safety net entitlement to superannuation on all paid leave and workers compensation.

d. If there is no such an identification, then there cannot be such a provision, as it would exceed the stated intentions of the Commission to solely retain pre-modernisation entitlements and do no more than that.

CURRENT SUPERANNUATION LAW 96. The extension of superannuation contributions to “any paid leave” and

“workers compensation” in the standard sub-clause wording is clearly at odds in our view with how both award and statutory superannuation presently works.

97. The current SGA ruling9 indicates that “workers compensation payments, including top up payments, paid by the employer, where no work is performed” are not salary and wages for the purpose of the SGA (and therefore are not superannuable). They are said to be payments in relation to employment not the ordinary outs of work.

98. It also indicates that “payments when on maternity or paternity leave” are “payments in respect of employment and parenthood, not in respect of ordinary hours of work”. Therefore such payments are not subject to superannuation.

99. Thus, we consider the sub-clause in the drafts to date cannot be the current law, or consistent with the 19 December 2008 decision. It could only have ongoing legitimacy where there was (and to the extent that) there was an express decision or obligation which deliberately differed from the SGA.

9 SGA 94/4 Attachment A – Checklist of salary and wages and OTE.



Parental Leave

100. Further support for this perspective is provided by considering the application of superannuation to paid parental leave (a form of paid leave). There is currently a draft approach from the Productivity Commission which would see employers pay superannuation on periods of paid parental leave (otherwise funded by government).

101. This issue is not determined, with neither the PC having finally reported nor the government responding to any final package of recommendations. It would be prejudicial to this process, and finalisation of a major national policy issue, for modern awards to apply superannuation obligations to all forms of paid leave.

The “Maintenance” Argument

102. Consider again:

a. The December decision: “It is not our intention that the additional paragraph should be part of the standard clause. It may be appropriate, however, where it is necessary to maintain the pre-existing safety net”.

b. The proposed subclause: “the employer must also make the superannuation contributions provided…:

(a) Paid leave—while the employee is on any paid leave;”

103. Logically then, a subclause demanding the payment of superannuation for any period of paid leave could only be applied “where it is necessary to maintain the pre-existing safety net”. This means that such an expansive obligation would only legitimately be in modern awards where the preceding awards applied an equally wide obligation to pay superannuation on all forms of paid leave.

a. ACCI was not aware of many, if any awards explicitly demanding payment “while the employee is on any paid leave”. This is not how the SGA works, and any awards which applied in these terms would have differed from the SGA.

b. ACCI is certainly not aware of 80% of pre-modernisation awards containing such clauses, such that 80% of modern awards would be in these terms.



THE WAY FORWARD

104. The December 2008 decision states in regard to the application of superannuation to paid leave and workers compensation that “It may be appropriate, however, where it is necessary to maintain the pre-existing safety net.”.

105. This dictates not a general or at large clause (as has been included in almost all of the draft awards at this stage), but one which is genuinely transitional or maintains obligations where they exist, but only to the extent they exist. It demands both a properly award by award approach, or a generic clause (where it is to be inserted in awards) which has effect only where the preceding obligation existed.

106. There are clear options to achieve this.

a. The first option is that where there is no pre-existing award provision, there be no absence from work subclause in modern award superannuation provisions. This is clearly being applied in some areas of Stage II modernisation with 7/25 awards omitting the additional subclause in the wake of the December 2008 decision (see below).

b. Where there is some pre-existing entitlement (and this should be a proper finding, expressly identified to parties in a decision or statement), the key option is to re-draft the clause to ensure it operates to genuinely, and solely maintain entitlements rather than extend them. This could be achieved as follows:

20.5 Absence from work

Subject to the governing rules of the relevant superannuation fund, the employer must also make the superannuation contributions provided for in clause 20.2 and pay the amount authorised under clauses 20.3(a) or (b):

(a) Paid leave—while the employee is on any paid leave;

(b) Work-related injury or illness—for the period of absence from work (subject to a maximum of 52 weeks) of the employee due to work-related injury or work-related illness provided that:

(i) the employee is receiving workers compensation payments or is receiving regular payments directly from the employer in accordance with the statutory requirements; and

(ii) the employee remains employed by the employer.



Provided that the obligations under subclause 20.5 only apply to the extent that there would have been an obligation to make such superannuation contributions under an award governing the employer in relation to the employment and workplace concerned, directly prior to 31 December 2009.

107. ACCI understands that comparable wording has been included in 2 of the 25 Stage II exposure draft awards addressing superannuation. The Health Professionals and Support Services Industry and Occupational Award 2010 contains the following:

NOTE: Clause 22.5 will only apply if there was a pre-existing award provision to this effect.

108. (We consider the more fulsome paragraph we have proposed above to be clearer than the simplified two line note in the Health Professionals award. However, some clarification to this effect is required in all modern awards that contain a superannuation clause purporting to apply to paid leave and workers compensation absences).

109. If the shorthand note from the Stage II health awards is included in all awards containing the “Absence from Work” superannuation sub-clause, there will need to be clarification of its intended effect in any covering decision or statement.

110. We request that:

a. The Commission give consideration to amending awards from all stages in the terms we set out above – omitting the absence from work subclause where there is no pre-existing entitlement, and only applying such obligations to the extent they were operative pre-modernisation without any extension.

b. This will mean reviewing those Stage I and II awards issued to date with the ‘Absence from Work’ sub-clause to check it is validly included in awards consistent with the December 2008 decision.

c. Any modern award that is to validly contain a superannuation provision containing the ‘Absence from Work’ sub-clause (including Stage I awards), be amended to contain a suitable qualification to give proper effect to [92] of the December 2008 decision.



STAGE II EXPOSURE DRAFT AWARDS

111. There are 26 Stage II Exposure Draft Awards, 25 of which contain superannuation clauses.

112. Of the 25 drafts:

a. 16 (64%) contain the apparently standard ‘absence from work’ subclause, unmodified and unqualified (the situation we say should not occur).

b. 7 (28%) do not contain the additional ‘absence from work’ subclause, apparently properly following the terms of the December 2008 decision.

c. 2 (8%) awards (both from the health sector) contain a qualification and clarification akin to, but not as clear as, the proposed by ACCI.

113. We ask that the 16 draft awards which do contain the standard superannuation sub-clause on “Absence from Work” be reviewed against the Full Bench’s stated criteria. Unless there is a proven pre-existing obligation, the sub-clause should be deleted from the Stage II awards as they are finalised.

114. Where there is some pre-existing obligation, and the award is to contain an Absence From Work sub-clause, then there should be a suitable qualification to ensure the proper effect in relation to paid leave and workers compensation. Again the approach proposed is the additional of the following wording:

Provided that the obligations under subclause 20.5 only apply to the extent that there would have been an obligation to make such superannuation contributions under an award governing the employer in relation to the employment and workplace concerned, directly prior to 31 December 2009.



5. TRAINING WAGE SCHEDULE

115. ACCI intends to address the proposed draft National Training Wage Schedule in a short additional written submission, to be lodged within 7 days.

School-Based Apprentices

116. ACCI supports school-based apprenticeship provisions being included in all modern awards. This is an essential element in the continued growth and encouragement of training at secondary school level. ACCI understands that such measures are supported by all peak parties and federal, State and Territory Governments.

117. ACCI has briefly examined the exposure draft schedule for School Based Apprentices (SBA) and will allow individual members provide the Full Bench with specific input in relation to the draft SBA Schedule and its inclusion in specific awards.

118. Subject to ACCI or members’ specific further feedback, the draft SBA schedule appears to be the standard model clause endorsed by the AIRC in 2000.

119. The essential feature of the model clause is that it “deems” 25% of the time to be in off-the job training.

120. ACCI will allow members to provide specific comment on the contemporary relevance of this clause.

121. One source of feedback may concern the requirement for employers to pay 125% for each hour of work on the job, regardless of the time spent in off-the-job training, as this may disproportionately affect various awards depending on the training arrangements and industry.





6. SUPPORTED WAGE SCHEDULE

INTRODUCTION

122. ACCI has for many years successfully negotiated consent positions with the ACTU on Supported Wage System (SWS) arrangements for those persons with a disability whose productive capacities are reduced.

123. This consent approach has encompassed the creation of the standard award clause, its evolution within awards, passage into and back out embodiment as a pay scale, right through to negotiations on its reformulation as a simplified schedule to modern awards.

124. Most recently ACCI and the ACTU have been able to agree an approach to the modernisation of the existing SWS standard clause for inclusion in modern awards, in responding to an initial proposal from the Commonwealth in its submissions.

125. The jointly agreed approach is reflected in the bulk of the Exposure Draft SWS Schedule issued on 23 January 2009. However:

a. The Exposure Draft does not fully reflect the position agreed between ACCI and the ACTU, and contains a material and non agreed change the long standing status quo which would negatively effect employers, employees and trade unions.

b. This is opposed by ACCI (and we understand the ACTU), departs from the long standing consensus approach to this area and should be reversed in favour of the agreed wording (see below).

c. Some additional issues have come to ACCI’s attention subsequent to discussions with the ACTU and the Commonwealth which should also be considered.

LODGEMENT OF THE SWS WAGE INSTRUMENT

Introduction

126. ACCI is very concerned about changes to the approach developed between employers and unions, in consultation with the Commonwealth, as it appears in the draft SWS schedule.



127. This is illustrated by the following, which has been spilt up to allow propositions to be compared between (a) the status quo, (b) the position agreed between the ACTU and ACCI, and (c) the exposure draft schedule issued by the AIRC:

Current Award Clause10

ACTU-ACCI Proposal AIRC Draft Schedule

15.6.5(b) All assessment instruments shall be agreed and signed by the parties to the assessment,

provided that where a union which is party to the award, is not a party to the assessment,

it shall be referred by the Registrar to the Union by certified mail

and shall take effect unless an objection is notified to the Registrar within ten working days.

All SWS wage assessment agreements must be agreed and signed by the employee and employer parties to the assessment,

provided that where a union which has an interest in the award, is not a party to the assessment,

it will be referred by Fair Work Australia to the union by certified mail

and will take effect unless an objection is notified to Fair Work Australia within ten working days.

6.2 All SWS wage assessment agreements must be agreed and signed by the employee and employer parties to the assessment,

provided that where a union which has an interest in the award is not a party to the assessment,

the employer must refer the agreement to the union by certified mail

and the agreement will take effect unless an objection is notified to the Commission within 10 working days.

Employer Concerns

128. Since the creation of the SWS in 1994, there has been an acceptance that where an assessment is being made without a union party, the union will be notified and may object.

129. This is not the type of obligation which ACCI would generally agree to in other areas, and indeed employers regularly object to any assumed or automatic role for trade unions or any notification to unions of a non-union process. The standing clause reflects the unique nature of the SWS and unique considerations for facilitating employment for persons with a disability.

10 From the Hospitality Industry Award.



130. Since 1994 there has equally been a clear process for achieving this, with the Registry notifying union parties to awards of any non-union SWS assessments. ACCI understands that this has worked well, and its operation has been supported by unions and employers.

Under Modern Awards

131. The award modernisation process does demand some change to the status quo of this clause (the left column above). Awards will no longer have union parties – and the SWS clause will need to be changed to reflect.

132. This led to the alternative proposition contained in the middle column (above) which makes use of the concept of the proposed interest lists FWA is to maintain as outlined in the following from the 20 June 2008 decision:

[22] In our view there is no point embarking on an exercise to identify the organisations which should be covered by each modern award, and to what extent, when, for the reasons we have given, nothing appears to turn on the outcome. It is also relevant to observe that under the award system which operated prior to the Work Choices amendments the identification of parties bound was necessary because of the requirement for an antecedent dispute between named employers and organisations. That requirement is not a feature of the modern award system. We have decided, therefore, that as a general principle we shall not name registered organisations as covered by modern awards. Should it be necessary to do so we shall of course reconsider the matter when the legislation has been passed. Although organisations will not be named in awards, we would expect that as a matter of course lists will be compiled of registered organisations, and of other entities, with an interest in a particular award so that they can be informed of developments in relation to that award.

133. This was a quite specific, deliberate and limited proposal to use the administrative lists of interests that FWA was to maintain, in the discharge of what would remain a FWA function (as the successor to the Registry).

134. The concept of using interest lists in place on named award respondency cannot in our view be divorced from the registry (or its successor) maintaining responsibility for notifying unions of proposed non-union arrangements.



The Problem

135. The problem is that there has been a material change to the negotiated approach to maintaining the agreed position.

136. The exposure draft proposes an approach which would be a major change to the status quo. It does so with no justification, and in a manner which will create detriment and harm to both employer and employee interests.

137. The problem is the difference between the following

“…it will be referred by Fair Work Australia to the union by certified mail…”

“…the employer must refer the agreement to the union by certified mail…”

138. As proposed, a long standing administrative requirement of the Registry would become an additional compliance obligation upon an employer.

139. Employers are strongly opposed to such a shifting of responsibility and costs from the Commission/Registry to the employer. This is a substantive change of obligation and would create an entirely new compliance obligation upon employers. This is utterly at odds with the stated aims of this process and the modernisation request.

Arguments Against

140. The Status Quo Works: ACCI knows of no basis to depart from the status quo. We have never heard of any difficulties with the operation of the existing approach, nor of the Registry having trouble in playing its role. The successor to the Registry will be well resourced to continue to do this.

141. Additional Burden = Reduced Demand: Employers taking on people on an SWS arrangement are already assuming an additional paperwork burden above the ordinary challenge of employing someone. They don’t need to have another obligation lumped on them, which for some may simply make the compliance burden of job creation in this area simply too difficult to bear. We should be very careful in the fragile area of employers creating jobs for persons with a disability – any disincentives or imposts which would make this less likely need to be avoided.



142. Asymmetrical Information: The proposal to use the award interest lists was quite specific and carefully considered. These are FWA/ Commission maintained lists foreshadowed in the late 2008 statement, which we believe could be employed to determine which unions to inform where an assessment is undertaken without a union party.

143. The concept of an interest list does not properly translate into an obligation on any party external to the Registry / FWA. Employers will not have the lists of interests – which will be internal FWA documents. These lists will be part of the currency of the day-to-day work of FWA, not accessible or familiar to employers, and even less so to those trying to navigate the system without external advice.

144. Fundamentally at odds with the Request: Paragraph 1(a) of the request is:

The aim of the award modernisation process is to create a comprehensive set of modern awards. As set out in section 576A of the Act, modern awards:…

must be simple to understand and easy to apply, and must reduce the regulatory burden on business; …

145. The proposed approach would not reduce the regulatory burden upon business, it would increase it – and it would do so by shifting a long standing obligation from a well resourced administration onto often smaller employers seeking to create jobs for persons with a disability (one of the very hardest areas of job creation). This is simply wrong in both principle and effect – and it is directly contrary to the modernisation request. It should not be allowed to come to pass.

146. As a secondary point – this is scarcely going to be easy to apply. For the reasons outlined above, an employer is not going to able to assume the responsibilities of the Registry – and will not be able to comply with something based on lists of award interests.

Other Concerns

147. It is not just the employer perspective which needs to be considered. There are asymmetries and limits on information which will effect both unions and inspectors. These include:



a. A union is not going to know if an employer fails to comply. An employer is going to always have complied with 6.1 (lodgement with the Commission) but any failures to comply with 6.2 will see the anomalous situation of FWA having information unions should have, but no longer being in a position to give this to unions.

b. How would any compliance issues here ever come to the attention of inspectors? A far better approach would be to have FWA continue to on-forward the paperwork to unions.

148. Again, there is no reason to create such problems. The status quo has worked satisfactorily, and unions and employers have identified an option to maintain the status quo across the major changes to the system through award modernisation. The previously agreed approach should be preferred to that in the draft SWS schedule.

Outcome

149. Proposed cl.6.2 of the Draft SWS Schedule should be amended to read:

All SWS wage assessment agreements must be agreed and signed by the employee and employer parties to the assessment, provided that where a union which has an interest in the award, is not a party to the assessment, it will be referred by Fair Work Australia to the union by certified mail and will take effect unless an objection is notified to Fair Work Australia within ten working days.

150. If there is some fundamental reason why an award cannot place an obligation on FWA (as it presently does on the AIR) at this point, then the Full Bench should identify this in a further statement and work with the ACTU, ACCI and the Commonwealth towards something mutually agreeable and sustainable. That FWA may not yet exist, nor the Fair Work Bill be passed, is not a reason to shift a responsibility from the Registry to employers.

ADDITIONAL ISSUES

Definitions

151. There appears to be some room for potential ambiguity in some of the new definitions in cl.2.

152. The wording in "Assessment Instrument" and "SWS wage assessment agreement" is similar in the use of the words "that records the assessment of the productive capacity of the person to be employed under the supported



wage system" and "that records the employee's productive capacity and agreed wage rate".

153. To clarify what the SWS wage assessment agreement is, we suggest the insertion of alternative wording as outlined below. We have based this wording on the definition of "Wage Assessment Agreement" in the DEEWR Handbook.

154. The definition would read:

"SWS wage assessment agreement means the document in the form required by the Department of Education, Employment and Workplace Relations that records the employee's productive capacity and agreed wage rate, which is duly signed by the relevant parties and required to be registered with Fair Work Australia11."

155. This would hopefully better clarify the difference between the Assessment Instrument and the SWS Wage Assessment Agreement definitions.

“Commission” or “Fair Work Australia”

156. There are two references in Clause 6 of the draft schedule to “the Commission” in relation to lodgement of SWS wage assessment instruments.

157. Whilst we appreciate that Fair Work Bill 2008 has not passed Parliament at this time, we would hope that this is replaced in the final modern awards with updated references to “Fair Work Australia”.

Trial Period

158. There is a change to the status quo in proposed 10.2 of the award schedule:

Current Award Clause12 Proposed Modern Award Schedule

15.6.9(b) During that trial period the assessment of capacity shall be undertaken and the proposed wage rate for a continuing employment relationship shall be determined.

10.2 During that trial period the assessment of capacity will be undertaken and the percentage of the relevant minimum wage for a continuing employment relationship will be determined.

11 We note the use of the term “Commission” in cl.6 of the draft schedule and address that issue below. 12 From the Hospitality Industry Award.



159. The omission of the word "proposed" may be significant.

160. Only when the agreement is signed and registered is the wage rate set. The purpose of the trial period is to determine a wage rate for on-going employment, should that occur. It may not. Even if the employer makes an offer the wage rate "proposed" could still be re-negotiated, or indeed refused by an employee. Thus, consideration should be given to better reflecting what actually occurs during such trials, and retaining the word “proposed”.

SCOPE – BUSINESS SERVICES

161. Finally, the SWS is an instrument designed to facilitate the employment of persons with a disability in the “open” or general employment sector, where those on supported wages work alongside peers without adjusted wage rates.

162. This differs from what used to be termed the Sheltered Workshops, recently called Business Services, and even more recently renamed to Australian Disability Enterprises (ADE).

163. The SWS clause in awards was originally specifically agreed on the basis that it excluded such workplaces. Contemporaneous with the evolution of workplace and regulatory arrangements in the sector, there is now some application of SWS in some ADE workplaces, but only as one amongst a pallet of available “wages tools”. Thus, the model or general arrangement where the SWS is the sole approach to concessional wages for persons with a disability does not and cannot be applied to the sheltered employment / business services sector.

164. It is vital that any decision or statement make clear that the SWS schedule will not necessarily be applied to a modern award or awards covering the business services / ADE sector. Any award or awards for the sector must exclude the schedule and/or modify the operation of the SWS.

165. An example of such an award in the federal system is the Liquor, Hospitality And Miscellaneous Union Supported Employment Services Award 2005. (At very least) the modernisation process in relation to this award should not assume or mandate the inclusion of any standard SWS schedule properly geared to open employment (and otherwise being applicable to awards more generally).



7. OTHER MATTERS

DAILY HIRE

166. We note the following from [39] of the 23 January statement in relation to daily hire in the building and construction industry:

[39] We have retained daily hire as an optional employment type, together with hourly rates loaded with the follow the job component of the minimum wage rate and certain additional payments in the exposure drafts for the Building and Construction Modern Award and the Plumbing and Fire Sprinklers Modern Award. We have drawn on the CFMEU draft for this purpose. However, we invite the parties to address us on the continuing role of the daily hire mode of employment, and associated loaded rates, in the context of a contemporary safety net modern award.

167. ACCI also notes that s.123(3) of the Fair Work Bill and clauses 543(1) and 789(1) continues to recognise this form of work in various industries and occupations. Such provisions appear to evince an intention by Parliament that requires the industrial relations system to recognise such a mode of engagement.

168. However, perhaps Australia’s foremost national consideration in the present circumstances is jobs and retaining employment across a period of economic downturn and uncertainty.

169. The Workplace Relations Act 1996 and the Fair Work Bill 2008 both identify the importance of economic sustainability for the award system, carrying with it the importance of jobs. This occurs within an overall statutory context that supports (from the current Act) the pursuit of the highest possible levels of employment.

170. This is also reinforced by the consolidated request which indicates that modern awards must be economically sustainable and promote flexible modern work practices and the efficient and productive performance of work.

171. To ACCI this dictates that modern awards should provide as fulsome a suite of modes of employment as possible in an industry, and modes of employment which provide the greatest possible employability and scope for engagement within the industry.



172. ACCI therefore shares the concerns of construction industry members within our network13 with any suggestion that awards in that industry may be varied to remove a mode of employment outright (daily hire).

173. ACCI cannot see how the modernisation process could result in an award which removed a mode of employment from an industry in which many people work, and have worked for many decades.

174. Whilst we would defer to the industry concerned and its expertise, it also strikes us that a daily type engagement may provide added flexibility during a time in which demand for construction work may downturn. For example, it may be that a daily hire type arrangement facilitates more employment in a downturn of the commencement of new projects.

175. Ultimately, ACCI supports the submissions from construction industry employers in support of the retention of daily hire working arrangements in that industry.

THE “SILVICULTURE” AWARD

“modern awards….must be simple to understand and easy to apply”

176. The first line of the Minister’s request makes perfectly clear what the core aims of modernisation are about – greater simplicity and ease of comprehension.

177. When we first looked at this proposed Stage II award title we could not work out whether this award related to the resurgent Australian band Silverchair, or an obscure part of jewellery manufacturing.

178. After it became our office pop quiz for the day – we found no one who knew what Silviculture was without looking it up. We were genuinely surprised to ultimately find it related to forest management.

179. Modernisation is supposed to create a comprehensible and accessible award system, in which lay users can at very least navigate the system and find awards. You shouldn’t need Google or Wikipedia to even know what an award is about, or comprehend its title and coverage.

13 Typified by the submissions of Master Builders Australia,



180. A modern award should not be an insiders document in any industry, applying obscure codes and languages only initiates know. This is the award system we should be deliberately trying to move away from.

181. This is not a flippant point. The persons enforcing awards and trying to navigate the system are often younger and lacking experience across industries. Within the new FWA inspectorate, unions and employer associations, new generations of staff need to be able to exercise some common sense in finding and applying awards, and no longer rely on arcane specialist knowledge – such as explanation that Silviculture relates to forests.

182. In short, if this is basically going to be the new forest management award, call it the Forest Management Award 2010. Plain English drafting should apply to titles as well as substantive obligations.

COVERAGE AND ENTERPRISE NAPSAS

183. Paragraphs [5], [7] and [9] of the Stage II Statement of 23 January 2009 are as follows:

[5] Clause 2(e) of the consolidated request now requires that a modern award should be expressed “so as not to bind an employer who is bound by an enterprise award or a Notional Agreement Preserving a State Award (NAPSA) derived from a state enterprise award.” The requirement in relation to NAPSAs derived from state enterprise awards was not part of the consolidated request prior to 18 December 2008 and was not therefore taken into account in the making of the priority modern awards.

[7] These requirements obviously were not taken into account when the model flexibility clause was formulated. Nor were they taken into account in the making of the priority modern awards.

[9] We intend to deal with these variations to the consolidated request, and any others that might be relevant, in making the Stage 2 awards, provided it is practical to do so. We encourage interested parties to bring forward proposals and submissions as to how these new requirements should be reflected in the coverage, award flexibility and annual leave clauses. The Stage 2 exposure drafts do not attempt to take account of the 18 December variations.

184. It is for parties to individual award modernisations in both Stages I and II to now address the Full Bench on what if any changes this may require to the coverage of draft awards. We commend the submissions of ACCI member organisations to you in this regard.



185. We note however that in light of the 18 December 2008 revisions to paragraph 2(e) of the request, coverage clauses may not be the only part of the draft awards which may need to be revisited. To the extent that any of the content of proposed modern awards reflects content from NAPSAs which are now to be excluded from coverage, this may need to be revisited in light of the revised award parameters.

186. If the scope of awards is to be restricted, then the sources of award content may need to also be restricted which may require a revisiting of existing modern award text.

187. Any such issues in relation to specific awards and content will be raised by ACCI member organisations.

PIECE WORK

188. Paragraph [19] of the Stage II Statement of 23 January 2009 is as follows:

[19] Clauses 43 to 45 of the consolidated request refer to piece workers and to the interaction between modern awards and the entitlements in the National Employment Standards (NES). A number of Stage 2 industries have piece workers. We ask interested parties to address the matters raised in cll.44 and 45 of the consolidated request during the consultations.

189. ACCI member organisations will address this issue in relation to particular modern awards.

RATIONALISATION OF ALLOWANCES

190. Paragraphs [20] and [21] of the Stage II Statement of 23 January 2009 are as follows:

[20] In a number of industries there are many different allowances in federal awards and NAPSAs, some of quite small amounts. It is often difficult to know the origin and purpose of the allowances and whether they are still relevant. In some cases the allowance will not be appropriate for inclusion in a safety net award because it is outmoded, is the result of enterprise bargaining or for some other reason.

[21] In some industries there is a strong case for rationalising allowances. The manufacturing and building and construction industries are examples. We encourage parties to give attention to the number, amount and purpose of allowances with a view to rationalising them and eliminating those that are no longer relevant.

191. Again, ACCI member organisations will address this issue in relation to particular modern awards.



CAR ALLOWANCE

192. ACCI is receiving feedback that the “common rate” for the car and motorcycle allowance assumed or standardised through the December decision14, has been set too high.

193. This is an issue for consideration in specific awards, but it would be problematic if this rate is set too high / at a level which discourages long standing “give and take” style arrangements in relation to personal vehicle use. It would also be problematic if there is insufficient account taken of falls in fuel and car prices.

194. Clarification of the derivation of the so called common rate for this allowance would be useful to employer representatives seeking to engage with it in relation to specific awards.

14 [2008] AIRCFB 1000, at [77]





ABOUT ACCI – LEADING AUSTRALIAN BUSINESS

ACCI has been the peak council of Australian business associations for 105 years and traces its heritage back to Australia’s first chamber of commerce in 1826.

Our motto is “Leading Australian Business.”

We are also the ongoing amalgamation of the nation’s leading federal business organisations ‐ Australian Chamber of Commerce, the Associated Chamber of Manufactures of Australia, the Australian Council of Employers Federations and the Confederation of Australian Industry.

Membership of ACCI is made up of the State and Territory Chambers of Commerce and Industry together with the major national industry associations.

Through our membership, ACCI represents over 350,000 businesses nation‐wide, including over 280,000 enterprises employing less than 20 people, over 55,000 enterprises employing between 20‐100 people and the top 100 companies.

Our employer network employs over 4 million people which makes ACCI the largest and most representative business organisation in Australia.

Our Activities

ACCI takes a leading role in representing the views of Australian business to Government.

Our objective is to ensure that the voice of Australian businesses is heard, whether they are one of the top 100 Australian companies or a small sole trader.

Our specific activities include:

• Representation and advocacy to Governments, parliaments, tribunals and policy makers both domestically and internationally.



• Business representation on a range of statutory and business boards, committees and other fora.

• Representing business in national and international fora including the Australian Fair Pay Commission, Australian Industrial Relations Commission, Australian Safety and Compensation Council, International Labour Organisation, International Organisation of Employers, International Chamber of Commerce, the Business and Industry Advisory Committee to the Organisation for Economic Co‐operation and Development, the Confederation of Asia‐Pacific Chambers of Commerce and Industry and the Confederation of Asia‐Pacific Employers.

• Research and policy development on issues concerning Australian business.

• The publication of leading business surveys and other information products.

• Providing forums for collective discussion amongst businesses on matters of law and policy affecting commerce and industry.

Publications

A range of publications are available from ACCI, with details of our activities and policies including:

• The ACCI Policy Review; a analysis of major policy issues affecting the Australian economy and business.

• Issue papers commenting on business’ views of contemporary policy issues.

• Policies of the Australian Chamber of Commerce and Industry – the annual bound compendium of ACCI’s policy platforms.

• The Westpac‐ACCI Survey of Industrial Trends ‐ the longest, continuous running private sector survey in Australia. A leading barometer of economic activity and the most important survey of manufacturing industry in Australia.

• The ACCI Survey of Investor Confidence – which gives an analysis of the direction of investment by business in Australia.



• The Commonwealth‐ACCI Business Expectations Survey ‐ which aggregates individual surveys by ACCI member organisations and covers firms of all sizes in all States and Territories.

• The ACCI Small Business Survey – which is a survey of small business derived from the Business Expectations Survey data.

• Workplace relations reports and discussion papers, including the ACCI Modern Workplace: Modern Future 2002‐2010 Policy Blueprint and the Functioning Federalism and the Case for a National Workplace Relations System and The Economic Case for Workplace Relations Reform Position Papers.

• Occupational health and safety guides and updates, including the National OHS Strategy and the Modern Workplace: Safer Workplace Policy Blueprint.

• Trade reports and discussion papers including the Riding the Chinese Dragon: Opportunities and Challenges for Australia and the World Position Paper.

• Education and training reports and discussion papers.

• The ACCI Annual Report providing a summary of major activities and achievements for the previous year.

• The ACCI Taxation Reform Blueprint: A Strategy for the Australian Taxation System 2004–2014.

• The ACCI Manufacturing Sector Position Paper: The Future of Australia’s Manufacturing Sector: A Blueprint for Success.

Most of this information, as well as ACCI media releases, parliamentary submissions and reports, is available on our website – www.acci.asn.au.





ACCI MEMBERS

ACT and Region Chamber of Commerce & Industry 12A Thesiger Court DEAKIN ACT 2600 Telephone: 02 6283 5200 Facsimile: 02 6282 2439 Email: [email protected] Website: www.actchamber.com.au Business SA Enterprise House 136 Greenhill Road UNLEY SA 5061 Telephone: 08 8300 0000 Facsimile: 08 8300 0001 Email: [email protected] Website: www.business-sa.com Chamber of Commerce & Industry Western Australia PO Box 6209, Hay Street East EAST PERTH WA 6892 Telephone: 08 9365 7555 Facsimile: 08 9365 7550 Email: [email protected] Website: www.cciwa.com Chamber of Commerce Northern Territory Confederation House Suite 1, 2 Shepherd Street DARWIN NT 0800 Telephone: 08 8982 8100 Facsimile: 08 8981 1405 Email: [email protected] Website: www.chambernt.com.au Commerce Queensland Industry House 375 Wickham Terrace BRISBANE QLD 4000 Telephone: 07 3842 2244 Facsimile: 07 3832 3195 Email: [email protected] Website: www.commerceqld.com.au Employers First™ PO Box A233 SYDNEY SOUTH NSW 1235 Telephone: 02 9264 2000 Facsimile: 02 9261 1968 Email: [email protected] Website: www.employersfirst.org.au



New South Wales Business Chamber Level 15, 140 Arthur Street NORTH SYDNEY NSW 2060 Telephone: 132696 Facsimile: 1300 655 277 Website: www.nswbusinesschamber.com.au Tasmanian Chamber of Commerce and Industry GPO Box 793 HOBART TAS 7001 Telephone: 03 6236 3600 Facsimile: 03 6231 1278 Email: [email protected] Website: www.tcci.com.au Victorian Employers’ Chamber of Commerce & Industry GPO Box 4352 MELBOURNE VIC 3001 Telephone: 03 8662 5333 Facsimile: 03 8662 5462 Email: [email protected] Website: www.vecci.org.au ACCORD Suite 4.02, Level 4, 22-36 Mountain Street ULTIMO NSW 2007 Telephone: 02 9281 2322 Facsimile: 02 9281 0366 Email: [email protected] Website: www.accord.asn.au Agribusiness Employers’ Federation GPO Box 2883 ADELAIDE SA 5001 Telephone: 08 8212 0585 Facsimile: 08 8212 0311 Email: [email protected] Website: www.aef.net.au Air Conditioning and Mechanical Contractors’ Association 30 Cromwell Street BURWOOD VIC 3125 Telephone: 03 9888 8266 Facsimile: 03 9888 8459 Email: [email protected] Website: www.amca.com.au/vic Association of Consulting Engineers Australia Level 6, 50 Clarence Street SYDNEY NSW 2000 Telephone: 02 9922 4711 Facsimile: 02 9957 2484 Email: [email protected] Website: www.acea.com.au



Australian Beverages Council Ltd Suite 4, Level 1 6-8 Crewe Place ROSEBERRY NSW 2018 Telephone: 02 9662 2844 Facsimile: 02 9662 2899 Email: [email protected] Website: www. australianbeverages.org Australian Hotels Association Level 1, Commerce House 24 Brisbane Avenue BARTON ACT 2600 Telephone: 02 6273 4007 Facsimile: 02 6273 4011 Email: [email protected] Website: www.aha.org.au Australian International Airlines Operations Group c/- QANTAS Airways QANTAS Centre QCD1, 203 Coward Street MASCOT NSW 2020 Telephone: 02 9691 3636 Facsimile: 02 9691 2065 Australian Made, Australian Grown Campaign Suite 105, 161 Park Street SOUTH MELBOURNE VIC 3205 Telephone: 03 9686 1500 Facsimile: 03 9686 1600 Email: [email protected] Website: www.australianmade.com.au Australian Mines and Metals Association Level 10 607 Bourke Street MELBOURNE VIC 3000 Telephone: 03 9614 4777 Facsimile: 03 9614 3970 Email: [email protected] Website: www.amma.org.au Australian Newsagents’ Federation Level 3 33-35 Atchison Street ST LEONARDS NSW 2065 Telephone: 02 8425 9600 Facsimile: 02 8425 9699 Website: www.anf.net.au



Australian Paint Manufacturers’ Federation Inc Suite 1201, Level 12 275 Alfred Street NORTH SYDNEY NSW 2060 Telephone: 02 9922 3955 Facsimile: 02 9929 9743 Email: [email protected] Website: www.apmf.asn.au Australian Retailers’ Association Level 2 104 Franklin Street MELBOURNE VIC 3000 Telephone: 1300 368 041 Facsimile: 03 9321 5001 Email: [email protected] Website: www.ara.com.au Live Performance Australia Level 1 15-17 Queen Street MELBOURNE VIC 3000 Telephone: 03 9614 1111 Facsimile: 03 9614 1166 Email: [email protected] Website: www.liveperformance.com.au Master Builders Australia Level 1, 16 Bentham Street YARRALUMLA ACT 2600 Telephone: 02 6202 8888 Facsimile: 02 6202 8877 Email: [email protected] Website: www.masterbuilders.com.au Master Plumbers’ and Mechanical Services Association of Australia 525 King Street WEST MELBOURNE VIC 3003 Telephone: 03 9329 9622 Facsimile: 03 9329 5060 Email: [email protected] Website: www.plumber.com.au National Baking Industry Association Bread House, 49 Gregory Terrace SPRING HILL QLD 4000 Telephone: 1300 557 022 Email: [email protected] Website: www.nbia.org.au



National Electrical and Communications Association Level 4 30 Atchison Street ST LEONARDS NSW 2065 Telephone: 02 9439 8523 Facsimile: 02 9439 8525 Email: [email protected] Website: www.neca.asn.au National Fire Industry Association PO Box 6825 ST KILDA CENTRAL VIC 8008 Telephone: 03 9865 8611 Facsimile: 03 9865 8615 Website: www.nfia.com.au National Retail Association Ltd PO Box 91 FORTITUDE VALLEY QLD 4006 Telephone: 07 3251 3000 Facsimile: 07 3251 3030 Email: [email protected] Website: www.nationalretailassociation.com.au Oil Industry Industrial Association c/- Shell Australia GPO Box 872K MELBOURNE VIC 3001 Telephone: 03 9666 5444 Facsimile: 03 9666 5008 Pharmacy Guild of Australia PO Box 7036 CANBERRA BC ACT 2610 Telephone: 02 6270 1888 Facsimile: 02 6270 1800 Email: [email protected] Website: www.guild.org.au Plastics and Chemicals Industries Association Level 1 651 Victoria Street ABBOTSFORD VIC 3067 Telephone: 03 9429 0670 Facsimile: 03 9429 0690 Email: [email protected] Website: www.pacia.org.au Printing Industries Association of Australia 25 South Parade AUBURN NSW 2144 Telephone: 02 8789 7300 Facsimile: 02 8789 7387 Email: [email protected] Website: www.printnet.com.au


http://www.neca.asn.au/

http://www.pacia.org.au/


Restaurant & Catering Australia Suite 17 401 Pacific Highway ARTARMON NSW 2604 Telephone: 02 9966 0055 Facsimile: 02 9966 9915 Email: [email protected] Website: www.restaurantcater.asn.au Standards Australia Limited Level 10 20 Bridge Street SYDNEY NSW 2000 Telephone: 02 9237 6000 Facsimile: 02 9237 6010 Email: [email protected] Website: www.standards.org.au Victorian Automobile Chamber of Commerce 7th Floor 464 St Kilda Road MELBOURNE VIC 3004 Telephone: 03 9829 1111 Facsimile: 03 9820 3401 Email: [email protected]: www.vacc.com.au


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Documents

AUSTRALIAN INDUSTRIAL RELATIONS COMMISSION AWARD ... · AIRC – Award Modernisation –Stage II 8. In short, whether at the stage of producing exposure draft award awards, or in