4 yearly review of modern awards—transitional provisions
[2015] FWCFB 3523
•18 AUGUST 2015
[2015] FWCFB 3523
The attached document replaces the document previously issued with the above code on 18 August 2015.
Footnote references 24 and 25 have been amended to the correct citation.
Jimmy Li
Associate to Justice Boulton
Dated: 19 August 2015
| [2015] FWCFB 3523 |
| FAIR WORK COMMISSION |
DECISION |
Fair Work Act 2009
s.156 - 4 yearly review of modern awards
(AM2014/190)
JUSTICE BOULTON, SENIOR DEPUTY PRESIDENT | SYDNEY, 18 AUGUST 2015 |
4 yearly review of modern awards - Common issues - Transitional provisions - Accident Make-up Pay – applications to vary awards – approach to be adopted in 4 yearly reviews – where significant change is sought in modern award - preliminary issues – issue estoppel and abuse of process – State-based difference terms in awards under section 154 – coverage of accident pay entitlements in pre-reform instruments – categories of awards having accident pay provisions - interaction of awards with workers’ compensation schemes – step downs in compensation payments – modern awards objective – accident pay entitlements to be included in some awards as part of safety net of terms and conditions – consideration of standardised and simplified award provisions – extension of accident pay entitlements to persons no longer employed – allowances to be clearly identified in awards - draft orders.
CONTENTS | PARA |
The union applications [3]
Background to the applications [8]
Approach to be adopted in 4 yearly review [14]
Evidence and submissions of the parties [18]
(a) Evidence of the ACTU and the unions [20]
(b) Evidence of the employer groups [48]
Submissions of the parties [61]
(a) Submissions by the ACTU and the unions [62]
(b) Submissions of the employer groups [99]
(c) Submissions of the Commonwealth and New South Wales [133]
Consideration [139]
(i) Preliminary matters raised by some employer groups [148]
(ii) Circumstances of the awards and coverage of accident pay provisions [165]
(iii) Interaction between awards and workers’ compensation schemes [175]
(iv) The modern awards objective [187]
Conclusions [207]
The award variations [217]
Draft orders [225]
[1] The Fair Work Act 2009 (the Act) provides that the Commission must conduct a 4 yearly review of modern awards (s.156(1)). As part of the present 4 yearly review, applications have been made by several unions to vary modern awards to include provisions for accident make-up pay.
[2] The applications relate to some 37 modern awards and seek to insert into those awards an entitlement to accident make-up pay applying to all employees covered by each award.
THE UNION APPLICATIONS
[3] The applications by the Construction, Forestry, Mining and Energy Union (CFMEU) Construction and General Division relate to three awards 1 and seek to establish an accident pay entitlement of up to 26 or 52 weeks. The applications by the Australian Workers’ Union (AWU) relate to seven awards2 and seek either 26, 39 or 52 weeks as the maximum period of accident pay. The applications by the Australian Municipal, Administrative, Clerical and Services Union (ASU) relate to eleven awards3 and seek either 26, 39 or 52 weeks as the maximum period of accident pay. The application by the CFMEU Forestry and Furnishing Products Division seeks to include either 39 or 52 weeks as a maximum period in relation to workers in different streams under the Timber Industry Award 2010. The applications by the Australian Manufacturing Workers’ Union (AMWU) relate to four awards4 and seek a maximum period of 39 or 52 weeks accident pay. The AMWU Vehicle Division made application to vary the Vehicle Manufacturing, Repair, Service and Retail Award 2010 to include an accident pay provision of 39 weeks.
[4] The Textile, Clothing, and Footwear, Union of Australia (TCFUA) seeks an entitlement of up to 39 weeks accident pay for workers covered by the Textile, Clothing, Footwear and Associated Industries Award 2010. The United Firefighters’ Union (UFU) seeks an entitlement of up to 52 weeks accident pay for workers covered by the Fire Fighting Industry Award 2010. 5The applications by the Shop Distributive and Allied Employees’ Association, Victorian Branch (SDA) relate to six awards6 and seek a maximum period of 39 or 52 weeks accident pay. The applications by the Maritime Union of Australia (MUA) relate to three awards7 and seek a period of either 52 or 104 weeks accident pay.
[5] The accident pay scheme proposed in relation to each award provides for the circumstances in which accident pay is payable, the amount payable by the employer and any exceptions or exclusions from the accident pay entitlement. The applications generally seek that a standard entitlement to accident pay would apply to all employees covered by each award. However the details of the proposed accident pay schemes vary from award to award. For example, the maximum period for which accident pay is payable might be 26, 39, 52 or 104 weeks depending on the award concerned.
[6] The accident pay entitlements sought by the unions in some cases reflect the accident pay provisions which existed in pre-reform instruments or at least have been drafted in the light of those provisions. In relation to some of the applications, the proposed accident pay entitlements would extend to groups of employees not previously entitled to accident pay and/or would provide more generous accident pay entitlements than in the relevant pre-reform instruments.
[7] The union applications were opposed by the employer groups which participated in the proceedings, namely the Australian Chamber of Commerce and Industry (ACCI); the Australian Industry Group (Ai Group); NSW Business Chamber Ltd; Restaurant and Catering Australia; Australian Business Industrial; Master Builders’ Australia; the National Farmers’ Federation; the Pharmacy Guild of Australia; the Maritime Industry Australia Limited; the Australian Retailers’ Association; the Motor Traders’ Association of New South Wales, the Motor Trade Association of South Australia and the Motor Trade Association of Western Australia and the Victorian Automobile Chamber of Commerce (‘Motor Traders Associations’); the Printing Industries’ Association; the Australasian Railway Association; and the Australian Federation of Employers and Industries. 8
BACKGROUND TO THE APPLICATIONS
[8] The background to the making of the applications may be set out in brief terms as follows.
[9] The accident make-up pay provision included in most modern awards at the time of their making preserved the operation of existing accident pay schemes in pre-reform awards and Notional Agreements Preserving State Awards (NAPSAs) until the end of a transition period. In the Award Modernisation Decision 2008 9it was decided that, except where the accident pay scheme applying in a particular industry provided a clear national standard, accident pay would be dealt with on a transitional basis and the accident pay schemes in pre-reform instruments would be preserved in modern awards until 31 December 2014. It was envisaged by the Award Modernisation Full Bench that there would be an opportunity within the transition period for the parties to consider the formulation of a national standard on accident pay to apply to all award covered employees.10 Other than that, only one award, the Air Pilots Award 2010, provided for accident pay other than on a transitional basis. That Award provides for a maximum period of 52 weeks accident pay.
[10] On 1 July 2014, as part of the 4 yearly review of modern awards, the Australian Council of Trade Unions (ACTU) filed an application to vary 105 modern awards by deleting the sunset provisions in the model transitional provisions relating to accident pay and district allowances. At that time the ACTU foreshadowed that its affiliated unions might also seek to deal with substantive aspects of the ACTU’s claim on an award by award basis. Applications by various unions seeking to insert new accident pay provisions into a number of awards were filed in September 2014.
[11] On 31 October 2014 the Full Bench rejected the ACTU’s application to delete the sunset provisions in the transitional accident pay provisions in modern awards. 11 The reasons for this decision were given on 11 February 2015.12 The main reasons for the rejection of the ACTU application were as follows:
“[26] First, we do not consider that the case has been made out for the continuation of the transitional accident pay provisions having regard to the basis on which they were inserted into modern awards. In this regard we note that no party has sought the inclusion in modern awards of a national standard on accident pay to apply to all award covered employees, as was anticipated by the Award Modernisation Decision 2008. Further we note that it has not been demonstrated in the proceedings before us that the accident pay entitlements which would continue to operate if the sunset provisions are removed would provide a clear national accident pay scheme applying under the relevant modern awards.
[27] In these circumstances, we do not consider that we should depart from the position determined by the Award Modernisation Full Bench in 2008 that the continuation in modern awards of the diverse accident pay arrangements applying under pre-modern awards and NAPSAs should be for a limited period only.
[28] Second, in our view the removal of the sunset provisions, and therefore the determination that the current transitional accident pay provisions should continue to apply, is not appropriate having regard to the modern awards objective in s.134 of the Act (see also s.138).
[29] Whilst we do not rule out the possibility that accident pay provisions may be necessary and appropriate in some modern awards in order to provide a fair and relevant minimum safety net of terms and conditions, we do not consider that the current transitional accident pay provisions can continue to be included in awards consistent with the modern awards objective. This is because, as submitted by the employer groups, the transitional provisions are complex and both difficult to understand and apply. The application of the provisions is to be ascertained having regard to the relevant terms of pre-reform awards and instruments, most if not all of which are no longer in operation. We agree with the submission of the ACCI that as a general principle it is undesirable to express terms and conditions in modern awards by reference to external instruments and documents.
[30] The maintenance of accident pay provisions in modern awards in the terms of the current transitional provisions would not contribute towards ensuring that Australia has “a simple, easy to understand, stable and sustainable modern award system” (s.134(1)(g)) and would have adverse impacts in terms of the regulatory burden on business (s.134(1))f)). Further those provisions do not meet the requirement that any allowance included in a modern award must be “clearly identified” in the award (see s.139(2)).
[31] For these reasons we determined that the ACTU application which simpliciter sought the deletion of the sunset provision in the model accident pay clauses in modern awards should be refused.” (footnotes omitted)
[12] In the decision of 31 October 2014, the Full Bench also decided that the sunset provision in the accident pay clause in the Black Coal Mining Industry Award 2010 should be deleted as that clause did provide a clear national standard for the industry as described in the Award Modernisation Decision 2008. The reasons for our decision in this regard are set out in the decision of 11 February 2015. 13
[13] In the decision of 11 February 2015, the Full Bench also granted an application by the Ai Group to delete the transitional accident pay provisions from most modern awards as the effect of the sunset provision was that those provisions were no longer in operation after 31 December 2014. 14
APPROACH TO BE ADOPTED IN 4 YEARLY REVIEW
[14] The general approach to be adopted by the Commission in dealing with applications to vary modern awards as part of the 4 yearly review was considered in the Preliminary Jurisdictional Issues decision made by a Full Bench of the Commission on 17 March 2014 (the Preliminary Issues decision). 15 In that decision the Full Bench refers to the relevant sections of the Act to be taken into account and, in particular, the provisions relating to the modern awards objective (ss.134 and 138). The Full Bench also notes that any variation of a modern award arising from the review must comply with the requirements of the Act which relate to the content of modern awards (ss.136-155) and that a modern award must not, subject to some limited exceptions, include terms that contain State-based differences (s.154).
[15] The Full Bench in the Preliminary Issues decision stated:
“[23] The Commission is obliged to ensure that modern awards, together with the NES, provide a fair and relevant minimum safety net taking into account, among other things, the need to ensure a ‘stable’ modern award system (s.134(1)(g)). The need for a ‘stable’ modern award system suggests that a party seeking to vary a modern award in the context of the Review must advance a merit argument in support of the proposed variation. The extent of such an argument will depend on the circumstances. We agree with ABI’s submission that some proposed changes may be self evident and can be determined with little formality. However, where a significant change is proposed it must be supported by a submission which addresses the relevant legislative provisions and be accompanied by probative evidence properly directed to demonstrating the facts supporting the proposed variation.”
[16] The Full Bench concluded its examination of the relevant statutory provisions and the authorities by making a number of general observations about the conduct of the 4 yearly review, including the following at [60]:
“3. The Review is broader in scope than the Transitional Review of modern awards completed in 2013. The Commission is obliged to ensure that modern awards, together with the NES, provide a fair and relevant minimum safety net taking into account, among other things, the need to ensure a ‘stable’ modern award system (s.134(1)(g)). The need for a ‘stable’ modern award system suggests that a party seeking to vary a modern award in the context of the Review must advance a merit argument in support of the proposed variation. The extent of such an argument will depend on the circumstances. Some proposed changes may be self evident and can be determined with little formality. However, where a significant change is proposed it must be supported by a submission which addresses the relevant legislative provisions and be accompanied by probative evidence properly directed to demonstrating the facts supporting the proposed variation. In conducting the Review the Commission will also have regard to the historical context applicable to each modern award and will take into account previous decisions relevant to any contested issue. The particular context in which those decisions were made will also need to be considered. Previous Full Bench decisions should generally be followed, in the absence of cogent reasons for not doing so. The Commission will proceed on the basis that prima facie the modern award being reviewed achieved the modern awards objective at the time that it was made.
4. The modern awards objective applies to the Review. The objective is very broadly expressed and is directed at ensuring that modern awards, together with the NES, provide a ‘fair and relevant minimum safety net of terms and conditions’.
5. In the Review the proponent of a variation to a modern award must demonstrate that if the modern award is varied in the manner proposed then it would only include terms to the extent necessary to achieve the modern awards objective (see s.138). What is ‘necessary’ in a particular case is a value judgment based on an assessment of the considerations in s.134(1)(a) to (h), having regard to the submissions and evidence directed to those considerations.
6. There may be no one set of provisions in a particular modern award which can be said to provide a fair and relevant minimum safety net of terms and conditions. There may be a number of permutations of a particular modern award, each of which may be said to achieve the modern awards objective.
7. The characteristics of the employees and employers covered by modern awards varies between modern awards. To some extent the determination of a fair and relevant minimum safety net will be influenced by these contextual considerations. It follows that the application of the modern awards objective may result in different outcomes between different modern awards.” 16
[17] The approach we have adopted in considering the accident pay applications is consistent with that outlined in the Preliminary Issues decision.
EVIDENCE AND SUBMISSIONS OF THE PARTIES
[18] There was a vast amount of evidence, both witness and documentary, presented in the course of the proceedings. The evidence and material presented dealt with the award history and coverage of accident pay provisions in the various industries and awards, the operation of workers’ compensation legislation and schemes in the States and Territories and in the Commonwealth jurisdiction, and the history and application of accident pay entitlements in awards and agreements. It included witness statements and testimony from experts in the field of workers’ compensation, from officials of union and employer organisations, and from workers who have suffered work-related injuries.
[19] Although we have had regard to all the evidence and material presented in reaching our decision, we have not sought in this decision to refer in detail to all the evidence and material presented in the case. The following is a summary of some of the main points from the evidence presented.
(a) Evidence of the ACTU and the unions
[20] The ACTU relied upon a research report prepared for the purposes of the proceedings by Dr Kevin Purse, a Research Fellow with Central Queensland University’s Appleton Institute. Dr Purse gave evidence in the proceedings and was cross-examined by employer advocates.
[21] The report prepared by Dr Purse reviews the history of workers’ compensation in Australia and the developments which led to the inclusion of ‘accident pay’ provisions in industrial awards and agreements in the 1970s. It explains that accident pay is funded directly by employers to make up the difference between a worker’s average pre-injury earnings and statutory weekly workers’ compensation payments for a specified period so that the worker is not disadvantaged economically as a result of work injuries. It states that the importance of accident pay has ebbed and flowed depending on the adequacy of weekly workers’ compensation payments. In more recent times, accident make-up pay has become an issue of significant interest largely due to the winding back of workers’ compensation entitlements in some States and, more particularly, the pervasive use of step-downs in weekly payments.
[22] ‘Step-downs’ are phased reductions in weekly compensation payments which are often justified on the grounds that they provide incentives that motivate injured workers to return to work. In some respects, make-up pay arrangements are designed or operate so as to offset, to a greater or lesser extent, the financial impact of step-down provisions. In relation to step-downs, the report notes that there is no consistent approach in regard to the timing, extent and frequency of step-downs in the various workers’ compensation schemes in Australia. For example, step-downs in New South Wales and Victoria come into operation immediately; in South Australia after 13 weeks of incapacity; 17 in Tasmania after 26 weeks; and under the Comcare scheme after 45 weeks. In Victoria weekly payments may fall from 95% to 80% after 13 weeks, while in Tasmania and Queensland the decrease is from a maximum of 100% to 90% and 75% after 26 weeks respectively.
[23] The report examines the research and evidence concerning the relationship between workers’ compensation step-downs and return to work outcomes, and its relevance to accident make-up pay. It is said that more recent studies suggest that both the number of claims and their duration may be substantially less responsive to increases in weekly payments to injured workers than previously thought. In this regard it is important that the examination is not focused exclusively on worker behaviour but takes into account the role of other scheme participants, particularly insurers and employers, and their capacity to significantly influence the duration of claims and return to work outcomes. The report concludes that there is a lack of persuasive empirical and theoretical evidence to support the contention that step-downs are an essential feature in the design of workers’ compensation schemes which facilitate the return to work process.
[24] Dr Purse suggested in his testimony that step-downs are punitive in their effect on lower income workers and that those who are most affected by step-downs are workers with more serious injuries who cannot be incentivised to return to work early by the loss of income resulting from step-downs. It was recognised that all workers’ compensation schemes in operation in Australia include step-downs and that there is no conclusive empirical evidence either for or against the contribution of step-downs in promoting early return to work.
[25] The most important implications from the report’s findings for accident make-up pay arrangements are stated as being: firstly, that there is no substantive evidence to suggest that make-up pay is at odds with return to work objectives; and, secondly, that the availability of make-up pay may contribute to more sustainable outcomes for both workers and employers.
[26] The AWU filed witness statements from nine workers who have suffered work-related injuries and from two of its officials.
[27] Daniel Walton, the Assistant National Secretary of the AWU, said that the AWU generally seeks to have members covered by enterprise agreements, rather than awards, and that it has a significant number of agreements in the concrete products, hydrocarbons (upstream), oil refining and manufacturing industries. Based on his experience, he said that the terms in relevant modern awards are very important to members, even where they are covered by an enterprise agreement, as the awards are used as ‘a reference point and benchmark in enterprise agreement negotiations.’ Mr Walton said that the absence of accident pay entitlements in awards will make it more difficult to retain accident pay provisions in future enterprise agreements. In this regard, he has particular concerns in relation to employees in the dry cleaning and laundry, horticulture, and wine industries. He said that any reduction in income during an injured worker’s absence from work is likely to ‘place them under significant economic pressure.’
[28] Matthew Dixon has been employed as an organiser with the Western Australia Branch of the AWU since September 2009 and is involved in organising workers in the hydrocarbons and oil refining industries. He said that accident pay is a standard condition in these industries, that award provisions are often discussed during enterprise agreement negotiations, that most of the enterprise agreements negotiated included an entitlement of at least 52 weeks accident make-up pay, that an absence of accident pay in the relevant awards will make it more difficult to retain such entitlements in future agreements. He said that AWU members in the hydrocarbons industry are often employed under individual contracts and thus rely on award conditions such as accident pay.
[29] The other AWU witnesses have all suffered injuries at work and gave evidence as to their experience regarding accident make-up pay. Most of the witnesses received accident pay and said that this did not affect their desire to return to work, the majority saying that they were eager to get back into the workforce and to ‘do the right thing’ by their employer. They said that accident pay helped to ensure that their financial commitments were met and consequently helped to alleviate the worry about their finances whilst off work. Two of the witnesses did not receive accident pay and referred to the effect on them of the step-down in workers’ compensation payments, including the financial difficulties faced, problems with anxiety and depression, and a belief about being punished for their workplace injury. One witness said that the “loss of 20% of my normal income had a massive impact on my life.” 18
[30] Two witnesses gave evidence for the AMWU - Alan Mansfield, a Workers’ Compensation and Rehabilitation Officer with the union, and Richard Debabneh, a partner at Turner Freeman Lawyers.
[31] Mr Mansfield provides assistance to members in relation to return to work and injury management with respect to workers’ compensation in New South Wales and the ACT and under the Comcare scheme. He gave evidence about some employers not assisting injured workers to return to work by providing light or safe duties, and wanting employees to return only if they are suitable to perform their pre-injury duties. He said that employers are generally reluctant to provide modified jobs for workers with medium to long term impairments. He believes that accident pay does provide an incentive for employers to maximise opportunities for employees to return to work.
[32] Mr Debabneh is a specialist in personal injury law and assists injured workers with workers’ compensation claims. He referred to the significant changes made to the NSW workers’ compensation legislation in 2012, including changes which affect the payment of weekly compensation to workers who are incapacitated. He is aware of many workers who have suffered severe financial hardship as a result of the reduction in workers’ compensation payments. He believes the current workers’ compensation scheme is heavily skewed in favour of the employer and the compensation insurer and that many employers are unwilling to cooperate and do not provide suitable duties to allow injured workers to return to work. Mr Dababneh believes that return to work rates have not improved following the 2012 amendments to the NSW workers’ compensation system.
[33] The ASU relied upon a statement by Casey Young, Director Legal and Industrial at the NSW Local Government, Clerical, Administrative, Energy, Airlines & Utilities Branch of the ASU.
[34] Ms Young explained the changes to the NSW workers’ compensation scheme and the reduction in weekly payments. It was said that the effect of the changes has not been insignificant for members in the industries covered by the ASU and as a result there has been a reduction in overall entitlements to injured workers. She provided examples of accident pay entitlements under enterprise agreements and the effects of the legislative changes. She suggests that a consistent national approach to accident pay will ensure that minimum entitlements are available to injured workers where required.
[35] The CFMEU Construction and General Division presented evidence from three witnesses.
[36] Tom McDonald was the National Secretary of the Building Workers Industrial Union (BWIU) from 1985 to 1991 and had been an official of the NSW Branch of the BWIU since 1955. He described the history in NSW of the union claims in the 1970s for accident pay and the introduction of such entitlements. He said that the building industry had a very high accident rate compared with other industries and that the issue of accident pay was a very emotional issue for workers. He referred to the accident pay strike in 1971 and the decision in May 1971 of the NSW Industrial Commission to provide for an accident allowance. He said that this decision paved the way for an agreement between the unions and the employers to include an accident pay scheme in awards.
[37] Neil Browne is the WorkCover Officer of the Victorian Branch of the CFMEU Construction and General Division. Mr Browne’s statement provides examples of employees in Victoria who have been off work on workers’ compensation and highlights the level of potential disadvantage to employees in that State if the awards do not contain accident pay. It also provides information on the other effects on workers and their families caused by the financial stress of being off work on workers’ compensation. He calculates that the loss of the award accident pay entitlement will result, on average, in a loss for an injured worker of approximately $40 per week for the first 13 weeks of absence from work and up to $150 after that period. Mr Browne also states that in his experience, workers prefer to return to work and to be active on the job.
[38] The statement of Sherri Hayward, an industrial officer with the CFMEU NSW Branch, deals with the operation of the NSW workers’ compensation legislation and provides an analysis of work related injuries in the construction industry in that State. She explains how award reliant workers will be disadvantaged if there is no accident pay provision in the awards. Ms Hayward provides a number of calculations to show the shortfall in take home pay for various classifications of employees under the Building and Construction General On-site Award 2010 for the first 13 weeks. On average, it was said that there would be a shortfall of $43 gross per week.
[39] The CFMEU Forestry and Furnishing Products Division relied upon the witness statement of Jane Calvert, its Divisional President. Ms Calvert outlined the award history of accident make up pay in the timber and paper industries and in the predecessor awards to the Timber Industry Award 2010. She said that accident pay was a feature of the Timber and Allied Industries Award 1999 and its predecessor awards since 1973 when an accident pay provision relating to NSW and Victoria was inserted by consent. The award entitlement in the timber industry was generally 39 weeks accident make-up pay in all States covered by the 1999 award. She said that other awards in the timber industry also provided accident pay entitlements. 19 In relation to the pulp and paper industry, it was said that the two pre-modern awards provided for 52 weeks accident make up pay.
[40] Ms Calvert also provided information regarding enterprise agreements in the timber industry. It was said that 41% of the agreements have a clause that specifically deals with accident make-up pay. Within that group, 75% provide for 39 weeks accident make-up pay and 25% provide for 52 weeks make-up pay. Of the agreements that do not have a clause dealing with accident make-up pay, those agreements “almost uniformly” incorporate the terms of the modern award which entitled employees to accident make-up pay under the transitional provisions.
[41] Ms Calvert referred to the comparatively low wages in the industry and provided some estimates as to the loss that would be suffered by an injured award reliant worker in Victoria if there was no accident make-up pay provision in the award. Based on her calculations, a level 4 employee who is unable to work due to a work related injury who is on workers’ compensation will suffer a $35 reduction in take home pay each week for the first 13 weeks and a $141 reduction after 13 weeks. She said that the loss of accident pay entitlements would exacerbate the problems faced by injured workers, including financial difficulties, stress and anxiety and personal issues due to an inability to contribute to household expenses. Finally Ms Calvert notes that the timber industry has a high national injury incidence rate and suggests that workers in the industry are more reliant on accident make up pay entitlements.
[42] The SDA relied upon the evidence of six employees in the retail industry who have suffered injuries at work and received workers’ compensation entitlements and accident pay. Most of the workers had received accident pay under enterprise agreements. Generally the evidence of the employees was that the reductions in their workers’ compensation payments would have caused them financial strain had they not had the benefit of accident pay.
[43] Two witness statements were filed by the TCFUA - from Michele O’Neil, National Secretary of the union and the State Secretary of the Victorian Queensland Branch, and Allen Spencer, a worker in the carpet industry.
[44] Ms O’Neil said that wages and job and income security are major issues for TCF workers. Where award-dependent, TCF workers tend to be low-paid and solely dependent on the award rate for their primary source of income each week. The relatively low level of bargaining power of groups in the industry means that workers are likely to remain award dependent. She referred to a range of studies and reports about outworkers in the TCF industry and said that there is systematic exploitation of outworkers as a class through non-compliance by employers with minimum award wages and conditions and other industrial laws. She said that outwork remains a prevalent feature of the industry, with workers often working in precarious circumstances and excessively long hours without additional compensation. She gave examples of the negative impact of outwork on workers, including poor health and injury from overwork.
[45] Ms O’Neil said that TCF work ‘on the floor’ is physically strenuous in respect to both the physical nature and duration of the tasks, ‘can result in eye strain, repetitive strain, back and arm injuries and high levels of exhaustion’, and that ‘overuse, manual handling and musco-skeletal workplace injuries are typical for workers in the industry’. She said that TCF workers ‘work in very poor physical environments in which they are exposed to a range of hazards’, and that poor OH&S practices are common in TCF workplaces. Disputes typically arise about return to work programs, with employers not agreeing to provide suitable alternative duties. This leads to an extension of the period for which an injured worker will be off work.
[46] Ms O’Neil said there is a long and consistent history of accident pay going back to the mid 1970s. Prior to award modernisation and the making of the TCF Award, the TCF industry was covered by approximately 23 award based transitional instruments, with 5 of the 6 federal awards, and 4 of the 17 NAPSAs containing accident pay provisions. She said that where enterprise bargaining does occur, accident pay provisions continue to remain an important underpinning condition as a means of providing income security during a period of workplace injury. Ms O’Neil suggested from her analysis of enterprise agreement coverage that almost 80% of current TCF enterprise agreements contain an accident pay provision. This was said to demonstrate that accident pay remains an important industry standard for bargaining and significant to the financial security and living standards of TCF workers. She said that accident make-up entitlements previously under the TCF award ‘represented significant amounts of money for such employees’ and that their removal would have a serious financial impact on employees.
[47] Mr Spencer has been employed since 2001 in the carpet industry and has held a number of positions in the TCFUA including as a shop steward and a workplace health and safety representative. He gave evidence about workplace injuries which he suffered in 2012 and 2013 and the benefit to him of receiving accident pay under an enterprise agreement. This ensured that he received his full payment of wages during the time he was off work. He said that being paid his ordinary wage during his absence meant that he could focus on his health and recovery and ‘not worry about how I could afford to live day to day.’ He estimated that in the absence of accident pay, he would have incurred a loss of approximately $1,415 for the total 28 weeks absence, and that in relation to his current absence he would otherwise be worse off by $41 per week.
(b) Evidence of the employer groups
[48] The Ai Group relied on the evidence of Tracey Browne, its Manager of National Safety and Workers’ Compensation Policy and Membership Services. Ms Browne has been employed in safety and workers’ compensation roles with the Ai Group since 2001 and has particular expertise in relation to the NSW and Victorian workers’ compensation schemes. She has participated in both formal and informal reviews of workers’ compensation systems on behalf of the Ai Group, including policy development, drafting of submissions, participating in consultations with regulators and assisting with the implementation of review outcomes.
[49] In her witness statement, Ms Browne refers to the range of provisions within workers’ compensation law designed to achieve a cooperative approach to rehabilitation and return to work. These include the obligations on employers to provide suitable employment and the obligations on workers to cooperate and participate in rehabilitation and return to work. There are specific financial elements of workers’ compensation schemes that encourage return to work outcomes, including the structure of weekly benefits and step-downs.
[50] Ms Browne provided a detailed comparison of the step-down provisions across jurisdictions in Australia and provided examples as to the practical operation and effect of the step-down provisions in the NSW and Victorian schemes. She said that the effectiveness of workers’ compensation schemes in achieving the outcomes of fair compensation and timely return to work is determined by the complex interaction of the range of benefits, obligations and incentives provided thereunder. In her testimony, Ms Browne stressed the importance of cooperation by employees in order to achieve an early return to work. Whilst most workers want to get back to work, some workers do not cooperate fully and there are a variety of measures for dealing with these problems, including the termination of weekly benefits. She said there was some evidence that injured workers become less reluctant to return to work when they know that a step-down is approaching. She does not see step-downs as being designed to punish workers but as being part of the scheme to achieve the best possible return to work outcomes. She also accepted that the employer obligation to provide suitable duties was an important part of the return to work scheme.
[51] Ms Browne described the obligations of employers in administering accident make-up pay and the times when an employer will be required to recalculate the amount of accident pay (e.g. when the weekly amount payable under the workers’ compensation scheme is varied or when the injured worker returns to work on modified hours and the hours progressively increase or reduce). The direct cost impact on an employer obliged to provide accident pay will commonly vary depending upon the ordinary time earnings of the injured worker and whether any overtime and shift penalties are part of the worker’s pre-injury average earnings. It was said that, if the union applications for the insertion of accident pay provisions are granted, then some employers who have never been required to make accident make-up payments before will be faced with both immediate direct costs if they have workers’ compensation claims and ‘adoption’ costs associated with understanding the provisions and working out how to apply them in their workplaces.
[52] The ACCI relied upon the evidence of Robin Shaw, the Manager of the Self Insurers of South Australia Inc (SISA). SISA is the representative organisation for self-insured employers in South Australia and covers most of the largest employers in the private and public sectors in that State. Mr Shaw has had 22 years experience in workers’ compensation roles including involvement with claims and injury management and return to work, policy formulation, scheme design and legislative developments.
[53] The statement provided by Mr Shaw and the numerous attached materials deal with a wide range of matters including the development and nature of the workers’ compensation system in Australia, and medical opinion as to the relationship between work and health. The attached materials include various reports and statements regarding workers’ compensation schemes and policies in Australia, including the Safety, Rehabilitation and Compensation Act Review Report – February 2013 by Peter Hanks QC (the Hanks Report), the Productivity Commission Inquiry Report on National Workers’ Compensation and Occupational Health and Safety Frameworks (March 2004) and a Safe Work Australia publication The Comparison of Workers’ Compensation Arrangements in Australia and New Zealand August 2014 (the Safe Work Comparison Report).
[54] In his statement, Mr Shaw refers to the 8 workers’ compensation schemes under the jurisdiction of the States and Territories and the 3 schemes under the jurisdiction of the Australian Government (Comcare, Seacare and the Department of Veterans’ Affairs). He notes that whilst there are some key shared attributes of workers’ compensation legislation across the various jurisdictions, the schemes are “varied, sophisticated and complex systems aimed at objectives broader than mere financial compensation of injured workers.” Whilst as a general proposition workers’ compensation schemes originally solely focused on paying compensation to workers injured in the course of their employment, more recently it has been recognised that prevention is preferred and workers’ compensation arrangements have changed accordingly. The primary response of the workers’ compensation schemes to the new focus on injury prevention and workplace safety has been the introduction of experience-rated premiums for employers.
[55] Mr Shaw said that central to the evolution of workers’ compensation in Australia is an increasing emphasis on promoting and incentivising early and safe return to work. The increased focus on return to work outcomes is in part explained by the growing medical recognition of the health benefits of work and the health dangers of not being in some form of constructive or rewarding work. 20 Factors influencing return to work outcomes in the various schemes involve a range of parties working together in the best interest of the injured worker. A successful return to work is usually the result of four main factors: early intervention; an effective workplace based return to safe work program with employer support and participation; effective claims management; and cooperation, collaboration and consultation between stakeholders. It has long been generally recognised that maintenance of the employment relationship is vital to safe and sustainable return to work outcomes.
[56] In relation to step-downs, Mr Shaw notes that all workers’ compensation jurisdictions in Australia include step-downs in some form. Once in receipt of income replacement payments, injured workers are eventually subject to step-downs of those payments, with the timing and extent of the step-downs dependent on the relevant jurisdiction. The purpose behind the inclusion of step-downs across the various workers’ compensation schemes is multifaceted. It is incorrect to suggest that the sole consideration for the inclusion of step-downs is to reduce costs for the respective schemes. One motivating factor in the use of step-downs is to provide an extra impetus for a proportion of employees who may need an incentive, or at least a reminder, to return safely to work as early as possible. Mr Shaw said that there is evidentiary material which supports the proposition that step-downs provide an incentive to return to work and that make-up pay entitlements may disincentivise a return. 21 In this regard, reference was made to the Productivity Commission Inquiry Report 2004 which notes that empirical evidence from Australian workers’ compensation schemes suggests that step-downs provide incentives for return to work.22
[57] Mr Shaw suggested that, although in most schemes, regardless of the structure of step-downs, a majority of workers will return to work as soon as it is safe. However, given the scale of the schemes and the medical evidence, even if a small percentage of workers are disincentivised from returning to work, it would be a highly adverse result for both those workers and the schemes. Mr Shaw recognises in his statement that “the use and effectiveness of step-downs in workers’ compensation schemes is complex and worker-specific.”
[58] The Motor Traders Associations relied upon the evidence of Paul Eblen, a consultant with MTA South Australia who has extensive experience in workers’ compensation and industrial law, and Greg Hatton, Deputy CEO - Policy and Employment Relations at the MTA NSW.
[59] Mr Eblen said that accident make-up pay provisions in awards served a “very useful purpose” under workers’ compensation legislation which in the past only provided for 65-85% of weekly ordinary time earnings to be paid to injured workers. However today accident pay is an “archaic provision” given the changes in workers’ compensation schemes and the benefits payable. He suggested that accident pay provides a financial incentive for injured workers to delay their return to work. He said that until 2008 the South Australian workers’ compensation scheme provided for benefit payments at full average weekly earnings for 2 years with no step-downs and that this resulted in a culture where physically recovered workers continued on benefits and refused to participate in return to work programs. This position changed with amendments to the scheme in 2014 to improve return to work rates. Based on his experience in South Australia, Mr Eblen suggested that continuing accident pay provisions in modern awards would remove the incentive to return to work and will result in an increase in the costs of workers’ compensation.
[60] Mr Hatton said that the previous accident pay clause in the relevant federal award was complex and employers found it difficult to calculate the appropriate benefits to be paid. He considered that the proposed provisions maintained all the complexity of the previous clause and sought to extend the obligation to 39 weeks when the previous obligation, for a majority of employers in the NSW vehicle industry, was 26 weeks. Mr Hatton explained that the transitional accident pay provisions only applied to employers who were employers as at 26 March 2006 and only applied to employees who were engaged at that time. He said that accident pay has been effectively removed over time without any concerns being raised by the employees or unions until the present application. He suggested that with the reducing incidence of accident pay entitlements, and the success of the NSW system in recent years in getting employees rehabilitated and back to work within a three-month period, there is less of a need for a longer period of support for employees via an accident pay entitlement.
SUBMISSIONS OF THE PARTIES
[61] We now refer to the main submissions made by the unions and employer groups in the proceedings before the Full Bench.
(a) Submissions by the ACTU and the unions
[62] The ACTU supported the union applications and submitted that it is necessary to include accident pay in the awards in order to achieve the modern awards objective. It was said that accident pay has been a feature of award regulation since the 1970s and that this suggests a history of positive determinations in favour of accident pay being included in the award safety net. It was also said that throughout this time, the award safety net has operated simultaneously with State and Territory workers’ compensation legislation and that there is little evidence to suggest that this has been to the detriment of return to work objectives for injured workers or employers. The ACTU submitted that accident pay is a matter of great significance to workers and that its removal from the award safety net would constitute both a significant departure from previous industrial jurisprudence and the loss to workers of an important entitlement.
[63] In relation to questions of jurisdiction, the ACTU submitted that accident pay is a term that may be included in modern awards because it is a matter about ‘allowances’ (s.139(1)(g)) 23 and is not a term or condition of employment which is subject to State or Territory boundaries (s.154). It was said that the union applications generally provide for a single and standardised entitlement to accident pay that would apply to all employees covered by the particular award.
[64] In relation to the Award Modernisation Decision 2008 the ACTU submitted that the decision should be read having regard to the questions raised in the award modernisation proceedings by the ACCI as to whether accident pay was to be considered an ‘allowance’ within the meaning of s.576J(2)(g) of the Workplace Relations Act 1996 (the WR Act). It was said that the Award Modernisation Full Bench ruled that accident pay may be characterised as an ‘allowance’ 24 and acknowledged that accident pay had been a feature of the award system for many years.25 It was suggested that the transitional arrangements for accident pay were the consequence of the circumstances at the time of the award modernisation exercise, including the enormity of the task of modernising the award system, the problems associated with the rationalisation of a broad range of disparate entitlements and the question of whether the provisions were terms that contained State-based differences contrary to s.576T of the WR Act. It was said that the ultimate resolution, by way of transitional arrangements, was in line with the predisposition at that time which was to maintain the status quo, having regard to the constraints of the Award Modernisation Request, specifically that the creation of modern awards was not intended to disadvantage employees or increase costs for employers.26 It was submitted that the transitional arrangements did not represent a conclusion that at the end of the five-year period, accident pay should disappear from the award safety net – rather it was anticipated that a national standard of accident pay would be established during that time.
[65] The ACTU relied upon the report prepared by Dr Purse to challenge the view of employers that accident pay might have a negative effect on return to work rates or that step-downs are an essential design feature of workers’ compensation schemes which facilitate the return to work process. It was said that the report takes the view that there is no substantive evidence to suggest that accident make-up pay is at odds with return to work objectives and that the availability of such pay may in fact contribute to more sustainable outcomes for both workers and employers.
[66] In regard to the modern awards objective (s.134), the ACTU submitted that the union applications are necessary to meet the objective and that there is probative evidence to support the applications.
[67] In response to a request from the Full Bench, the ACTU put forward a draft award clause on accident pay 27 which was accepted by the applicant unions as being appropriate with some award specific amendments to be used by the Full Bench should a decision be made to include accident pay in the relevant awards.
[68] The submissions put by the ACTU were adopted and supplemented by the submissions and material presented by the applicant unions. Each of the unions provided material and submissions regarding the history of accident pay provisions in relevant awards and the necessity for such provisions to be included as part of a fair and relevant minimum safety net of terms and conditions for workers covered by the awards.
[69] The CFMEU Construction and General Division has applied to have accident pay provisions inserted into the Building and Construction General On-Site Award 2010, Joinery and Building Trades Award 2010 and the Mobile Crane Hiring Award 2010.
[70] The CFMEU submissions dealt with a range of general matters relating to the 4 yearly review as well as matters specifically relating to its application to vary the building and construction awards. In particular, the CFMEU presented material and submissions in relation to the history of accident pay in the building and construction industry and in relevant federal awards, the critical mass of award coverage of accident pay in the building and construction industry prior to March 2006, the making of the modern awards and the treatment of accident pay as a transitional matter, the effect on the safety net of employees not having accident pay under the awards, the cost impact of accident pay on employers in the industry and the need for accident pay to be retained in the awards having regard to the modern awards objective.
[71] In relation to the history of accident pay in the building and construction industry, it was said that this can be traced back to 1971 and the New South Wales Building Trades Disputes Award. 28It was said that accident pay has been a feature in the predominant federal building and construction industry awards since 1975. It was explained that the only reason that South Australia and Tasmania were not included in the accident pay clause in the National Building and Construction Industry Award 1990 was because of the reason given back in 1975, namely that the workers’ compensation schemes in those States already paid the award rate or better for the first 26 weeks.
[72] A similar pattern of regulation of accident pay applied in the industries covered by the Joinery and Building Trades Award 2010 and the Mobile Crane Hiring Award 2010. For example, in the case of the joinery award, when the various federal off-site awards were consolidated by the Australian Industrial Relations Commission in 1993 to form the National Joinery and Building Trades Award 1993, the accident pay clause applied in every State except for South Australia. The first Mobile Crane Hiring Award was made in 1975 and at that time the accident pay clause only applied in Victoria and provided an entitlement of 26 weeks. The entitlement was increased to 39 weeks in 1978 and then to 52 weeks in 1981. When the award was consolidated and a new award made in 1988, the award applied in all States and Territories and the accident pay clause applied to all employees covered by the award.
[73] The CFMEU in its submissions dealt in a detailed way with the award modernisation exercise which led to the making of the three awards and the insertion of transitional provisions relating to accident pay. It was submitted that, based on the historical coverage of accident pay in the relevant federal awards prior to 2006, an industry standard should be inserted into the three awards. This would be consistent with the approach adopted in the General Retail Industry Award 2010 decision 29where the Full Bench in establishing the terms of modern awards had particular regard to the terms of existing instruments and where there was significant disparity in those terms “attached weight to the critical mass of provisions and terms which are clearly supported by arbitrated decisions and industrial merit.”30 In this regard, the CFMEU highlighted the history and arbitrated decisions that led to accident pay being a significant provision in the federal awards and identified the pre-reform instruments that contained accident pay provisions.
[74] The CFMEU gave examples of the impact of not having accident pay. It was said that the greatest impact will be felt by those workers on the award rate of pay, who do not receive over award payments, who do not work regular overtime, and who are off work for more than 13 weeks. It also provided information regarding health and safety in the building and construction industry, the number of serious injuries which occur each year and the experience with workers’ compensation claims. It was said that although the majority of CFMEU members in the Construction and General Division are covered by enterprise agreements and therefore have superior benefits to those contained within awards, including superior provisions in regard to accident pay, the awards are still vital in providing a minimum accident pay entitlement because of the itinerant nature of work in the industry.
[75] The CFMEU submitted that the inclusion of accident pay is necessary to achieve the modern awards objective in relation to the three awards and made submissions in relation to each of the matters set out in s.134(1)(a) to (h).
[76] The AWU’s application seeks the insertion of accident pay provisions into seven modern awards, namely the Concrete Products Award 2010; Dry Cleaning and Laundry Industry Award 2010; Gardening and Landscaping Services Award 2010; Horticulture Award 2010; Hydrocarbons Industry (Upstream) Award 2010; Oil Refining and Manufacturing Award 2010;and Wine Industry Award 2010. The AWU provided documentation regarding the pre-reform instruments for the relevant industries covered by the awards and the extent to which those awards contained accident pay provisions.
[77] In relation to the hydrocarbons and oil refining industries, it was submitted that there was a clear national standard of a maximum of 52 weeks accident pay in the overwhelming majority of pre-reform instruments in these industries. It was said that a strict application of the Award Modernisation Decision 2008 31 should have resulted in a substantive accident pay clause being included in the two modern awards as the accident pay scheme applying in both industries was clear.32 In relation to the Concrete Products Award 2010, some of the pre-reform instruments included accident make-up pay provisions for up to 26 weeks. This included the main predecessor federal award, the Cement and Concrete Products Award 2000 – although the accident pay provision in that award did not apply in Queensland and South Australia. The AWU was not able to provide statistics as to how many workers were covered by the relevant pre-reform instruments. In relation to the Dry Cleaning and Laundry Industry Award 2010, it was submitted that numerous pre-reform instruments in the industry included accident pay entitlements up to a maximum of 26 weeks. The relevant pre-reform instruments included the two federal awards which were the primary reference points33 for the respective dry cleaning and laundry streams in the modern award, namely the Dry Cleaning Industry Award 2000 and the Laundry Industry (Victoria) Award 1998. In relation to the Gardening and Landscaping Services Award 2010,it was submitted that the AWU Commercial Landscaping Award 2001 was a significant federal award which contained a maximum of 26 weeks accident pay for employees of named respondents in Queensland, Western Australia and Victoria and that the award had common rule operation in Victoria from 2005. In relation to the Horticulture Award 2010, it was said that the award which was used as the primary reference point for the making of the modern award,34 namely the Horticulture Industry (AWU) Award 2000 contained an accident pay provision for 26 weeks. A similar submission was made in relation to the Wine Industry Award 2010.It was said that the Wine Industry - AWU - Award 1999 was one of the primary reference points used in the preparation of the draft modern award and that that award applied to an extensive list of respondents in New South Wales, Victoria, Queensland and Western Australia and contained an entitlement to a maximum of 26 weeks of accident pay.
[78] The AWU submitted that accident pay is an important employment condition because it helps workers meet their financial commitments while they are incapacitated as a result of a work-related injury. In relation to the modern awards objective, it was submitted that if accident pay entitlements are not inserted into modern awards, some award reliant employees will receive below minimum national rates of pay and that this will give rise to serious concerns about whether low-paid employees will be able to meet their financial commitments when they are off work due to injury or illness (s.134(1)(a)). It was also submitted that if accident pay provisions are not included in the awards then unions will find it more difficult to negotiate or protect accident pay provisions in enterprise agreements (s.134(1)(b)).
[79] The AMWU Vehicle Division made application to vary the Vehicle Manufacturing, Repair, Service and Retail Award 2010 to include an accident pay provision based on the entitlements found in the two major pre-reform industry awards. It was said that both the Vehicle Industry Award 2000 and the Vehicle Industry - Repair, Services and Retail Award 2000 contained an accident pay entitlement of 39 weeks other than in New South Wales and Queensland where the entitlement was 26 weeks. The content and application of the accident pay entitlements were consistent in form and content across both pre-reform awards and were first inserted by consent into the predecessor awards in 1973. It was submitted that, although the awards did not cover all States and Territories uniformly, the workers covered by the two awards represented a ‘critical mass’ amongst vehicle industry employees covered by pre-reform instruments. It was also said that other pre-reform instruments contained entitlements to 26 weeks accident pay. 35 There were also many enterprise awards and agreements in the vehicle manufacturing industry with entitlements to 52 weeks accident pay.36
[80] It was submitted that the accident pay clauses in the main pre-reform awards represented a stable, commonly understood, 40 year old entitlement in the vehicle industries. The long-standing and stable history of accident pay provisions in the industries demonstrates that the inclusion of the accident pay provision is necessary to provide a fair and relevant minimum safety net of terms and conditions. It was explained that the application by the AMWU Vehicle Division would involve an extension of the pre-modern award entitlement to the Northern Territory and the Australian Capital Territory and to some award covered employees in Western Australia 37 and an increase in the quantum of accident pay entitlements in NSW and Queensland from 26 to 39 weeks.
[81] The AMWU Vehicle Division submitted that the financial impact of the loss of accident pay, and the associated loss of the ability of affected employees to maintain relative living standards, would be significant. Examples were given as to the potential impact of the loss on workers and statistics were provided regarding award-reliant employees and workers’ compensation claims in the vehicle industries.
[82] The TCFUA sought the inclusion of an accident pay entitlement of 39 weeks in the Textile, Clothing Footwear and Associated Industries Award 2010. It was submitted that there is a long history of accident pay provisions in awards in the textile, clothing and footwear industry with those provisions having a near national coverage and application and that the inclusion of a substantive accident pay provision is necessary and will provide a clear national standard for an industry which is characterised as low-paid and highly award reliant. It was said that an entitlement of 39 weeks accident pay would reflect the previous entitlement in the critical mass of pre-reform instruments with accident pay provisions and was appropriate having regard to the circumstances of the clothing and textile industry. In this regard it is noted that the Textile Industry Award 2000 contained an entitlement of up to 39 weeks accident pay, whereas the Clothing Trades Award 1999 provided for 26 weeks accident pay.
[83] In relation to the TCF industry, it was said that the industry is heavily concentrated in 2 main sectors, namely textiles and clothing, and in two main States (Victoria and NSW). It was submitted that employment in the industry is highly award dependent and low-paid and that there is a relatively low level of enterprise bargaining. It was also submitted that it is an industry which continues to be characterised by non-compliance with minimum award wages and conditions and health and safety standards. This is particularly the case in the outwork sector. In this regard reference was made to various studies in Australia, including a 2014 study conducted by Professor Christina Cregan from the University of Melbourne. 38
[84] It was submitted by the TCFUA that the loss of accident pay for low-paid injured workers in the industry would be significant and would directly affect their capacity to meet the basic costs of living. It was said that award dependent workers have much less capacity to absorb the loss of income involved or to recover that income through other means. Therefore the loss of accident pay would have a disproportionately regressive impact on low-paid award dependent workers in comparison with workers who enjoy superior wages and conditions.
[85] The TCFUA submitted that the inclusion of a national accident pay provision in the TCF award is necessary having regard to the modern awards objective. This would provide a fair and relevant minimum safety net of terms and conditions in the TCF industry, which is significantly award reliant, generally low-paid and with particular classes of workers who require special protection and regulation. In particular, the inclusion of the accident pay provision will address the needs of the low-paid (s.134(1)(a)) and ensure that workers in the TCF industry are not further disadvantaged due to workplace injuries and illnesses. The provision will promote social inclusion by ensuring that low-paid workers maintain a living wage when injured (s.134(1)(c)). The failure to include an accident pay entitlement will have an adverse impact on enterprise bargaining as it will remove the underpinning award provision (s.134(1)(b)). The proposed accident pay provision is simple and easy to understand and reflective of provisions in a majority of the pre-reform instruments, thereby providing a stable and sustainable award-based accident pay provision in the TCF industry (s.134(1)(g)).
[86] The ASU has sought to vary 11 modern awards to include accident pay entitlements. All of the awards contained transitional accident pay provisions and it was submitted that accident pay should continue to be part of the safety net of workers entitlements in the respective industries. The ASU also submitted that the entitlement to accident pay should be extended to all workers, irrespective of whether they work in an industry where a “critical mass” of workers was entitled under pre-reform awards to accident pay. It was said that every employee covered by a modern award should have an entitlement to accident pay as a minimum standard. The only variation to a national standard should be based on historically different industry standards, particularly in relation to the quantum of accident pay.
[87] The ASU provided information regarding accident pay entitlements in the pre-reform instruments in the various industries covered by its applications. It was submitted that in relation to three awards, namely the Business Equipment Award 2010, Airline Operations - Ground Staff Award 2010 and the Labour Market Assistance Industry Award 2010 there has been a clear industry standard of 26 weeks or 39 weeks accident pay. In most of the other awards it was said that there have been significant entitlements to accident pay in some of the relevant pre-reform instruments. However in relation to the Contract Call Centres Award 2010 there were no pre-reform entitlements. It was submitted that the coverage of the Clerks - Private Sector Award 2010 and the Social, Community, Home Care and Disability Services Industry Award 2010 provide a safety net for workplaces made vulnerable by low pay and conditions where the majority of employees are award reliant and female, with little or no bargaining power. It was submitted that, although the predecessor instruments for these awards have inconsistent accident pay entitlements, an entitlement to accident pay should be included in the awards having regard to the modern awards objective and, in particular, the needs of the low-paid.
[88] The SDA has sought to have accident pay provisions inserted into six modern awards, including the General Retail Industry Award 2010. It was submitted that an entitlement to accident make-up pay of 39 weeks was a common feature in pre-reform federal awards in Victoria in the industries covered by the relevant modern awards for over 30 years. In this regard, the SDA provided information regarding the operation and determinations of the State Wages Boards in Victoria and the relevant accident pay entitlements determined. It was also submitted that in relation to three of the awards, namely the Mannequins and Models Award 2010, the Fast Food Industry Award 2010 and the Storage Services and Wholesale Award 2010, the entitlement to accident pay extended beyond Victoria and there was a critical mass of employees with accident pay entitlements of between 26 and 52 weeks under relevant pre-reform instruments. The SDA sought an entitlement of a maximum period of 39 weeks accident pay in its awards.
[89] The SDA provided information on the pre-reform accident pay entitlements and also on the range of enterprise agreements in the various industries which include provision for accident pay. It was submitted that an entitlement to accident pay would ensure that the awards provide a fair and relevant minimum safety net taking into account the needs of the low-paid. It was said that workers in the retail industry and the fast food industry are generally low-paid and award reliant. Examples were given as to the losses which would be suffered by injured workers in the various States and Territories if an accident pay provision is not included in the awards.
[90] The AMWU sought to include accident pay provisions in four awards, namely the Manufacturing and Associated Industries and Occupations Award 2010, the Food, Beverage and Tobacco Manufacturing Award 2010, the Graphic Arts, Printing and Publishing Award 2010 and the Airline Operations - Ground Staff Award 2010. The quantum sought is based on the standard in pre-reform instruments, namely 39 or 52 weeks accident pay. It was submitted that the inclusion of these provisions is necessary to achieve the modern awards objective.
[91] The AMWU provided information regarding the pre-reform instruments related to each of the modern awards and the coverage of accident pay in the awards. In relation to the Manufacturing and Associated Industries and Occupations Award 2010, reference was made to the agreements made between the main employer and union groups in Victoria and New South Wales in the early 1970s. It was said that a federal award was made in 1998 to replace the 1972 agreement which applied in Victoria. 39 This provided a standard of 39 weeks accident pay whereas the unregistered agreement provided for 52 weeks accident pay. It was said that the New South Wales agreement fell into disuse when the workers’ compensation legislation in that State provided for 26 weeks pay at 100%. In relation to other awards which were superseded by the Manufacturing Industries Award, it was said that pre-reform instruments in the rubber and plastics industry predominantly contained accident make-up pay provisions which applied nationally (except in the Northern Territory).
[92] In relation to the Graphic Arts Award 2010,the main pre-reform instruments contained provisions for accident make-up pay, although the provisions only applied in New South Wales and Victoria. In relation to the Food, Beverage and Tobacco Manufacturing Award 2010, it was said that most of the pre-reform awards contained accident pay provisions and that, when the Queensland, South Australian, Western Australian and Tasmanian awards are excluded (on the basis that accident pay is not required in these States for at least the first 26 weeks of injury), only the New South Wales awards did not contain accident pay. In relation to the Airline Operations - Ground Staff Award 2010, it was said that the main pre-reform award 40 contained an accident pay provision which applied nationally and entitled workers to up to 52 weeks accident make-up pay. Other pre-reform awards provided an entitlement to 26 weeks accident pay.41 It was submitted that the circumstances with the Airline Operations award is similar to those relating to the Black Coal Mining Industry Award 2010.
[93] The AMWU made detailed submissions regarding the modern awards objective. It was submitted that accident pay is necessary to ensure that employees continue to receive the minimum wage whilst they are off work due to injury so that they might maintain their living standards and be allowed to return to work without undue pressure when it is possible to do so (s.134(1)(a)). It was also submitted that the provision of accident pay by employers and other ongoing support would assist in improving the motivation of injured workers to return to work (s.134(1)(c)). It was also said that accident pay creates a further incentive for employers to provide safe workplaces (s.134(1)(d)).
[94] The CFMEU Forestry and Furnishing Products Division sought to include accident pay entitlements in the Timber Industry Award 2010. The submissions made relied upon the statement of Ms Calvert which explains the award history of accident pay provisions in this industry. It was submitted that there is a long history of accident pay provisions in the different sectors of the industry and that the inclusion of accident pay in the modern award is necessary to ensure that it takes into account the needs of the low paid. It was said that the consideration of the needs of low-paid and award reliant workers has particular relevance for the timber industry. There is evidence that many award reliant workers are highly dependent from week to week on award wages such that any reduction in those wages, such as occurs when a worker is injured and make-up pay is not available, is magnified and can cause financial stress and social deprivation. It was also submitted that the relatively high workplace injury rates in the timber and paper industries highlight the importance of accident pay for employees. It was also said that enterprise bargaining in the industry is characterised by a high degree of award incorporation by reference.
[95] It was submitted that, prior to award modernisation, the majority of accident make-up pay provisions in federal and State awards in the timber industry provided for a standard of 39 weeks accident pay. The federal awards in the pulp and paper industry provided for a standard of 52 weeks of accident pay. The CFMEU seeks to retain these entitlements for the different sectors covered by the modern award. It was submitted that it is important to consider the award history and the role of critical mass of award coverage in determining matters of this kind. In this regard it was acknowledged that the pre-reform awards covering the wood and timber furniture streams in the award did not have a history of accident pay entitlements. However the union submitted that there should be an accident pay entitlement for all workers covered by the award.
[96] The MUA has made application for accident pay provisions to be included in the Marine Towage Award 2010, the Professional Diving Industry (Industrial) Award 2010 and the Stevedoring Industry Award 2010.
[97] The MUA generally relied upon the submissions of the ACTU and other unions. It presented information and research as to the award history of accident pay provisions in the relevant industries and submitted that there has been a long history of accident pay provisions in the pre-reform awards and in enterprise agreements in the industries. The accident pay entitlement in the tugboat industry increased from 26 weeks in 1974 to 52 weeks in the pre-reform Tugboat Industry Award 1999. The entitlement in the pre-reform diving industry award was 52 weeks. In the stevedoring industry the first occurrence of accident pay was in the Waterside Workers’ Award 1960 which provided a benefit period of two years. The pre-reform stevedoring industry award had an accident pay entitlement of 104 weeks. All the awards were said to have national coverage. It was submitted that it is important that the accident pay entitlements be maintained as a safety net in the industry awards given the long award history of such entitlements and the nature of employment in the maritime industry, including work related injuries and accidents.
[98] The UFU did not file any submissions in support of its application to vary the Fire Fighting Industry Award 2010 and did not appear in the proceedings.
(b) Submissions of the employer groups
[99] The employer groups which participated in the proceedings opposed the union applications for the insertion of accident pay provisions into awards. The main submissions were presented by the ACCI and the Ai Group.
[100] The Ai Group submitted that the unions have not made out a case as contemplated by the Preliminary Issues decision for the making of significant variations to awards. In particular it was submitted that the unions have failed to establish that their claims have merit and that the proposed accident pay provisions are necessary to ensure that the modern awards objective is met. It was also submitted by the Ai Group that the proposed provisions contain State-based difference terms contrary to s.154 of the Act and do not meet the requirements of s.139(2).
[101] As a preliminary matter, the Ai Group submitted that the union applications should not be entertained because they are closely connected to claims which were recently heard and determined by the Commission. For this reason it was said that the claims amount to an abuse of process and that the estoppel principles developed by the courts should guide the Full Bench in refusing to consider the claims.
[102] In relation to the proposed accident pay provisions to be inserted into awards, the Ai Group submitted that the provisions are not drafted uniformly and differ significantly with respect to a range of matters including the definition of accident pay, the length of time over which the accident pay entitlement is to be paid, and eligibility requirements. It was said that the definition of accident pay is particularly important when it comes to considering the cost impact of the union claims on employers. In some cases the proposed clauses provide a far more generous definition of accident pay than that which equates to the compensation payments under workers’ compensation schemes. It was also said that those elements of the claims that attempt to extend accident pay entitlements to persons who are no longer employees are beyond power because awards can only cover employers, employees and registered organisations (s.143A(1) and (3)).
[103] The Ai Group in its submissions and through the evidence of Ms Browne, provided information regarding the operation of the workers’ compensation schemes in the States and Territories, and the operation of the Commonwealth schemes. It was said that since the 1980s the focus of workers’ compensation schemes has been on the rehabilitation of injured workers and ensuring a safe and timely return to work. Although the legislation in each State and Territory has responded to the challenges in different ways, all the systems have adopted a “stepping down” approach in regard to weekly workers’ compensation payments. It was said that recent amendments to workers’ compensation legislation in Victoria and New South Wales demonstrate the increasing acceptance that the legislation is intended to encourage employees to return to work in a timely and safe manner and that the stepping down of weekly payments provides an incentive for injured workers to return to work as quickly as possible. 42 There is also a proposal to amend the Comcare scheme to introduce similar step-downs as in Victoria and New South Wales.43
[104] It was not disputed by the Ai Group that a broad range of factors influence when an injured employee returns to work and that the level of compensation payments to which an employee is entitled is only one of many relevant matters. However it was submitted that the task of managing each of these factors, evaluating their impact on return to work outcomes, and introducing relevant reforms, is one which is best undertaken by State and Territory governments in conjunction with workers’ compensation regulators and stakeholders. It is not an appropriate role of the award system to second-guess the role of the workers’ compensation schemes or to interfere with the integrity of such schemes by e.g. overriding step-down provisions or seeking to fix problems with workers’ compensation. The inclusion of accident pay provisions in awards would undermine the carefully struck balance that has been achieved by each of the relevant legislatures, without due regard for the research, knowledge and policy considerations underpinning the entitlement to workers’ compensation.
[208] In general terms, the decision we have taken is to maintain an accident pay entitlement in areas of award coverage where it has had wide application in the past and to set that entitlement at a level appropriate for the award safety net. We consider that award accident pay entitlements can operate satisfactorily alongside workers’ compensation schemes and do not undermine key policy objectives of those schemes.
[209] We have not been persuaded on the evidence and submissions presented that the awards in the other categories, i.e. the third and fourth categories listed above, should be varied to include accident pay.
[210] In determining the accident pay provision to be included as part of the minimum safety net of terms and conditions in the awards we have had particular regard to the period and quantum of accident make-up pay and the form of the award provision.
[211] In general we consider that the safety net accident pay entitlement should only apply for a period of 26 weeks from the time of incapacity for work due to injury or illness. This is the period of accident pay entitlement under many of the pre-reform instruments to which we have been referred. We consider that this is the appropriate period to be included as part of the minimum safety net in the awards unless there are special circumstances relating to particular awards which warrant a departure from this standard. Such an entitlement will provide support for low paid and award reliant employees at least in the initial period of absence from work due to injury. It will also limit the cost impact of providing a generally applicable accident pay entitlement under the relevant awards and provide scope for collective bargaining to improve upon the minimum entitlement.
[212] We recognise that there are special circumstances relating to the awards in the first category listed earlier in this decision. The pre-reform instruments in these industries provided a generally applicable accident pay entitlement of 39, 52 or 104 weeks. The accident pay provisions in those awards provided what might be considered to be a clear national standard for the particular industries as described in the Award Modernisation Decision 2008. 65 For similar reasons as were given in relation to the Black Coal Mining Industry Award 201066 we have decided that the previous accident pay entitlements in these award areas should be maintained as part of the minimum safety net. However, having regard to the evidence and submissions in the present proceedings, and given the purpose of modern awards in setting minimum terms and conditions for employees in particular industries or occupations consistent with the statutory objectives, we do not consider that the accident pay entitlement in any of the awards should exceed 52 weeks. We consider that there is a difference in inserting such provisions in awards by arbitral determination at this time and in the context of the present proceedings and a decision to maintain provisions which were still in operation in an award.67 We do not consider that it is necessary for the minimum award safety net to provide for a period beyond 52 weeks. In so deciding, we note that the evidence presented suggests that there is considerable scope in some of the industries for the safety net entitlement to be supplemented through collective bargaining.
[213] Similar considerations apply in relation to the Timber Industry Award 2010. Given that the accident pay provision to be included in that award will only apply to workers in two classification streams and that the entitlement covering those workers in the pre-reform instruments provided a national standard in those industry areas, the provision to be included in the award as a minimum safety net for the respective streams should reflect the previous entitlements.
[214] In relation to the form of the accident pay provision to be inserted into the relevant awards, the ACTU in response to a request from the Full Bench provided a proposed simplified accident pay clause. It was explained by the ACTU that the clause was based on the accident pay clause in the Black Coal Mining Industry Award 2010 and had been the subject of discussions between the unions. Whilst there was no amendment to the union applications before the Full Bench, it was said the proposed clause was suitable with necessary adaptations to be included in the awards. In this regard it was said that the reference in the draft clause to “appropriate rate of pay” to be used for the purpose of calculating the accident pay entitlement was intended to reflect the way in which the rate of pay is described in a particular award. For example in the Building and Construction Industry Award 2010 the reference would be to the ordinary time hourly rate of pay. It was explained by the ACTU that “appropriate rate of pay” would not include over award payments, shift allowances or overtime. We do not consider that it is appropriate or necessary in order to achieve the modern awards objective that accident pay entitlements to be included as part of the minimum safety net in the awards should include over award payments, shift allowances or overtime.
[215] The Ai Group opposed the adoption of the ACTU clause. It was submitted that the clause represents a substantively different claim to those advanced by the unions in the proceedings. The AI Group identified a range of elements which have been altered or removed from the initial claims and submitted that the ACTU clause will result in a more extensive entitlement and therefore a greater cost obligation on employers. It was also submitted that the employer parties were not given the opportunity to lead evidence in the proceedings regarding what was in effect a new claim by the unions. It was said that the unions and the employer groups have run their cases based on the terms of the original claims.
[216] We consider that the adoption of a more standardised clause dealing with accident pay would be a desirable development and consistent with the modern awards objective. This would have benefits both for employers and workers in providing simple, easy to understand and stable modern awards. However we accept the concerns raised by the Ai Group in relation to the ACTU clause and the need for further consideration to be given to the implications of adopting the simplified provision. The unions and employer groups may seek to have further discussions around the concept of a simplified accident pay provision in future reviews of the awards.
THE AWARD VARIATIONS
[217] The variations to the relevant awards to give effect to this decision should generally be in the form of those sought by the applicant unions and which in most cases have been drafted having regard to accident pay entitlements under pre-reform instruments. The AMWU and the ASU should confer in relation to a draft variation to the Airline Operations - Ground Staff Award 2010. The variations to the awards will need to reflect the decisions we have made in relation to the length and quantum of accident pay entitlements and the provisions which applied in the main pre-reform instruments relevant to the particular modern award.
[218] The Ai Group made a number of submissions regarding the specific union claims. These included a submission to the effect that an award accident pay provision should not impose obligations on employers in respect of persons who are no longer employed. It was submitted that those elements of the claims which attempt to extend accident pay entitlements to persons who are no longer employees are beyond power because awards can only cover employers, employees and registered organisations (see s.143A(1) and (3)). Further it was submitted that, because of the difficulties and limitations associated with the application and enforcement of provisions that provide an on-going entitlement to accident pay after termination of employment, the Commission should not as a matter of discretion include such provisions in awards.
[219] A somewhat similar submission was put by the ACCI. The ACCI submitted that the term of an award seeking to extend the operation of accident pay after the termination of an employee’s employment is beyond the jurisdictional scope of the Act. It was said that such a term would have no operative effect having regard to ss.46, 136, 137 and 139 of the Act.
[220] In response to these submissions, the CFMEU and other unions referred to the unfair dismissal provisions of the Act which provide a framework for obtaining relief from unfair dismissal to employees who have been terminated and to provisions in awards dealing with casual employees and matters such as minimum notice periods for engagement and conversion from casual employment to permanent employment. It was submitted that the award making powers under the Act are only confined by the existence of a relevant nexus to the employment relationship between a national system employer and its employees. It was said that there are a number of instances where award obligations pertaining to the employment relationship subsist beyond the immediate cessation of employment (e.g. an obligation on an employee to return tools, or an obligation on an employer to arrange transport and temporary accommodation for an employee who has been terminated). In relation to accident pay provisions, it was said that provisions to the effect of requiring that an employee’s pay be made up even where the employment is terminated before the incapacity ceases or before the expiration of the period of accident pay entitlement have been included in many awards and have not previously been challenged by employers. Further it was said that the practical instances where accident make-up payments continue beyond termination of employment will be minimal or non-existent given that State workers’ compensation schemes provide protection for injured workers against termination of employment because of unfitness for employment as a result of the injury.
[221] Although consideration may need to be given to the particular provisions of some accident pay clauses, we do not consider that provisions to the effect of requiring an employer to make accident make-up payments for a particular period, and even where the employment of an injured worker is terminated, are outside the scope of what may be included in awards. Such provisions have been a common feature of accident pay entitlements in awards for many years. The obligation to make the payments arises at the time of injury or incapacity and whilst the employment contract is still on foot. 68 The continuation of that obligation, even where the employment relationship is terminated by the employer, does not render the provision to be beyond power. Further, it might be considered that a provision which ensures that the obligation continues despite the termination of employment is incidental and essential for the purpose of making the income maintenance protection operate in a practical way (see s.142 of the Act).
[222] We are also not persuaded as a matter of discretion that the accident pay provisions should be limited in such a way as submitted by the Ai Group. As we have observed, accident make-up pay entitlements which extend beyond termination of employment by the employer have for a considerable time been a feature of accident pay provisions in many pre-reform instruments. The application of these provisions has not been shown to give rise to such practical problems in administration for employers as would warrant their exclusion from awards.
[223] The Ai Group also submitted that the complexity of calculating the accident pay entitlement of employees meant that accident pay as an allowance within s.139(1)(g) cannot properly be regarded as being “separately and clearly identified in the award” as required by s.139(2). It was said that the difficulty associated with identifying the specific amount payable and the necessity to have regard to workers’ compensation legislation in order to determine what the “allowance” constitutes, rather than merely the term of the award, demonstrates that the union proposals are contrary to s.139(2). The difficulty is even greater where the employment of an injured worker has been terminated.
[224] Whilst we recognise that accident pay might be considered to be of a different character than some other allowances, we note that s.139(1)(g) provides that a modern award may include “terms about” allowances. The entitlement to accident pay operates to ensure that an employee receives a certain weekly rate of pay made up of two components: a workers’ compensation payment and a make-up payment. The calculation of the make-up payment will therefore involve a consideration of both the relevant workers’ compensation legislation and the award provision. Although this might involve a more complex calculation than in the case of some other allowances, we do not consider that this means that the provision would offend s.139(2). This is not unexpected given the nature of accident pay. However the entitlement to accident make-up pay may still be regarded as being separately expressed and clearly identified in the award. We are not persuaded that the issues raised by the Ai Group are such as would lead us to the conclusion that it would be inappropriate or beyond power for accident make-up pay provisions to be included in awards in a form in which such entitlements have traditionally been expressed.
Draft orders
[225] The applicant unions should provide to the Commission draft orders to include the accident pay provisions in the relevant awards within seven days. The draft orders will be posted on the Commission’s website and any employer group wishing to make submissions in relation to the draft orders should file those submissions within seven days from the posting. The orders will be settled and made by Deputy President Kovacic.
[226] The operative date for the award variations will be 15 October 2015.
SENIOR DEPUTY PRESIDENT
Appearances:
G. Starr for the Australian Council of Trade Unions (ACTU).
S. Maxwell for the Construction, Forestry, Mining and Energy Union (CFMEU) - Construction and General Division.
M. Nguyen for “Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers’ Union (AMWU).
L. Weber, A. Moussa for the AMWU - Vehicle Division.
J. Knight for the Australian Municipal, Administrative, Clerical and Services Union (ASU).
V. Wiles for the Textile, Clothing and Footwear Union of Australia (TCFUA).
M. Moretta for the Shop, Distributive and Allied Employees Association (SDA) - Victorian Branch.
S. Crawford for the Australian Workers’ Union.
T. Borgeest for the CFMEU - Forestry and Furnishing Products Division (FFPD).
M. Burns for the Maritime Union of Australia (MUA).
N. Ward for Australian Chamber of Commerce and Industry (ACCI), NSW Business Chamber Ltd, Restaurant and Catering Australia.
B. Ferguson, R. Bhatt for the Australian Industry Group (Ai Group).
J. Archibald for Australian Business Industrial.
R. Calver for Master Builders’ Australia (MBA).
M. Adler for the Housing Industry Association (HIA).
S. McKinnon for the National Farmers’ Federation (NFF).
K. Mark for the Pharmacy Guild of Australia.
S. Cerche for the Maritime Industry Australia Limited.
W. O’Donnell for the Australian Retailers’ Association.
W.J. Chesterman for the Motor Traders’ Association of New South Wales, Motor Trade Association of South Australia, Motor Trade Association of West Australia, and the Victorian Automobile Chamber of Commerce.
A. Baumgartner for the Motor Traders’ Association of New South Wales.
M. Blewett for the Printing Industries’ Association.
N. Hill for the Australasian Railway Association.
J. Light for the Australian Federation of Employers and Industries.
Hearing details:
2015.
Sydney:
March 31
April 1, 2
May 25, 26, 27, 28
Final written submissions:
Ai Group: 4 June 2015
ACTU: 11 June 2015
1 Building and Construction General On-Site Award 2010 [MA000020]; Joinery and Building Trades Award 2010 [MA000029]; Mobile Crane Hiring Award 2010 [MA000032].
2 Concrete Products Award 2010 [MA000056]; Dry Cleaning and Laundry Industry Award 2010 [MA000096]; Gardening and Landscaping Services Award 2010 [MA000101]; Horticulture Award 2010 [MA000028]; Hydrocarbons Industry (Upstream) Award 2010 [MA000064]; Oil Refining and Manufacturing Award 2010 [MA000072]; Wine Industry Award 2010 [MA000090].
3 Airline Operations - Ground Staff Award 2010 [MA000049]; Business Equipment Award 2010 [MA000021]; Clerks - Private Sector Award 2010 [MA000002]; Contract Call Centres Award 2010 [MA000023]; Labour Market Assistance Industry Award 2010 [MA000099]; Legal Services Award 2010 [MA000116]; Local Government Industry Award 2010 [MA000112]; Rail Industry Award 2010 [MA000015]; Social, Community, Home Care and Disability Services Industry Award 2010 [MA000100]; Water Industry Award 2010 [MA000113]; Electrical Power Industry Award 2010 [MA000088].
4 Manufacturing and Associated Industries and Occupations Award 2010 [MA000010]; Food, Beverage and Tobacco Manufacturing Award 2010 [MA000073]; Graphic Arts, Printing and Publishing Award 2010 [MA000039]; Airline Operations - Ground Staff Award 2010 [MA000048].
5 The UFU did not file submissions in support of its application to vary the Fire Fighting Industry Award 2010 and did not appear in the proceedings. Accordingly we have taken the view that the application was not pursued.
6 General Retail Industry Award 2010 [MA000004]; Fast Food Industry Award 2010 [MA000003]; Pharmacy Industry Award 2010 [MA000012]; Hair and Beauty Industry Award 2010 [MA000005]; Mannequins and Models Award 2010 [MA000117]; Storage Services and Wholesale Award 2010 [MA000084].
7 Marine Towage Award 2010 [MA000050]; Professional Diving Industry (Industrial) Award 2010 [MA000108]; Stevedoring Industry Award 2010 [MA000052].
8 The Chamber of Commerce and Industry of Western Australia forwarded written submissions but did not appear in the proceedings.
9 [2008] AIRCFB 1000.
10 Ibid at [87]-[88].
11 [2014] FWCFB 7767.
12 [2015] FWCFB 644.
13 Ibid at [65]-[72].
14 Ibid at [73]-[76].
15 [2014] FWCFB 1788.
16 Ibid at [60].
17 As a result of legislation enacted in late 2014, from 1 July 2015 the first step down under the Return to Work Act 2014 (SA) is after 52 weeks of incapacity.
18 Mr John Barbante (AWU3) is employed as a gardening and maintenance worker in Victoria. In 2007 he suffered an injury and was off work for around 18 months and did not receive accident make-up payments during any of this period. He said that the step-down provisions in the Victorian workers’ compensation scheme meant that he “initially received 90 or 95% of my normal wages but this soon dropped to 80%.”
19 For example, the Timber Industry - CFMEU Wood Panels - Award 2000 provided for 39 weeks accident make-up pay, as did the NSW Sawmillers & C., (State) Award. In Queensland, the AWU Hardboards Industry (Queensland) Award 2002 provided for 26 weeks accident make-up pay.
20 ‘The Australasian Faculty of Occupational and Environmental Medicine (AFOEM) and the Royal Australasian College of Physicians (RACP) Australian and New Zealand Consensus Statement on the Health Benefits of Work: Position Statement: Helping People Return to Work, Using Evidence for Better Outcomes’ (2010): see pp. 14, 19. ‘AFOEM and RACP Australian and New Zealand Consensus Statement on the Health Benefits of Work: Position Statement: Realising the Health Benefits of Work consensus statement on the health benefits of work’ (2011) see pp. 4, 12.
21 E.g. Productivity Commission Inquiry Report, National Workers’ Compensation and Occupational Health and Safety Frameworks, no. 27, 16 March 2004, p. 263; and Safety, Rehabilitation and Compensation Act Review Report - February 2013 (Hanks report) at [7.174] and [7.175].
22 Productivity Commission Inquiry Report, National Workers’ Compensation and Occupational Health and Safety Frameworks, no. 27, 16 March 2004: p. 264.
23 The Explanatory Memorandum to the Fair Work Bill 2008 refers at paragraph 536 to accident make-up pay as an example of an allowance that might be included in an award under paragraph 139(1)(g).
24 [2008] AIRCFB 1000 at [83].
25 [2008] AIRCFB 1000 at [85].
26 Australian Government Request under Part 10A of the Workplace Relations Act 1996, 2 April 2008, [2(c)] and [2(d)].
27 Exhibit ACTU 3.
28 (1971) 181 NSW Industrial Gazette 905 (Sheehy J).
29 [2010] FWAFB 305.
30 Ibid at [3].
31 [2008] AIRCFB 1000.
32 Ibid at [88].
33 See Award Modernisation Statement [2009] AIRCFB 865 at [54].
34 See Award Modernisation Decision [2009] AIRCFB 345 at [60].
35 See e.g. Clerks (Vehicle Industry - Repair, Services and Retail) Award 2003 and the Vehicle Industry - Repair, Services and Retail (State) Award (NSW).
36 See Attachment 2 to the AMWU Vehicle Division submission (Exhibit AMWU-VD 1).
37 It was submitted that tyre fitters, tyre repairing and tyre retreading workers were entitled to accident pay under the pre-reform federal award.
38 Christine Cregan and Philip Johnston, ‘Wages and conditions of outworkers in the clothing industry in Melbourne, Victoria (Part 1)’ (University of Melbourne, June 2014).
39 Metal Engineering and Associated Industries (Accident Pay) Victoria Award 1998.
40 Aircraft Engineers (General Aviation) Award 1999.
41 Overseas Airlines (Interim) Award 1999; Airline Operations (Transport Workers) Award 1998.
42 See e.g. Workplace Injury Rehabilitation and Compensation Act 2013 (Vic); Workers’ Compensation Legislation Amendment Bill 2012 (NSW).
43 See Explanatory Memorandum to the Safety, Rehabilitation and Compensation Amendment (Improving the Comcare Scheme) Bill 2015, at paragraphs 361-363.
44 See Security Services Industry Award 2010 Decision [2015] FWCFB 620 especially at [6].
45 Preliminary Issues Decision [2014] FWCFB 1788 at [60].
46 Ibid.
47 See [2015] FWCFB 644.
48 Motor Traders’ Association of New South Wales, the Motor Trade Association of South Australia, the Motor Trade Association of West Australia and the Victorian Automobile Chamber of Commerce.
49 Dated 25 March 2015, MBA 1.
50 Dated 25 March 2015, MIAL 1.
51 See Institute of Actuaries Australia submission, (Submission 88) p.10.
52 [2015] FWCFB 620.
53 [2015] FWCFB 1729.
54 Ibid at [143].
55 See Port of Melbourne Authority v Ashun Pty Ltd (1981) 147 CLR 589. See also CFMEU v Pacific Coal Pty Ltd PR935308, 25 July 2003, AIRC Full Bench at [11]-[112].
56 [2015] FWCFB 644 at [28]-[30].
57 Transcript at PN348-349.
58 PR559107.
59 See Explanatory Memorandum to the Fair Work Bill 2008 at [536].
60 See generally The Centre for International Economics (CIE) Final Report, Statutory review of the Workers Compensation Legislation Amendment Act 2012 prepared for the NSW Office of Finance and Services (30 June 2014).
61 Productivity Commission Inquiry Report, National Workers’ Compensation and Occupational Health and Safety Frameworks, no. 27, 16 March 2004: p. 264.
62 See Annual Wage Review 2012-13 [2013] FWCFB 4000, 3 June 2013 at [102].
63 The Mannequins and Models Award 2000 included an accident pay provision of 39 weeks which applied as a common rule in Victoria, Northern Territory and Australian Capital Territory and to employees of respondent employers in Queensland, Tasmania and Western Australia.
64 The coverage of the relevant awards is dealt with in the submissions of the AWU, referred to earlier in this decision. It is also dealt with in Annexure ‘A’ to the submission of the ACCI (Exhibit ACCI 2). The coverage of the pre-reform instruments relating to the Dry Cleaning and Laundry Industry Award 2010 is also dealt with in Attachment B to the Ai Group submission (Exhibit AIG 2). The written submissions of the AFEI also deal with the coverage relating to the Dry Cleaning and Laundry Industry Award 2010 and the Horticulture Award 2010.
65 [2008] AIRCFB 1000 at [88].
66 See [2015] FWCFB 644 at [65]-[72].
67 Ibid.
68 See also Modern Awards Review 2012 - Road Transport (Long Distance Operations) Award 2010 [2014] FWC 3529.
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