Parks Victoria v The Australian Workers' Union and others - [2013] FWCFB 950

[2013] FWCFB 950

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.266 - Industrial action related workplace determination

Parks Victoria
v
The Australian Workers' Union and others
(B2012/1554)

JUSTICE ROSS, PRESIDENT
DEPUTY PRESIDENT HAMILTON
COMMISSIONER HAMPTON

MELBOURNE, 11 FEBRUARY 2013

Workplace determination - relevant factors - s.275 Fair Work Act 2009 - matters at issue - retrospectivity - relevance of Victorian Government wages policy - Fair Work (Commonwealth Powers) Act 2009 (Vic) - excluded subject matters - Re AEU.

Contents	page	paragraph
1.	Introduction	2	1
2.	Parks Victoria	2	8
3.	The Legislative Framework	7	36
4.	The Agreed Terms	13	63
4.1	Terms agreed during the statutory period	13	63
4.2	Terms agreed after the statutory period	20	101
5.	The Contested Matters at Issue	26	144
5.1	Wages and allowances increases	26	144
5.2.	Ceiling point lump sum performance pay	49	251
6.	The Referral Act/Re AEU point	57	288
7.	Conclusion	74	365

1. Introduction

[1] On 31 May 2011, the Parks Victoria Agreement 2008 (2008 Agreement) reached its nominal expiry date. The 2008 Agreement covered Parks Victoria, four unions (the Community and Public Sector Union, the Australian Municipal, Administrative, Clerical and Services Union, the Australian Workers’ Union and the Association of Professional Engineers, Scientists and Managers, Australia (collectively, the Unions) and just over 1000 non-executive employees of Parks Victoria who are eligible to be members of the Unions.

[2] In June 2011, Parks Victoria and the Unions (as bargaining representatives for the employees) commenced negotiations for a replacement enterprise agreement, to be known as the Parks Victoria Agreement 2011 (the proposed agreement).

[3] On 5 July 2012, the Unions and their members notified Parks Victoria of their intention to take protected industrial action in the form of bans on engaging emergency response work, to commence on 11 July 2012.

[4] On 11 July 2012, Deputy President Smith made an unopposed order under s.424 of the Fair Work Act 2009 (Cth) (the Act), terminating the emergency response bans. 1 That order is a “termination of industrial action instrument” within the meaning of s.266 of the Act.

[5] During the post-industrial action negotiating period (which ended on 1 August 2012), Parks Victoria and the Unions did not settle all of the matters that were at issue during bargaining for the proposed agreement.

[6] Section 266(1) of the Act provides that the Fair Work Commission (the Commission) must make an industrial action related workplace determination (the workplace determination) if the following jurisdictional facts have been established:

“(a) a termination of industrial action instrument has been made in relation to a proposed enterprise agreement; and

(b) the post-industrial action negotiating period ends; and

(c) the bargaining representatives for the agreement have not settled all of the matters that were at issue during the bargaining for the agreement.”

[7] It is common ground that these jurisdictional facts have been established. This decision concerns the workplace determination arising from those jurisdictional facts. Before turning to the relevant legislative provisions we propose to set out some background material about Parks Victoria.

2. Parks Victoria

[8] The Department of Sustainability and Environment (DSE) is Victoria’s lead government agency for the sustainable management of land, water, fire and biodiversity.

[9] DSE delivers services to and has responsibilities for the State of Victoria either directly or through a number of portfolio agencies, including Parks Victoria. Parks Victoria provides these services on behalf of DSE under the Parks Victoria Act 1998 (Vic), and pursuant to a Management Services Agreement. Parks Victoria also performs similar agreed services on behalf of the Department of Transport in relation to local ports.

[10] Parks Victoria is a Victorian public statutory authority established by the Parks Victoria Act 1998 (Vic). Under that Act, Parks Victoria’s key responsibilities are to provide services to the State of Victoria and its agencies for, or with respect to, the management of parks, reserves and other land under the control of the State, including waterways land (within the meaning of the Water Industry Act 1994 (Vic)). Parks Victoria is also required to carry out such other functions conferred on it by other State legislation, which includes the National Parks Act 1975, the Crown Land (Reserves) Act 1978, the Conservation Forest and Lands Act 1987, the Port Management Act 1995 and the Marine Act 1988.

[11] The stated vision and purpose of Parks Victoria is for an outstanding parks and waterways system, protected and enhanced, for people, forever. It exists to:

(a) conserve, protect and enhance natural and cultural values;

(b) provide quality experiences, services and information to its customers;

(d) contribute to the environmental, social and economic wellbeing of Victorians.

[12] Parks Victoria is responsible for managing almost four million hectares of land and waterways, some 18% of Victoria. This includes management of a varied range of parks, from intensively used small urban parks, historic sites and small dispersed conservation reserves, through to large intact wilderness areas.

[13] Park Victoria’s responsibilities include managing:

70% of Victoria’s coastline (about 1200km)

• 45 national parks;
• 3 wilderness parks;
• 25 state parks;
• 30 metropolitan parks;
• 60 other parks;
• more than 2700 natural features or conservation reserves;
• 10 out of 11 of Victoria’s wetlands of international importance; and
• 1500km of river frontage in the newly established River Red Gum Parks. 2

[14] Parks Victoria also manages more than 25 000 assets, including:

• 47 visitor centre buildings;

• 671 shelters;

• 852 toilets;

• 515 viewing lookouts;

• 55 playgrounds;

• 14 000 kilometres of roads;

• 1 109 pedestrian and vehicular bridges;

• 3 700km of walking tracks;

• 89 sporting facilities, e.g. golf courses, ovals and wickets;

• 246 piers and jetties;

• 92 water access points, e.g. boat ramps, rowing launches and slippings; and

• 999 navigation aids.

[15] The parks and waterways managed by Parks Victoria attract 86.9 million visits each year.

[16] Parks Victoria’s funding is primarily derived from two sources, being a grant from the Parks and Reserves Trust Account (PRTA) and allocation of funding from DSE pursuant to State appropriation. The PRTA is established under s.153A of the Water Industry Act 1994 (Vic) and administered by DSE. The principal amounts paid into the PRTA are rates levied on Victorian land owners. Parks Victoria does not have any direct control over the amount of funding it receives from DSE. 3

[17] Over the past two years Parks Victoria has identified a shortfall in its financial position, amounting to about $178 million over five years, as follows:

• $18.1 million in 2010–11;

• 33.8 million in 2011–12;

• $41.1 million in 2012–13;

• $42.2 million in 2013–14; and

• $43.2 million in 2014–15.

[18] The nature of the shortfall is significant, being approximately 22% of Parks Victoria’s total budget over five years. 4

[19] In 2011–12, the Victorian Government provided Parks Victoria with budget supplementation of $46.71 million, over five years from 2011–12. This budget supplementation was to specifically assist with its budget shortfall and was provided on the basis that Parks Victoria would fund the remaining shortfall of approximately $133 million.

[20] In June 2012, DSE provided a one-off payment of $1.56 million as a further general budget supplementation payment to assist Parks Victoria in managing its budget. DSE has identified a further one-off payment of $5 million. There is also a contingency provision in the Victorian budget for, among other things, unexpected wage increases. 5

[21] In addition to its projected budget shortfall, Parks Victoria also needs to achieve budget savings and reduce its expenditure as a result of the reduction in appropriation funding to Departments (including DSE) announced in the 2011–12 state budget. These measures resulted in a reduction in the appropriation funding provided to Parks Victoria by DSE. 6

[22] Due to these financial pressures and constraints, Parks Victoria has sought to achieve savings through cost reduction measures, including reducing operating costs and labour costs through attrition. 7 Parks Victoria developed a financial plan which consisted of three broad measures:

(a) Operating savings — this includes reducing operating expenditure such as park presentation, minor works, business improvement initiatives, staff travel and accommodation, and park issues management. Parks Victoria plans to achieve a reduction of operational expenditure of approximately $15.2 million in 2012–13.

(b) Labour savings — to date, labour cost reductions have been achieved through attrition only. During 2011–12, 100 staff left Parks Victoria through attrition and expiration of fixed term contracts and this has resulted in some reprioritising of works to ensure that key priorities have continued to be undertaken, while less important functions have been deferred or stopped. On 21 September 2012, Parks Victoria announced a voluntary departure program (VDP) for around 120 employees in selected positions. It is expected that these redundancies will be finalised early in 2013.

(c) Additional source revenue — this means Parks Victoria generating its own revenue through a number of options, including through camping and roofed accommodation and from licensed tour operators. These revenue raising opportunities are limited and have a lengthy lead time as regulatory changes are required which have an associated lead time that is outside Parks Vivtoria’s control. 8

[23] In addition to cost reductions Parks Victoria will seek to increase revenue. However, the revenue options are limited, with lengthy lead times. 9 Parks Victoria’s financial viability is also the subject of a review by relevant Ministers and senior departmental officers.10

[24] In terms of staffing levels, the number of full-time equivalents (FTEs) has gone down over time due to attrition. 11 Parks Victoria’s Annual Report for 2011–12 shows a 6 per cent reduction in the total FTE’s from June 2011 to June 2012 (from 1103 to 1036).12 The process of reducing labour costs by attrition is ongoing.13

[25] In addition to attrition, Parks Victoria is seeking to reduce the number of FTEs by the VDP announced in September 2012. 14 In the first round of the VDP 64 employees accepted a departure package and the majority of those employees left Parks Victoria on 21 December 2012.15 Parks Victoria is hoping to make a second round of offers leading to additional departures prior to 30 June 2013.16

[26] The impact of the attrition policy and the VDP on the workload of the remaining employees was a matter of contention in the proceedings. In his second witness statement Mr Mead (Human Resources Manager of Parks Victoria) stated , at paragraph 62:

“I agree (speaking generally), that if administrative staff in a certain office or district accepted voluntary redundancies, and some of the work performed by those personnel needed to remain in the organisation, then there is the potential that this work would then need to be undertaken by other, existing staff in that office or district. However, Parks Victoria will of course need to make an assessment of the work required to be performed and there may be a re-prioritisation of work undertaken to take into account positions that no longer exist because of the VDPs.” 17

[27] Parks Victoria has not yet undertaken any planning to reallocate the tasks and responsibilities undertaken by employees who may have accepted redundancies. In his second witness statement Mr Mead stated:

“I expect that this process will include detailed consideration of PV priorities and what activities or functions PV will continue to undertake, as well as the activities and functions that PV will decide that it will no longer undertake. As the decision to offer the VDP is based on PV’s current financial position, PV has offered as many voluntary redundancies to eligible employees as it has been granted approval for, and will restructure around the gaps this leaves in the organisation once it is known which employees will accept voluntary redundancies.

In that sense, it is not possible to say now, simply by reference to basic headcount figures, that any such reductions will be ‘substantial’, or that it is likely that there will be a ‘substantial’ impact on remaining employees covered by the Determination.” 18

[28] Mr Mead was cross examined about these issues. 19 The following exchange is set out between the Unions’ counsel, Mr Harding, and Mr Mead:

“Yes. Isn't it the inevitable result, Mr Mead, that there will be an assumption of work by remaining employees?---Until we have done the work I won't know. Until we have done the redesign, I can't answer that.

Or you don't deny it?---I don't know.

You can't guarantee to the tribunal that that won't occur over the life of the determination?---I can't either guarantee or not guarantee because we haven't done the work. We don't know what the impact will be on jobs until we have done the analysis.

Yes. So you accept in your reply statement that that's a potential, don't you? It's a potential outcome?---Yes, we - yes, there will need to - we'll need to really look long and hard at how we deliver - how we do business, how we service the business, how we work internally, how we deliver services externally. We'll have to work smarter and we'll have to redesign jobs and reallocate work.” 20

[29] In this context the evidence of Ms Brooke (Ranger in charge, Mount Buffalo, Parks Victoria) as to the impact of such actions in the past, is relevant. Ms Brooke states that in her experience ‘where administrative positions have been abolished in the past it has led to rangers having to take on administrative work that was previously undertaken by those employees.’ 21 Ms Brooke provided a number of specific examples in support of this general proposition.22 Ms Brooke was not cross examined on her evidence.

[30] In his second statement, Mr Mead did not contest the thrust of Ms Brooke’s evidence, though he contested some of the detail as to the precise impact of some past changes. 23 As to the inference to be drawn from Ms Brooke’s evidence, Mr Mead said that any suggestion that the planned removal of some administrative staff will increase the workload for remaining employees was ‘speculative’.24 However, elsewhere in his evidence Mr Mead agreed with the proposition that the reduction in staff numbers as a result of attrition had placed some pressure on service delivery, but despite this Parks Victoria has been able to meet or exceed its output targets.25 He also conceded that maintaining output performance with fewer staff was a benefit to Parks Victoria.26 We note Mr Mead’s evidence as to there being a limited number of hours per day that employees could be required to work.27 We accept this is so, but that does not preclude the prospect of employees being required to complete more tasks within existing working hours (i.e. an increase in their workload).

[31] Further, Mr Mead acknowledged that Parks Victoria was required to perform certain fixed work under its service agreements 28 and that in approving the VDP the Victorian Government had required Parks Victoria to maintain service delivery.29 He also agreed with the proposition that Parks Victoria had very limited capacity to restructure its operations,30 though we note that this would not preclude a reprioritisation of tasks and the deferral or cessation of some of the work done by Parks Victoria.31

[32] In our view it is likely that Parks Victoria’s attrition policy and the VDP program will result in some increase in workload for some of the remaining employees. Such a finding is based on past experience where administrative positions have been abolished and on the fact that, despite the recent reduction in staff numbers, Parks Victoria has been able to meet or exceed its output targets.

[33] Given Parks Victoria’s obligation to maintain service delivery, it is likely that, if staff numbers reduce, some non-core activities will cease and there will be some increase in workload for some of the remaining staff. It is not possible to determine the extent of any increase in workload at this stage.

[34] These initiatives will provide a benefit to Parks Victoria in that it will be able to meet its service obligations with fewer staff.

[35] We now turn to our consideration of the legislative provisions relevant to the determination of these proceedings.

3. Legislative Framework

[36] The workplace determination provisions of the Act set out the scope of the merits arbitration required of the Commission. Sections 276 and 268, along with Division 5 of Part 2-5 of the Act deal exhaustively with the content of workplace determinations. Only four types of term may be included in a workplace determination (see ss.267 and 268).

(i) the agreed terms (s.267(1)(a) and (2))

An agreed term is a ‘term that the bargaining representatives for the proposed enterprise agreement concerned had, at the end of the post-industrial action negotiating period agreed should be included in the agreement (s.274(2)).

(ii) arbitrated terms regarding the matters in issue (s.267(1)(a) and (3))

The determination must include the terms that the Commission considers deal with the matters that were still at issue at the end of the post industrial action negotiation period.

(iii) core terms (s.267(1)(b))

The ‘core terms’ are set out at s.272:

“272 Core terms of workplace determinations

Core terms

(1) This section sets out the core terms that a workplace determination must include.

Nominal expiry date

(2) The determination must include a term specifying a date as the determination’s nominal expiry date, which must not be more than 4 years after the date on which the determination comes into operation.

Permitted matters etc.

(3) The determination must not include:

(a) any terms that would not be about permitted matters if the determination were an enterprise agreement; or

(b) a term that would be an unlawful term if the determination were an enterprise agreement; or

Better off overall test

(4) The determination must include terms such that the determination would, if the determination were an enterprise agreement, pass the better off overall test under section 193.

Safety net requirements

(5) The determination must not include a term that would, if the determination were an enterprise agreement, mean that the FWC could not approve the agreement:

(a) because the term would contravene section 55 (which deals with the interaction between the National Employment Standards and enterprise agreements etc.); or

(b) because of the operation of Subdivision E of Division 4 of Part 2-4 (which deals with approval requirements relating to particular kinds of employees).”

Apart from ensuring that the workplace determination as a whole contains only permitted matters, satisfies the “better off overall test” and does not contravene s.272(5) of the FW Act, the only “core term” is a nominal expiry date no more than 4 years after the workplace determination comes into operation (s.272(2)).

(iv) mandatory terms (s267(1)(c))

The mandatory terms are set out at s.273:

“273 Mandatory terms of workplace determinations

Mandatory terms

(1) This section sets out the mandatory terms that a workplace determination must include.

Term about settling disputes

(2) The determination must include a term that provides a procedure for settling disputes:

(a) about any matters arising under the determination; and

(b) in relation to the National Employment Standards.

(3) Subsection (2) does not apply to the determination if FWA is satisfied that an agreed term for the determination would, if the determination were an enterprise agreement, satisfy paragraphs 186(6)(a) and (b) (which deal with terms in enterprise agreements about settling disputes).

Flexibility term

(4) The determination must include the model flexibility term unless FWA is satisfied that an agreed term for the determination would, if the determination were an enterprise agreement, satisfy paragraph 202(1)(a) and section 203 (which deal with flexibility terms in enterprise agreements).

Consultation term

(5) The determination must include the model consultation term unless FWA is satisfied that an agreed term for the determination would, if the determination were an enterprise agreement, satisfy subsection 205(1) (which deals with terms about consultation in enterprise agreements).”

[37] In relation to coverage, the workplace determination must be expressed to cover:

“(a) each employer that would have been covered by the proposed enterprise agreement concerned; and

(b) the employee who would have been covered by that agreement; and

[38] Exhibit Parks 4 is the latest draft determination provided to the Commission. 32 The principal ‘matters at issue’ between the parties and the differences in the clauses proposed with respect to those matters are identified in Exhibit Unions 5. Exhibit Parks 4 is referred to throughout this document as the draft determination.

[39] The draft determination contains the mandatory terms about settling disputes (clauses 3.7 – 3.15), a flexibility term (clause 3.16) and a consultation term (clause 3.6), as required by ss.273(2)–(5) of the FW Act.

[40] The Commission is only required to conduct a “merits arbitration” in relation to the matters at issue at the end of the post industrial action negotiation period (the statutory period).

[41] The parties are agreed that at the end of the statutory period there were seven matters at issue which require an arbitral decision by the Commission, namely:

(i) wages and allowances increases (clauses 3.3, 7.2, 9.2(c) and Schedule 1 of the draft determination);

(ii) ceiling point performance pay (clause 7.4.1 of the draft determination);

(iii) progression (clauses 7.4.1 and 7.2 of the draft determination);

(iv) higher duties (clause 7.9 of the draft determination);

(v) rostered weekend employees (clauses 8.4 and 8.6 of the draft determination);

(vi) rostered standby employees (clause 8.5 of the draft determination); and

(vii) alternative employment arrangements (clause 5.6.4 of the draft determination).

[42] We note that Parks Victoria contended that a number of the agreed terms should not be included in the workplace determination because of the operation of the Fair Work (Commonwealth Powers) Act2009 (Vic) (the Referral Act) and the implied constitutional limitation on Commonwealth legislation curtailing the capacity of the States to function as governments, as explained in Re Australian Education Union; Ex parte Victoria (Re AEU). We deal with this contention later and for convenience refer to it as the Referral Act/Re AEU point.

[43] Following further conciliation after the end of the statutory period, the parties reached agreement in respect of five of the seven matters at issue (namely matters (iii) – (vii) set out at paragraph 41 above). It is common ground that, as these matters were agreed after the end of the relevant statutory period, they are not agreed terms within the meaning of s.274(2), but rather they remain matters at issue for arbitral determination by the Commission. However, in making such a determination the Commission will obviously have regard to the fact that the parties have reached agreement in respect of these issues.

[44] Having regard to these developments three principal issues remain for consideration and determination:

(ii) the wages and allowances matter at issue (clauses 3.3, 7.2, 9.2(c) and Schedule 1 of the draft determination);

(iii) the ceiling point performance pay matter at issue (clauses 7.4.1(a) and (b) of the draft determination); and

(iii) the Referral Act/Re AEU point.

[45] In determining the matters at issue, the Commission is required to take into account each of the factors set out in s.275.

“275 Factors the FWC must take into account in deciding terms of a workplace determination

The factors that the FWC must take into account in deciding which terms to include in a workplace determination include the following:

(a) the merits of the case;

(b) for a low-paid workplace determination—the interests of the employers and employees who will be covered by the determination, including ensuring that the employers are able to remain competitive;

(c) for a workplace determination other than a low-paid workplace determination—the interests of the employers and employees who will be covered by the determination;

(d) the public interest;

(e) how productivity might be improved in the enterprise or enterprises concerned;

(f) the extent to which the conduct of the bargaining representatives for the proposed enterprise agreement concerned was reasonable during bargaining for the agreement;

(g) the extent to which the bargaining representatives for the proposed enterprise agreement concerned have complied with the good faith bargaining requirements;

(h) incentives to continue to bargain at a later time.”

[46] The use of the word ‘include’ in s.275 suggests that the Commission is not confined to those considerations alone, and can have regard to any other relevant considerations in the circumstances of the particular case. 33 Sections 577 and 578 are relevant in this regard.

[47] Section 577 states:

“The FWC must perform its functions and exercise its powers in a manner that:

(a) is fair and just; and

(b) is quick, informal and avoids unnecessary technicalities; and

(d) promotes harmonious and cooperative workplace relations.

Note: The President also is responsible for ensuring that the FWC performs its functions and exercises its powers efficiently etc. (see section 581).”

[48] Section 578 states:

“In performing functions or exercising powers, in relation to a matter, under a part of this Act (including this Part), the FWC must take into account:

(a) the objects of this Act, and any objects of the part of this Act; and

(b) equity, good conscience and the merits of the matter; and

(c) the need to respect and value the diversity of the work force by helping to prevent and eliminate discrimination on the basis of race, colour, sex, sexual preference, age, physical or mental disability, marital status, family or carer’s responsibilities, pregnancy, religion, political opinion, national extraction or social origin.”

[49] Section 275(d) provides that the Commission must take the ‘public interest’ into account. The public interest imports a discretionary value judgment confined only by the subject matter, scope and purpose of the FW Act. 34

[50] The public interest refers to matters that may affect the public as a whole such as the achievement or otherwise of the objects of the FW Act, employment levels, inflation and the maintenance of appropriate industrial standards. 35

[51] The statutory distinction between the interests of the employer and employees on the one hand (s.275(c)) and the public interest on the other (s.275(d)) leads us to conclude that the public interest is distinct from the interests of the parties, though the considerations may overlap. For example, matters which may be in the public interest may also be in the interests of one or more of the parties. 36

[52] Section 275(e) provides that one of the factors which the Commission must take into account is ‘how productivity might be improved in the enterprise ... concerned’. The meaning of the word ‘productivity’ in this context was considered in Schweppes Australia Pty Ltd v United Voice Victoria Branch (Schweppes). 37 In Schweppes the Full Bench decided:

“... that ‘productivity’ as used in s.275 of the Act, and more generally within the Act, is directed at the conventional economic concept of the quantity of output relative to the quantity of inputs. Considerations of the price of inputs, including the cost of labour, raise separate considerations which relate to business competitiveness and employment costs.

Financial gains achieved by having the same labour input - the number of hours worked - produce the same output at less cost because of a reduced wage per hour is not productivity in the conventional sense.” 38

[53] As to s.275(f), neither party seeks any particular finding in relation to the reasonableness of the conduct of the bargaining representatives. It is not contended that such conduct was unreasonable. Accordingly, we find that for the purposes of s.275(f), the conduct of the bargaining representatives was reasonable during the bargaining for the proposed agreement.

[54] In relation to s.275(g), it is common ground that the bargaining representatives have complied with the good faith bargaining requirements.

[55] Parks Victoria submitted that in most workplace determination cases the factors in s.275(a) (the merits of the case) and s.275(e) (productivity) take on particular significance. This was said to be so because in respect of many matters at issue the other factors in s.275 are likely to largely balance each other out or be neutral. The Unions contend that this submission should be rejected.

[56] No authority was cited in support of the proposition advanced by Parks Victoria and in any event it seems to us to be largely irrelevant. In deciding the terms of the workplace determination we must take into account all of the factors set out in s.275.

[57] At the hearings on 4 and 5 December the evidence 39 set out below was adduced.

[58] The following witnesses gave evidence on behalf of Parks Victoria in the proceedings:

• Mr Greg Mead, Human Resources Manager, Parks Victoria 40;

• Dr William Jackson, Chief Executive Officer, Parks Victoria 41;

• Dr Peter Appleford, Deputy Secretary Land and Fire, Department of Sustainability and Environment (Victoria) 42;

• Mr Brendan Flynn, Deputy Secretary of the Economic and Financial Policy Division, Department of Treasury and Finance (Victoria). 43

[59] Parks Victoria also filed a report titled ‘Deloitte Report’ by Mr Chris Richardson. Messrs Mead, Jackson, Appleford and Flynn were cross examined.

[60] The following witnesses gave evidence on behalf of the Unions’ in the proceedings:

• Mr Wayne Townsend, Senior Industrial Officer, Community and Public Sector Union (CPSU) 44;

• Mr Matthew Price, Industrial Officer, CPSU (SPSF Group Victorian Branch) 45;

• Mr Sam Beechy, Organiser, The Australian Workers’ Union (AWU) 46;

• Mr Ben Davis, Vice President, AWU, Victorian Branch 47;

• Ms Felicity Brooke, Ranger in Charge, Mount Buffalo, Parks Victoria 48;

• Mr John Argote, Ranger in Charge, Point Cook Coastal Park, Parks Victoria 49;

• Mr Mick Caldwell, Team Leader, Water, Parks Victoria. 50

[61] The parties contributed to the efficient hearing of this matter by appropriately limiting the cross examination of witnesses and by focussing on the matters of real substance rather than on peripheral or marginally relevant issues.

[62] We deal first with the agreed terms before turning to the contested matters at issue.

4. The Agreed Terms

4.1 Terms agreed during the statutory period

[63] A substantial part of the proposed workplace determination is agreed. In his witness statement Mr Mead set out the changes incorporated into the proposed workplace determination. 51 One of these changes is contested (ceiling point performance pay), the others are agreed. There were 14 separate matters that were agreed between the parties, prior to the end of the negotiating period.52 Some of these matters were technical and three of the 14 matters were not changes in a relevant sense, rather it was agreed to leave certain clauses as they existed under the 2008 Agreement, or agreement was reached not to include certain Union proposals. There was an agreement not to change fixed-term employment, not to make changes in relation to annual leave loading, and not to include a provision sought about labour hire. In addition to the matters agreed prior to the end of the statutory period, the parties have recently reached agreement on a number of the matters at issue (see paragraph [43] of this decision). Each of the significant matters which have been agreed are set out below.

(i) Consultation arrangements for the implementation of change (Clause 3.6)

[64] The parties agreed to include a new consultation clause which requires Parks Victoria to consult with its employees in more limited circumstances than had previously applied. In particular:

• the amended clause only applies to proposals for major change, no such limitation appeared in the corresponding clause in the 2008 agreement; and

• the amended clause applies in circumstances where Parks Victoria has developed a proposal for major change the corresponding clause in the 2008 Agreement applied when Parks Victoria was merely considering a change.

[65] Mr Mead conceded that these changes favoured Parks Victoria as they provide a less onerous consultation obligation but said that ‘it is difficult to quantify what the value of this change is without knowing how often a situation will arise where Parks Victoria is not required to consult (when it otherwise would have under the 2008 Agreement)’. 53 For this reason Parks Victoria did not assign a ‘bankable value’ to this change, within the context of the Victorian Government’s wages policy. We deal with that policy later.

[66] We note that the agreed consultation arrangements are in identical terms to clause 10 of the Victorian Public Sector Workplace Determination 2012 (VPS determination). 54 We deal with the VPS determination at paragraphs [188]-[193].

[67] In his evidence Mr Flynn stated that the VPS determination was consistent with the Victorian Government’s wages policy because all costs above 2.5% per annum were fully offset by genuine productivity gains linked to workforce reforms. One of the workforce reforms referred to by Mr Flynn was the change to the consultation arrangements:

“[97] The VPS determination was consistent with the Government’s wages policy as all costs above 2.5% per annum were fully offset by genuine productivity gains linked to workforce reform achieved as part of the agreement negotiations, and the ultimate Determination. Departments received no additional budget supplementation to fund the outcome of the VPS Determination.

[98] ...

(b) management now has more flexibility when implementing change in the workplace, which will ensure more timely implementation of change across the public service. The definition of major change is now consistent with the model clause in the Fair Work Act. This significant improvement provides guidance on when consultation is required in line with community standards.” 55

[68] Mr Flynn is referring to clause 10 of the VPS determination. 56 It would seem to follow that, contrary to Mr Mead’s evidence, the new consultation clause is properly seen as a workforce reform that will give rise to genuine productivity gains.

(ii) Casual employees (Clause 5.5(b))

[69] This clause was amended to delete the words ‘weekend penalties’ from the list of matters said to be compensated for by the payment of the 25 per cent casual loading.

[70] In his second witness statement Mr Mead said that this change was a benefit to casual employees and that there was a ‘clear cost implementation in the change’. The increased cost to Parks Victoria is said to arise from the fact that casual employees who work on a weekend will receive weekend penalties in addition to their casual loading. 57 In cross examination Mr Mead said that casuals who are rostered to work on weekends would be entitled to the weekend penalties prescribed in clause 8.4(b) of the draft determination. This is said to be so if they were classified as ‘rostered weekend employees’ (see clause 8.4).58

[71] We note that if a casual was regarded as a ‘non rostered employee’, within the meaning of clause 8.3, then it would appear to be the case that they would not be entitled to be paid weekend penalties when working on weekends. It is also relevant to note that the proposed changes in relation to casual employees are a consequence of the introduction of ‘as worked’ weekend penalties (see paragraphs [126] - [139] of this decision).

(iii) Workload (Clause 4.5(b)(iv))

[72] An amendment was made to this clause to provide that if a dispute was not resolved under this clause, either Parks Victoria or an employee could refer the dispute to Fair Work Australia (now the Fair Work Commission) in accord with Subdivision B of Division 3 of Part 5-1 of the FW Act. Previously there was no access to arbitration. Mr Mead characterised this change as a benefit to employees but as there may never be a dispute under the clause he did not assign any cost to the change. 59 During cross examination Mr Mead acknowledged that the change provided some benefit to Parks Victoria:

“Mr Mead, at 4.4 of the determination, if you go to the heading Outcomes for Parks Victoria, Parks identifies, ‘Continued resolution of grievances and disputes in an orderly manner as an outcome of benefit to Parks.’ Do you see that?---Yes.

Doesn’t it follow that the conferral of power on Fair Work Australia gives further effect to that outcome?---I think it gives - I mean, we could still have without a referral to Fair Work Australia. I think the referral to Fair Work Australia is a direct benefit to employees. We could not have a referral to Fair Work Australia and still have an output that gives us continued resolution of grievances and disputes in an orderly manner.

Save that under the 2008 agreement, if you decided unilaterally to say no to an employee who had ventilated a dispute about workload, that doesn't guarantee, does it, that the dispute would be resolved in an orderly manner?---There was nowhere for the employee to take it, so I think - look, I think it certainly assists, there's no doubt about that.

Then in 4.5(a) of the clause, ‘Parks Victoria acknowledges the benefits to both the organisation and individual employees gained through employees having a balance between their professional and family life.’ Do you accept that?---Yes.

The conferral of power means that there’s an opportunity for that to be objectively determined by Fair Work Australia on its merit?---Yes.

That’s consistent with the benefit to Parks Victoria, is it not?---Yes.” 60

[73] It seems to us that this change is in the interests of all parties, in that it provides an orderly mechanism for the resolution of disputes about workload.

(iv) Part -time employees (Clause 5.2)

[74] This clause was amended to ensure greater consistency with the part-time employment clause included in the relevant modern award, being the State Government Agencies Administration Award 2010. 61 The changes resulted in simpler language being used and do not create any tangible cost or benefit.

(v) Appointments by transfer (Clause 6.2)

[75] The parties agreed to insert the proposed clause 6.2(b) and, in particular, the words “if Parks Victoria is able to demonstrate sound operational reasons for requesting an Employee to undertake a different role in the same location, agreement cannot be unreasonably withheld.” The comparable clause in the 2008 Agreement only allowed Parks Victoria to transfer an employee by mutual agreement. There was no obligation on an employee to agree to any transfer, regardless of Parks Victoria’s reasons for requesting the change. 62

[76] Parks Victoria conceded that the change under this clause creates a bankable saving. This is based on predicted savings through reduced recruitment expenditure. Parks Victoria has estimated that without this change, it would need to recruit new employees to address staffing needs. On a worst case scenario basis, this could be up to an additional 2.7 FTE positions each year.

(vi) Rostered work – outside the spread of hours (Clause 8.7)

[77] The comparable clause in the 2008 Agreement is in the following terms:

“(a) When necessary to respond to particular operational requirements such as environmental or visitor management programs, Parks Victoria may request employees to work to a roster that starts or finishes two hours or more outside the normal spread of hours.

(b) Rosters shall be prepared on the basis of:

(i) Normal hours for the rostered employees being 38 hours per week averaged over a 2 week period.

(ii) Individual shifts being 7.6 hours.

(iii) At least 7 days notice shall be given where there is a requirement to work a roster that is outside the normal spread of hours unless agreed otherwise.

(c) An employee rostered to work under this clause shall be paid 30% more than his/her substantive hourly rate for the 7.6 hours works. Time worked in excess of the ordinary rostered hours shall be paid at the rate of double time unless otherwise agreed.

(d) An employee who is rostered to work all their normal hours within the spread of hours and finishes work outside the spread of hours shall be paid overtime for all the actual time worked outside the spread of hours. Overtime will be paid at the rate of time and a half for the first two hours and double time thereafter. Time in lieu provisions will not apply to work outside the spread of hours.” (emphasis added)

[78] The proposed clause in the draft determination is in identical terms save that the words in bold have been deleted.

[79] Mr Mead acknowledged that the change gave Parks Victoria greater flexibility in terms of rostering outside the spread of hours 63 but in his view ‘the increased cost outweighed the increased flexibility’.64 As the situation covered by the clause would rarely arise, Mr Mead considered that the amendment was cost neutral.65

[80] Mr Mead’s reference to the increased costs arising from the proposed clause is based on an expectation that there will be more circumstances in which Parks Victoria will roster employees outside the span of hours. While the loading prescribed in the proposed clause is the same as under the 2008 Agreement, the more occasions on which Parks Victoria rosters employees outside the span of hours the higher the overall labour cost.

[81] In our view the proposed change provides Parks Victoria with greater flexibility in terms of rostering outside the spread of hours.

(vii) Home–based work (Clause 8.9)

[82] This is a new clause which provides that ‘home based work arrangements may be agreed between Parks Victoria and an Employee on a case by case basis.’

[83] The proposed clause is in identical terms to clause 16 of the VPS determination. 66

[84] In his evidence, Mr Mead considered the inclusion of home–based work arrangements to be primarily for the benefit of employees, and not Parks Victoria, as it provides employees with the benefit of flexibility in the performance of work. According to Mr Mead, Parks Victoria obtains no measurable benefit from employees having the additional ability to work from home, as opposed to working from their ordinary work location. However, given the relatively small number of instances where this could occur, and the difficulty in assigning a cost to such circumstances (given that, for certain employees, a large amount of their work could be done via remote computer access), Parks Victoria has not assigned any additional cost to this change. 67

[85] In cross-examination Mr Mead conceded that to the extent home–based work contributes to a satisfied workforce it provides a benefit to Parks Victoria. 68

[86] In his witness statement Mr Price indicated, at paragraphs 27(a)(iii):

“The effect of this change is that PV has greater flexibility in when it may request employees to work outside the normal spread of hours.”

[87] In our view the proposed clause has the potential to provide benefits to all parties.

(viii) Flexible leave arrangements (Clause 6.2 of Appendix B)

[88] Mr Mead’s evidence was that this clause is a benefit to employees as it extends the period of time in which employees who purchase annual leave must take the annual leave. There was a 12 month limitation in the 2008 Agreement (clause 7.2(b)(iv) of Appendix B). The proposed clause provides an additional three months for leave to be taken from the expiry of the 12 month accrual period (clause 6.2(g)(iv) of the draft determination). As the amount of leave taken by employees does not change, Mr Mead did not consider that there is any additional cost in this change. 69

[89] While the proposed change is a benefit to employees, it does not impose any additional costs upon Parks Victoria.

(ix) Domestic violence leave (Clause 7.2.5 of Appendix B)

[90] This is a new clause that was inserted into the workplace determination. It provides an employee the right to take paid leave in certain circumstances where there are incidents of domestic family violence.

[91] The proposed clause is of benefit to employees, though the extent of any additional cost to Parks Victoria is not likely to be significant. Mr Mead was not aware of any situation where an employee would have previously had need for such leave, and did not consider it is the type of situation where Parks Victoria could accurately predict the extent to which this entitlement will be used. For that reason, Mr Mead did not assign any additional cost to the clause. 70

(x) Costs of employment related legal proceedings (Clause 7.3.4 of Appendix B)

[92] This clause provides that where an employee is required, in certain circumstances, to attend legal proceedings as a result of their employment with Parks Victoria, Parks Victoria will meet the employee’s costs in such legal proceedings.

[93] The proposed clause is of benefit to employees, though the extent of any additional cost to Parks Victoria is not likely to be significant. Mr Mead was not aware of any situations where this would have been relied on, and accordingly did not contend that it was an additional cost.

(xi) Emergency work (Appendix A)

[94] The parties agreed to adopt the DSE emergency work provisions (Appendix 6 Part 1) from the VPS determination. This new provision generally updates the previous emergency work provisions that were in the 2008 Agreement, including indexing relevant allowances and clarifying language. There is no reduction in terms and conditions for employees and there are no additional costs incurred by Parks Victoria as a result of this new Appendix as Parks Victoria is reimbursed by DSE for all additional costs associated with emergency work under Appendix A (such as allowances, loadings and overtime). For this reason, the changes to this Appendix are cost neutral. 71

(xii) Management of misconduct, disciplinary process and unsatisfactory work performance (Clauses 5.11–5.13)

[95] These clauses include a new system for managing underperformance and misconduct of employees. These clauses set out the processes and steps involved in managing misconduct and underperformance more clearly, and Mr Mead expected that, through this more rigorous process, some bankable savings will be achieved. 72 These savings would include the administrative time and costs saved through having a more efficient process, as well as the potential savings in any replacement of staff who are dismissed under these clauses, as any new employee is more likely to commence at the start of a grade, as compared to the large number of employees who are already at the top of their grade.

[96] The proposed clause is of benefit to Parks Victoria.

(xiii) Overtime (Clause 9.2)

[97] This clause was amended to provide that part time employees do not get overtime until they work more than 10 hours per day. In his second witness statement Mr Mead said, at paragraph [27], this change to be cost neutral, as part-time employees receive time off in lieu if they work in excess of ordinary hours.

[98] In cross-examination Mr Mead conceded that the time off in lieu arrangements were on the basis of one for one, rather than at overtime rates. 73 He also agreed that the proposed change was a benefit to Parks Victoria:

“In that event, they're not cost-neutral, it's a saving to the employer, isn't it?---It could be a saving to the employer.

Well, it is, isn't it?---Well, we would see that it would be a situation where generally they would work 7.6 hours a day.

If you acquired the right to require overtime for free up to 10 hours, apart from ordinary wages, that's a benefit to the employer, isn't it?---Yes.” 74

[99] The proposed clause is of benefit to Parks Victoria.

[100] We now turn to the matters at issue. The parties have recently reached an in-principle agreement in relation to a number of matters at issue in these proceedings.It is convenient to first deal with those matters.

4.2 Terms agreed after the statutory period

[101] After the end of the relevant statutory period the parties reached agreement in respect of five of the seven matters at issue. The parties made a joint submission in respect of the agreed matters. The parties submitted that each of these agreed matters at issue ought to be included in the determination. A summary of the agreed matters and the submissions of the parties in support of the inclusion of these matters in the determination is set out below.

(i) Alternative employment arrangements (clause 5.6.4)

[102] This change seeks to amend clause 5.6.4 of the 2008 Agreement to address what Mr Mead described as an unexpected and unintended issue.

[103] By way of background, clause 5.6.4 of the 2008 Agreement provides that Senior Officers may enter into an Alternative Employment Arrangement (AEA). The most common form of AEA gave an eligible employee the ability to enter into a lease arrangement for a motor vehicle through Parks Victoria. In effect the employee paid two–thirds of the cost of the lease, out of pre-tax earnings, and Parks Victoria paid the balance.

[104] The arrangement would not otherwise be available under the terms of the 2008 Agreement as the effect of taking on a motor vehicle lease would be, in most cases, to reduce the salary of an employee below the nominated salary required under the 2008 Agreement. The same position would apply under the workplace determination.

[105] As the vehicle under an AEA is treated as part of the employee’s overall remuneration package, if an employee elected to terminate their AEA at the end of the vehicle lease then their actual salary increased (as they no longer have the benefit of the motor vehicle).

[106] A practice had developed whereby employees in defined–benefit superannuation funds, who had taken on a motor vehicle lease under an AEA, terminated the AEA just prior to their retirement. As a consequence, the value of the lease is added back into their salary, which has the effect of the employee’s defined superannuation benefit increasing substantially.

[107] In his evidence, Mr Mead said that Parks Victoria ‘considers this practice to be unfair to the organisation, particularly in circumstances where it is obliged to fully fund an employee’s defined benefit’. According to Mr Mead, the indicative costs to Parks Victoria of each employee implementing this election is between $60 000 and $70 000. There are 25 Senior Officers who are members of defined–benefit funds who are eligible to access these arrangements. 75

[108] The parties have agreed to a clause whereby existing employees who have an AEA in place, have until 30 June 2013 to notify Parks Victoria as to whether they intend to retain their motor vehicle lease under the AEA once that motor vehicle lease expires.

[109] If an employee does notify Parks Victoria by this date, and subsequently terminates their AEA and ends their motor vehicle lease, Parks Victoria will recognise the employee’s actual salary amount (being their total remuneration package less statutory super contributions) for the purposes of their defined benefit superannuation fund.

[110] After this period, or for new employees employed after the determination comes into operation (who enter into an AEA), their salary for the purposes of their defined benefit superannuation fund will be capped at 80% of their total remuneration package.

[111] The only difference between the parties had been the timing of the cut-off arrangements, which have been resolved in favour of the Unions’ proposal. 76

[112] The parties submitted that the changes have merit (s.275(a)) and are in all parties’ interests (s. 275(c)). The changes do not give rise to any immediate public interest or productivity issues either way, and neither party suggests that ss.275(f) and (g) have any application.

(ii) Progression (clause 7.4.1)

[113] The parties agreed to significant changes in the progression clause. Parks Victoria sought a revised progression clause which was very similar to the progression clause in the VPS determination so that ‘any performance entitlement payable truly rewards excellent performance rather than paying ‘performance pay’ to the vast majority of employees, most of whom simply meet expectations’. 77 Mr Mead acknowledged that the agreed progression clause was very close to the terms of the relevant clause in the VPS determination and that the agreed clause met Parks Victoria’s objectives.78

[114] The parties submitted that the changes made have merit – each party achieved something, and the changes have now been agreed (s.275(a)); the interests of Parks Victoria and its employees favour the inclusion of the agreed provision (s.275(c)); and the public interest is aided by the consistent application of performance pay criteria (s.275(d)). Tightened criteria for performance pay will increase the prospects of better service outcomes for the public (s.275(d)), whilst also leading to potential improvements in productivity (s.275(e)).

[115] Mr Mead estimated that the more rigorous performance management system would save Parks Victoria $458,000 in 2012–13; $570,000 in 2013–14 and $646,000 in 2014–15. 79

[116] The parties also submitted that ss.275(f) and (g) do not have any application and that there is an incentive to bargain again in the future (s.275(h)).

(iii) Higher Duties (clause 7.9)

[117] The 2008 Agreement provides that employees who perform the duties of a higher classification receive 100 per cent of the rate of pay pertaining to the higher classification. 80 This is so despite the fact that the employee may only be performing part of the duties of the higher position or performing those higher duties for a portion of the employee’s shift.

[118] In his evidence Mr Mead identified the problems with the existing clause:

“The problem with the current Higher Duties clause is that in many circumstances, employees receive the full higher duties payment when full higher duties are not being performed. This means that at times employees are being paid for work that they are not performing.

This clause has the additional problem of discouraging managers from offering higher duties to employees who would not be able to perform all of the higher duties of a higher classification, due to the additional costs involved in paying full higher duties. This discourages the organisation from offering development opportunities to employees based on the additional cost involved.” 81

[119] The parties have agreed to an amended higher duties clause, clause 7.9, in the following terms:

(a) Higher duties payments shall only apply where an Employee is required by management to relieve in a position classified at a higher Grade for 5 or more consecutive working days in any one assignment.

(b) Where an Employee is eligible for higher duties, a payment equal to the difference between the Employee’s usual rate of pay and that of the rate of the higher classified position shall be paid for each period of higher duties worked for 5 or more consecutive working days, effective from the first working day of the assignment.

(c) Provided that an Employee who is required to carry out only part of the duties of a higher classified position or who is unable to carry out all such duties because of lack of experience or qualifications, shall be paid such proportion of the higher duties otherwise payable under this clause as is agreed to by the employee and Parks Victoria.

(d) If agreement is not reached on the proportion of the higher duties payable, either Parks Victoria or the Employee may initiate a dispute to determine the matter in accordance with the dispute resolution procedure contained in this determination.

(e) Higher Duties may also be paid during periods of short term deployment as described in Clause 9.10 (Business Continuity/Short term deployment) where an Employee is required to undertake duties and the work value during the deployment is commensurate with the work value descriptors of a higher grade. Payment of higher duties in this instance shall require the approval of the Manager Human Resources.

[120] The agreed higher duties clause provides that Parks Victoria can offer proportionate higher duties (and only be required to pay proportionate payment of the higher rate) to all grades of employees, and not just grade 8 employees as was the case under the 2008 Agreement.

[121] In addition, the clause has been amended to provide that, where agreement as to the required proportionate rate cannot be reached between Parks Victoria and the relevant employee, either party will have the right to activate the dispute resolution procedure under the workplace determination.

[122] The agreed clause is in substantially the terms sought by Parks Victoria, save that the proportion of the higher duties payment to be paid to an employee who is required to carry out only part of the duties of the higher position is as agreed to by the employee and Parks Victoria. If agreement is not reached on the proportion of the higher duties payable the dispute may be resolved by arbitration by the Commission. Parks Victoria had sought the right to determine the proportionate payment in its sole discretion.

[123] Mr Mead was cross-examined about this issue:

“If I can take you then to paragraph 30 of your reply statement, this is Parks 2, and there you deal with the higher duties reform. Now, what you sought initially in these proceedings as identified in the document that you've just been reading, was the right or rather the capacity to align the higher duties payment with the work actually performed, whatever proportion that was?---Yes.

That's what you've got in the determination. Do you accept that?---Yes.

The only variation is that the amount has to be agreed or the proportion - the actual proportion has to be agreed between the employee and the employer. Do you accept that?---Yes.

Whereas you wanted it to be solely in your discretion?---Yes.

That reform agreed in discussions between you and the union simply ensures the clause operates fairly. Do you accept that?---Yes.” 82

[124] In his second witness statement Mr Mead stated that ‘the clause is likely to result in an increased use of proportionate higher duties ... creating a saving’ for Parks Victoria. 83

[125] In support of the inclusion of the proposed clause in the workplace determination the parties submitted that the logic (and merit) of the proposal is strong (s.275(a)), the parties have reached agreement, and whilst the proportionate payment requires agreement, either party has access to dispute resolution to resolve any difficulties (s.275(c)). Further, it was submitted that broader and increased access to higher duties is likely to lead to more highly skilled workers, 84 which improves productivity and is in the public interest (ss.275(d) and (e)). Sections 275(f) and (g) do not have any application.

(iv) Rostered weekend employees (clauses 8.4 and 8.6)

[126] Clauses 8.4 and 8.6 of the 2008 Agreement provide for employees to be rostered to work up to a nominated number of weekend days each year and receive an annualised allowance or loading for that capacity. The value of the annualised allowance increases, depending upon the number of rostered weekend days that are allocated to an individual employee, as follows:

• 10 days - 3.75 annual allowance;

• 20 days - 7.5% annual allowance;

• 30 days - 11.25% annual allowance; and

• 40 days - 15% annual allowance.

[127] The employees under the 2008 Agreement who receive these annualised allowances are primarily Rangers, as well as some Field Service Officers.

[128] There is no capacity under the 2008 Agreement for employees to receive ‘as worked’ shift loadings for weekend work. Any time worked on the weekend for employees who do not receive annualised allowances is treated as overtime, and Parks Victoria has very limited capacity to require or roster such overtime to be worked. 85

[129] In his evidence Mr Mead identified the problems with the current arrangements:

“The current arrangement of annualised allowances is based on historical arrangements and does not meet or recognise the organisation’s current requirements for weekend work. Introducing the option for ‘as worked’ weekend penalties will create more flexibility for PV to target its rostering on weekends around providing services efficiently and effectively.

For example, it is common for an employee to continue to be rostered for a set number of weekend days for several years, even after they have changed position or their duties have changed. This has resulted in rostered weekend work not being tailored to suit the specific needs of a particular region or work location.

It also means that weekend labour is often not allocated by the operational requirements of each park, but rather it is allocated depending on staff available for weekend work on the roster for each park. This means that some parks have too much labour for weekend work, while others do not have enough.

PV is seeking additional flexibility in having the option to pay weekend penalties on an ‘as worked basis’ under the proposed determination, as an alternative to only having weekend employees who receive annualised allowances. PV would still have employees receiving annualised allowances, and indeed, there is likely to be a strong, ongoing need for Rostered Weekend Employees under the determination. The amendments sought are about providing PV with more relevant, effective and efficient options for labour allocation on weekends.’ 86

[130] The major amendments to clause 8.4 are to include the option for employees to work weekends on an as worked basis (subject to extensive notice requirements) for which they will receive weekend penalties equivalent to overtime under the workplace determination. No changes have been made to the arrangements in relation to annualised allowances. Under clause 8.4(a), employees may be remunerated for weekend work through an annualised allowance, as worked penalties, or a combination of both.

[131] In relation to clause 8.4(k), the parties have agreed to a further variation of the wording, as follows:

“Superannuation contributions will be paid on as worked penalties, however payments made for weekend work on an as worked basis will only be added to salary for superannuation purposes for employees who are in a defined benefit superannuation fund, where permitted under the terms of the relevant Trust Deed for the defined benefit superannuation fund, or if there is no Trust Deed, the applicable governing rules for that defined superannuation fund. Where this is not permitted, superannuation contributions will be made on such payments to an appropriate accumulation fund nominated by the employee, or in the absence of nomination, the default specified in this determination.”

[132] This variation will ensure that, where permitted by the relevant trust deed, payment for as worked penalties will be included for the purposes of that employee’s salary for a defined–benefit superannuation fund.

[133] Clause 8.6 has been amended so that employees who do not receive at least 2 weeks’ notice of a cancellation of weekend work that was to be worked on an as worked basis, will receive a minimum payment of one day’s pay for the relevant weekend day that would have been worked, which will be payable at the Sunday loading in the event that the employee was rostered to work both weekend days.

[134] Mr Mead stated that the introduction of as worked penalties, of itself, does not create a bankable saving for Parks Victoria. This is said to be so because the payment for such weekend work will be the same as if employees worked overtime under the 2008 Agreement, such that as worked penalties is effectively cost neutral. Further, there have been no changes in this clause to the periods of notice that Parks Victoria can provide employees to reduce or cease their annualised weekend allowances, or any changes to the annualised allowances available. This means that, even though the introduction of as worked penalties will provide Parks Victoria with greater flexibility in rostering, it has the same rights and obligations to reduce or cease these allowances as it did under the 2008 Agreement. Parks Victoria did not propose any change to that arrangement. 87 Mr Mead says that for this reason, any potential reduction or cessation of annualised allowances is not itself a bankable saving that is created by any change in the rostered weekend work clause, rather it will come from better rostering organisation and efficiencies, which are implemented outside of the workplace determination.

[135] However, Mr Mead conceded that the option of as worked penalties is likely to provide Parks Victoria with additional flexibility with its rostering and, as a result, Parks Victoria will be more likely to, where necessary, reduce or cease the annualised allowances for some employees than was previously the case, thus creating savings.

[136] The introduction of a minimum payment in the event that as worked weekend work is cancelled is likely to create some additional cost for Parks Victoria, in circumstances where the rostered work is no longer required, but is cancelled with less than two weeks’ notice. 88

[137] During cross-examination Mr Mead conceded that the agreed changes had provided Parks Victoria with ‘more relevant, effective and efficient options for labour allocations on weekends’. 89

[138] The parties submitted that the changes made have merit and that the interests of Parks Victoria and its employees favour the inclusion of the agreed provision in the workplace determination (s.275(c)). The public interest (and productivity) is said to be aided by providing Parks Victoria with another means of allocating and remunerating weekend work in order to discharge its public functions. It is another flexibility available to Parks Victoria, that was not available under the 2008 Agreement, that improves productivity (ss.275(d) and (e)).

[139] Neither party suggested that ss.275(f) and (g) have any application. Both parties contended there is no disincentive to bargain in future arising from the proposed clause (s.275(h)). The as worked arrangement is new. The determination affords an opportunity for it to be utilised and to be assessed by the parties in practice and thereby provides an incentive to bargain in the future.

(v) Rostered stand–by employees (clause 8.5)

[140] Clause 8.5 of the 2008 Agreement is in the following terms:

“8.5 Rostered Stand-by Employees

(a) A Rostered Stand-by Employee will be rostered to be on stand-by on a regular basis as part of an annual duty roster. A Rostered Stand-by Employee shall be entitled to an annual allowance of 7.5% of substantive salary. The employee, on the basis of what is reasonable, will respond to, or initiate a response to, incidents as required for which no additional payment will be made.

(b) The allowance is payable only whilst the employee is rostered to undertake annual stand-by duty in accordance with this sub-clause and will be added to salary for superannuation purposes. A minimum of three months notice in writing shall be given for cessation of the requirement to undertake annual stand-by duty.”

[141] Clause 8.5 of the draft determination is in the same terms. The parties jointly submitted that, given that no changes were made to this clause from the 2008 Agreement, and the parties reached agreement as to that term in 2008, the Commission ought be satisfied that no changes are now required to the clause. It was submitted that there is nothing in the material which would enable the Commission to form any alternative view in any event.

[142] We have had regard to the matters put by the parties and to the factors identified in ss.275, 577 and 578 and to the objects of the FW Act. We are satisfied that each of the matters at issue agreed after the end of the relevant statutory period should be included in the workplace determination.

[143] We now turn to the contested matters at issue.

5. The contested matters at issue

5.1 Wages and allowances increases

[144] The parties are agreed that the workplace determination is to operate for a period of three years. The matter at issue concerns the level of increases in wages and allowances over the period of operation of the workplace determination.

[145] Parks Victoria’s preferred outcome (clause 3.3(b) of the draft determination) is that the Commission award the following increases in wages and allowances:

• 3% on commencement of the workplace determination;

• 2.75% after 12 months; and

• 2.75% after 24 months.

[146] The Unions seek the following increases:

• 3.5% on 1 June 2012;

• 6.3% on commencement of the workplace determination;

• 4% after 12 months; and

• 4% after 24 months.

[147] In the event that we were not minded to grant a retrospective wage increase, the Unions submitted that we should ‘front load’ the first increase in the determination to compensate employees for the decline in their real wages since May 2011, by adding 3.5% to the 6.3% proposed to operate from 1 February 2013.

[148] Parks Victoria’s preferred outcome involves an increase of 8.5% over the three year term of the workplace determination, whereas the Unions’ proposal provides for an increase of 17.8%. 90

[149] Parks Victoria also advances an alternate position in the event that the Commission does not accept its preferred outcome, namely:

• the Commission should award wage increases in the same terms as those in the VPS determination; and

• the Commission should also award an initial $1500 one-off bonus, similar to the sign on bonus included in the VPS determination.

[150] The VPS determination is dealt with later (see paragraphs [188]-[193]). For present purposes we note that the VPS determination provides for an increase of 12.5% over three and a half years and an initial $1500 bonus payment.

[151] Parks Victoria submitted that there is no basis for any award of retrospectivity and in any event there is no power to grant retrospectivity in the sense that the determination can only operate prospectively. This submission was based on the terms of s.276(1) of the FW Act, which states:

“(1) A workplace determination operates from the date on which it is made.”

[152] However, Parks Victoria does not contend that it is beyond the power of the Commission to include a clause which commences operation upon the actual commencement of the workplace determination and gives rise to a new obligation to calculate and provide back pay. 91 In our view this concession is entirely appropriate. While s.276(1) expressly provides that a workplace determination operates from the date on which it is made, that does not preclude the inclusion within the workplace determination of a requirement to give effect to a wage increase from an earlier date. Such a requirement operates prospectively in the sense that it has legal effect upon the workplace determination coming into operation. However while the Commission has the power to include such a provision in a workplace determination, Parks Victoria submitted that special, compelling or exceptional circumstances must exist to warrant such a course:

“The Tribunal should exercise considerable caution in adjudging the consequences of this statutory scheme as being unfair or lacking equity.”

[153] Parks Victoria also submitted that the front loading of increases; sign on bonuses; or building any element of compensation for the delay since the last pay increase, achieves the same end as retrospectivity and accordingly should be subject to a similar test of special, compelling or exceptional circumstances. It was submitted that such measures should be seen as ‘more than usually undesirable’ as there is an element of conflict between compensating employees for delay and the statutory scheme, which itself leads to lengthy delay.

[154] Parks Victoria submits that there are no special, compelling or exceptional circumstances in this case. It is contended that the length of the delay since the last wage increase and the length of the bargaining process are circumstances which would attend most workplace determinations. The following points are advanced in support of that contention:

• the last pay increase in most enterprise bargaining agreements is usually 12 months before expiry (that was the position with the 2008 Agreement and is proposed in relation to this determination);

• the procedures in the Act for terminating protected industrial actions (and triggering the workplace determination process) are only intended to be available in exceptional circumstances. Combined with the good faith bargaining obligations and the capacity for the Commission to suspend most forms of protected industrial action, as an alternative to terminating action, it is not particularly unusual for unsuccessful enterprise bargaining to proceed for up to 12 months or more before being terminated; and

• the completion of the workplace determination process can take many months depending on the number of matters at issue.

[155] It was submitted that the combination of these factors suggests that, in almost all cases, periods of in excess of 24 months would elapse since the last pay increase. This case involved a 12 month period between the last pay increase and the expiry of the 2008 Agreement, just over 12 months of unsuccessful bargaining and around a 6 month workplace determination process. Parks Victoria submitted that such time periods are neither exceptional nor special.

[156] Parks Victoria also submitted that:

“... much of any ‘unfairness’ caused by that delay cannot be laid at the feet of PV (as opposed to the usual processes involved in workplace determinations), such that it is comparatively unfair for PV to bear the significant burden of compensatory amounts for unfairness not of its making. This is particularly so given PV’s financial position. And whilst it may be argued that PV has accrued a ‘benefit’ in not paying increased wages over the period of the delay, this benefit operates on the assumption that everyone is entitled to an annual wage increase in all circumstances, which is not a safe assumption’. 92

[157] It is convenient to deal now with the proposition that special, compelling or exceptional circumstances must be shown before the Commission provides for a retrospective wage increase or adopts some other measure to compensate employees for the delay since the nominal expiry of the previous agreement. There are two aspects to this proposition. The first is the contention that the time which has elapsed since the nominal expiry date of the 2008 Agreement is not relevant to our determination of the level of the first wage increase under the workplace determination. The second aspect is the proposed test of special, compelling or exceptional circumstances before the Commission awards retrospectivity or some other measure to compensate employees for such delay.

[158] At the outset we note that compensating employees for such delay has been a common feature of workplace determinations, both under the FW Act and the legislative predecessors to the current provisions. In each of the cases footnoted the Commission, either awarded a retrospective wage increase 93 or front loaded the first increase94 to compensate employees for the delay since they last received a wage increase. Further, in a number of these cases the Commission has not applied a test of special, compelling or exceptional circumstances before awarding either retrospectivity or a front loaded increase.95

[159] A similar proposition to that put by Parks Victoria was also put and rejected in Transport Workers’ Union of Australia v Qantas Airways Limited. 96 In that case, the Transport Workers’ Union submitted that the wage increases under the workplace determination should apply from 1 July 2011 as the employees had not received an increase in wages since July 2010. Qantas opposed retrospectivity and it’s submission is summarised at paragraph [96] of the Full Bench’s decision as follows:

“Qantas submits that there are no exceptional circumstances warranting a retrospective wage increase, and applying a retrospective wage increase would place employees in the same position as they would have been if they had not engaged in damaging industrial action.”

[160] The determination in that case commenced operation on 8 August 2012 and the Full Bench decided that the first wages increase would operate from 1 July 2011, as sought by the Transport Workers’ Union and, by implication, rejected the submission advanced by Qantas.

[161] We are of the view that the time between the nominal expiry date of a previous agreement (in this case 31 May 2011) and the operative date of a workplace determination is a factor to be taken into account in deciding the wage increases to be included in the workplace determination. Further, in the circumstances of this matter we are of the view that the extent of the wage increase referable to this consideration is not going to be as great as the prospective wage increases we will award. The reason for such a distinction is simple. The aspects of the workplace determination that provide a benefit to the employer are prospective. It is appropriate that some of that benefit be shared with the employees, in the form of a higher wage increase. The same considerations do not apply to the wage increase which is referable to the passage of time since the nominal expiry date of the last agreement. During that period the employer did not have the benefit of the various changes incorporated in the workplace determination. We note that the Full Bench in Schweppes arrived at a similar conclusion. The adoption of such an approach also accords with our statutory obligation to have regard to the interests of the employers and employees covered by the determination (s.275(c)).

[162] We also note that the proposition advanced by Parks Victoria, if accepted, would reduce an employer’s incentive to resolve disputes in a timely fashion. An employer may resist compromise in the knowledge that the employees will not be subsequently compensated for the delay. In our view a more balanced approach is required.

[163] We are satisfied that it is appropriate to have regard to the time which has elapsed since the nominal expiry date of the 2008 Agreement in determining the level of the first wage increase under the workplace determination.

[164] The bargaining process can be protracted, and the time taken in bargaining is not necessarily a function of unreasonable behaviour by a particular party. Absent unreasonable behaviour there is no reason in principle why a party should be disadvantaged by the time taken in the bargaining process.

[165] We acknowledge that in an appropriate case behaviour by a bargaining representative may warrant a different approach. But in this case no party contended that s.275(f) or (g) were enlivened in relation to this matter at issue.

[166] The proposition advanced by Parks Victoria that special, compelling or exceptional circumstances must be shown to warrant retrospectivity or front loading, derives from authorities dealing with the retrospective operation of awards and variations to awards. The Commission recently dealt with this issue in the Modern Awards Review 2012 decision in which it decided that variations arising from the review would generally operate prospectively:

[350] It will be recalled that in Re AEU the High Court held that the implied limitation precluded the Commission from making an award binding on the States in relation to the identification of persons it wishes to dismiss from its employment on redundancy grounds. In the above passage from Re AEU; ex parte Victoria the Court was interpreting and applying what the High Court had said in Re AEU. In doing so the Court was clearly of the view that Re AEU did not support the proposition that the implied limitation precluded an award clause providing that the identification of persons to be made redundant must not involve discrimination. In a sense the Court was reading down the general proposition in Re AEU that the implied limitation precluded an award provision relating to the identity of persons to be made redundant.

[351] As we have indicated the excluded matter in s.5(1)(a) is largely coextensive with the relevant Re AEU exclusions. Accordingly, it is appropriate to construe the terms in s.5(1)(a) in a manner consistent with the interpretation of those terms in Re AEU and in subsequent cases applying Re AEU.

[352] Adopting this approach to the clause under consideration it seems to us that a requirement that appointments be non-discriminatory and in accordance with the Equal Opportunity Act 2010 (Vic) is not an excluded matter. On the reasoning in Re AEU; ex parte Victoria such a provision does not fall within the scope of the Re AEU proscription of award provisions regulating the identity or appointment of public sector employees. It is also relevant to note that the provision considered by the Court in Re AEU, Ex parte Victoria (i.e. Schedule 1) was the subject of subsequent consideration by Munro J in Re Victorian Teachers Redundancy Award 1994. 183 In that matter his Honour was considering applications to vary the award in light of the High Court’s judgement in Victoria v The Commonwealth.184His Honour declined to vary Schedule 1 and in doing so rejected the proposition that the Schedule infringed the implied limitation.185 A subsequent Full Bench, Victoria v Health Services Union of Australia,186 referred to Munro J’s consideration of the relevant authorities with apparent approval.187

[353] For the reasons given the provision is not an excluded matter within the meaning of s.5(1)(a).

[354] We now turn to the other provisions in clause 6.1 which are said to be excluded subject matter.

[355] Clause 6.1(b) provides that certain vacant or newly created positions (i.e. those more than 12 weeks in duration) must be first offered to existing employees. It is only in circumstances where no suitable internal applicant meets the selection criteria that the position may be made available to external applicants. As was the case in Re AEU; ex parte Victoria, the effect of this provision is to prevent the employer offering the position to anyone else in circumstances where there is a suitable internal candidate that meets the selection criteria. In such circumstances there may be a more meritorious external candidate but the employer would not have the option of appointing them. The provision affects the employer’s capacity to determine the identity of the persons it wishes to employ and as such it is an excluded matter.

[356] As to cl. 6.1(c), this provision creates a default position whereby certain positions must be first advertised internally. Limited exceptions to this general rule are provided (in cl.6.1(c)(i), (ii) and (iii)).

[357] The provision only affects the sequencing of the advertising process, it is no longer part of a scheme which required internal candidates to be considered first (because cl. 6.1(b) deals with excluded subject matter and no longer forms part of the clause). The positions must be advertised internally first (save in the circumstance where one of the points in cl. 6.1(c)(i) to (iii) applies, see cl. 6.1(d)), before they can be advertised externally. The provision does not impact on the employer’s capacity to determine the number or identity of the persons it wishes to employ, nor does it pertain to the appointment of those persons.

[358] We are not persuaded that this provision pertains to an excluded matter. The provision does not pertain to the number, identity or appointment of public sector employees. Unlike Clauses 6.0 and 6.1(a) and (b), this clause does not affect the employer’s capacity to determine the identity of the persons it wishes to employ.

[359] We now turn to the alternate argument advanced on behalf of Parks Victoria.

[360] As we indicated earlier, in addition to relying on the excluded subject matter in s. 5(1)(a) Parks Victoria advances an alternate submission based on the High Court’s observations in Re AEU. This submission proceeds on the assumption that the matters proscribed by the High Court in Re AEU may be broader in scope than the excluded subject matter in s. 5(1)(a).

[361] For their part the Unions contend that Re AEU and the implied limitation have no work to do in circumstances where powers have been referred to the Parliament of the Commonwealth by a State. In other words the challenge to the impugned clauses begins and ends with the determination of whether those clauses deal with any excluded subject matter within the meaning of s. 5(1)(a).

[362] It is unnecessary for us to resolve the controversy as to the application of Re AEU and the operation of the implied limitation in the context of a referral pursuant to s. 51(xxxvi) of the Constitution, for two reasons.

[363] First, as to Re AEU, while there are differences between the subject matter proscribed in Re AEU and the excluded subject matter in the Referral Act, those differences are not material in the present context. The challenge to the impugned clauses is made pursuant to s. 5(1)(a) and as we have already observed it seems to us that the excluded matter in s. 5(1)(a) is largely coextensive with the relevant Re AEU exclusions (see paragraph [307]. Indeed, Counsel for Parks Victoria conceded as much during the course of oral argument when he said:

“... the Referral Act is drafted in a way to try to give effect to Re AEU ... So the difference between the application of Re AEU and the Referral Act is likely not to amount to very much. But it may. It may at the margin ...” 188

[364] To the extent that there is any difference between the excluded subject matter in s. 5(1)(a) and the relevant Re AEU exclusions we are not persuaded that it alters the decision we have taken in respect of the impugned clauses. In such circumstances it is unnecessary for us to express a view on application of Re AEU in the context of the Referral Act.

[365] Second, as to the implied limitation, it is common ground that the application of the doctrine now requires an evaluation of the impact of the challenged provision. As their Honours Gaudron, Gummow and Hayne JJ observed in Austin v Commonwealth:

“There is, in our view, but one limitation, though the apparent expression of it varies with the form of the legislation under consideration. The question presented by the doctrine in any given case requires assessment of the impact of particular laws by such criteria as ‘special burden’ and ‘curtailment’ of ‘capacity’ of the States ‘to function as governments’. These criteria are to be applied by consideration not only of the form but also ‘the substance and actual operation’ of the federal law (155). Further, this inquiry inevitably turns upon matters of evaluation and degree and of ‘constitutional facts’ which are not readily established by objective methods in curial proceedings.’ 189

[366] It seems to us that Re AEU can be reconciled with Austin on the basis that in Re AEU the court was developing a specific sub rule to the Melbourne Corporation case 190 such that certain features of State governments (such as the capacity to determine the number and identify of public sector employees) must be kept free of Commonwealth regulation, without requiring the States to demonstrate that regulation of those matters would in fact undermine the capacity of the State to govern.191

[367] In the context of the present case it is important to appreciate that Parks Victoria does not seek any finding to the effect that the impact of the impugned clauses is such as to impair the State of Victoria’s capacity to function as a government. The case put by Parks Victoria is based upon s. 5(1)(a) and any residual application of Re AEU, it is not propounding a general case based on the implied limitation. As Counsel for Parks Victoria put it during the course of oral argument:

“So the test for the Tribunal is not to in effect try and apply, with all the difficulty that involves, to a test that drives ultimately from the Melbourne Corporation case, but to accept that the High Court has drawn the line at Re AEU. We only rely upon Re AEU. We’re not asking the Tribunal to find that if in their view the clause somehow impairs the operation of the state, but it is not covered by the limitation as described in Re AEU that it is therefore invalid. We’re not asking the Tribunal to do that.” 192

[368] In these circumstances, it is unnecessary for us to determine whether the implied limitation has any operation in the context of the referred matters.

[369] We conclude this part of our decision by observing that the impugned clauses have been a feature of the industrial instruments which have applied to Parks Victoria, for many years. No previous challenge has been made to those provisions. The impugned clauses are also substantially similar to clauses recently agreed by the Victorian government in the context of the VPS determination. While the inconsistent approach taken by the Victorian government to these matters is regrettable it is not relevant to the task of determining whether the Commission has jurisdiction to include the impugned clauses in the workplace determination.

7. Conclusion

[370] We have now dealt with all of the matters still at issue at the end of the post industrial action negotiation period.

[371] We are satisfied that the determination we will make passes the better off overall test in s.193 of the FW Act, and that it includes all of the ‘agreed terms’; terms which deal with matters still at issue at the end of the post industrial action negotiation period; the ‘core terms’ and the ‘mandatory terms’. Further, the determination does not include any terms that would not be about permitted matters or a term that would be an unlawful term, if the determination were an enterprise agreement.

[372] We have had regard to the factors identified in ss.275, 577 and 578 and to the objects of the Act. In our view, the determination reflects an appropriate balance between these various considerations.

[373] The parties are directed to confer and file a joint draft Workplace Determination giving effect to our decision by 4.00pm Monday 18 February 2013. In the event that any disagreement arises between them as to the terms of the final determination these should be clearly identified. The terms of the determination will be settled by Commissioner Hampton with recourse to the Full Bench if necessary.

PRESIDENT

Appearances:

S. Wood SC with M. Follett of Counsel for Parks Victoria.

H. Borenstein SC with M. Harding of Counsel for the Australian Workers' Union; Australian Municipal, Administrative, Clerical and Services Union; the Community and Public Sector Union.

Hearing details:

2012.

Melbourne:

December 4, 5, 20.

1 PR526198.

2 See generally Exhibit Parks 1 at paragraphs 6 - 12.

3 Exhibit Parks 8 at paragraphs 7-19.

4 Ibid at paragraphs 22-27.

5 Transcript, 5 December 2012, at PN 1485-1508.

6 Exhibit Parks 8 at paragraphs 29-31 and Annexures PA-1 and PA-2.

7 Exhibit Parks 1 at paragraph 50.

8 Exhibit Parks 6 at paragraph 23.

9 Exhibit Parks 8 at paragraphs 25, 26 and 28.

10 Transcript, 4 December 2012, PN 1082 - 1092.

11 Transcript, 4 December 2012, at PN 977.

12 See Annexure MP3 to the statement of Matthew Price, Exhibit Unions 7 and Mr Mead’s evidence at paragraphs 977-999 of the Transcript, 4 December 2012.

13 Mr Mead’s evidence at PN 303 of the Transcript, 4 December 2012.

14 Mr Mead’s evidence at PN 384-385 of the Transcript, 4 December 2012.

15 Mr Mead’s evidence at PN 395 of the Transcript, 4 December 2012.

16 Mr Mead’s evidence at PN 397 of the Transcript, 4 December 2012.

17 Exhibit Parks 2 at paragraph 62.

18 Exhibit Parks 2 at paragraphs 55-56.

19 See Transcript, 4 December 2012, at PN 304 - 310; 331 - 339; 377 - 380 and 409 - 445.

20 Transcript, 4 December 2012, at PN 419 - 422.

21 Exhibit Unions 10 at paragraph 10.

22 Ibid at paragraphs 11-16.

23 Exhibit Parks 2 at paragraph 65.

24 Ibid at paragraph 61.

25 Transcript, 4 December 2012, at PN 304 - 305.

26 Transcript, 4 December 2012, at PN 339.

27 Transcript, 4 December 2012, at PN 424, 543 and 879.

28 Transcript, 4 December 2012, at PN 417.

29 Transcript, 4 December 2012, at PN 409.

30 Transcript, 4 December 2012, at PN 299 - 300.

31 See Mr Jackson’s evidence, Exhibit Parks 6 at paragraphs 23(a) and (b); Exhibit Parks 7 at paragraphs 20 and 23.

32 Filed by Parks Victoria on 30 November 2012.

33 AWU v Pioneer Construction Materials Pty Ltd, PR925916, 19 December 2002, at paragraphs 32 - 33; CPSU v Australian Protective Service, PR910682, 29 October 2001, at paragraph 12 - 13.

34 O’Sullivan v Farrer (1989) 168 CLR 210 at p216; Randall v Australian Taxation Office (2010) 198 IR 114 at paragraph 11.

35 Ibid.

36 Re Kellogg Brown and Root, Bass Strait (Esso) Onshore/Offshore Facilities Certified Agreement 2000 (2005) 139 IR 34 at paragraph 23.

37 [2012] FWAFB 7858.

38 Ibid at paragraphs 45 - 46.

39 See Exhibits Parks 1-11 and Exhibits Unions 1-15.

40 Exhibit Parks 1; Exhibit Parks 2; Transcript, 4 December 2012, at PN 196 - PN 1015 and PN 1210 - PN 1320. (We note that paragraphs 38 - 46, 67 - 87 and 91 - 126 of Exhibit Parks 1 were not tendered by Parks Victoria but were put in evidence during the course of cross examination by the Unions’).

41 Exhibit Parks 6; Exhibit Parks 7; Transcript, 4 December 2012, at PN 1020 - PN 1204. (We note that paragraphs 4, 5, 8 and 9 of Exhibit Parks 7 were not tendered by Parks Victoria but were put in evidence during the course of cross examination by the Unions’).

42 Exhibit Parks 8; Exhibit Parks 9; Transcript, 4 December 2012, at PN 1325 - PN 1380.

43 Exhibit Parks 10; Transcript, 5 December 2012, at PN 1423 - PN 1598.

44 Exhibit Unions 6.

45 Exhibit Unions 7.

46 Exhibit Unions 8; Exhibit Unions 13.

47 Exhibit Unions 9; Exhibit Unions 14.

48 Exhibit Unions 10.

49 Exhibit Unions 11.

50 Exhibit Unions 12.

51 Exhibit Parks 2 at paragraphs 12-36.

52 See GM-6 annexed to Exhibit Parks 1.

53 Exhibit Parks 2 at paragraph 15.

54 AG895510.

55 Exhibit Parks 10 at paragraph 97 and 98(b).

56 See the statement of Wayne Townsend, Exhibit Unions 6, at paragraph 32. Mr Townsend was not cross examined and this aspect of his statement was not challenged by any other witness.

57 Exhibit Parks 2 at paragraph 16.

58 Transcript, 4 December 2012, at PN 469-488.

59 Exhibit Parks 2 at paragraph 17.

60 Transcript 4 December 2012, at PN 493-498.

61 MA000121.

62 Exhibit Unions 7 at paragraph 27(c).

63 Transcript, 4 December 2012, at PN 519-528.

64 Exhibit Parks 2 at paragraph 20.

65 Ibid.

66 Exhibit Unions 7 at paragraph 35(c).

67 Exhibit Parks 2 at paragraph 21.

68 Transcript, 4 December 2012, at PN 536.

69 Exhibit Parks 2 at paragraph 22.

70 Exhibit Parks 2 at paragraph 23.

71 Exhibit Parks 2 at paragraph 25.

72 Exhibit Parks 2 at paragraph 26.

73 Transcript, 4 December 2012, at PN 540.

74 Transcript 4 December 2012, at PN 542-544.

75 Exhibit Unions 2 and Transcript, 4 December 2012, at PN 573, 588 and 600.

76 See Mr Mead’s evidence, Transcript, 4 December 2012 at PN 627 - 629.

77 Ibid.

78 Transcript, 4 December 2012, at PN 637-638.

79 Exhibit Unions 2 at paragraph 68 and Transcript, 4 December 2012, at PN 573, 588, 600 and 1003-1004.

80 Save for those employees acting in Grade 8 positions.

81 Ibid.

82 Transcript, 4 December 2012, at PN 630-634.

83 Exhibit Parks 2 at paragraph 30.

84 See paragraph 93 of Exhibit Parks 1.

85 See paragraphs 99 - 110 of Exhibit Unions 2.

86 Exhibit Unions 2 at paragraph 100-106 and Transcript, 4 December 2012, at PN 573, 588 and 600.

87 Transcript, 4 December 2012, at PN 645.

88 Exhibit Parks 2 at paragraphs 30-31 and Transcript, 4 December 2012, at PN 660-661.

89 Transcript, 4 December 2012, at PN 652 - 653.

90 Note that the practical effect of the increases proposed by each party will be slightly higher, due to the compounding effect of successive increases.

91 See Informax International Pty Ltd v Clarius Group Limited [2012] FCAFC 165 at 146-155.

92 Parks Victoria’s final submissions, 14 December 2012, at paragraph 100.

93 Transport Workers Union of Australia v Qantas Airways Ltd and Anor [2012] FWAFB 6612 at 96; Health Services Union v Austin Health and Ors [2009] AIRCFB 353 at 34; Southlink Pty Ltd v Transport Workers Union PR948148 at 96 - 97; CPSU v Australian Protective Service (APS) PR910682 at 272 - 277 and Australian Education Union v State of South Australia (DETE) and CPSU and State of South Australia (DETE) Print T1383 at 170.

94 Metropolitan Ambulance Service v LHMU; Rural Ambulance Service v LHMU; 28 July 2005 PR960731 at 22-23.

95 For example, Schweppes Australia Pty Ltd v United Voice - Victoria Branch[2012] FWAFB 8599; TWU v Qantas[2012] FWAFB 6612

96 [2012] FWAFB 6612.

97 Ship Painters and Dockers 94 CAR 579 at 619-620.

98 [2012] FWAFB 5600 at paragraphs 112 - 115.

99 Print Q4464.

100 Ibid. Also see TWU v Qantas [2012] FWAFB 6612 at paragraphs 28 - 29.

101 CPSU v Australian Protective Service, Print PR910682, at paragraph 272- 277.

102 Huntley v Alexander (1922) 30 CLR 566 per Isaacs J.; Norbis v Norbis (1985) 161 CLR 513 at 537 per Brennan J.; and Lambley v DP World Sydney Limited [2013] FCA 4 at paragraph [34] per Katzmann J.

103 Parks Victoria’s response to the draft summary at pp 5-6.

104 HSU v Austin Health (2009) 180 IR41 at paragraph 35.

105 Ibid at paragraph 45.

106 Ibid at paragraph 43; Southlink Pty Ltd v TWUA (PR948148) at paragraph 43; State of South Australia v CEPU (PR957094) at paragraph 91.

107 CPSU v Australian Protective Service (PR910682) at paragraph 266; State of South Australia v CEPU (PR957094) at paragraph 91; ANF v Queensland Department of Health (2003) 126 IR 244 at paragraph 102.

108 Schweppes Australia Pty Ltd v United Voice - Victoria Branch[2012] FWAFB 8599 at paragraph 115.

109 Ibid at paragraph 130.

110 Parks Victoria’s written submissions of 12 October 2012, at paragraph 34.

111 s.284(1)(c).

112 [2012] FWAFB 8599 at paragraphs 110 and 118.

113 Paragraph 41 and p14 of Annexure BF5 to Mr Flynn’s witness statement of 12 October 2012, Exhibit Parks 10.

114 [2012] FWAFB 5000 at paragraphs 73-75.

115 ABS Catalogues 6401.0 and 6467.0.

116 The DEEWR Enterprise Bargaining Report, Exhibit Parks 11.

117 Ibid at p 1.

118 Ibid at p 6.

119 Exhibit Parks 10 at paragraph 96.

120 Exhibit Parks 10 at paragraph 97.

121 Beechey at paragraph 3-10; Argote at paragraphs 16-18 and Caldwell at paragraph 3-11.

122 Exhibit Parks 9 at paragraph 97.

123 Ibid.

124 [2012] FWAFB 8599 at paragraph 115.

125 Parks Victoria’s written submissions of 12 October 2012 at paragraph 37.

126 See Mr Mead’s evidence: Exhibit Parks 1 at paragraphs 22-24 and Annexure GM3, Exhibit Parks 2 at paragraphs 3-11 and Transcript at PN, 4 December 2012, 676-685; Dr Jackson’s evidence: Exhibit Parks 6 at paragraphs 37-38, Exhibit Parks 7 at paragraphs 13-17 and Transcript, 4 December 2012, at PN 1169-1179; Mr Brendan Flynn: Exhibit Parks 10 at paragraphs 78-103 and Transcript, 5 December 2012, at PN 1448-1477 and 1563-1574; Exhibit Parks 5: ‘The Economic backdrop to wage determination for Parks Victoria’ by Deloitte Access Economics, 10 October 2012 at paragraphs 224-261.

127 Annexure GM-3 to Exhibit Parks 1.

128 Transcript, 5 December 2012, at PN 1446-1447.

129 Exhibit Parks 10 at paragraphs 96-98.

130 Transcript, 5 December 2012, at PN 1570-1574.

131 The actual amount of increase is slightly higher due to compounding.

132 Unions’ Final Submissions, 14 December 2012 at paragraphs 100 and 102.

133 Ibid at paragraphs 103.

134 Ibid at paragraphs 106 and 113.

135 Ibid at paragraph 114.

136 See the evidence referred to at paragraph 61 of Parks Victoria’s final submission, dated 14 December 2012.

137 TWU v Qantas[2012] FWAFB 6612 at paragraph 39.

138 Ibid at paragraphs 120-122

139 Paragraphs 68, 70-71 of Parks Victoria’s final submissions, dated 14 December 2012.

140 See paragraphs 131-145 of the Unions’ Final Submissions, dated 14 December 2012.

141 Ibid at paragraph 149.

142 ABS Catalogue 6401.0, 23 January 2013.

143 Exhibit Parks 1 at paragraph 54.

144 Exhibit Parks 1 at paragraph 88.

145 Also see Mr Davis’ second statement at paragraph 2.

146 AEU v State of South Australia Print T1389 at paragraph 23 and TWUA v Qantas Airways Ltd[2012] FWAFB 6612 at 34.

147 Exhibit Parks 2 at paragraphs 39 and 41, and Exhibit Parks 3.

148 Transcript, 4 December 2012, at PN 736-737.

149 Parks Victoria’s final submissions 14 December 2012 at paragraph 134-136.

150 Unions final submissions, 14 December 2012 at paragraphs 155-158.

151 Transcript, 4 December 2012, at PN 732-733 and PN 737 and 743.

152 Parks Victoria’s final written submissions at paragraphs 128 - 130.

153 Transcript, 4 December 2012, at PN 950.

154 Exhibit Parks 3.

155 Print Q4464.

156 Also see Transport Workers Union of Australia v Qantas Airways Limited [2012] FWFB 6612 at paragraph 39.

157 Parks Victoria final submissions, 14 December 2012 at paragraphs 144-145.

158 (1951) 83 CLR 1 at pp.258.

159 Also see Attorney-General (Qld) v Riordan (1997) 192 CLR 1 at 11-12 per Brennan CJ and McHugh J. For analogous reasoning in respect of the exclusions from the Commonwealth Powers (Industrial Relations) Act 1996 (Vic) see: Dempster v Comrie (2000) 96 FCR 370 at paragraph 18 per Kiefel J. and [29]-[32] per Lehane J.

160 S.35(a) of the Interpretation of Legislation Act 1984 (Vic).

161 (1994) 49 FCR 534 at 538. Also see Mills v Meeking (1990) 169 CLR 214 at 235 per Dawson J.

162 (2010) 25 VR 436.

163 Ibid at paragraph 92.

164 (2011) 245 CLR 1 at paragraph 51 per French CJ, and paragraph 565 per Crennan and Kiefel JJ.

165 As to the application of the principle of legality to statutory interpretation see: Bropho v Western Australia (1990) 171 CLR 1 at pp18 per Mason CJ, Deane, Dawson, Toohey, Gaudron and McHugh JJ; Coco v The Queen (1994) 179 CLR 427 at pp436-437 per Mason CJ, Brennan, Gaudron and McHugh JJ; Electrolux Home Products Pty Ltd v Australian Workers’ Union (2004) 221 CLR 309 at pp329 per Gleeson CJ; Saeed v Minister for Immigration and Citizenship (2010) 267 ALR 204 at pp209. Also see J.J. Spigelman (205) ‘The Principle of Legality and the Clear Statement Principle’ 79 ALJ 769; and M. Gleeson (2009) ‘The Meaning of Legislation: Context, Purpose and Respect for Fundamental Rights’, 20 PLR 26.

166 Municipal Officers’ Association of Australia v Lancaster (1981) 37 ALR 559 at 579-580 per Evatt and Northrop JJ; JW v City of Perth (1997) 191 CLR 1 at 12 per Brennan CJ and McHugh J.

167 Victorian Parliamentary Hansard Legislative Council 4 June 2009, pp 2680-2681.

168 (1994 - 1995) 184 CLR 188 at pp.232 to 234 per Mason CJ and Brennan, Deane, Toohey, Gaudron and McHugh JJ.

169 For example, Konrad v Victoria (1999) 91 FCR 95 and Austin v Commonwealth (2003) 215 CLR 185.

170 Also see PTC v Strain and CORE v Howarth, Print Q7860. In that matter the Full Bench observed that ‘s.5(1)(c) [the redundancy exclusion] of the [1996 Referral Act] is intended to operate so as to preserve the full scope of the implied limitation’. Although this observation was made in relation to the previous Referral Act it is apposite to the excluded matter presently under consideration.

171 (1986) 160 CLR 341 at 353; also see R v Kelly; Ex parte Victoria (1950) 81 CLR 64 at 84 and R v Portus; Ex parte ANZ Banking Group Ltd (1972) 127 CLR 353 at 362.

172 (1996) 73 IR 250.

173 Ibid at 263.

174 (1995) 61 IR 174 at 198.

175 Ibid at 200.

176 (1996) 73 IR 250 at 262-263

177 See NTEU v Bendigo Regional Institute of TAFE and others, Print R3868 per Giudice P., Polites SDP and Smith C at paragraphs 15-18.

178 Ibid.

179 Ibid.

180 Ibid at paragraphs 28-30.

181 (1996) 78 IR 250.

182 (1996) 73 IR 250 at 261.

183 Print P4491, 2 September 1997.

184 187 CLR 416.

185 So much is apparent from his Honour’s decision and subsequent order, see Print P4768.

186 (1997) 77 IR 151.

187 Ibid at 160

188 Transcript at paragraphs 1830 and 1832.

189 (2003) 215 CLR 185 at pp.124.

190 (1947) 74 CLR 31

191 See G Hill ‘Austin v Commonwealth: Discrimination and the Melbourne Corporation Doctrine 92003) 14 PLR 69 at 81-84.

192 Transcript, 20 December 2012, at PN 1747.

Printed by authority of the Commonwealth Government Printer