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Re Annual Wage Review 2019-20

Re Annual Wage Review 2019-20

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Case Copied 19 June 2020 77 min read

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[2020] FWCFB 3500

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.285—Annual wage review

Annual Wage Review 2019–20
(C2020/1)

JUSTICE ROSS, PRESIDENT
VICE PRESIDENT CATANZARITI
DEPUTY PRESIDENT ASBURY
COMMISSIONER HAMPTON
MR FERGUSON
PROFESSOR WOODEN
MS LABINE-ROMAIN

MELBOURNE, 19 JUNE 2020

Paragraph
1.	Reasons for Decision of Justice Ross, Vice President Catanzariti, Deputy President Asbury, Commissioner Hampton, Mr Ferguson and Ms Labine-Romain The Decision	[1]
2.	The Legislative Framework	[193]
3.	Economic and Labour Market Considerations	[272]
4.	Relative Living Standards and the Needs of the Low Paid	[338]
5.	Other Relevant Considerations	[386]
6.	Transitional Instruments and Other Matters	[406]
7.	Conclusion	[464]
8.	Reasons for Decision of Professor Wooden	[476]

Abbreviations

2011–12 Review decision	Annual Wage Review 2011–12 decision
2012–13 Review decision	Annual Wage Review 2012–13 decision
2014–15 Review decision	Annual Wage Review 2014–15 decision
2015–16 Review decision	Annual Wage Review 2015–16 decision
2016–17 Review decision	Annual Wage Review 2016–17 decision
2017–18 Review decision	Annual Wage Review 2017–18 decision
2018–19 Review decision	Annual Wage Review 2018–19 decision
AAWI	average annualised wage increase
ABI	Australian Business Industrial and the NSW Business Chamber Ltd
ABS	Australian Bureau of Statistics
ACBC	Australian Catholic Bishops Conference
ACCI	Australian Chamber of Commerce and Industry
ACCS	Additional Child Care Subsidy
ACOSS	Australian Council of Social Service
Act	Fair Work Act 2009 (Cth)
ACTU	Australian Council of Trade Unions
Ai Group	Australian Industry Group
APCSs	Australian Pay and Classification Scales
April Statement	[2020] FWCFB 1804
ATO	Australian Taxation Office
AWOTE	average weekly ordinary time earnings
AWU	Australian Workers’ Union
C4	Engineering Associate/Laboratory Technical Officer Level 1
C10	Engineering/Manufacturing Tradesperson Level 1
C14	Engineering/Manufacturing Employee Level 1
CCS	Child Care Subsidy
Commission	Fair Work Commission
CPI	Consumer Price Index
Discussion paper	Fair Work Commission (2020), What can and can’t be done in the Annual Wage Review 2019–20, Discussion Paper, 13 May.
EEH	Survey of Employee Earnings and Hours
FCIA	Federal Chamber of Automotive Industries
GDP	gross domestic product
GVA	gross value added
HILDA	Household, Income and Labour Dynamics in Australia
IMF	International Monetary Fund
LCI	Living Cost Index
LMITO	low and middle income tax offset
Manufacturing Award	Manufacturing and Associated Industries and Occupations Award 2020
MGA	Master Grocers Australia Limited
NCVER	National Centre for Vocational Education Research
NMW	national minimum wage
NNDSS	National Notifiable Diseases Surveillance System
NSA	Newstart Allowance (now JobSeeker)
NTWS	National Training Wage Schedule
OECD	Organisation for Economic Co-operation and Development
Panel	Expert Panel for annual wage reviews
Rail Award	Rail Industry Award 2020
Rail Employers	Aurizon, Australian Rail Track Corporation, Brookfield Rail Pty Ltd, Sydney Trains and V/Line Passenger Pty Ltd
RBA	Reserve Bank of Australia
R&CA	Restaurant and Catering Industry Association
Review	Annual Wage Review
RNNDI	real net national disposable income
RTBU	Australian Rail, Tram and Bus Industry Union
SDA	Shop Distributive and Allied Employees’ Association
SES Award	Supported Employment Services Award 2020
Statistical report	Statistical Report—Annual Wage Review 2019–20
SWS	Supported Wage System
Transitional Act	Fair Work (Transitional Provisions and Consequential Amendments) Act 2009
UK	United Kingdom
US	United…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2020] FWCFB 3500
Decision Date: 19 JUNE 2020

CaseChat Overview and Summary

This case involved the Annual Wage Review 2019-20, where the Fair Work Commission (FWC) was required to conduct and complete a review of the national minimum wage (NMW) and modern award minimum wages in each financial year. The Panel had to make an NMW order and could set, vary or revoke modern award minimum wages. The NMW order applies to award/agreement free employees, and modern award minimum wages are the minimum wages contained in modern awards.

This Review was undertaken during a global pandemic, and the Panel had to consider the economic consequences of the pandemic on the review. The outbreak of the coronavirus, COVID-19, and the measures put in place to contain the spread of the virus had led to significant shifts in the way work and society was conducted. The Panel had to take into account the economic environment, labour market considerations, relative living standards and the needs of the low paid, and other relevant considerations in making its decision.

The Panel concluded that the economic considerations weighed in favour of greater moderation in terms of the outcome of the Review. However, the Panel also considered that the impact of an increase in minimum wages on aggregate demand, albeit modest, was relevant because it was obliged to take into account the likely impact of any exercise of modern award powers on the performance of the national economy. The Panel concluded that it was appropriate to increase the NMW and modern award minimum wages, taking into account the proposed NMW and other relevant considerations.

The Panel awarded an increase of 1.75 per cent to the NMW and modern award minimum wages. The NMW would be $753.80 per week or $19.84 per hour, and the hourly rate would be calculated by dividing the weekly rate by 38, on the basis of the 38-hour week for a full-time employee. This constituted an increase of $13.00 per week to the weekly rate or 35 cents per hour to the hourly rate.

The Panel also considered the timing of these adjustments. The Panel decided that the NMW order would come into operation on 1 July 2020, and the adjustments to modern award minimum wages would be deferred for some awards. The Panel concluded that the data showing the differential impact of the pandemic on particular industry sectors and the import of s.286(2) of the Act warranted a more nuanced approach than that advocated by some parties.

Orders