Australian Business Skills Pty Ltd v Australian Skills Quality Authority

Background 8The nature of ABS's activities as an RTO, the role of ASQA in relation to the activities of RTOs and various features of the somewhat complex legislative regime under which these entities operate were outlined near the commencement of the Tribunal's reasons. The following extracts from these reasons provide a useful summary for the purposes of the present decision:- 1 Australian Business Skills Pty Ltd (ABS), trading as Amstar Learning, is a Registered Training Organisation (RTO) that has been operating since 2004. ABS is contracted by employers who provide traineeships under the Apprenticeship and Traineeship Act 2001. Employers within certain vocational areas can enter into a contract with a person to employ them as a trainee. Trainees must be enrolled in an approved course of formal training with an RTO chosen by the employer. 2 The NSW Vocational Education and Training Accreditation Board (VETAB) regulates RTOs that provide vocational education and training in NSW. VETAB monitors RTOs to ensure that they comply with national standards. From 1 July 2011 the Australian Skills Quality Authority (ASQA) has taken over VETAB's role and has been substituted for VETAB as the respondent in these proceedings: National Vocational Education and Training Regulator (Transitional Provisions) Act 2011, Schedule 1, Cl 26.... 4 ASQA has power to cancel ABS's registration if it fails to comply with the RTO standards and to refuse ABS's application to renew its registration on the same basis: Vocational Education and Training Act 2005 (VET Act): s 18(1)(d) and s 12(3)(c). Following amendments to the legislative scheme, those provisions have been superseded by equivalent provisions in the National Vocational Education and Training Regulator Act 2011(Cth) (NVR Act). The cancellation and failure to renew decisions are decisions that could be made under ss 39 and 31 of the NVR Act (Cth). Under s 31 of that Act, ASQA may cancel an RTO's registration in any circumstances that it considers it appropriate to do so. We accept ASQA's submission that the same findings of fact and law would be made under both the VET Act and the NVR Act. 5 Common to both the cancellation decision and the refusal decision is the question of whether or not ABS complies with the relevant standards, whether those standards are the "RTO standards" under the VET Act or the "Standards for NVR Registered Training Organisations" under the NVR Act. The Standards for NVR Registered Training Organisations 2011 were made by the Minister under s 185(1) of the NVR Act on 6 June 2011. 9 As well as being registered as a training organisation, ABS had approval from ASQA to deliver training and assessment in certain courses including Certificates and Diplomas in Business, Financial Services, Insurance Services and Hospitality. Some courses run for 12 months, others for two or three years. ABS currently provides employment based training to about 100 trainees in 12 workplaces. Four part-time ABS trainer/assessors are responsible for the training and assessment that takes place in those workplaces and for the conferral of nationally recognised qualifications. 10 ABS describes the model it uses as an employment based model. Mr Jain, ABS's sole director and chief executive officer, summarised ABS's role as involving "enrolment of trainees, learning and special needs assessment, orientation, learning and honing of skills through day to day work functions and continuity of employment, employer feedback on trainees' performance on the job, monitoring and assessment of competencies and post-assessment feedback." Apart from the occasional need for a trainee to receive formal or structured training off-site, for example to obtain a first aid certificate or a certificate relating to the responsible service of alcohol, ABS's model does not include routine formal face to face training. Skills are learnt on the job with the training being delivered, in the most part, by workplace trainers rather than ABS trainer/assessors. 11 The relevant standards applicable to RTOs when ASQA made the decisions were the Registered Training Organisation (RTO) standards. Since 1 July 2011, those standards have been superseded by the VET Quality Framework (including the Standards for NVR Registered Training Organisations). The standards applicable at various times were: (1) Australian Quality Training Framework (AQTF) 2007 Essential Standards of Registration (AQTF 2007) - effective to 31 August 2010; (2) AQTF Essential Conditions and Standards for Continuing Registration (AQTF 2010) - effective from 1 September 2010 to 30 June 2011; and (3) Standards for NVR Registered Training Organisations 2011 (SNR) - effective from 1 July 2011. 12 For the purposes of these proceedings the three sets of standards are equivalent. We will refer mainly to the SNR standards... 9For the sake of simplicity, we will adopt the Tribunal's practice of referring to the Respondent as 'ASQA', whether or not the correct entity at the time was VETAB or ASQA. 10We reproduce here a number of relevant provisions of sections 12, 13, 14 and 18 of the VET Act. Sections 12 and 18 contain the provisions on which the decisions of ASQA relating to ABS were based:- 12 Board to decide application for registration (1) On receiving an application for registration as a training organisation, the Board may: (a) register the applicant as a training organisation, or (b) refuse to register the applicant. (2) In deciding the application, the Board is to have regard to the RTO standards, the RCAB standards and the registration and accreditation guidelines. (3) The Board may register the applicant as a training organisation only if:... (c) the Board is satisfied that the applicant complies with the RTO standards. (4) In considering whether an applicant complies with the RTO standards, the Board may conduct a compliance audit of the applicant and have regard to the findings of that audit. (6) The Board may, despite any other provision of this section, refuse to register an applicant as a training organisation if the Board is satisfied that the applicant is not suitable to be registered as a training organisation. In determining whether an applicant is suitable to be registered, the Board may have regard to such matters as it considers relevant (including the registration and accreditation guidelines). (7) If the Board decides to grant the application, the Board must: (a) register the applicant as a training organisation, and (b) register the training organisation's scope of registration, and (c) if the Board imposes any conditions under section 13-register those conditions in relation to the training organisation, and (d) provide the training organisation with a certificate of registration. 13 Conditions of registration (2) The Board may impose such conditions on the registration of a training organisation as the Board thinks appropriate. Any such conditions may be imposed when the Board decides to register the training organisation or at any later time. 14 Term of registration and renewal (1) Unless sooner cancelled by the Board, the registration of a training organisation by the Board has effect for such period (not exceeding 5 years) as is specified by the Board. 18 Board may cancel, suspend or amend registration (1) The Board may do any one or more of the following:... (b) amend the scope of registration or recorded conditions of a training organisation that has been registered by the Board so as to restrict the operations of the training organisation in this State or any other jurisdiction, (c) suspend the registration, or part of the scope of registration, of a training organisation that has been registered by the Board, (d) cancel the registration of a training organisation that has been registered by the Board. (2) The Board may only take action under subsection (1) in relation to an RTO on any one or more of the following grounds:... (d) the training organisation has failed to comply with the RTO standards or the registration and accreditation guidelines,...

The grounds for ASQA's decisions regarding ABS 11At the time when ABS applied to the Tribunal for a review of ASQA's decision cancelling its registration and refusing its application for registration, ASQA maintained eight allegations of non-compliance by ABS with RTO standards. During the hearing, ASQA advised that it did not press all these allegations. Ultimately, it relied on three forms of non-compliance. 12In the following extracts from paragraphs [7] and [12] of its decision, the Tribunal outlined these forms of alleged non-compliance and reproduced the relevant RTO standards:- 7 In summary the final grounds for cancelling ABS's registration are that ABS has: (1) failed to adequately supervise workplace trainers (the "direct supervision" non-compliance), (2) conducted a non-compliant assessment of a trainee's competence (the "assessment" non-compliance); and (3) failed to provide support for the special needs of trainees (the "support" non-compliance). 12... ASQA submitted that when the Tribunal heard this matter in March and May 2012, ABS remained non-compliant with SNR 15.3 (in relation to the direct supervision non-compliance), SNR 15.5(b) (in relation to the assessment non-compliance) and SNR 16.5 (in relation to all three non-compliances). SNR 15.3 Staff, facilities, equipment and training and assessment materials used by the NVR registered training organisation are consistent with the requirements of the Training Package or VET accredited course and the NVR registered training organisation's own training and assessment strategies and are developed through effective consultation with industry. SNR 15.5(b) Assessment including Recognition of Prior Learning (RPL) is conducted in accordance with the principles of assessment and the rules of evidence. SNR 16.5 Learners receive training, assessment and support services that meet their individual needs. 13We will now deal separately with these three forms of non-compliance, in the order in which the Tribunal dealt with them. In relation to each of them, we will set out (a) any further regulatory requirements that are of specific relevance, (b) the Tribunal's findings and rulings, (c) the submissions put to us by the parties at the appeal hearing and (d) our conclusions. The Tribunal's conclusions flowing from its rulings on these three matters will then be outlined and discussed. 14For reasons indicated below, we have formed the view that this is a case in which leave should be granted (as was sought in the Notice of Appeal) for the appeal to extend to the merits. Accordingly, we refer in the ensuing discussion to a number of aspects of the documentary and oral evidence that was put before the Tribunal. 15Our task, having granted this leave, is defined in section 115(1) of the ADT Act as being to 'decide what the correct and preferable decision is' having regard to the material now before us, including 'any relevant factual material' and 'any applicable written or unwritten law'.

'Direct supervision' non-compliance 16Regulatory requirements. The requirement of 'direct supervision' with which, according to ASQA, ABS did not comply derives from a Determination of a body called the National Quality Council ('the Determination'). The Determination, which is set out as Appendix 3 to the Users' Guide to the Essential Conditions and Standards for Continuing Registration, describes what is required for 'direct supervision' in the Note at the end. It is in the following terms:- Appendix 3 Training and assessment competencies to be held by trainers and assessors Determination of the National Quality Council 18 December 2009 The AQTF Essential Standards for Registration specifies the requirements to be met by RTOs throughout their period of registration. The National Quality Council is responsible for determining the training and assessment competencies to be held by trainers and assessors in accordance with Standard 1.4(a) as set out below. Standard 1 The RTO provides quality training and assessment across all of its operations. Element 1.4 Training and assessment are delivered by trainers and assessors who: a) have the training and assessment competencies determined by the National Quality Council or its successors b) have relevant vocational competencies at least to the level being delivered or assessed c) continue to develop their vocational and training and assessment competencies to support continuous improvement in the delivery of RTO services. The current National Quality Council policy in relation to Standard 1.4(a) is shown below. Trainers must: i) hold the Certificate IV in Training and Assessment (TAA40104) from the Training and Assessment Training Package; or ii) be able to demonstrate equivalent competencies; or iii) hold the Certificate IV in Assessment and Workplace Training from the superseded Training Package for Assessment and Workplace Training (BSZ98), or iv) be able to demonstrate that prior to 23 November 2005 they had been assessed as holding equivalent competencies to the Certificate IV in Assessment and Workplace Training from the Training Package for Assessment and Workplace Training (BSZ98); or v) work under the direct supervision* of a person who has the competencies specified in (i) or (ii) or (iii) or (iv) above; and be able to demonstrate vocational competencies at least to the level of those being delivered. Note: Direct supervision is achieved when a person delivering training on behalf of the RTO has regular guidance, support and direction from a person designated by the RTO who has the trainer competencies in (i), (ii), (iii) or (iv) above and who monitors and is accountable for the training delivery. It is not necessary for the supervising person to be present during all training delivery. 17At [42 - 43], the Tribunal observed that SNR 15.4 was 'also relevant', being the 'equivalent' of Standard 1.4(a) to which this Determination refers. SNR 15.4 states: 15.4 Training and assessment is delivered by trainers and assessors who: (a) have the necessary training and assessment competencies as determined by the National Quality Council or its successors; and (b) have the relevant vocational competencies at least to the level being delivered or assessed; and (c) can demonstrate current industry skills directly relevant to the training/assessment being undertaken; and (d) continue to develop their vocational education and training (VET) knowledge and skills as well as their industry currency and trainer/assessor competence. 18The Tribunal's findings and rulings. In a passage at [23 - 30], the Tribunal discussed the requirement of 'direct supervision' contained in the Note at the end of the Determination. The discussion concerned in particular the meaning and implications of the relatively brief last sentence of the Note, which we will quote once again:- It is not necessary for the supervising person to be present during all training delivery. 19As summarised by the Tribunal at [23 - 24], the competing arguments of the parties regarding this sentence were as follows:- 23 ASQA submitted that the Note to the Determination means that an ABS trainer/assessor must be present at the workplace to observe the training being delivered by the workplace trainer at least some of the time. That conclusion was said to arise from the fact that the Note states that it is not necessary for the supervising person to be present during all training delivery. (Emphasis added.) It follows, according to ASQA, that it is necessary for the supervising person to be present during at least some of the time when training is being delivered by the workplace trainer. 24 ABS does not agree with that interpretation. It says that the obligations of the ABS trainer/assessor are contained in the first sentence of the Note. Those obligations are to guide, support and direct the training and to monitor and be accountable for the training delivery. According to ABS, the second sentence is merely a qualification or an explanation of the obligations in the first sentence. A statement that it is not necessary for the person in the position of the ABS trainer/assessor to be present during all training delivery does not impose an obligation on that person to be present for some of the time when the training is being delivered. 20At [25 - 27], the Tribunal expressed doubts about the value of the evidence given on this matter by Mr Westenberg, an expert witness called by ABS, and by Ms Trigg, an employee of ASQA whom it called as its expert witness. Earlier in its decision (at [13 - 14] and [16 - 17]), it had indicated, with reasons, that it did not regard either of them as a wholly satisfactory witness. 21The Tribunal then set out at [28] its ruling on this question of interpretation:- 28 We agree with ASQA's interpretation of "direct supervision" in the Note to the Determination. While the Note makes it clear that the supervising person does not need to be present during all the training delivery, the implication is that they must be present during some of the training delivery. If the intention were that supervisors need not be present when training was being delivered, the word "all" would not have been included. 22Earlier (at [20 - 21]), the Tribunal had summarised evidence, which it apparently accepted, regarding the training methods used by ABS:- 20 ABS's director, Mr Jain, gave evidence that ABS currently has workplace trainers in 12 workplaces training approximately 100 trainees. Three of the eleven workplace trainers for whom ABS provided details have the required qualifications or equivalent competencies to train trainees. However, ABS did not rely on any of the workplace trainers being qualified trainers. Their business model is to directly supervise all workplace trainers regardless of their training qualifications. 21 Each of the four ABS trainer/assessors, who work part-time on a contract basis, has the necessary qualifications or competencies set out in the Determination. They are all eligible to directly supervise the workplace trainers. 23At [31 - 40], the Tribunal reviewed the evidence furnished to it as to the frequency with which ABS trainer/assessors were present at workplaces in order to observe the training being delivered. It characterised this evidence as 'inconsistent and imprecise'. It pointed out that in documentation, provided by Mr Jain, relating to the 'guidance, support and monitoring' furnished by ABS trainer/assessors, there was no reference to any observation by them of the training being delivered. It quoted passages from the transcript of Mr Jain's oral evidence, such as his answer - 'It depends on the circumstances' - to the question whether it was 'acceptable' for an ABS trainer/assessor 'never to be present when training is delivered'. It also mentioned an instance, based on a document called an 'Employer Contact Log' tendered by ABS, of training being delivered personally by an ABS trainer/assessor (AS) 'on seven occasions between 13 November 2008 and 31 July 2009'. In this context (at [36]), it added that 'Mr Jain said that both AS and the workplace trainer would have been present when the training was being delivered'. 24The Tribunal inferred from this document 'and other evidence' that 'in some instances an ABS trainer/assessor will deliver the training personally', suggesting as an example that 'a trainee might be taken off site to receive training on the use of spreadsheets'. It also referred to opinions on this matter that were expressed by Ms Trigg. These included the following: (a) that visits by assessor/trainers to workplaces did not demonstrate that supervision was being carried out in relation to the actual delivery of training; and (b) that while ABS's documentation did satisfy her that some 'direct supervision' by ABS took place, it was 'not sufficient'. 25At [40], the Tribunal stated the following findings:- 40 There was evidence that ABS trainer/assessors regularly visit workplaces and discuss the progress of the training and various other matters reflected in checklists provided by ABS. There was also evidence that ABS trainer/assessors personally deliver training on some occasions and that training is delivered off-site when necessary. There was no evidence of routine or even occasional observation of training delivery. Mr Jain did not directly assert that ABS trainer/assessors were present when workplace trainer/assessors were delivering training. On the basis of all the evidence, we are not satisfied that ABS trainer/assessors were routinely present at workplaces to observe training being delivered by the workplace trainers. 26This finding was the basis of a ruling by the Tribunal that ABS was non-compliant with two applicable Standards, SNR 15.4 and SNR 16.5 (these Standards are quoted above at [17] and [12] respectively). The Tribunal set out this ruling at [44 - 45]:- 44 The Note to the Determination is a policy document, not a legislative provision, but it explains what is required by SNR 15.4. Non-compliance with the Determination should be regarded as non-compliance with SNR 15.4. 45 ABS has not complied with SNR 15.4 because, as provided for in the Determination, workplace trainers are not being directly supervised by a qualified trainer/assessor. ABS has failed to ensure that a qualified trainer/assessor is present to observe the workplace trainer delivering training on at least some occasions. We are also satisfied that ABS has failed to comply with SNR 16.5. When unqualified workplace trainers are not being directly supervised as intended, there is potential for trainees to receive training that does not meet their individual needs and does not meet the requirements of the training package. 27In challenging these conclusions of the Tribunal, Mr Rogers' submissions focused on four matters: (a) the Tribunal's approach to interpreting the Note to the Determination, particularly the final sentence; (b) its criticisms of the evidence put before it (notably by Mr Jain) on the extent to which ABS's trainer/assessors were present during training delivery; (c) the view that the Tribunal implicitly took on the question of onus of proof; and (d) the criterion that it actually applied when deciding that ABS was non-compliant. We will discuss these matters separately. 28Interpretation of the Note. Mr Rogers criticised the Tribunal for interpreting the Note as if it were a legislative provision, despite acknowledging that it was a 'policy document' as distinct from a provision of this nature. He argued also that while the Tribunal's interpretation of the final sentence was a 'possible reading', it was not 'the most likely reading'. The reasons that he gave for this were that the Tribunal's interpretation gave to the word 'all' a 'very great deal of work to do' and that if had been intended to require that a qualified trainer/assessor be present during some at least of the training delivery, this requirement would have been expressed in clear and mandatory terms. According to Mr Rogers, all that the Note obliged RTOs such as ABS to do was provide 'regular guidance, support and direction' and to ensure that a qualified trainer/assessor 'monitored' and 'was accountable for' the training delivery. Accomplishment of these tasks did not necessarily require the presence of a trainer/assessor when training was being delivered. 29On these matters of interpretation, we prefer the following arguments made by Mr Cribb. Even if the Note could properly be described as a policy document, not a statutory provision, it does not follow, in our opinion, that it may be viewed as no more than a guideline, with which compliance is not essential. Because the word 'all' must have some 'work to do', the final sentence of the Note must be taken to indicate that the presence of one or more assessor/trainers is required during 'some' at least of the training delivery. From now on, we will refer to this implicit requirement as the 'presence requirement'. 30In so construing the final sentence, we place significant weight on the fact that the term being explained in the Note is not 'supervision', but 'direct supervision'. If the final sentence had not been included in the Note, this term would, in our opinion, be open to the interpretation that unless a trainer/assessor was present at all times during training delivery, the supervision being provided would not have been 'direct'. 31The evidence regarding compliance with the presence requirement. Mr Rogers submitted that the Tribunal's descriptions of Mr Jain's evidence on this matter as 'not straightforward' and 'not specific' (at [15 and [34] respectively) were not warranted. He relied on the following passage in the transcript of the Tribunal hearing (8 May 2012, p 43, lines 29-35):- Q. The ABS trainer and assessor is not there at that time, is he or she? A. If you see all the evidence which we have given before the training starts-- Q. No, I'm talking about the actual training activity where the trainer is imparting knowledge to the student and directing the student about how to do the activity the student is being trained in. A. He may be there or he may not be there. 32In evaluating this submission, we have also given consideration to other parts of Mr Jain's evidence in cross-examination relating to this particular question. Our conclusion is that the Tribunal's assessment of this evidence was clearly available to it. 33In reaching this conclusion, we have taken into account some further passages from Mr Jain's cross-examination. They are all to be found in the transcript of proceedings on 8 May 2012. The first of them immediately follows the passage just quoted:- Q. I put it to you the ABS trainer assessor is not there. A. Well, he may be there and he may not be there. (p 43, lines 37-38) Q. When the workplace trainers are actually delivering training to students are the ABS trainer assessors onsite? A. During the monitoring visits, yes. Q. No. My question is, when workplace trainers are actually delivering training to students are the ABS trainer assessors onsite? A. This question is not relevant. (p 47, lines 14-16) Q. Would you also agree that nowhere in that almost two page description does it say that Mr Horridge [an ABS trainer/assessor] is present during any training delivery? Take your time to read the whole paragraph? A. This particular page does not say that when he - training delivery no. They do not, specific paragraph relating to that. Q. Mr Horridge is not present during any training delivery is he? A. I did not say that. Q. I'm putting that to you? A. I said in this sequence of documents which have been attached as evidence of supervision, there is no evidence attached relating to Mr Horridge being present during training delivery but that does not, if you look at the training plan which you are referring to, that trainee has only started the planning. In fact they have another two years to run. The training has not or just commenced... (p 51, lines 12-30) 34In reaching this conclusion, we rely also on two passages in Mr Westenberg's report which were set out in ASQA's 'Tender Bundle' and highlighted in Mr Cribb's submissions. These are as follows:- 6... Most RTOs provide instruction in some formal setting, including classroom facilities, simulators and training equipment... ABS operates in a unique manner. ABS is engaged by a company, such as Harvey Normans, to provide the training materials to their employee and to conduct the assessments... The company in turn, provides the mentoring and supervision and ensures that the assessment is based on the accurate records of observation, questioning and other supervisor's/mentor's reports. 20... ABS does not deliver training per se, but provides the candidates with the training materials... Each candidate is currently employed and their training is paid for by their employer. Thus, each candidate is being trained in the workplace... As ABS assessors undertake monitoring visits then any resources that are required and not available would be identified during these visits... 35Mr Cribb's submission based on these passages, with which we agree, is that nowhere did they indicate that ABS's modus operandi included ensuring that trainer/assessors were present at any time during training delivery. 36In relation to Mr Westenberg's testimony, we add the observation that the transcript of his cross-examination, which we have reviewed, supports a finding by the Tribunal (at [26]) that he did not in fact have any 'direct knowledge' of 'the day to day operations of ABS'. It must be inferred that his descriptions of ABS's practices, in the two passages that we have quoted, were based on information received by him from representatives of ABS. 37The onus of proof. Mr Rogers submitted that the Tribunal erred in implicitly placing the onus of proof of compliance with statutory requirements, such as the presence requirement, on ABS. This was apparent, he said, from the Tribunal's use of the phrase 'we are not satisfied' in stating its conclusion, at the end of paragraph [40], that ABS had not complied with this particular requirement. He referred also to other examples in the Tribunal's decision, which are discussed below. 38In seeking to establish the principle that the onus lay instead on ASQA to prove non-compliance, Mr Rogers argued that this stemmed from the wording of section 18(2) of the VET Act (from which we have quoted an extract at [10]). This subsection, he submitted, required that ASQA should form an 'affirmative opinion as to an objective state of affairs' (for example, that an RTO has failed to comply with the RTO standards) before taking action under section 18(1) (such as cancelling the RTO's registration). If there were no information available on which the requisite opinion could be based, ASQA could not act under section 18(1). 39In support of this proposition, Mr Rogers cited two cases decided under industrial legislation. The statement of principle on which he relied, as stated in the later of these two cases (North v Television Corporation Ltd (1976) 11 ALR 599 at 603), does not in our opinion bear upon the proceedings, such as these, in the very different context of administrative review. 40The Tribunal, Mr Rogers contended, stood in the same position as ASQA by virtue of section 63(1) of the ADT Act. If in proceedings such as these the only information before it was that ASQA had cancelled an RTO's registration, it would be bound to set aside the cancellation. The fact that section 63(1) requires the Tribunal to 'look at the matter afresh' (as Mr Rogers expressed it) supported this proposition. 41In a brief oral submission, Mr Cribb argued that the Tribunal appeared to have taken the view that in proceedings such as these there is no onus of proof. 42In its decision, the Tribunal did not address the general question of onus of proof. It did however refer (at [8]) to section 63(1), describing its operation in these terms:- 8 The Tribunal's role when reviewing the cancellation and non-renewal decisions is to decide whether those decisions are the "correct and preferable" decisions: Administrative Decisions Tribunal Act 1997 (ADT Act), s 63(1). In reviewing the decisions we must have regard to all the material before us at the hearing. We must decide, as at the date of hearing, whether the decisions are the correct and preferable decisions, not whether they were correct when they were made: ADT Act, s 63(1). We must do so on the basis of all the material before us. 43We are not persuaded by Mr Rogers' arguments, for the following reasons. 44The claim advanced by him that ASQA bears the onus of proof does not take account of an important practical consideration that regularly applies in merits review proceedings such as these. This is that the specific factual question in issue - whether, and if so to what extent, trainer-assessors employed by ABS were present during training being delivered by workplace trainers - was a matter within the particular knowledge of ABS, not of ASQA. It was therefore a matter in relation to which ABS bore at least an evidentiary onus. 45Furthermore, the Tribunal's statement in its decision at [40] that it was 'not satisfied that ABS trainer/assessors were routinely present at workplaces to observe training being delivered by the workplace trainers' came shortly after a finding, in the same paragraph, that 'there was no evidence of routine or even occasional observation of training delivery'. This finding is enough to indicate that, according to the Tribunal's view of the matter, ABS failed to discharge this evidentiary onus. In such circumstances, the Tribunal's statement that it was 'not satisfied' of the relevant matter did not indicate that it had erred in any relevant way on the question of onus. 46The criterion that the Tribunal actually applied. In his supplementary submissions, Mr Rogers argued that the Tribunal erred in law in so far as, in the final sentence of paragraph [40], the criterion that it expressly applied was whether or not ABS trainer/assessors were 'routinely' present at workplaces to observe training being delivered. He maintained that in this sentence the Tribunal impermissibly 'raised the standard', because it had previously stated (at [28]) that the presence requirement was only that assessor/trainers must be present during 'some' of the training delivery. 47Because ASQA did not file supplementary submissions in reply, this was an issue on which it did not address us. 48It is undeniable that the Tribunal, at this point in its decision, altered its formulation of the presence requirement. The important question is whether this alteration was of material significance. In our opinion, it was not, because on three other occasions on which the Tribunal referred to its finding on this matter, it used a formulation indicating that the criterion being applied was whether or not assessor/trainers were present during 'some' of the training delivery. 49These three formulations of the Tribunal's finding were as follows:- 40... There was no evidence of routine or even occasional observation of training delivery. 45... ABS has failed to ensure that a qualified trainer/assessor is present to observe the workplace trainer delivering training on at least some occasions. 97... We have found that ABS was not directly supervising its workplace trainers.... In circumstances where training takes place almost exclusively 'on the job' and is delivered by trainers who, for the most part, do not have training qualifications, it is critical that they be directly supervised, including being observed delivering the training at least some of the time. 50Our conclusions on 'direct supervision' non-compliance. For the foregoing reasons, we conclude that there are no grounds for setting aside the Tribunal's ruling that ABS failed to comply with what we have called the 'presence requirement': namely, the requirement, conveyed by implication in the Note to the Determination, that 'direct supervision' involves the presence of an assessor/trainer during some part at least of the training delivery. 51We agree with the Tribunal's ruling, at [44 - 45], that this non-compliance amounted to non-compliance with SNR 15.4. 52We do not agree, however, that it also amounted to non-compliance with SNR 16.5. To support this ruling, it is not enough merely to say, as the Tribunal did at [45], that if 'direct supervision' did not occur, there was 'potential' for trainees to 'receive training that does not meet their individual needs and does not meet the requirements of the training package'. A finding of 'potential' for this to occur does not, without more, provide the foundation for a finding that it did occur.

Support services non-compliance 53The Tribunal's findings and rulings. Under the heading 'Background', the Tribunal noted the following matters at [47]:- 47 A standard with which ABS must comply (SNR 16.5) is that "Learners receive training, assessment and support services that meet their individual needs." Individual needs may arise in relation to many areas including language, literacy and numeracy skills, a disability or ill health, age, gender, non-English speaking background and family responsibilities. Indigenous trainees, and trainees who have recently returned to the workplace, may also have individual needs. 54At [48], the Tribunal formulated as follows the questions to be answered in determining whether ABS complied with SNR 16.5:- (1) Does ABS provide trainees with training, assessment and support services that meet their individual needs? (2) If not, is ABS compliant with SNR 16.5? 55In the following passages drawn from paragraphs [49] to [52] and [55], the Tribunal described the policies and practices of ABS with regard to SNR 16.5:- 49 ABS has a policy for identifying and meeting the training and individual needs of trainees. The policy states, in part, that: [ABS] ensures that the needs of students are identified and documented to ensure proper adaptation in delivering training and/or assessment. The purpose of this procedure is to ensure individual needs such as learning needs and the needs of a diverse range of individuals are accurately captured and to apply those identified needs to the delivery and assessment process. 50 The policy categorises needs into learning needs and individual needs. Examples of learning needs include literacy and numeracy, language, study path needs, physical/emotional needs and specific personal needs. Many of the examples of individual needs overlap with the learning needs including language, literacy and numeracy. Attention spans and other intellectual characteristics are also included. 51 Under the heading "Meeting Training and Individual Needs", the ABS policy states that: The Training Manager acting on [ABS's] behalf and in consultation with employers will outsource qualified support contractors on a needs only basis. The CEO will be consulted during this process. 52 Although the policy refers to learners and support services, the main evidence of a method by which needs were identified were questionnaires entitled "Learning Needs and Special Support."... The forms have a "yes", "no" and S/N (support needed) box against each "need".... The forms are signed by the workplace trainer, the ABS trainer/assessor and the trainee. 55 The only other relevant document was a document entitled "Record of Monitoring, Mentoring and Assessment Visit". That document provides for the trainee, the workplace trainer and the ABS trainer/assessor to indicate by ticking a box, whether or not the trainee needs support for training and assessment... 56Paragraphs [52] to [54] of the Tribunal's decision contain criticisms of the 'Learning Needs and Special Support' questionnaires. The Tribunal pointed out that in their original form these questionnaires expected trainees to tick one or more 'yes' boxes if they had needs in the areas of 'language, literacy and numeracy skills', but to tick one or more 'no' boxes if they had needs in any one or more of seven other listed areas, such as 'disability', 'gender' or 'ill health'. The Tribunal described the questionnaires in this form as 'confusing', because in its view it was 'not possible' to ascertain from them whether 'any individual trainee had a learning or individual need'. 57The Tribunal then outlined evidence from Mr Jain that he had amended the questionnaires in such a way that ticking 'yes' next to the items under the heading 'Language, literacy and numeracy' would indicate that the trainee did not require any special support. The Tribunal's assessment of the outcome (at [54]) was as follows:- 54... While this amendment is an improvement, the form is still ambiguous because ticking "yes" next to the headings relating to other areas where support may be needed indicates that the trainee does require special support. Furthermore there is no indication on either the original or the amended form that the abbreviation S/N means "support needed". For those reasons we do not agree with Ms Trigg's or Mr Westenberg's opinion that the amended document has removed any ambiguity. 58The principal matter on which the Tribunal focused in the present context was a concession by Mr Jain that the Tribunal described in the following terms at [56]:- 56 Despite having a policy in place and a form which purports to identify a trainee's individual needs, ABS, by its own admission, has never taken any management action to support a trainee's individual needs. That conclusion applies not only to the nine trainees whose forms were in evidence, but to every trainee who has ever trained with ABS. 59At [57], the Tribunal referred to a submission by ASQA that 'in ABS's eight years of operation, there would have been trainees with learning or individual needs who required management action of some kind to support them when undertaking training and assessment'. 60At [57 - 59], the Tribunal outlined opposing contentions put by Mr Jain and Mr Westenberg. The gist of these was that it was not surprising that none of the trainees had special needs requiring management action. This was for the following reasons: (a) the trainees were in employment and had been identified by their employers as being suitable for training; (b) their employers, not ABS, were responsible for accommodating any disabilities that they might have; (c) Mr Westenberg stated in a report dated November 2011 that 'ABS undertakes more than enough student support services in co-operation with the employer and mentor who is vigilant in providing employee support services to their employees'; and (d) many of the trainees were young university students who had obtained employment to fund their studies. 61The Tribunal was not persuaded by these explanations. At [60 - 62], it set out the following reasons for its determination, adverse to ABS, on this question of compliance:- 60 We are perplexed by this evidence. The trainees who ABS trains are completing vocational training. We would have thought it unlikely that they would also be enrolled in a university course. Mr Westenberg's evidence was affected by his tendency to defend ABS and advocate for them, rather than expressing an objective view. We query how Mr Westenberg formed the view that the employers and workplace trainers were "vigilant in providing employee support services to their employees." We are also sceptical about Mr Westenberg's speculations on the lack of need for management action to support trainees. 61 While we accept that trainees are likely to be young people in their late teens and twenties, we do not agree with Mr Jain's or Mr Westenberg's assertion that during an eight year period no trainee had learning or individual needs which required ABS to modify or adjust the training and assessment it provided to meet or support that need. The group comprises several hundred mostly young people studying a variety of vocational subjects while working. Some would be new entry trainees while others would have completed some workplace training. While the employer is obliged to comply with obligations under state and federal anti-discrimination and workplace laws, the responsibility to support trainees in relation to their training and assessment lies with the Registered Training Organisation. 62 We take judicial notice of the fact that in such a group, one or more trainees will have had an individual or learning need, either identified at the commencement of training or as the training progressed, that required some action by the body responsible for training and assessment. That is a fact that is so obvious that it needs no evidence. 62The Tribunal's conclusion (at [63]) on the issue of compliance by ABS with SNR 16.5 was in the following terms: 63 ABS is non-compliant with SNR 16.5 because not all trainees are receiving training, assessment and support services that meet their individual needs. 63The parties' submissions. Mr Rogers' challenge to this conclusion by the Tribunal was chiefly based on its reliance on the concept of judicial notice in order to arrive at its crucial finding. This finding was that within the group of several hundred mostly young trainees who over an eight-year period had studied a variety of vocational subjects while working, one or more must have had 'an individual or learning need, either identified at the commencement of training or as the training progressed, that required some action by the body responsible for training and assessment'. 64In his written submissions in chief, Mr Rogers argued that this finding was 'not a matter upon which a court or tribunal is entitled to take judicial notice', because while judicial notice may be taken of what are called 'notorious facts' it could not be said that 'among a closed class of persons some or any would necessarily have a need for special support'. At the hearing, he added that statistical evidence could have been tendered on this question, but this did not occur. 65Mr Rogers made the following additional submissions at the hearing: (a) the initial ambiguity in ABS's questionnaires related to only one of the eight areas in relation to which they asked for indications of special needs; (b) the ambiguity had been removed; (c) each completed questionnaire bore the signatures of the workplace trainer and the trainer/assessor as well as the trainee; (d) the statement by the Tribunal at [54] that 'there is no indication on either the original or the amended form that the abbreviation S/N means "support needed"' was wholly incorrect; (e) it was difficult to know what ABS could have done to identify trainees with special needs, other than to require all trainees to fill out questionnaire forms; and (f) the Tribunal failed to take account of the possibility that employers not only catered for special needs of their employees where necessary, but also 'weeded out' those employees who had such needs. 66Mr Cribb submitted that except on one matter the Tribunal's fact-finding and reasoning were correct and should not be disturbed. This matter was the Tribunal's assumption that trainees were 'unlikely' to be enrolled in a university course. According to Mr Cribb, a number of them might well have been university students. 67Further submissions by Mr Cribb were (a) that the ambiguity in the questionnaires was not the basis for the Tribunal's finding and (b) that Mr Westenberg's claim that ABS had provided support services to some trainees would appear to have been based on a misunderstanding of some of ABS's documentation. 68Our conclusions on support services non-compliance. In our opinion, Mr Rogers' principal submission should be accepted. The Tribunal erred in relying on the concept of judicial notice in order to find that within the relevant group of several hundred trainees, one or more must have had 'an individual or learning need... that required some action by' ABS. 69We cannot characterise this question of fact as a 'matter of common knowledge'. It involved at least two findings: that a proportion of trainees would, objectively speaking, have had 'special needs' and that these needs of individual trainees would not have been appropriately dealt with by the entities (their employers) that had taken responsibility for organising their training. Even if the first of these matters was one of 'common knowledge' (which we doubt), the second was not. 70Independently of this, we have significant concerns about the way in which the Tribunal interpreted the relevant Standard (SNR 16.5). It made a finding of non-compliance on the ground that 'not all trainees are receiving training, assessment and support services that meet their individual needs'. Logically, this implies that non-compliance could be established solely by evidence that a single trainee, who did not communicate directly or indirectly to ABS that he/she had an 'individual need' and who gave no overt indication of having such a need, did in fact have one and did not receive relevant 'training, assessment and support services' from ABS. To interpret the Standard in this way is to treat it as a principle of 'absolute liability'. No excuse by way of showing that there was no way of realising that a trainee had an 'individual need' is permitted. 71The Standard should instead be read as requiring that an RTO must take reasonable steps to ascertain whether any trainee has 'individual needs' and, where such needs are disclosed, must provide the relevant services. Even acknowledging that ABS's questionnaires, in their original form, were not as clear as they should have been, we have a degree of sympathy with Mr Rogers' submission that it was difficult to know what further steps ABS should have taken to identify trainees with special needs. 72We will add that on this question of the ambiguity of the questionnaires the Tribunal, in our opinion, overstated the case against ABS. In particular, it erred, as Mr Rogers pointed out, in stating at [54] that 'there is no indication on either the original or the amended form that the abbreviation S/N means "support needed"'. In fact, in both their original and their amended forms (examples of which were in ABS's 'Tender Bundle'), the abbreviation S/N was followed by an asterisk, and an asterisked footnote near the bottom of the page stated: 'S/N = Support Needed.' 73For these reasons, the Tribunal's ruling that ABS failed to comply with SNR 16.5 must be set aside. 74It is by virtue of this determination by us, based to a significant degree on the Tribunal's erroneous recourse to the principle of judicial notice, that we have granted leave under section 113(2)(b) of the ADT Act for this appeal to extend to the merits.

Assessment non-compliance 75Regulatory requirements. At [65], the Tribunal outlined the relevant requirements, stemming from SNR 15.5(b):- 65 SNR 15.5(b) states that "Assessment . . . is conducted in accordance with the principles of assessment and the rules of evidence." The principles of assessment and rules of evidence from the BSB07 training package relating to Assessment Guidelines, defines the Principles of Assessment and Rules of Evidence. The Principles of Assessment are validity, reliability, flexibility, fairness and sufficiency. The rules of evidence are that the collection of evidence must be: valid, sufficient, current and authentic. 76The Tribunal's findings and rulings. In dealing with this issue, the Tribunal (at [67 - 88]) focused principally on one example, provided by ABS as evidence of compliance, of a completed assessment record of a trainee. The assessments were conducted on a day (26 September 2009) on which an ABS trainer/assessor visited the trainee's workplace and met both the trainee and the workplace trainer. The course being studied was for a Certificate III in Business and the unit of competence being assessed was called 'Deliver and Monitor a Service to Customers'. 77With reference to one of the assessment tasks (Task 2) required of the trainee, the Tribunal observed as follows (at [70]):- 70 Task 2 required the trainee to write a short guide to customer service for the representative of the organisation. Nine dot points directed the trainee to the issues to be covered in the guide. The trainee provided a 43-word response which was largely a re-wording of some of the dot points provided in the question. 78The Tribunal further observed that Ms Trigg and Mr Westenberg both characterised this response as insufficient to warrant a grading as competent. It added that although Mr Westenberg had acknowledged that he was not a 'subject matter expert', he had expressed the opinion that the other assessments of the trainee did 'add up to her being competent'. It pointed out that despite these criticisms of her answer to Task 2, the mark 'C', meaning 'competent', had been placed at the foot of the assessment sheet containing the instructions for the Task and her answer. It then referred to evidence from Mr Jain to the following effect: (a) this mark was intended to apply to the entire unit of study, not just to Task 2; (b) in order to avoid confusion he had subsequently removed that option from the foot of each assessment sheet; and (c) a trainee's competence was measured not only through the assessment tasks, but also through the observations and involvement of the ABS trainer/assessor and the workplace trainer during the period of delivery of the unit. 79In relation to this last matter, the Tribunal commented as follows (at [74]):- 74 If there are other activities, observations or discussions which form part of the assessment, no documentary evidence of them has been provided. In particular there was no evidence of any policy on summative assessment being implemented. 80At [87 - 88], the Tribunal summed up the opinions of Mr Westenberg and Ms Trigg as to the adequacy of the assessment of this trainee:- 87 Mr Westenberg's overall assessment of the evidence was that if the trainee had been assessed as "not yet competent", more detail would have been provided but as the trainee was assessed as competent, sufficient detail has been provided. This response was not a convincing explanation for the token responses given by the ABS trainer/assessor in relation to Task 2. 88 Ms Trigg's overall view was that while the assessment had sufficient components (question and answer, observation, third party report and written response) the quality of the assessment was deficient. She said it was not sufficient or fair. 81The Tribunal then stated, at [89 - 93], its conclusions as to compliance by ABS with SNR 15.5(b):- 89 We note that ABS uses commercial assessment materials which are "Quality Noted" by the National Quality Council. Our findings do not relate to the assessment materials themselves but to the manner in which the assessment has been conducted and the conclusions which have been drawn. We have based our decision on the sample assessment tasks for an individual student for one unit of competence and the evidence about the assessment process in general. That evidence does not satisfy us that ABS is complying with the principles of assessment and the rules of evidence. 90 The resolution of this issue is not simply a matter of accepting either Ms Trigg's evidence or Mr Westenberg's evidence. We have to come to our own view based on the documents themselves as well as the oral and written evidence. 91 Both the principles of assessment and the rules of evidence require "sufficiency". There is insufficient evidence in the material provided by ABS to support the conclusion that the trainee is competent against all elements and performance criteria. Many of the performance criteria listed in the Record of Demonstration/Observation/Role Play were not addressed by the ABS trainer/assessor. 92 The validity and reliability of the assessment is also in doubt, particularly in relation to the trainee's answer to Task 2. One does not have to be a subject matter expert to appreciate that that answer does not reflect competence on the part of the trainee. While that is not the only measure of competence, there is no satisfactory explanation as to how the trainee was regarded as competent overall having given such an answer. 93 We are not satisfied that ABS is compliant with SNR 15.5(b). 82The parties' submissions. In challenging this component of the Tribunal's decision, Mr Rogers put forward three propositions. 83The first was that the Tribunal had improperly placed the onus on ABS, through holding that the absence of sufficient evidence to establish that the individual trainee was competent in the unit that she had studied gave grounds for its ruling that ABS did not comply with SNR 15.5(b). 84Secondly, he submitted that the Tribunal had erred in stating (at [74]) that there was 'no documentary evidence' of 'other activities, observations or discussions'. He based this submission on material in ASQA's 'Tender Bundle'. 85Thirdly, while conceding that the trainee's answer to Task 2 could properly be regarded as inadequate, Mr Rogers pointed out that Mr Jain's evidence that the mark 'C' at the foot of the assessment sheet was intended to apply to the entire unit that she had studied had not been challenged in cross-examination. This explanation, he said, should therefore have been accepted by the Tribunal. 86In responding to this last submission, Mr Cribb argued that the Tribunal had correctly inferred from the assessment sheet that the mark 'C' must have been intended to apply to the trainee's answers to Task 2 only. 87Our conclusions on assessment non-compliance. We have found it difficult to rule on this ground of appeal. Our decision, after careful consideration, is that it has not been made out, for the following reasons. 88In our opinion, the Tribunal was entitled to find that the individual trainee's answer to Task 2 was inadequate and that this gave grounds for thinking that her competence overall in the unit of study was open to question. We also agree with the Tribunal, after reviewing relevant documents in ASQA's 'Tender Bundle', that the mark 'C' at the foot of the trainee's assessment sheet for Task 2 gave the impression that it applied to her performance of this Task even if, as Mr Jain asserted, it was 'intended' to apply to her performance in the whole unit. We add the comment that if this was indeed the 'intention', the message conveyed by the assessment sheet was misleading. 89Having reviewed accompanying documents in the 'Tender Bundle', we agree also with the Tribunal's observation at [91] that 'many of the performance criteria listed in the Record of Demonstration/Observation/Role Play were not addressed by the ABS trainer/assessor'. 90Mr Rogers' submission regarding the onus of proof must be given due weight. In addition, the Tribunal's ruling is very substantially based on evidence and argument relating to no more than the assessment of one trainee in one unit of study. But ABS's assessment practices are a matter within the particular knowledge of ABS, not of ASQA. ABS therefore bore evidentiary onus, at least. The material that it adduced in discharging this onus was not, for the reasons given by the Tribunal, sufficient to indicate that it complied with SNR 15.5(b). It had the opportunity to tender other material dispelling any such impression and showing that its practices were indeed compliant. It did not do so. 91 For these reasons, we conclude that there are no grounds for setting aside the Tribunal's ruling that ABS failed to comply with SNR 15.5(b).

The Tribunal's affirmation of ASQA's decision 92Following its rulings on each of the first two of these claims of non-compliance on the part of ABS, the Tribunal indicated (at [46] and [64]) that after it had dealt with all three such claims, it would consider whether the non-compliance that it had found, either by itself or in conjunction with any other non-compliances, justified cancellation of ABS's registration. 93Having reached this stage of its reasons, it discussed (at [94 - 100]) the significance of each form of non-compliance, considered in isolation. 94With regard to its finding, which we have upheld, that ABS did not comply with the requirement of 'direct supervision', the Tribunal said (at [94 - 97]):- 94 Mr Jarrett, representing ABS, highlighted the fact that the direct supervision issue was not raised expressly until the third day of a five day hearing. Prior to that time, the issue had been identified as the workplace trainers and/or the ABS trainer/assessors, not having the necessary training and/or vocational qualifications. He said that while ABS has had an opportunity to address other criticisms of its operation, it has not had an opportunity to address the direct supervision non-compliance. 95 In the original audit report conducted by ASQA in April and June 2010, the auditor found ABS non-compliant with Standard 1.4 (SNR 15.4). The internal review decision did not indicate any non-compliance with Standard 1.4 and non-compliance with that standard does not appear in ASQA's Position Paper filed on 26 March 2012 as amended on 16 May 2012. ASQA's concern at that stage was that ABS trainer/assessors and/or the workplace trainers did not have the necessary training qualifications. 96 On the third day of a five day hearing, ABS clarified that the workplace trainers do not have to have any training qualifications when they deliver training under the direct supervision of ABS trainer/assessors. 97 ABS had an adequate opportunity to respond to the issue of direct supervision and did so. ABS does not have workplace trainers on each site with the required training and assessment competencies. It is dependent on ABS trainer/assessors who do have the required competencies, to visit sites and directly supervise the workplace trainers. We have found that ABS was not directly supervising its workplace trainers. This is a fundamental issue. In circumstances where training takes place almost exclusively 'on the job' and is delivered by trainers who, for the most part, do not have training qualifications, it is critical that they be directly supervised, including being observed delivering the training at least some of the time. 95At [98], the Tribunal elaborated as follows on its finding, which we have set aside, of non-compliance with the support services requirement:- 98 In its eight year history, ABS had not taken management action to meet an individual need of a trainee. We do not agree with ABS's witnesses' when they said that no trainee had an individual need which required action on ABS's part. ABS did not have appropriate procedures in place to identify trainees who required support services. ABS was wrong in its assumption that support would be provided by the employer and/or that because of the demographics of the group, none needed support from ABS. It was ABS's responsibility, not the responsibility of the employer, to provide support in relation to training and assessment. ABS was not genuinely attempting to identify and support trainees. This is another fundamental breach of the RTO standards. 96In relation to its finding, which we have upheld, of non-compliance with the assessment requirement, the Tribunal said (at [99]):- 99 We were not satisfied that the sample, completed assessment materials met all evidence requirements and conformed to all the principles of assessment. The ABS trainer/assessor is ultimately responsible for the assessment of trainee competence. Again, this is a fundamental breach of the RTO standards. 97At [100], the Tribunal referred to a claim made by ABS, based on a number of reports by the Australian Council for Educational Research, that there was a 'high level of satisfaction' with the services that it provided. Having noted that Ms Trigg agreed with this claim, it said: 'We accept that there is no evidence of any general dissatisfaction from employers or trainees.' 98The Tribunal then summed up (at [101 - 103]) its reasons for affirming ASQA's decision to cancel ABS's registration:- 101 Each of the non-compliances represents a failure to comply with one or more of the required RTO standards. Training and assessment which complies with the RTO standards must be provided regardless of whether training is delivered face to face in a formal or structured environment or on the job in the workplace. 102 The non-compliances, in combination, justify cancellation. Providing trainers with the requisite skills or ensuring that they are directly supervised, undertaking compliant assessments of a trainee's competence and ensuring that trainees are supported are fundamental to the delivery of quality training by an RTO. 103 Mr Jain said that if ABS was found to be non-compliant with any standards he undertook to rectify the non-compliance as soon as possible. Given that the non-compliances relate to training delivery, assessment and individual needs, they are too widespread and fundamental to risk allowing ABS to continue operating. 99The substantive orders that the Tribunal made were in these terms:- 1. The decision to cancel the registration of Australian Business Skills Pty Ltd as a registered training organisation is affirmed. 2. The decision to refuse the application from Australian Business Skills Pty Ltd for renewal of its registration as a registered training organisation is affirmed.

The orders that we should make 100We have concluded that one of the three forms of non-compliance on which the Tribunal based these two orders has not in fact been made out. This is significant, because in explaining the basis for its orders the Tribunal stated (at [102]): 'The non-compliances, in combination, justify cancellation' (our emphasis). It did not indicate that one or two of the three non-compliances would have been sufficient (though it might have believed this to be the case). This factor alone is sufficient to impel us to give serious consideration to setting aside the Tribunal's orders. 101A further matter prompting us to take this course, on which Mr Rogers placed a degree of emphasis, is that ASQA did not call for compliance with the 'presence requirement' (as we have called it) until the third day of the Tribunal hearing. Before then, it had maintained that ABS's non-compliance with Standard 15.4 stemmed from a failure to ensure that its ABS trainer/assessors and/or the workplace trainers had the requisite qualifications. 102In view of this, we attach significant weight to the submission, made by Mr Jarrett at the Tribunal hearing and recorded by the Tribunal at [94], that 'while ABS has had an opportunity to address other criticisms of its operation, it has not had an opportunity to address the direct supervision non-compliance'. 103An additional concern, which Mr Rogers emphasised in his submissions and which we share, is that the obligations imposed by the 'presence requirement' were not clearly defined in the Note to the Determination. If this requirement had been more strongly highlighted amongst the provisions regulating ABS's operations and had been drafted in a manner that left no doubt as to what ABS had to do, this argument put by Mr Jarrett to the Tribunal would have been less significant. 104In maintaining that the Tribunal's orders were fully justified, Mr Cribb referred to its characterisation of each of the non-compliances as 'fundamental'. On this ground, he argued that even if we determined that the Tribunal erred in concluding that all three claims of non-compliance were made out, we should nonetheless affirm its orders. 105In this context, Mr Rogers and Mr Cribb referred us to two Tribunal decisions under the VET Act describing and illustrating different 'grades' of non-compliance with regulatory standard. 106In the first of them, Sydney Business Institute Pty Ltd v NSW Vocational Education Training Accreditation Board [2009] NSWADT 322, the Tribunal said (at [97 - 98]):- 97 The Commonwealth government has produced a guideline entitled National Guideline for Managing Non-Compliance. That document sets out how the Board should ensure that an RTO that is not compliant with the standards is treated fairly, given every opportunity to demonstrate compliance and that any restrictions placed on the RTO's registration is in proportion to the level of non-compliance with the standards. Three categories of non-compliance are identified: minor, significant and critical. Critical non-compliance arises where there is a critical adverse impact on learners and/or consumers. The guidelines make the point that the type of sanction to be imposed depends on the nature and extent of non-compliance and the degree of risk it presents to consumers and the VET system. Compliance history is said to be relevant when determining sanctions. 98 The guidelines suggest that the terms 'minor', 'significant' and 'critical' be used in the audit report. For minor non-compliances, it is suggested that no sanction be imposed provided it is rectified within the applicable period. For significant non-compliances, the suggested sanctions include imposition of conditions and amendments to the registration. In the case of critical non-compliance, the guidelines suggest that an RTO be given up to 20 working days to remedy the non-compliance. Possible sanctions for critical non-compliance are the imposition of conditions, the amendment of registration, suspension of registration and cancellation of registration. 107In the second decision, Australian Academy of Commerce Pty Ltd v NSW Vocational Education Training Accreditation Board [2010] NSWADT 22, the Tribunal gave the following illustration (at [24 - 27]) of how the characterisation of non-compliances as 'minor' may guide it in deciding on appropriate action under the VET Act:- 24 Both parties described the non-compliances as minor. The fact that the parties agreed on that point is significant. We find that they are minor and that they relate to only a relatively small proportion of AAC's assessment materials. We are also satisfied that AAC has been on notice of these non-compliances since at least September 2009 when VETAB provided an audit report. 25 According to Mr Cribb, although the National Guideline suggests that minor non-compliances do not ordinarily justify cancellation of registration, the fact that AAC has had almost 12 months to address these issues means that the Tribunal cannot be satisfied that they will be addressed in the future. Mr Trice's opinion was that AAC has gone from having significant non-compliances to minor non-compliances by a process of continuous improvement and that that process will continue... 26 Mr Nabung set out in his statement the history of AAC's interaction with VETAB and the measures it has taken to address its concerns. According to Mr Nabung, compliance with the standards is 'tough' because the standards change and people disagree as to what they mean. He agreed, however that the standards have been the same since the beginning of 2008. Mr Nabung also agreed that the outstanding non-compliances need to be addressed and proposed that that would happen through a more detailed and intense process of "moderation" whereby he meets with teachers to evaluate and amend the assessment materials where necessary. 27 While we agree that Mr Nabung may find it difficult to comply with the standards because of the general way in which many of them are expressed, those standards have not changed since the beginning of 2008. Furthermore, VETAB has informed AAC of the ways in which their assessment materials do not comply. The majority of non-compliances have been addressed and we accept that Mr Nabung is committed to addressing the remaining issues. We are satisfied that there will be no critical adverse impact on students provided AAC complies with the condition of registration in s 13(4)(c) of the VET Act, that is "take all necessary steps to comply with the RTO standards if a compliance audit shows that the RTO does not comply with those standards". While we do not intend to make an order in relation to the time frame in which those steps must be taken, we expect that AAC will take those steps within 3 months of the date of this decision. 108The Tribunal in that case set aside decisions by the regulatory authority to cancel the registration of the applicant RTO and made lesser orders under the VET Act involving the imposition of conditions on its operations. 109In another decision cited to us, Success Fast-Track Pty Ltd and Australian Skills Quality Authority [2012] AATA 531, the Administrative Appeals Tribunal stated as follows (at [81]), with reference to the 'sanctions' listed in the Commonwealth equivalent of section 18 of the VETAB Act:- 81 The task therefore is to identify the minimum "sanction" that needs to be imposed in order to protect the public interest. Anything greater than that would constitute the punishment of the applicant and would be impermissible. 110In the present proceedings, the Tribunal did not refer at any stage to the lesser 'sanctions', falling short of cancellation of registration, that were available to it under sections 12, 13 and 18 of the VETAB Act. 111We would not regard as 'fundamental' either of the two non-compliances that we have held to have been established. They are better characterised as 'significant'. In these circumstances, as the Tribunal said in Sydney Business Institute Pty Ltd v NSW Vocational Education Training Accreditation Board at [98], 'the suggested sanctions include imposition of conditions and amendments to the registration'. 112In our opinion, the 'correct and preferable decision' on the material before us is to the following effect. We should leave intact the Tribunal's order affirming ASQA's decision to cancel ABS's registration. But we should set aside its order affirming ASQA's decision to refuse the application by ABS for registration, and should substitute our own order granting this application, subject to stipulations that take account of the past failures by ABS to comply with applicable Standards. These stipulations should take the form of restricting the period of registration to three years and imposing conditions whereby ABS demonstrates to ASQA at appropriate intervals that it is compliant with these Standards. 113Because re-registration coupled with stipulations such as these was not raised as a possible measure during the appeal hearing, we think it desirable that the parties should have an opportunity to address us on the way in which they should be formulated. We have accordingly delayed the operation of our orders for a period of 21 days. During this period, either party may apply to have this appeal relisted for the purpose of receiving submissions on this topic. If no such application is made within 21 days, our orders will take effect. 114The appeal by ABS has succeeded, but only in part. In these circumstances, the parties should bear their own costs, as provided for in section 88(1) of the ADT Act.

DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 19 February 2013