Australian Nursing Federation v Aaron Private Nursing Home and others

CITATION : Public Hospital Nurses (State) Award (No. 4) Re [2003] NSWIRComm 442 APPLICANT New South Wales Nurses' Association

PARTIES : RESPONDENT Health Administration Corporation

INTERVENOR: Minister for Industrial Relations FILE NUMBER: IRC 6802 of 2001 CORAM: Wright J President; Boland J; Patterson C CATCHWORDS : Award - Wage fixation - Application for increased rates of pay - Public hospital nurses and assistants in nursing - Work value - Special case - Pay equity for assistants in nursing - Reasonable workloads - Retention allowance - Qualification allowances - Environment allowance - Recruitment and retention of nurses - Rates of pay increased - New award made Aged Care Act 1997 LEGISLATION CITED : Children And Young Persons (Care And Protection) Act 1998 Industrial Relations Act 1996 Workplace Relations Act 1996 (Cth) Australian Nursing Federation v Aaron Private Nursing Home and others (unreported, Full Bench of AIRC Print S2652, 28 January 2000) Health and Community Employees Psychologists (State) Award Re (2001) 109 IR 458 Medical Officers - Hospital Specialists (State) Award Re (1990) 33 IR 79 Nurses (Queensland Health) - Section 170 MX Award 2003 Re (unreported, Full Bench of AIRC, Print PR 932194) Public Hospital Nurses (State) Award Re (unreported, Wells SCC, 22 July 1986 [Ministerial Reference Case]) Public Hospital Nurses (State) Award (No 2), (2002) 118 IR 336 CASES CITED : Public Hospital Nurses (State) Award, Re (2002) 115 IR 183 Public Hospital Nurses (State) Award, Re (No 2) (2002) 118 IR 336 Public Hospital Nurses (State) Award, Re (No 3) (2002) 121 IR 28 Public Hospital Nurses (State) Award, Re (unreported, 1 August 1990, Cahill VP, Sweeney and Hill JJ) Public Hospital Nurses (State) Award, Re (unreported, Cahill VP, Bauer J, Shiels CC 10 July 1989 [Professional Rates Case]) Queensland Department of Health and Mater Misericordiae Health Service Brisbane Ltd v ANF (Print PR 931289, Full Bench of AIRC, 16 May 2003) State Wage Case 2003 (2003) 121 IR 446 The TAFE Case (unreported, Full Bench of the Industrial Commission of New South Wales, Matter Nos 515, 566 and 1619 of 1989, 7 August 1991) HEARING DATES: 06/11/2002; 06/12/2002; 06/13/2002; 06/14/2002; 07/22/2002; 07/23/2002; 07/24/2002; 07/25/2002; 07/26/2002; 07/29/2002; 08/01/2002; 08/02/2002; 08/05/2002; 08/06/2002; 08/07/2002; 08/08/2002; 08/09/2002; 09/12/2002; 09/13/2002; 09/16/2002; 09/17/2002; 09/18/2002; 09/19/2002; 09/20/2002; 09/30/2002; 10/01/2002; 10/02/2002; 10/03/2002; 10/04/2002; 10/08/2002; 10/09/2002; 10/10/2002; 10/21/2002; 11/07/2002; 11/12/2002; 02/06/2003; 03/06/2003; 03/12/2003; 04/09/2003; 06/25/2003; 06/26/2003; 07/21/2003; 07/23/2003; 07/24/2003; 07/25/2003 DATE OF JUDGMENT: 12/11/2003

APPLICANT: Mr S J Howells of counsel with Ms C M Howell of counsel Solicitor: Ms L Doust R L Whyburn & Associates

RESPONDENT: LEGAL REPRESENTATIVES: Mr R C Kenzie QC and Mr I Taylor of counsel Mr T Craft - Health Administration Corporation

INTERVENOR: Ms E Brus of counsel Minister for Industrial Relations

JUDGMENT: INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES FULL BENCH Matter No IRC 6802 of 2001 Re PUBLIC HOSPITAL NURSES (STATE) AWARD (No. 4) Application by the New South Wales Nurses' Association for variation Re Increased Remuneration and New Allowances TABLE OF CONTENTS

INTRODUCTION 3 THE RELEVANT PRINCIPLES 8 WORK VALUE CHANGES 13 Work value principle 13 HAC's general contentions 22 Submission by Minister 27 Statistics 27 Increased acuity of patients 33 HAC's position on acuity 38 Consideration regarding acuity 47 Ageing of the population 52 Nurses perform functions previously performed by doctors 55 Discharge planning 57 Increased occupational health and safety responsibility 59 Child protection legislation 62 Accountability and aggression 63 Increased use of computers 64 Changes in managerial work 65 Nurses performing work of other staff 67 New technology, drugs and procedures 68 Increased paperwork and meetings 70 Mandatory and other training 72 Policy development and protocols 73 Mentoring and preceptorship 73 Comparison with Physiotherapists and Other Health Care Professionals 74 Enrolled nurses 75 Assistants in nursing 83 Agency nurses 93 Reasonable workload 94 Positive and ameliorating circumstances 107 Work value - other considerations 111 Conclusions in respect of work value claim 120 RETENTION ALLOWANCE 123 Consideration regarding retention allowance 126 QUALIFICATION ALLOWANCES 127 Consideration regarding qualification allowance 133 EQUAL REMUNERATION FOR AINs 137 Consideration regarding pay equity issue for AINs 143 MATTERS OUTSTANDING FROM THE CONDITIONS CASE 144 Consideration regarding environment allowance 149 RECRUITMENT AND RETENTION 150 Consideration regarding recruitment and retention 163 ORDERS AND DIRECTIONS 166

INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES FULL BENCH CORAM: Wright J, President Boland J Patterson C

Matter No IRC 6802 of 2001 Re PUBLIC HOSPITAL NURSES (STATE) AWARD (No. 4) Application by the New South Wales Nurses' Association for variation Re Increased Remuneration and New Allowances DECISION OF THE COMMISSION [2003] NSWIRComm 442

1 This decision concerns an application by the New South Wales Nurses' Association ("the Association") to vary the Public Hospital Nurses' (State) Award by increasing rates of pay by 15 per cent and introducing two new classes of allowance, namely, a qualification allowance and a retention allowance. Our decision in this matter follows on from an earlier decision in Re Public Hospital Nurses (State) Award (No. 3) (2002) 121 IR 28 ("the Interim Decision".)

2 The Association's application was filed in October 2001. The grounds and reasons in support of the application to vary included reference to the stressful environment in nursing brought about by nursing shortages; a significant increase in the skill, responsibility and value of the work performed by nurses in public hospitals since 1991 that had not been reflected in nurses' pay; and, the undervaluation of nurses' work compared with other health professionals. The Health Administration Corporation ("HAC") and the Minister for Industrial Relations appearing pursuant to s 167 of the Industrial Relations Act 1996 opposed the application.

3 Following some 35 hearing days and the taking of evidence from 40 witnesses in 2002 (see Re Public Hospital Nurses (State) Award (No 2) (2002) 118 IR 336) the Full Bench decided in its Interim Decision to increase the weekly rates of pay for nurses under the Public Hospital Nurses' (State) Interim Award by six per cent. In doing so we stated: 122 [A] special case has been made out by the Association for nurses' wages to be increased. As we observed earlier, the situation is that nurses' wages are below those of comparable health and other public sector professionals. Against the background of the need to attract and retain nursing staff in order to relief the strain on the public hospital system, it is in the public interest to lift nurses' wages. 123 In awarding a further six per cent increase we noted earlier that we have taken into account the increases that have been received under the MOU and those which will apply in the next six to seven months. Further, the amount we have awarded will largely, although not completely, address the deterioration in the graduate level of nurses' salaries under the Award.

4 The increase awarded was payable from 1 January 2003. In our decision we said: 127 The increase of six per cent shall apply from the same operative date as the next increase of four per cent payable under the MOU, namely, 1 January 2003. Due to the compounding effect, this will mean that from 1 January 2003 nurses' wages will initially increase by slightly more than 10 per cent. Under the terms of the MOU rates for nurses will increase by a further 5 per cent from 1 July 2003. The full effect of these increases will be to produce a total increase of over 15.75 per cent in the first six months of 2003.

5 The increase was interim in nature and was granted on the basis that the Association had made out a special case. The Association had contended that increases in rates of pay were also justified by increases in work value. In that respect we held as follows: 24 There has been a great deal of evidence tendered in the proceedings regarding the work of nurses and how it is said the value of that work has increased. The HAC contended that there has been no increase in the value of work of nurses having regard to the relevant wage fixing principle.

25 We are yet to hear the submissions of the parties in relation to all of the evidence regarding changes in work value and so we are not in a position to make any final determination in that respect. We do consider, however, that sufficient material has been put to the Commission to allow us to form the view that since 1996 the work value of nurses in public hospitals has increased.

26 Notwithstanding this limited conclusion, we should indicate we have significant doubts as to whether there is scope for general wage increases to be awarded on work value grounds alone for the life of the MOU. The understanding and intent of the parties in making the MOU was to preclude such increases and, subject to what we say later in this decision regarding the unique mix of circumstances we have been presented with in these proceedings which, in our opinion, justify wage increases being granted to nurses in public hospitals, there do not appear to be extraordinary circumstances existing such that would cause us to award wage increases on work value grounds alone in addition to the 16 per cent available under the MOU. 27 We also consider that the claims for a retention allowance and qualification allowances are in the nature of general wage increases and may well be precluded by the MOU during its term.

28 The Commission will proceed to hear the parties' outstanding submissions in respect of the work value aspects of the claim, the retention and qualification allowances and other outstanding issues, on the dates that have been set aside for that purpose in 2003. However, if there are to be any further adjustments to wages arising out of the work value claim and the claim for allowances, any relevant award variation should not operate before 30 June 2004. One possible exception that might allow an earlier operative date relates to the success or otherwise of initiatives to overcome the problem of attracting and retaining nurses in order to maintain a viable public hospital system. We address this question later in the decision.

6 As to the question of further wage increases and an operative date earlier than 1 July 2004, we said in our decision: 124 Although the effect of our decision, in a formal sense, will be to vary the Interim Award, in substance a new interim award is being made in which case the principles discussed in the Conditions Case apply. That is, any interim wage increase must be approached on a cautious basis so as not to "embarrass the final result". Such an approach, in the context of a final determination in this matter, will permit the Commission to have regard to all of the relevant factors in setting fair and reasonable rates of pay, including other relevant graduate rates then existing. It also means that when we come to assess fully the question of change in work value it should be understood that the six per cent wage increase here awarded is, in part, in recognition of work value changes.

125 We have commented earlier that wage increases are not the whole answer to the nursing shortage but we consider that they can play an important part in a broader strategy that we are told is now being put into place to alleviate the shortage. We intend to monitor the effectiveness of this strategy, and its success or otherwise may be an important consideration in assessing the claims for qualification and retention allowances and in determining whether or not it is appropriate to apply any additional wage increase that might be awarded on work value grounds from a date earlier than 1 July 2004. If it can be demonstrated, for example, that the various initiatives implemented by the respondent to overcome the difficulties in attracting and retaining nurses in the public hospital system are working and that wage increases that have been awarded in this decision have had a limited impact, then it would be most unlikely that the Commission would be convinced to grant further increases prior to 1 July 2004. On the other hand, if the initiatives are having little or no effect and there is evidence that the wage increase has had a positive effect, there may be a case for any increase to be payable earlier than 1 July 2004.

126 We expect, when proceedings resume in 2003 or soon thereafter, to be provided with precise information as to what measures have continued to be taken (and any new measures that have been implemented) to address the problem of attraction and retention of nurses in the public hospital sector. We also expect to be informed at the appropriate time of the results of such measures, the basis for assessing with precision the effectiveness of such measures and the program put in place by the respondent up to 30 June 2004 to continue to monitor the success or otherwise of the initiatives to overcome the shortage issue.

7 In order to assist the parties as to the issues we considered to be outstanding following our decision in December 2002, we identified these at par [129] as follows: 1. Whether further wage increases are justifiable on the ground of changes in the work value of nurses, including enrolled nurses and assistants in nursing. 2. What is the datum point for the assessment of changes to work value for nurses, noting that the datum point for enrolled nurses may be different to that for registered nurses and assistants in nursing. 3. Whether the claim for qualification allowances is justifiable on work value and/or special case grounds. 4. Whether the claim for retention allowances is justifiable on special case grounds. 5. Whether increases to the rates of pay for assistants in nursing are justifiable under the Equal Remuneration Principle. 6. What is to be done with the outstanding issues from the proceedings in Matter No. IRC 3810 of 2000 (the Conditions Case).

8 The reference to the "Conditions Case" was a reference to our decision in Re Public Hospital Nurses (State) Award (2002) 115 IR 183 which dealt with an earlier claim by the Association for a new Award involving changes to allowances and employment conditions.

9 Without detracting from the importance of the Association's other claims referred to in par [7] above and which we address in this decision, the principal issue to be determined is whether further wage increases are justifiable on the ground of changes in the work value of nurses, including enrolled nurses, assistants in nursing and agency nurses. It will be seen from our earlier decision that the wage increase there awarded was, in part, in recognition of work value changes. This is an important consideration in assessing whether there is scope for further increases based on changes in work value. The closely related issue is the datum point, or points, for the assessment of changes to work value.

10 A further important consideration is whether any additional wage increase, if granted, should apply earlier than 1 July 2004. As we explained in our Interim Decision, if initiatives implemented by the HAC to overcome the difficulties in attracting and retaining nurses in the public hospital system were working, and the wage increases we have already awarded had a limited impact, it was unlikely that we would be moved to again increase rates of pay in the period covered by the Memorandum of Understanding ("MOU") between the Association (and other unions) and the Public Employment Office in March 2000 (the MOU and its relevance to the proceedings is addressed in the Interim Decision at pars [9] to [23]). The evidence about these initiatives and the impact of the six per cent wage increase, therefore, becomes important if it is determined that further wage increases should apply. As to the evidence relating to changes in work value, and to the other issues we are called upon to decide, this was all presented during the proceedings in 2002. We will come to this evidence in due course.

11 The Commission's wage fixing principles are set out in Annexure B to the decision in State Wage Case 2003 (2003) 121 IR 446. The principles relevant to these proceedings are as follows: · Principle 5 Adjustment of Allowances and Service Increments; · Principle 6, Work Value Changes; · Principle 10, Special Case; and · Principle 14, Equal Remuneration and Other Conditions.

12 The Allowances principle is relevant in respect of the claim for new allowances and the allowance matters outstanding from the Conditions Case. The principle is in the following terms: 5 Adjustment of Allowances and Service Increments (a) Existing allowances which constitute a reimbursement of expenses incurred may be adjusted from time to time where appropriate to reflect relevant changes in the level of such expenses. (b) Existing allowances which relate to work or conditions which have not changed, including shift allowances expressed as monetary amounts and service increments, may be increased by 3.2 per cent for the State Wage Case 2003 adjustment. Counterpart State awards should be adjusted by the same amount as their federal counterpart. (c) Existing allowances for which an increase is claimed because of changes in the work or conditions will be determined in accordance with the relevant provisions of the Work Value Changes principle of these principles.

(d) New allowances to compensate for the reimbursement of expenses incurred may be awarded where appropriate having regard to such expenses. (e) Where changes in the work have occurred or new work and conditions have arisen, the question of a new allowance, if any, will be determined in accordance with the relevant principles of these principles. The relevant principles in this context may be Work Value Changes or First Award and Extension to an Existing Award.

(f) New service increments may only be awarded to compensate for changes in the work and/or conditions and will be determined in accordance with the relevant provisions of the Work Value Changes principle of these principles. 13 The work value principle is claimed to be relevant in relation to all classifications of nursing including enrolled nurses, assistants in nursing and agency nurses. The principle is as follows: 6 Work Value Changes (a) Changes in work value may arise from changes in the nature of the work, skill and responsibility required or the conditions under which work is performed. Changes in work by themselves may not lead to a change in wage rates. The strict test for an alteration in wage rates is that the change in the nature of the work should constitute such a significant net addition to work requirements as to warrant the creation of a new classification or upgrading to a higher classification. In addition to meeting this test a party making a work value application will need to justify any change to wage relativities that might result not only within the relevant internal award structure but also against external classifications to which that structure is related. There must be no likelihood of wage leapfrogging arising out of changes in relative position.

These are the only circumstances in which rates may be altered on the ground of work value and the altered rates may be applied only to employees whose work has changed in accordance with this principle. (b) In applying the Work Value Changes principle, the Commission will have regard to the need for any alterations to wage relativities between awards to be based on skill, responsibility and the conditions under which work is performed.

(c) Where new or changed work justifying a higher rate is performed only from time to time by persons covered by a particular classification, or where it is performed only by some of the persons covered by the classification, such new or changed work should be compensated by a special allowance which is payable only when the new or changed work is performed by a particular employee and not by increasing the rate for the classification as a whole.

(d) The time from which work value changes in an award should be measured is the date of operation of the second structural efficiency adjustment allowable under the State Wage Case 1989 . (e) Care should be exercised to ensure that changes which were or should have been taken into account in any previous work value adjustments or in a structural efficiency exercise are not included in any work evaluation under this principle.

(f) Where the tests specified in (a) are met, an assessment will have to be made as to how that alteration should be measured in money terms. Such assessment will normally be based on the previous work requirements, the wage previously fixed for the work and the nature and extent of the change in work. (g) The expression ' the conditions under which the work is performed' relates to the environment in which the work is done. (h) The Commission will guard against contrived classifications and over-classification of jobs.

(i) Any changes in the nature of the work, skill and responsibility required or the conditions under which the work is performed, taken into account in assessing an increase under any other principle of these principles, will not be taken into account under this principle.

14 The special case principle is relevant to all classifications and is in the following terms: 10 Special Case Except for the flow on of test case provisions, any claim for increases in wages and salaries, or changes in conditions in awards, other than those allowed elsewhere in the principles, will be processed as a special case before a Full Bench of the Commission, unless otherwise allocated by the President.

This principle does not apply to applications for awards consented to by the parties, which will be dealt with in the terms of the Act, or to enterprise arrangements, which will be dealt with in accordance with the Enterprise Arrangements principle. 15 The equal remuneration principle is relevant to the Association's claims in relation to the alleged disparity between the rates of pay for assistants in nursing and those applicable to wardspersons. The principle is in the following terms: 14 Equal Remuneration and Other Conditions (a) Claims may be made in accordance with the requirements of this principle for an alteration in wage rates or other conditions of employment on the basis that the work, skill and responsibility required, or the conditions under which the work is performed, have been undervalued on a gender basis. (b) The assessment of the work, skill and responsibility required under this principle is to be approached on a gender neutral basis and in the absence of assumptions based on gender.

(c) Where the undervaluation is sought to be demonstrated by reference to any comparator awards or classifications, the assessment is not to have regard to factors incorporated in the rates of such other awards which do not reflect the value of work, such as labour market attraction or retention rates or productivity factors.

(d) The application of any formula, which is inconsistent with proper consideration of the value of the work performed, is inappropriate to the implementation of this principle.

(e) The assessment of wage rates and other conditions of employment under this principle is to have regard to the history of the award concerned. (f) Any change in wage relativities which may result from any adjustments under this principle, not only within the award in question but also against external classifications to which the award structure is related, must occur in such a way as to ensure there is no likelihood of wage leapfrogging arising out of changes in relative positions. (g) In applying this principle, the Commission will ensure that any alternative to wage relativities is based upon the work, skill and responsibility required, including the conditions under which the work is performed. (h) Where the requirements of this principle have been satisfied, an assessment shall be made as to how the undervaluation should be addressed in money terms or by other changes in conditions of employment, such as reclassification of the work, establishment of new career paths or changes in incremental scales. Such assessments will reflect the wages and conditions of employment previously fixed for the work and the nature and extent of the undervaluation established. (i) Any changes made to the award as the result of this assessment may be phased in and any increase in wages may be absorbed in individual employees' overaward payments. (j) Care should be taken to ensure that work, skill and responsibility which have been taken into account in any previous work value adjustments or structural efficiency exercises are not again considered under this principle, except to the extent of any undervaluation established. (k) Where undervaluation is established only in respect of some persons covered by a particular classification, the undervaluation may be addressed by the creation of a new classification and not by increasing the rates for the classification as a whole.

(l) The expression 'the conditions under which the work is performed' has the same meaning as in Principle 6, Work Value Change.

(m) The Commission will guard against contrived classification and over classification of jobs. It will also consider: i) the state of the economy of New South Wales and the likely effect of its decision on the economy; ii) the likely effect of its decision on the industry and/or the employers affected by the decision; and iii) the likely effect of its decision on employment. (n) Claims under this principle will be processed before a Full Bench of the Commission, unless otherwise allocated by the President.

(o) Equal remuneration shall not be achieved by reducing any current wage rates or other conditions of employment. WORK VALUE CHANGES

16 The work value principle allows for award wages to be increased if it can be demonstrated that there have been changes in the nature of the work, skill and responsibility required or the conditions under which work is performed to such an extent that the changes constitute a significant net addition to work requirements so as to warrant the creation of a new classification or upgrading to a higher classification. The principle refers to this test as a "strict test". There must be no likelihood of wage leap frogging either within the internal award structure or against external classifications to which that structure is related.

17 Further, there should be no double counting. That is, changes that were, or should have been, taken into account in any previous work value adjustments are not to be included in any work evaluation under this principle.

18 These requirements under the work value principle impose a significant burden on an applicant, particularly because of the strict test requiring the applicant to demonstrate a "significant net addition to work requirements so as to warrant the creation of a new classification or upgrading to a higher classification". It might be asked how such a burden exists in a decade or more of rapid and continuing workplace change and the almost universal impact that phenomenon has had on employees. But as the principle makes clear, changes in work by themselves may not justify an increase in wages. Some changes bring about a net reduction in work requirements. Others merely reflect the evolving nature of the particular occupation where skills or responsibilities are lost and new ones gained without producing a net addition to work requirements. In many occupations, particularly professional occupations, change, and the requirement to cope with it by coming to terms with new methods and new technology, is an inherent and accepted characteristic of the employment and rarely will this evolutionary process attract extraordinary wage increases under the work value principle. In this respect, we note the observations of Fisher P in Re Medical Officers - Hospital Specialists (State) Award (1990) 33 IR 79 at 84 where, after referring to the work value principle, his Honour said: One of the problems with the application of the "strict test" to professional or managerial employment lies in the nature of the change. Change must be accommodated, being an essential part of what professional practice is all about. It does not follow therefore without more, that changes even spectacular changes, necessarily fall within the work value principle. Secondly it is to be understood that new techniques and procedures bring with them their own advantages. For every new technological advance there is likely to be somewhere an inferior technology in part or in whole abandoned. Superior technologies give superior results and tend to free practitioners from laborious, uncertain and stressful practice. Changes, subject to habitation, do not necessarily make things more difficult or more demanding. They may, but equally they may remove problems, decrease anxieties and uncertainties and as well be more rewarding and more productive.

19 Other changes to work which have occurred in the quest for greater productivity and efficiency may have already been compensated for by wage increases paid in recognition of the increased productivity and efficiency or by increases granted for earlier work value changes.

20 A tribunal charged with determining whether the tests under the work value principle have been met must carefully sift through the material that has been placed before it and separate out those changes which have occurred to the nature of the work, skill and responsibility of employees or to the environment in which the employees work and which have not previously been the subject of compensation. An objective assessment then has to be made as to whether the changes that have occurred amount to such a significant net addition to work requirements as to warrant the creation of a new classification or upgrading to a higher classification. The change is to be measured from the last time wages were increased on the basis of work value or from the date of operation of the second structural efficiency adjustment allowable under the State Wage Case 1989, whichever is the later. An assessment is then to be made as to how that change should be measured in money terms. Such assessment will normally be based on the previous work requirements, the wage previously fixed for the work and the nature and extent of the change in work.

21 Finally, in relation to the application of the work value principle we refer to the Full Bench decision in The TAFE Case (unreported, Full Bench of the Industrial Commission of New South Wales, Matter Nos 515, 566 and 1619 of 1989, 7 August 1991) where after analysing the work value principle applicable at that time it was held at 44: We consider that reliance on this principle for general wage movements across all classifications in an award is not justified. Consideration of the phrases emphasised [by underlining] show that the purpose of this principle is directed towards specific work changes in specific areas. It was not intended that generalised across the board wage increases should be based on this principle.

22 We consider that the important point to be drawn from The TAFE Case is that if an applicant seeks wage increases for all classifications under an award the applicant carries the onus of demonstrating work value change in respect of each classification. It is not sufficient to contend, for example, that there have been changes in technology over the relevant period that have impacted on the work value of employees generally. It must be demonstrated how that impact has led to a significant net addition to the work requirements of each award classification in respect of which the increase is sought. Datum point

23 In the present proceedings the Commission has been presented with a vast amount of material going to the issue of changes in work value of all classifications of nursing under the Award. Whilst there was some early disagreement about the appropriate datum point for measuring the work value change, we consider that in respect of nurses generally and assistants in nursing, the date is 1 July 1996 and in respect of enrolled nurses it is 1 January 1993. It is apparent to us that it was agreed between the parties in correspondence in 1996 that wage increases then agreed upon recognised all work value changes for all nursing classifications which had occurred up to 30 June 1996 except for enrolled nurses, where it was agreed that the increases satisfied all work value claims up to 31 December 1992. We do not accept the Association's contention that the datum points agreed to in 1996 should not be strictly applied. There is no sound basis for such a contention.

24 Mr S J Howells of counsel with Ms C M Howell of counsel appeared for the Association. It was their submission that since 1996 nurses have seen very significant changes to the nature of the work they perform, the levels of skill and responsibility required, and the conditions under which work is performed. It was submitted there were many factors which, combined together, had given rise to significant change in the work value of nurses since the relevant datum points. Further, that the Association's case did not rely upon a simple reference to disjunctive changes in the tasks performed by nurses or, for example, the increase in inpatients' acuity and the decreased length of stay. Rather, that the Association's case on work value change relied upon the fact that the conditions under which nursing is performed in the public hospital system and the demands upon nurses have so altered and combined in such a way as to materially alter the role and function of nurses in the public hospital system. It was submitted that there had been a significant shift in the way the public hospital system provides care and services and the role of nurses within it. Counsel contended: The Applicant does not seek to rely upon a change in the acuity of patients of itself to ground work value change. Nor does the Applicant seek to rely upon a collection of disjunctive changes in individual indicators of activity of themselves as indicating work value change. Nor does the Applicant seek to rely on the allocation of individual additional duties to nurses as justifying a contention that work value has changed. Rather, the Applicant contends that it is the effect of the combination of all of these factors changing fundamentally the nature and content of the role of nurses within the public hospital system. The role of nurses has not changed simply because length of stay has been reduced, or because Nurse Managers now have a responsibility not only to work to a budget, or to understand its effects, but have to conduct facilities and parts of facilities within a budget. Rather, the combination of the changes and the reasons for those changes have in very recent years impacted upon the professional role being undertaken by nurses within the system. The public hospital system seeks now to provide a different service in a different way to the one which it provided prior to 1996. Examples of this include the emphasis on confining the patients' stay in hospital to the most acute phase of case and providing for all other phases including high acuity phases to be managed in the home or other facilities in the community.

25 Counsel for the Association submitted that the work value change considerations included the following changes in the functions required of nurses and the conditions under which nurses worked, namely: (a) Increased acuity of patients in the following contexts: · Increased acuity and the shift to Outpatient, Home Based and Ambulatory Care; · Intensive Care Units; · Surgical Wards; · Mental Health; · Community Nursing; · Midwifery; · Emergency Departments; · Non Metropolitan Hospitals; · Diagnostic Related Groupings (DRG's); · Consequences of Increased Acuity; (b) Reduced Bed Base; (c) Higher Bed Occupancy Rates; (d) Increased Case flow/Throughput per bed per annum; (e) Shorter Length of Stay; (f) Ageing of the Patient Population; (g) Nurses Performing Functions Previously Performed by Doctors; (h) Increased incidence and scope of Discharge Planning; (i) Increased Occupational Health and Safety Responsibility; (j) Increased incidence and scope of No Lift or Minimal Lift Policy; (k) Introduction of Child Protection Legislation; (l) Increased Accountability and increased incidence of or report of Aggression; (m) Increased Use of Computers; (n) Increased Involvement of NUMs in Personnel and Human Resource Functions;

(o) Increase in General Administrative and Financial Responsibilities of NUMs; (p) Increased Requirement for Nurses to Perform Ancillary Health and Other Functions;

(q) Technological Changes; (r) Increased Pharmacological Knowledge; (s) Increased Paperwork and Meetings; (t) Increased Mandatory and Other Training; (u) Nurse Involvement in Policy Development, Protocols, etc; (v) Changes to Community Nursing; (w) The effect of Nurse Numbers being reduced or effectively remaining the same.

26 Counsel for the Association addressed each of these areas of change and the evidence supporting them, at length. However, as we have already observed, the Association insisted that it was not relying on a "collection of disjunctive changes in the tasks performed by nurses or the increase in inpatients' acuity and the decreased length of stay" and that, in effect, a global view had to be taken of the changes. In its final submissions in reply the Association submitted that the change may be encapsulated in the following five propositions: (1) Confinement of the hospital stay to the most acute phase of relative unwellness . · The evidence disclosed that since July 1996 there has been a very dramatic reduction in length of stay, so that length of stay has been reduced to the lowest practicable point. · Since July 1996 the evidence also disclosed that since July 1996 there has also been a very dramatic reduction in the bed base, such that the bed base was now too low and this was coupled with higher occupancy rates. · The evidence disclosed that part of the rationale for these changes included the advantages in respect of infection control, improved healing and recovery outside the hospital system and helpful reduction in demands on the acute sector of the public hospital system. · There was evidence of a concomitant introduction of less invasive surgery. (2) There has also been a necessary reorganisation of services. · Extended pre-admission clinics. · Extended discharge planning. · Radical extension of community nursing. · Introduction of hospital in the home. · The evidence disclosed increases in day of admission, day-only and short stay arrangements. (3) There has been a consequential rise in acuity because the system can treat and operate upon more acutely ill and older patients than could be treated or operated on even five years ago.

(4) There has been an intensification of nursing practice and the nursing process arising from all of the above points (1) to (3) and the increasing sophistication of what is required of nurses, for example, it is unsurprising that nurses are now making more judgments than they were making even five years ago, including judgments which might formerly have been the responsibility of doctors. (5) There is also a fifth point to be made relevant to this change, and that is that at the same time liability issues and responsibility and accountability so far as nurses are concerned, are in much sharper focus.

· Occupational Health and Safety legislation now requires risk assessment, risk management and reporting in a way which it did not hitherto require, and nurses at all levels play a far greater role in this process than they did even five years ago. · Child Protection legislation. · No lift, minimal lift policies.

27 We understand the Association's submission that the change it seeks to identify is not just "organisational or organic change" but also that nursing work overall has been "radically altered" and that there has been a dimensional change in the nursing profession in public hospitals. We acknowledge this submission and in assessing change we have been mindful of this underpinning contention. Nevertheless, it is unavoidable for the Commission to have to consider each of the changes, which are said to impact on the work of nurses and assess their contribution to increasing the work requirements of nurses. If any one or more of the changes, or if in aggregate terms the changes, represent a significant net addition to work requirements, a wage increase may be warranted. But the Commission is unable to assess the whole without first considering its constituent parts.

28 Mr R Kenzie QC with Mr I Taylor of counsel appeared for the HAC. The HAC submitted that the Commission would not award any further increase in rates pursuant to the change in work value principle beyond the 6 per cent awarded in the Interim Decision. Counsel submitted there were a number of matters of general applicability that the Commission would "keep steadily in mind" in determining whether to award any further increase in pay for nurses pursuant to the changes in work value principle. These were as follows:

1. The existence of the 2000 MOU presents an insurmountable barrier to any increase being awarded solely on the basis of the change in work value principle during the life of the MOU (i.e. before July 2004). 2) The work value principle imposes a "strict test" for the alteration of wage rates, namely "that the change in the nature of the work should constitute such a significant net addition to work requirements as to warrant the creation of a new classification or upgrading to a higher classification". 3) The Full Bench is only examining change within a relatively short period of time (namely, since 1 July 1996 for registered nurses and 1 January 1993 for enrolled nurses). This consideration is of considerable importance particularly having regard to the fact that there have been other increases granted in that period. 4) The evidence does not support the conclusion that there has been a significant increase in work value in the relevant time period such as to satisfy the Work Value Principle. 5) Nurses have obtained significant increases in pay since 1 July 1996, which are to be seen appropriately as being, in part, compensation for any increases in work value during that period, namely: a. under the 1996-99 Agreement 14% (being 11% for RNs and a further 3% spread over certain other grades, including NUMs); b. under the 2000 MOU, up to 1 July 2003 16% and pursuant to the Interim Decision 6% c. Total 36% (33% for RNs). 6) In regard to the last of those increases, the Full Bench determined that the 6 per cent increase was, in part, in recognition of work value changes. 7) Pursuant to Principle 6(i), the Commission will not take into account under the Work Value Principle any changes in the nature of the work or the conditions under which the work is performed, which were taken into account under any other principle. Accordingly, to the extent that the 6 per cent awarded in the Interim Decision was awarded under the Special Case Principle in respect of certain matters such as shortage, those are matters that cannot be relied upon again under the Work Value Principle. 8) While improvements in productivity may coincide with changes in work value, they do not in themselves give rise to a change in work value. In any event, pay rises obtained by nurses under both the 1996-99 Agreement and the 2000 MOU were clearly, in part, in compensation for matters now pursued under the heading of 'work value' including the consequence of shorter length of stay, greater case flow and higher acuity. It is important that such matters are not double counted. 9) The Commission would not take into account a large number of matters relied upon by the Applicant which were or should have been taken into account in earlier wage adjustments, including in particular in the 1986 Ministerial Reference Case and the Professional Rates case, and also by the parties in reaching the 1996-1999 agreement. 10) A significant part of the Applicant's case was reliance on claimed increases in acuity and a claimed corresponding increase in work value. Even if increases in acuity were relevant for work value purposes there is no intrinsic higher work value in nursing a patient with higher acuity (an ICU nurse is valued the same as a nurse in a general ward). An increase in work value arises, if at all, as a result of increased acuity leading to increased work falling on the same number of nurses. If nurse numbers increase, or patient numbers decrease, such changes will reduce or cancel out the effect on work value of any increase in acuity. Further, the introduction by consent of a reasonable work load clause, designed to alleviate pressure on nurses and ensure there are sufficient numbers of nurses per patient, must in any event have a significant effect on any weight which might be given to any claim for increase in work value arising from an increase in acuity. 11) A significant proportion of the evidence led by the Applicant going to the demands on nurses did not focus on whether and to what extent there had been change in that work. This presumably was because the Applicant led evidence not only to show change, but also, as part of its special case, to show that there is an overall under-valuation of the work of the nursing profession. The Full Bench would be mindful, when considering the work value principle, to consider evidence as to the intensity and difficulty of particular work, such as work in an ICU, as only being of probative value where there is demonstrated change in that work. 12) The nursing profession across the public hospital system is diverse, both geographically and by nature of discipline. Care must accordingly be taken when attempting to assess general rates of change. Small rural facilities will naturally experience different rates and types of change compared with large teaching hospitals. Similarly, disciplines that rely heavily on technology and new techniques will experience different rates of change than the rest of the profession. The Applicant predominantly, although it is conceded not entirely, relied upon witnesses from disciplines and hospitals where the rate of change has been the most demonstrable. While the Applicant is entitled to rely on such 'best evidence', the Commission in considering across-the-board increases will temper the conclusions it might otherwise reach from such evidence by taking into account the rate of change in other areas of nursing practice. It will certainly not proceed on the basis that the evidence relating to nursing in high intensity areas, such as ICU or emergency characterises nursing activity as a whole. In this regard there is clearly an industrial consequence flowing from the application proceeding on an 'all-of-one-company' basis. 13) There has been no change in work value of significance sufficient to meet the Work Value Principle in light of the following: a. included amongst the recipients of the claimed increase in rates of pay are Nurse Unit Managers (NUMs), who were in receipt of a significant additional pay rise expressly based on significant work value changes pursuant to the 1996-99 Agreement; and b. the Applicant's claim embraces, inter alia, agency nurses in circumstances where the Applicant's evidence is to the effect that their work value was and remains at a lower level than that of permanent nurses. 14) Since the Professional Rates case in 1989-90 registered nurse rates of pay have been set taking into account their professional status, which amongst other matters, includes the ability to nurse a range of patients across the acute sector, to maintain professional skills and to deal with change. At the very least evidence as to particular changes will always have to be assessed against a background in which the capacity to accommodate change is part and parcel of the profession of nursing. In this regard, a Full Bench of the Australian Industrial Relations Commission has held that "the work of registered nurses associated with increased acuity and dependency level of [patients] is work which falls within the profession of nursing" and accordingly an increase in acuity and dependency levels "does not warrant an increase based on work value": Australian Nursing Federation v Aaron Private Nursing Home and others (Print S2652, 28 January 2000, MacBean SDP, Watson SDP and Bacon C at [86]). This approach has been recently reaffirmed by another Full Bench of the AIRC in Queensland Department of Health & Mater Misericordiae Health Service Brisbane Ltd v ANF ( 16 May 2003, Print PR931289, Munro J, Marsh SDP, Deegan C) ("the Queensland Decision"). 15) The Commission will take account of the fact that the evidence led by the Applicant concentrated, understandably, on those changes that have been perceived to have had a negative effect on nurses. The Commission, however, would also take into account those changes to the practice of work that have improved the conditions of work for nurses including the various positive or ameliorating considerations.

16. The Commission would have regard to the recent decision of a Full Bench of the AIRC in the Queensland Decision. There the Full Bench rejected a claim for an increase on work value grounds, while awarding increases and variations on other grounds, notwithstanding the fact that there appeared to be a much better case there for an increase, given factors such as: a. there was a much earlier datum point, namely 1990; b. nurses in Queensland had not recently been awarded an increase in the order of the 6 per cent interim increase awarded by this Commission to nurses in NSW; c. nurses in Queensland were (and remain after the increase) lower paid than nurses in NSW; d. the evidence showed that the number of nurses per bed had decreased during the relevant period (while in NSW there has been an increase,) resulting in an intensification of work demands; and e. there was no suggestion in the proceedings that there was a current agreement, like the 2000 MOU, that was providing ongoing increases and that could be said to have prevented any further increases.

29 Ms E Brus of counsel appeared for the Minister for Industrial Relations. The Minister adopted the submissions of the HAC. In addition, the Minister made submissions regarding the economic impact of the claim. We shall refer to these at the appropriate point in the decision.

30 Before commencing to address the work value changes identified by the Association, and the HAC's contentions regarding those changes, there were a number of issues going to statistical material used by the parties to support their respective cases. It is convenient at this juncture to deal with that material.

31 The HAC submitted that in a system as large and diverse as the public hospital system it was not surprising that the statistics were not beyond criticism. However, it was contended they were sufficiently robust to indicate general trends or demonstrate the absence of such trends. It was submitted that with respect to almost all the important matters about which statistical evidence was tendered, while there might have been some dispute as to the precise margin of change, there was no significant dispute as to the general rate of change. It was submitted by way of introduction that the Full Bench would accept, for example, that since July 1996: a. the number of admissions (including day only admissions) in the public hospital system has increased only very slightly; b. there has been a significant increase in both the number of patients being admitted for a procedure on the day of their procedure, and the number of patients who have day only procedures (i.e. do not stay overnight); c. there has been a significant (and related) reduction in the average length of stay, driven predominantly by the growth of day only procedures; d. there has been a significant reduction in the number of patients staying overnight; e. there has been a significant reduction in the average number of patients in hospital per day, even including the day only patients as there for the 'day' when they are in fact only there for part of the day; f. there has been a significant reduction in the average number of patients in hospital per day; g. there has been (a related) an increase in bed occupancy levels (although the rate of increase has been affected by the increase in day only patients, which has significantly inflated the rate of change because more than one person can use a bed per day, resulting in occupancy rates for such beds of more than 100%); and h. there has been a small increase in the total number of nursing staff; i. there has been very substantial increase in the number of nursing staff per bed (principally as a consequence of the reduction in beds); and j. there has been a very substantial increase in the number of nursing staff per patient on any given day (principally as a consequence of the reduction in the number of patients in the system on any given day).

32 The Association did not agree with any of the HAC's foregoing conclusions, although it would appear from the Association's submissions that the disagreement was essentially about the HAC's interpretation of the statistics rather than the statistics themselves. We consider that the statistics were "sufficiently robust to indicate general trends or demonstrate the absence of such trends".

33 In relation to the number of admissions, the Association contended that the average number of patients in the system on any given day had increased significantly when account was taken of the increase in outpatients or NAPOOS (non-admitted patient occasions of service). It is apparent that there has been an increase in the number of NAPOOS over the relevant period but because of the variations in the method of counting NAPOOS in the years since 1996 it is difficult to conclude that there has been any significant change in the workload related to outpatient services. As the HAC submitted: There are a wide range of services that are recorded as NAPOOS. Some require nursing time, occasionally over a few hours. Others would require little or no nursing time, including high volume NAPOOS such as pathology, radiology and allied health services such as physiotherapy and pharmacy services. Total NAPOOS figures do not allow one to understand the extent of any change in respect of nursing work within NAPOOS. What is known is that while there has been a shift from in-patient services to outpatient services in respect of some procedures (eg chemotherapy), the overall amount of the services shifted (about 106,000 occasions of service in 2000/01) are not so great as to make a significant difference to either the total number of NAPOOS or the total number of in-patients. In any event, any change in the amount of NAPOOS would only affect the small number of nurses who work in outpatient services.

34 We consider that the increase in outpatients has had an impact on the work of nurses involved in the care and treatment of such patients. However, the evidence does not support a conclusion that the net result of an increase in NAPOOS is an increase in the work value of nurses generally, given that most nurses are concerned with inpatient care.

35 As to increased staff numbers, including increased nursing staff, the Association submitted that the increase was only negligible and in any event increased staff did not necessarily mean reduced work value, it being a matter more related to workload. The HAC contended, however, that more nursing staff did have implications for work value because to the extent that there are claims of increased acuity, increased intensity and the like, increases in staff will impact to ameliorate the effect the change otherwise would have. This is discussed in more detail below. We should observe, of course, that whilst there has been an increase in nursing staff over the relevant period the increase was not sufficient to overcome the nursing shortage found to exist in our Interim Decision.

36 The Association submitted the perception amongst the witnesses that there had been a reduced availability of allied health staff was more reliable than any assertion contained in the statistical compilations because: - a. the well-established limitations on the statistical material were made out on the evidence; b. there are other explanations for the reduction in availability of Allied Health staff, for example the increased use of Allied Health staff in community health and in outpatient's clinics.

37 We consider the statistics bear out the HAC's assertion that there has been an increase in allied health staff over the past six years. The implications of this for the work of nurses are discussed later in this judgment.

38 The Association acknowledged there was no disagreement regarding the statistics relating to bed numbers and bed occupancy. It submitted, however, even if the increase in bed occupancy rates has been caused by a growth in day only units, on any view occupancy rates had increased and this of itself had involved significant work value change. In response to this proposition the HAC submitted: Firstly, there has been a decrease in the average number of patients in hospital on any given day … Second, the submission that increased bed occupancy rates leads to more patients assumes (wrongly) that the number of beds remains stable and the number of beds used more than once in a day remain stable. In fact, of course, day only patient rates have increased at the same time as the number of beds has decreased. If 6 years ago a ward had on average 6 patients in 10 beds (60% bed occupancy) all staying overnight and now, as a result of bed closures, has on average 5 patients in 7 beds (bed occupancy of 71%) with some of those leaving during the same day that does not signify an increase in workload. Third, the submission that increased bed occupancy increases workload assumes (again wrongly) that the number of nurses on that ward to treat those patients remained stable or decreased. Bed occupancy cannot be viewed in isolation.

39 The Association had submitted that the bed base was too low and was placing strains on the system. The evidence in this respect would appear to support the proposition that the bed base is too low at the moment. However, the HAC submitted "without any overall decrease in the number of nurses there is no reason to conclude that the closure of those beds has resulted in an overall increase in workload for nurses".

40 There was evidence about the difficulties arising from "bed block" that is, when beds are not available and when there is pressure to discharge patients to create a bed for the next patient. The HAC submitted that except for the evidence regarding pressures arising from the shortage of permanent nurses, being a matter already considered and dealt with in the Commission's Interim Decision, there was little evidence of system-wide change in respect of these matters in the last six years. These pressures and difficulties existed in 1996. The number of patients on public hospital waiting lists has declined in the last two years. Pressure to discharge patients from high intensity units was noted as part of the system in the 1986 Ministerial Reference Case before Senior Conciliation Commissioner Wells.

41 The Association submitted the case flow or throughput per bed per annum rate had increased dramatically between 1995/1996 and 2000/2001 from 53.3 per cent to 63 per cent. This was to be contrasted with the marginal change between 1983 and 1986 (27.1 per cent to 28.3 per cent). It was submitted the assertion by the HAC that there has been no increase in workload, even if it is accepted that nurse numbers stayed the same, was unsustainable. On the other hand, the HAC submitted case flow figures are simply the result of taking the number of total admissions and dividing that by the number of available bed days, multiplied by 365. As the number of beds decreases, the case flow number will increase, even though no more patients are being attended to per year. And the case flow figure does not take into account reducing length of stay.

42 The evidence regarding the bed base, the increase in bed occupancy, the increase in case flow and the decrease in average length of stay suggests that the public hospital system has been undergoing a change in the way it operates and, indeed, we consider that is the case. Importantly, patients are not kept in hospital as long as they once were - there is a faster turnover of patients and we consider that a shorter length of stay means that the focus of the nurse's work has changed from "managing patients across a continuum of care from relative wellness through to the acute episode and then back again to relative wellness, to the management of acute episodes and the preparation of a person for handover still at a relatively acute stage but to the care of another member of the nursing team". For many nurses they are experiencing more stress and a greater workload. As Ms Susan Bunt, Nursing and Patient Services Manager in charge of the Division of Surgery and Clinical Care, St George Hospital, Kogarah, said in her evidence: Nurses have to work harder to do all of the things for the patient in the shorter length of stay so they can be ready to move out into the community.

43 Having to cope with an influx of patients in the peak winter season when there are not enough beds, for example, must be a stressful situation for nurses. The nursing shortage in particular, the requirement to work shift work and the challenge involved in juggling work and family responsibilities makes working in the nursing profession less attractive than it otherwise might be.

44 We, of course, addressed a number of these issues in our Interim Decision where we accepted that, in the context of a special case and having regard to other factors, the increased stress on nurses arising out of the nursing shortage had impacted on their work value. Any further consideration of work value change will need to take this into account in order to avoid double counting. Moreover, as we discuss later in this decision, one must look at both sides of the equation. Whilst, faster turnover over of patients increases the workload of nurses, regard must be had to countervailing factors such as, for example: the creation of specialty units such as stroke units and specialist geriatric units which allows the 'heavy patients' being patients that placed heavy demands on nurses in general wards, to be moved to specialist wards; much improved drugs, technology and surgical techniques; and, new pre-admission procedures including advanced discharge planning. Increased acuity of patients

45 It was submitted the evidence showed that across the spectrum of the public hospital system patient acuity has increased significantly since 1996. That is, hospital patients were on average sicker than previously. Further, that this change has had a significant effect on the intensity and the complexity of the work performed by nurses. Reference was made to the evidence of a number of the Association's witnesses, including Professor John Dwyer, Professor of Medicine, University of New South Wales, and Clinical Director of the Programs for Medicine and Oncology, Prince of Wales Hospital, who said: The other key issue is the acuity and dependency of patients in hospitals today. When I first graduated people used to stay in hospital for many days recuperating. There were a number of what we would call easy admissions. People weren't that seriously ill. Today, to get into a hospital, you will be seriously ill. We can do more and more for people in an outpatient setting. Those people who are admitted are very sick. The physical demands and the emotional demands and the skill demands on nurses are as never before. It is very exhausting and demanding work with very sick patients… …

[E]fficiencies are either gained because of changes in work practices, which we all applaud, or because of this enormous pressure, the current way that acutely ill patients are looked after in our hospitals is putting enormous strain on nurses, more so, I believe, than ever before. They are asked to look after sicker patients, more technically complex patients; often patients whose families have more emotional demands than ever before. It is a very, very, hard job.

46 The Association submitted that the increased acuity of the inpatient population was not an accidental or unplanned occurrence. It was (at least in part) the result of systematic policies and innovations throughout the public hospital system in recent years that reduced the amount of treatment and care administered on an inpatient basis. Measures have been introduced which:- (a) Avoid inpatient admission altogether; or (b) Facilitate discharge at a much earlier stage in recovery; and/or (c) Involve admission at a later stage, in the case of elective admissions.

47 The evidence of Professor George Skowronski, Senior Staff Specialist Intensive Care Unit, St George Hospital, Kogarah, Conjoint Associate Professor Critical Care, University of New South Wales, was that: Instead of those patients who were previously in hospital having gall bladders and hernias and simple things done the patients left in the hospital are the elderly and the complex and the high-end technology patients… 48 Professor Dwyer said: [W]e do have a lot of out patient care in the hospital and a lot of that is becoming increasingly productive but fundamentally the inpatients in hospitals has changed considerably because, if you like to use the word easy and we qualify that, much of the easy work, work that perhaps wasn't easy ten years ago but can now be regarded as that, does not require inpatient admission. The corollary though is the patients now admitted to the hospitals, the majority are emergency admissions coming in through emergency departments and by definition those people are sick, hence when you analyze major public hospitals that is a clear trend and the acuity and the likelihood of the acuity increasing over the next few years is self evident.

49 The Association referred to evidence relating to increased acuity in a range of clinical environments and submitted as follows: Intensive Care Units : The APACHE 2 system is a widely recognised and used measure of ICU acuity. An APACHE 2 score of over 16 represents a critically ill patient. At both Westmead and St George Hospitals the figures show an increase in average APACHE 2 score from an average of a little over 16 to an average of close to 18 points. It cannot be doubted that ICU patients who are sicker will generally require nursing at a greater level of intensity and skill than a less sick patient. That is, patient acuity is generally reflected in the level of nursing acuity. With respect to the ICU area, patients are generally being transferred to other wards in a more acute state than previously, causing a flow on effect of increased acuity levels in those other wards. Surgical wards : The surgical inpatient wards are experiencing an increase in acuity because lighter patients are now treated on a day surgery basis (for example laparoscopic cholecystectomy is being performed increasingly on a day surgery basis). The effect of increased day surgery is that 'light' patients who require less intensive care are removed from the wards altogether. In other cases where admission as an inpatient is essential day of surgery admission has been introduced. The effect of this trend is that there are no longer any "light" pre surgery patients on the ward. Inpatients admitted one or more days prior to surgery needed relatively minimal care. Surgery is now being performed on patients who previously would have been considered too old and sick for such procedures. There is generally a higher incidence of co-morbidities amongst older and sicker candidates for surgery, with a corresponding increase in demands on the skill and time of nurses. Mental Health : Ms Sandra Hoot, Director, Division of Mental Health, Liverpool and Fairfield Sector Mental Health Services, gave unchallenged evidence as to the increased acuity of patients in acute inpatient mental health facilities. Ms Hoot pointed to: (a) the significantly reduced acute mental health bed base; (b) the increased number of involuntary admissions to inpatient facilities; and (c) the increased utilisation of community treatment orders (for persons who previously would have been admitted but who were capable of being treated in the community) as leading to a significantly more acute inpatient population. In addition, Ms Hoot noted that increased levels of drug and alcohol co-morbidities in recent years have further elevated overall acuity levels. Community Nursing : The community nursing area is one which has altered most dramatically in recent years as the effects of various programmes designed to keep people out of hospital have flowed through to the community sector. The effect of this trend is that community nurses are required to deal with patients who are much sicker than previously. They do so in the home environment, without immediate access to doctors or other support. Midwifery: There has been an increase in the acuity of women in the obstetrics area throughout NSW arising from a combination of shorter length of stay and increasing rates of intervention through inducements and caesarean births. Early discharge programs have increased the need for intensive education and assistance by ward nurses prior to discharge. The significant increase in inductions over recent years have had a significant impact on the intensity of nursing. Induced births require more intensive monitoring, and have higher levels of other interventions such as pain relief, and IV lines. Emergency Departments : From about 1997/8 all inpatient admissions to mental health were processed through the Emergency Department, rather than being admitted directly to the acute mental health unit. Two thirds of admissions to acute mental health facilities are now through Accident and Emergency. Non-metropolitan hospitals: Ms Christine Coombs, Director of Nursing, Tamworth Base Hospital, gave evidence as to the changes to acuity observed by her at the Tamworth Base Hospital: I know with my personal experience in Tamworth Base Hospital over many years and experience as a nurse the patients certainly are sicker while in hospital and that relates to the aging population increase, co-morbidities of the patients attending our hospital and procedures being undertaken on client groups that would not have been considered years ago. Diagnostic related groupings: The respondent relies on analysis of DRGs to downplay (though not to deny) the degree of increase in acuity since July 1996. However DRGs measure the cost of patient care and therefore are an unreliable indicator of actual acuity or nursing care. They do not fully capture levels of complexity and co-morbidity and they do not fully capture changes such as the increased age of the patient base. DRGs are manifestly inadequate for the purpose of measuring acuity in the case of chronic illness. Consequences of increased acuity: Increased acuity has effect in terms of the complexity and volume of clinical care to be provided. It is clear that more acute patients generally require more complex medical intervention and more intensive monitoring. Accordingly, not only is the skill level of nurses elevated, but also the intensity of work increases with increased overall acuity. The increase in patient acuity since 1996 represents a substantial change to the work value of public hospital nursing.

50 The HAC's general position regarding acuity and its effects on nursing work was that: (a) A change in the level of acuity does not, of itself, bring about work value change. Changes in acuity must be considered in the context of other changes, namely changes in staffing levels, in the level of other support (including new systems and technology) and in the context of reducing length of stay. Nurses have training to deal with all levels of acuity. If a particular ward has an increase in high dependency patients, but is staffed accordingly, then while that ward has a higher acuity that does not translate to a higher work value for nurses. That has been recognised by the fact that nurses in ICU get paid no more than a general ward nurse. The Association did not deal with these countervailing factors such as changes in staffing levels. (b) The Association's claim that increased acuity meant an increase in the physical and emotional demands on nurses was a claim of increased workload by another name. Increased workload does not equate to increased work value. (c) Professional nurses are trained to deal with varying levels of acuity. Nurses working with the most acute patients, which on the Association's case would be patients requiring the most 'intense' and 'complex' nursing, are viewed as having the same work value as other nurses and are paid the same as other nurses. Professional nurses are compensated on the basis that they are able to care for patients with a range of acuity. Increases in acuity and dependency levels of patients do not in themselves warrant an increase in pay based on work value principles: Australian Nursing Federation v Aaron Private Nursing Home and others (Print S2652, 28 January 2000, MacBean SDP, Watson SDP, Bacon C at par [86]); Queensland Department of Health & Mater Misericordiae Health Service Brisbane Ltd v ANF (Print PR931289, 16 May 2003, Munro J, Marsh SDP, Deegan C at par [80]). (d) The Association does not come to terms with the fact that high acuity, "no lull times" and "no light patients" were matters that have been previously recognised and taken into account in setting the rates for nurses: Re Public Hospital Nurses (State) Award (1 October 1981, Glynn J at 19-20 ("1981 Work Value Case")); Re Public Hospital Nurses (State) Award (22 July 1986, Senior Conciliation Commissioner Wells at 20 and 40 ("Ministerial Reference Case")); Re Public Hospital Nurses (State) Award (1 August 1990, Cahill VP, Sweeney and Hill JJ at 8 ("1990 special case for enrolled nurses and assistants in nursing"); 1996 Wages Agreement between the Association and HAC. Having convinced the Commission of those matters in earlier proceedings, and obtained significant increases on the basis of them, the Association cannot expect to get further increases on the same grounds, even if it can demonstrate now that the situation in fact was not as bad then as it successfully asked the Commission to find. (e) Changes to acuity, to the extent they have occurred, form part of a continuum. (f) Changes to acuity are difficult to measure with precision. An analysis of changes in cost-weights, using DRG data, is the best objective indicator as to changes in acuity available and, while acknowledging its limitations in this regard, it does not support the contention that acuity has changed significantly in recent years.

51 As to the important issue of the relationship between acuity and length of stay in hospital, the HAC submitted that the perception of an increase in acuity was substantially based on the notion that patients were arriving closer to their procedure date and leaving sooner, only for the bed to then immediately be filled with the next patient. It was submitted that there has not been any change of significance in the last six years in the amount of time a patient is in hospital before a procedure is undertaken. The number of patients attending 2 or 3 days prior to a procedure was small in 1996 (3 per cent), and while it has declined further (in 2000/01 it was 2 per cent), it remains small. The comparison is only valid if one takes a period considerably more than six years ago. Further, the patients who attend 2 or 3 days before a procedure (both in 1995/96 and now) are very complex patients. In that sense it would be wrong to suggest that patients admitted 2 or 3 days before a procedure are 'light' patients to nurse. Accordingly, it was submitted, the Association's submission to the effect that there are now fewer 'light' patients admitted one or more days before surgery, is a submission that cannot be made out in respect of the period since 1996.

52 Secondly, it was submitted, the overall trend has been no essential change in the overall number of patients; a 16 per cent reduction in beds; a (lesser) increase in bed occupancy; and an increase in the number of nurses. It might be the case, for example, that a patient recovers from cholecystectomy in some wards twice as quickly as before, allowing twice as many to be done there, but in the absence of evidence of a growth in the numbers of patients, the reduction in length of stay must mean that overall there are less patients in hospital on average per day.

53 Thirdly, it was submitted, one significant part of the work of the nurses on the wards in dealing with patients is the admission and discharge. If the true overall picture is that patients are not only staying shorter periods of time, but being replaced quickly with new patients, this might have been expected to be an area occupying a large growth in work. However, the change had coincided with the growth of pre-admission clinics (which also involves advanced discharge planning), which removed a lot of the work that would otherwise have to be done on admission from the ward, relieving the nurses on the ward. Although the Association now categorizes the work of admitting and doing advance discharge planning of patients as 'easy' work, it was time-consuming and, along with other documentation, a matter relied upon as an onerous part of nursing duties to justify earlier wage increases.

54 Fourthly, the HAC submitted the Association had asserted that the advent of pre-admission clinics means that when patients arrived they needed immediate medical treatment and care, as against some earlier period of time (before 1996) when they arrived some day or so before treatment and were then 'self-caring'. Such submissions, it was contended, appeared to place no weight on the removal of the work from the ward that the new procedures have brought about, including both the work associated with admission (and discharge planning) and the need to provide nursing care (however 'light') to those patients. Further, it ignored the fact that the longer patients stay in hospital the more likely they are to get infections or suffer other complications that require nursing care. 55 The HAC also referred to the improvements in medical practice and the implications of that for the work of nurses. It was submitted that it was too simplistic to take the reduced length of stay and from that extrapolate that people are going home 'sicker'. The reduction in time over the last decade or more has come about because of changes in virtually all areas of hospital practice, from attitudes to bed rest, through to drug therapies, chemotherapy treatment and keyhole surgery. It was submitted that (references deleted): One significant area in which there has been a reduction in length of stay has been in respect of surgical procedures that are now done in a minimally invasive manner. The reduction in length of stay comes about as a result of patients not being as 'sick' after these procedures as they were before (both as a result of minimally invasive surgery and improved anaesthetics), they can mobilise more quickly and are more quickly independent for their daily living needs. The intensity of care they require decreases more rapidly following admission. The severity of their dependency is thereby reduced and any period of severe dependency compressed. In other words, patients have less significant wounds following surgery and recover more quickly. The increase in day surgery treatments means less patients staying overnight. The Applicant's submissions regarding workload on surgical wards again ignore the reduction in the work that obviously flows from such changes.

56 It was further submitted that it was wrong to say that changes in surgical techniques were relevant only to a small number of patients. In this respect it was contended there was evidence as to the wide range of procedures in which there have been advances in care allowing shorter length of stay, including cataract surgery, prostratectomies, knee and hip replacements, intra-abdominal surgery (including cholecystectomies), coronary surgery and vascular surgery (using stents). It was submitted that shorter length of stay had also been achieved in areas of 'heavy' patient care, such as coronary care.

57 In relation to various clinical areas and the issue of acuity levels, the HAC submitted as follows: Intensive Care Units: ICU is now, and has always been, an area of nursing requiring intense nursing effort under high pressure. The general rule is that patients in ICU are nursed on a 1 to 1 basis, which has been the case since well before July 1996. APACHE scores were relied upon to show changes in acuity in ICU. APACHE, a measure of the patient's likelihood of surviving, usually conducted in the first 24 hours, is not intended or designed to be a measure of acuity nor a measure of the amount of nursing time required, and will not measure any changes in acuity over time. APACHE scores are not entirely objective, with variation of about 15% between different scorers, which means that small changes must be treated with caution. Further, APACHE scores are volatile from month to month. To the extent that there is an increase in acuity in ICU such that more staff are required, then more staff can be rostered to meet that need such that the patient-staff ratio goes above 1:1. Accordingly, as with other areas of nursing, one must take into account staffing levels when considering evidence about changing patient mix and acuity. An increase in acuity in a particular area (e.g., Westmead and St George) does not necessarily point to any system-wide change in work value (being essentially a change in location) or even an increase in the work value of the nurses working in that particular ICU (given the increase in staff). Surgical wards: There has been a reduction in stay as a result of the growth of minimally invasive surgery and new anaesthetics. These changes mean patients mobilise more quickly and are more quickly independent for their daily living needs. Patients have lesser wounds and recover more quickly. The increase in day only surgery means less patients staying overnight. The Association's submissions regarding workload on surgical wards ignore the reduction in the work that obviously flows from such changes. As to the Association's submission that there are now no longer the 'light' patients, as noted above this must be considered in light of the decisions of Wells CC in 1986. Even to the extent that there has been a reduction in 'lighter' patients, that was still a reduction in work that otherwise had to be done. The net result of the changes on nurse workload is not to be derived from examining changes in acuity alone. Mental health: HAC accepts there has been a trend over a number of years towards increased identification of mental disorder, increased acute admissions and increased reports of drug and alcohol co-morbidities. In other words, mental health is an exception to the general position that people are not generally sicker than they were before. These are changes, however, that commenced before 1996. Such changes do not necessarily translate to increased workload for individual nurses. One needs to understand the staffing levels and availability of other services before one can draw a conclusion that increased acuity necessarily translates to increased workload for individual nurses. Much of Ms Hoot's evidence as to the pressures that arise from reduced beds, such as the statement that patients now remain inpatients only during the most acute phase of their illness, must be seen as a change that had overwhelming occurred prior to 1996. Midwifery: The earlier discharge of obstetric patients into the community is said to mean that the nurses in hospital only deal with patients in their more acute stage (i.e., they no longer get the relief of caring for the 'light' patients at days 4 and 5 after birth), and also increase the workload of the community nurses (because those same patients become 'heavy' patients for community nurses). In truth changing the location of the patient's care does not increase the overall acuity of the patients, and the workload associated with their care. The Association's witness, Dr Caroline Homer, Clinical Midwifery Consultant Grade 3, Division of Women and Children's Health, St George Hospital, Kogarah, acknowledged that early discharge from major hospitals was a general feature of the system by the mid-1990s. Accordingly, while there may have been an increasing trend, the Commission would be careful to take into account that much of this change had occurred prior to July 1996. The increased rate of intervention demonstrated by the Association's evidence was affected by the fact that the figures used were for all births in NSW, not just births in public hospitals (where rates of intervention are lower). For example, the number of epidurals in the NSW Public Hospital system between 1995 and 2001 increased by only a small amount: from 13,727 to 14,229. A significant offsetting factor against any increase in acuity is that, in the period 1995 to 2001 the total number of confinements in the NSW Public Hospital system decreased from 71,741 to 63,271, a decrease of 11.8 per cent. Emergency departments : The change in policy that occurred in 1997/98 to have mental health patients presenting at hospital admitted via emergency departments instead of directly to mental health units meant that those attending hospital with co-morbidities could have those properly identified in the emergency department and any other medical conditions treated. Further, the emergency departments are better equipped to deal with dangerous patients. While the policy increases the number of patients presenting at the emergency department, adding to workload there, it assists those working in the mental health units. Non-metropolitan hospitals: The limited evidence relating to non-metropolitan hospitals (mainly Tamworth) does not suggest that change had occurred at the same rates as elsewhere. The shortage of nurses, relied upon by the Association as part of its work value case, was not evident in some regional areas, including coastal towns and the Hunter, the Northern Rivers Area Health Service, Tamworth and Armidale hospitals and the Mid North Coast, New England, Macquarie Area Health Services. Community nurses: There is a trend over the last 15 years or more to send home patients at an earlier point in their recovery, at least following some types of surgery, to be cared for by community nurses. As a result community nurses have been increasingly responsible for more acute patients. This is a trend that was identified and taken into account by Wells SCC in 1986. Post acute care teams/hospital in the home care existed well prior to 1996. Earlier discharge of patients with " higher dependency " in liaison with " early discharge teams or community based teams " was a recognised part of the system in 1996, and were included as part of the work value change of Nursing Unit Managers. The total volume of such services has been relatively stable in recent years. An increase in acuity in community nursing does not, in itself, lead to an increase in work value. Other considerations must also be taken into account. The first of those is staffing. Post-acute teams are newly staffed teams of community nurses, set up with nurses who have acute care training. Such teams have nurses with special training and skills. In the same way as nurses in the ICU have special skills for that type of work, so are there nurses in acute care teams who have special skills. The Association submitted that the post-acute care teams have "additional specialised training" and hence have higher work value. The first thing to note is that the nurses who make up such teams have acute care skills of the same type as held by nurses in acute facilities. They might be better qualified to deal with highly acute patients when compared to other community nurses, they are not more highly skilled in that regard than the nurses who did that work previously in a hospital setting. Changing the location of their work cannot lead to an increase in overall work value. The Applicant never addresses the logic of the submission that it cannot call these patients 'light' patients when they remained in hospital recuperating, and yet call them 'heavy' patients when they are cared for in the community. The changes to community nursing have not led to an overall increase in the acuity of the patients being treated nor new nursing treatments, just a change in the location. Indeed, the introduction of minimally invasive surgery and other medical advances have reduced the overall acuity of patients when viewed in and out of hospital. It is also relevant that in the community nursing sector as well there have been changes that positively impact on nursing workload. Dr Diana Horvath, Chief Executive Officer, Central Sydney Area Health Service and Ms Lynette Nancarrow, Director of Nursing and Manager of Clinical Operations, Griffith Base Hospital, gave evidence as to an improvement in dressings available for patients in their homes, which has reduced the work that was previously required for community nurses to scrub up, glove and do detailed dressing on a repetitive basis. The Association seeks in these proceedings a special allowance for community nurses, due to the environment in which they work. Yet the Association also relies on the environment of the work to justify a work value increase for community nurses. The Commission would be mindful of the need not to double count such factors. Outpatients : The Association led evidence to the effect that the increasing trend for some procedures to now be done as outpatient services (eg chemotherapy) has meant that 'lighter' patients have been removed from the hospitals, contributing to the increase in acuity. While the trend to increase the number of procedures that can be done as outpatient services has reduced the need for some procedures to be done in the wards, and so removed a level of work from those wards (now categorised by the Association as 'lighter' work), it cannot be said that has had the effect of increasing the overall acuity of the public hospital patient. These outpatients are still part of the public hospital system, and so when considering overall acuity, are still to be considered. The change to outpatients, where they will still need nursing, is a change of location. In fact, the improvements in medical procedures that allow these procedures to now be done on an outpatient basis has meant that the amount of total nursing work required for such patients has reduced. Diagnostic Related Groups (DRGs) : The Association submitted DRG statistics were not a useful measure of acuity because of certain limitations. While the DRG process is not without error, it has a high degree of accuracy. As a general statement, if there were an increase in the acuity of patients one would expect that there would be an increase in the resources (including nursing resources) required to care for those patients. That should in turn be reflected in an increase in the case weight average. Yet the average case weight for acute patients in NSW public hospitals has increased only marginally since 1995/96, at an annual rate of only 0.8 per cent, and that is before taking into account changes in counting that have occurred since 1995/96 which would have had the effect of inflating the rate of change. While the DRG process is not intended to be a measure of acuity, it can be used to assess changes in the overall cost of episodes of patient care. It reveals no substantial change, which, at the very least, is not consistent with the suggestion of a substantial increase in patient acuity. It would be wrong for the Commission to proceed on the basis that the picture to be drawn from the DRG data is to be ignored. Consideration regarding acuity

58 There is no reliable objective standard by which changes in acuity can be measured. DRGs are not an indicator that we would be content to rely upon. The evidence is, however, from senior practitioners, including persons of the standing of Professor Dwyer, that there has been an increase in acuity over the period since 1996. As Professor Dwyer said in his evidence, "The physical demands and the emotional demands and the skill demands on nurses are as never before. It is very exhausting and demanding work with very sick patients…" and that nurses "are asked to look after sicker patients, more technically complex patients; often patients whose families have more emotional demands than ever before. It is a very, very, hard job." 59 That there has been an increase in the acuity of patients does not, of itself, automatically translate to a significant net addition to work requirements such as to justify a wage increase. This is so for a number of reasons. An increase in acuity levels, for instance, is not a new phenomenon; such increases have been identified in past work value inquiries as early as 1981; and, whilst we acknowledge that over the past seven years the increase in acuity has come about quicker than in past years, the impact of the pace of the change must, to some extent, be offset by the fact that the change is part of a continuum.

60 Moreover, the fact that nurses are required to deal with greater levels of acuity in patients cannot be viewed in isolation from other changes that have occurred in the public hospital system that affect the level and intensity of nursing work. The HAC identified these changes as including: changes in treatment technique including new drugs and surgical techniques; improved technology; increase in support staff; changes in the mix of nursing staff (including availability of specialists); the effect of networking health services between hospitals (which concentrates resources on areas of greatest acuity); the effect of concentrating resources within a hospital (such as the creation of hot floors); and changes to the way wards operate so that activity previously required of registered nurses on the ward is long longer required (such as the introduction of pre-admission clinics and increased use of peri-operative units).

61 We note the Association's submission regarding the impact of increased levels of acuity on community nurses as patients are sent home at an earlier point in their recovery than 15 years ago. We accept that this has had a significant impact on the work of community nurses. However, we are concerned not just with one section of the nursing workforce; the claim is made in respect of all nurses in the public hospital system, not just community nurses, mental health nurses, enrolled nurses or assistants in nursing and, as we understand the Association's position, there should be no disturbance of existing relativities.

62 That community nurses may be responsible for more acute patients must be regarded in the light of the Association's across-the-board claim, which requires us to take a global view; that is, in assessing the impact of increased acuity levels we have to make the assessment across the spectrum of the nursing workforce.

63 The HAC referred to two decisions of the Australian Commission in relation to the issue of acuity and whether increases in acuity was a factor warranting wage increases based on work value. The first of those decisions was Australian Nursing Federation v Aaron Private Nursing Home and others. In that case the Full Bench conducted an arbitration pursuant to s 170MX of the Workplace Relations Act 1996 (Cth) in respect of approximately 356 employers engaged in the operation of nursing homes and hostels in the aged care sector in Victoria. The claim was for a 15 per cent increase in wages. The Full Bench noted that: The main factors relied on by the unions were: - The wages and conditions of work in the aged care sector are considerably lower than those applicable to registered nurses performing substantially the same work in other sectors including the public acute and public residential aged care sectors. - There has been significant increase in work value particularly since 1991. - Victorian residents have higher dependency levels compared to other states and territories and as a consequence care given is generally heavier or more complex than in other states and territories. - Although fewer nurses are now employed, they are performing more duties and nursing more highly dependent residents.

64 On the issue of acuity and work value the Full Bench held as follows: [86] Whilst we accept that there has been an increase in acuity and dependency levels of residents over the recent period, this factor in our view does not warrant an increase based on work value. The work of registered nurses associated with increased acuity and dependency level of residents is work which falls within the profession of nursing. The fact that there are more residents requiring the application of particular nursing skills and responsibilities does not constitute a ground for increased wages on work value. [87] The rates of pay in the award were established as professional rates having regard to the qualifications, training, skills and responsibilities necessary to deliver care in a range of health settings both acute and aged.

65 Another Full Bench of the Australian Commission recently in the Queensland Decision followed this approach. The claim before the Full Bench was in part a claim for wage increases based on work value grounds. The relevant datum point was 1990. The Full Bench held that the union (the Australian Nursing Federation) had failed to make out a case for wage increases on work value grounds. The Full Bench said: [78] We have given careful consideration to the material advanced by the ANF, including the evidentiary material, in support of its claim that a wage increase should be awarded on the basis that a net addition to work value had been demonstrated across the nursing structure, particularly over the past decade. We have formed the view that a case has not been made out to justify the granting of the claim. [79] We have several reasons for forming this view. Not least is that the ANF has failed to address with any degree of specificity the requirements of the Work Value Changes Principle. Whilst we have been presented with detailed material demonstrating the changes which have occurred in the nature of the work across the nursing structure, we are not convinced that this change has resulted in across the board changes in the value of the work performed by nurses. In particular we are unable to conclude that the "strict test" of the work value principle is met, namely, "that the change in the nature of the work should constitute such a significant net addition to work requirements as to warrant the creation of a new classification or upgrading to a higher classification". We are unable to identify any clear discriminative characteristic to distinguish ongoing changes and evolutions which occur within and are intrinsic to a profession of nursing among others, from demonstrable changes in the value of the work performed by nurses. [80] We agree with an earlier Full Bench which dealt with a work value claim for nurses. A Full Bench in Australian Nursing Federation v Tracy Lodge Nursing Home and Others stated: [39] In our findings on these points, we have taken into account the observations made in Re Aaron Private Nursing Home [Print S2652 MacBean , Watson SDPs, Bacon C]: ... [86] Whilst we accept that there has been an increase in acuity and dependency levels of residents over the recent period, this factor in our view does not warrant an increase based on work value. The work of registered nurses associated with increased acuity and dependency level of residents is work which falls within the profession of nursing. The fact that there are more residents requiring the application of particular nursing skills and responsibilities does not constitute a ground for increased wages on work value.

66 Whilst we consider that dealing with increased acuity and dependency levels is an intrinsic aspect of the nursing profession it does not automatically follow that changes in acuity or dependency will never constitute the basis for wage increases on work value grounds. To this extent we differ with the views expressed by the Australian Commission.

67 The evidence in this case was unambiguously that the nature of the work and the skill required in dealing with higher levels of acuity has changed for nursing staff. Notwithstanding that it is to be expected in the profession of nursing that nurses will be required to deal with changing levels of acuity, in this case we have discerned a system-wide change involving a significant shift in the way the public hospital system provides care and services and the role of nurses within it. It is this fundamental change that distinguishes the effects of higher levels of acuity on the work of nurses from what might be regarded as the norm or as evolutionary change.

68 It is our assessment that these changes constitute a significant net addition to work requirements. In coming to this conclusion we have been mindful of the factors referred to by the HAC that may be said to counter-balance the effects of higher levels of acuity on nurses' work. These factors have caused us to regard the changes as having less impact than otherwise might have been the case. In this respect, we should observe that the perception amongst many of the Association's witnesses that there have been extraordinary increases in acuity levels since 1996 (compared with earlier periods) has been driven to a large extent by the increased stress on nurses brought about by the nursing shortage. This was recognised in our Interim Decision and in respect of which we granted an increase of six per cent.

69 The Association submitted that the increase in average age of the population is a further factor contributing to and exacerbating the increasing acuity of patients as well as providing other complexities and challenges to nursing staff. Reference was made to Professor Skowronski's evidence that: There is plenty of evidence that the elderly are sicker, require more care and have poorer outcomes.

70 It was submitted that: [P]ersons in the 75+ (and even more so in the 80+) age group have significantly increased risk of dementia and delirium … incontinence, immobility, instability, greater susceptibility to infection, and other age related conditions. The 80+ age group is one where there is particularly elevated increase in frailty and co-morbidities. Where (as has occurred) this age group has increased significantly as a percentage of total bed days, then the impact on nursing will be marked.

71 It was further submitted that greater average age leads to increased potential for co-morbidities, greater risk of falls, increased incidence of dementia, increased risk of infection, increased risk of ulcers or bedsores. These factors, it was submitted, had direct impact upon the intensity and complexity of nursing care required.

72 The HAC submitted that since 1996 the population has aged, but the age of public hospital patients has increased only slightly, during a period in which there has been an increase in the health of older patients that has helped to offset that slight increase. Further, that whilst the Association relied on evidence going to the question of the difficulties associated with nursing for aged and frail patients, there was no evidence that this had changed in any significant manner, other than evidence that hospitals are getting better at treating older patients, making it easier to nurse those patients.

73 The Association agreed that the ageing issue does not affect nurses in a number of areas, but the majority of nurses who do not work in those areas are affected to a much greater degree than suggested by the HAC. It was accepted for the purpose of the argument that the HAC's statistic of an increase of "just 2.7 years" in the average age of patients since July 1996 was correct. However, contrary to the HAC's submission, an increase in average age of patients of 2.7 years in a 5-year period was highly significant. 74 The HAC referred to the evidence of Dr Peter Kennedy, Director of Health Services, Central Sydney Area Health Service that the increase in life expectancy does not necessarily result in persons experiencing longer periods in their lives when they are seriously unwell. Modern medical techniques and improved diagnosis, treatment and care in the majority of cases results in the effective management of chronic illnesses. The majority of people experience a healthy old age. There is evidence of a compression of morbidity in low mortality elderly populations. In other words, people are enjoying not only an increased life span, but also an increased health-span.

75 It was further submitted by the HAC that hospitals are getting better at treating older patients. The recent trend to create specialist units, such as stroke units and specialist geriatric wards, which are increasing in number, take the 'heavy' patients (stroke victims, those suffering from severe dementia) from the general wards and place them in an environment with specialist equipment and facilities, staffed by those with experience and skills in dealing with such patients and a greater number of allied health professionals. They also reduce patient complications that would otherwise require intensive nursing care. Further, there are improvements in the methods of treating older patients, in particular keyhole surgery, which reduce the amount of nursing work that is required for each patient. An example not involving keyhole surgery is the case of hip replacement operations, where it is now possible for patients to be admitted on the day of surgery and be mobile again within a few days of surgery, which reduces the likelihood of complications.

76 Mr Kenzie for the HAC referred again to Dr Kennedy's evidence where Dr Kennedy described elderly patients as falling into two groups: the fit elderly, which make up the great majority of elderly patients, and the unfit elderly. The latter are extremely frail, and require intensive, time-consuming nursing from nurses with considerable knowledge, skill, energy and patience. They include patients with severe dementia, limited or no mobility, incontinence and infections. There can be particular difficulties that can arise in caring for older patients in hospital, particularly during surgery. Mr Kenzie contended, however, these are matters that have not changed in recent years. The unfit elderly are those who are more likely to be cared for in the specialist geriatric units where there are specialist facilities and staff.

77 The HAC contended that whilst the elderly are more likely to exhibit co-morbidities, increased incidence of dementia, increased risk of infection, there is no evidence of any significant change in that regard (other than the evidence that hospitals are getting better at treating the elderly). In short, it was submitted, given the complete absence of evidence of any significant change in the age of the patient population since 1996 that part of the Association's case that relies on patients being significantly older is not made out.

78 We accept the Association's contention that the patient population is ageing. We also accept this has had a significant impact on the work of sections of the nursing workforce. However, we are not persuaded that the change in the age of the patient population since 1996 has had the effect of impacting to the requisite degree on the work value of nurses generally in public hospitals. Whilst it must be acknowledged that the treatment and care of the elderly has improved in the public hospital system this does not, of itself, translate into a significant net addition to work requirements for all nurses.

Nurses perform functions previously performed by doctors

79 The Association submitted that the increased pressure on the health system has led to a situation where nurses perform functions previously performed by doctors. An example included the authority to discharge patients. Reference was made to the evidence of Ms Linda Campbell, Nursing Unit Manager of the Neuromedical/Stroke Unit, Liverpool Hospital, where she said: There is simply not the time of the capacity to conduct those rounds with the doctors and as a result there is not the necessary communication. As a result, nurses are expected to discern difficulties in a way that they were not traditionally required to do and to deal with problems without the assistance of doctors far more than used to be the case and far more often than in my opinion is desirable. … A range of tasks that were previously undertaken by other staff have been progressively transferred to the nursing staff. Medical staff are less available and nurses now spend considerably more time on patient and family education, including family conferences that used to be done by the medical staff. And to the evidence of Ms Jennifer Morris, Clinical Nurse Consultant, Emergency Services, Liverpool Hospital, South West Sydney, where she said in her affidavit: The increasing pressure on the emergency department at Liverpool has led to some significant changes in the way nurses work within the department in the last few years. Nurses have increasingly taken on higher level of decision making rather than leaving the decision making until the patient can be seen by the doctor and as a consequence having the treatment of the patient delayed. An example of this is the x-ray process now in place in the emergency department to fast track patient care when the triage process revealed that a patient would require an x-ray nurses often found doctors to sign the x-ray form rather than wait until a doctor was available to see the patient. Liverpool Hospital has now developed a protocol so that the nurses can sign x-ray forms and fast track the patient. A similar protocol has been introduced for analgesia so that nurses recognising that a patient needs pain relief no longer have to go and find the doctor to order it but within the protocol can institute certain levels of pain relief on their own authority. Where it is recognised at triage that a patient needs simple wound management then nurses using steri strips attend to this so that the patient is fast tracked rather than having to wait for attention from a medical officer and receiving sutures. Another method for fast tracking patients is that nurses now recognising that a patient will need pathology tests will insert a cannular into the patient and take blood from the patient without the delay of waiting for a medical officer to perform that task. To provide this fast tracking of patients nurses are now taking a more extensive history from the patient than they did in the past enabling them to make decisions as to whether treatment can be started immediately or the patient will need to wait until they can be seen by a medical officer. And to the evidence of Professor Skowronski: It is my view that the role of the registered nurse in the intensive care unit has changed substantially in the past several years. While a doctor still carries the final responsibility for clinical decisions affecting the care of the patient the nurses now carry a substantial responsibility in that decision making process. In many cases ICU nurses are now expected to make independent measurements, adjust or even initiate therapies autonomously or semi autonomously. Such interventions might include intravenous fluid therapy, titration of vaso active drugs, cardiac output determination and weaning from mechanical ventilation.

80 The HAC submitted that the evidence going to nurses performing functions previously performed by doctors was not confined to the period since 1996 but had been developing for ten to fifteen years. Further, that the shifts in responsibility were often pursuant to protocols and were not sufficient to make out that there had been a significant general devolution of medical responsibility to nurses since 1996.

81 We agree with the HAC that there has not been a "significant general devolution of medical responsibility to nurses since 1996". However, the evidence of Ms Morris and Professor Skowronski would suggest that there has certainly been an increase in responsibility for nurses in emergency departments and intensive care units.

82 The Association referred to the increased emphasis on discharge planning due to decreasing length of stay and the reduced bed base. Reference was made to the evidence of Ms Rich, an enrolled nurse at Wellington Health Services who described the work involved in the new discharge process as including assessment of the status of the patient's condition and readiness for discharge, planning the requirements of the patient upon return to home or to another health care facility, determining whether there is sufficient support at home from family members or other cares, and whether additional support can be accessed in a way that will enable proper care to be provided.

83 The HAC contended that discharge planning was taken into account as early as the Ministerial Reference Case in 1986 and that in 1996 NUMs obtained a substantial wage rise on the basis of agreed changes in work value that included the: need to initiate discharge planning at an early stage to ensure discharge at the earliest time. This planning is more complex as clients are discharged with higher dependency than formerly. The planning often now involves multi-disciplinary planning and liaison with hospital based early discharge teams or community based teams and now often includes liaison with other service agencies.

84 Further, it was submitted there is an increasing emphasis to have discharge planning commence at the pre-admission clinic stage or have it handled by general practitioners. In those ways some of the work and pressure involved in planning an appropriate discharge has been removed from the role of the ward nurses.

85 We do not consider that the value of nurses' work in relation to discharge planning has escalated to such a degree since 1996 that it would provide support for a general wage increase on work value grounds. Whilst a more sophisticated approach is being taken to discharge planning within the public hospital system and has enlarged the scope of work for some nurses, such work is not new and the burden of work relating to discharge planning does not fall entirely on nurses as the evidence revealed.

Increased occupational health and safety responsibility

86 The Association submitted the introduction of the Occupational Health and Safety legislation and associated changes to practice in the area of occupational health and safety had increased the workload and the skills required of nurses at all levels. Relevant requirements include safety audits, risk assessments, OH&S committee attendance, and training. The evidence was to the effect that although some of the statutory obligations have been in place for several years the extent to which they have been enforced and acted upon in practical terms has altered in very recent times. 87 The Association's case in relation to occupational health and safety was that while the legislation casts certain obligations on employers and on employees, and while those obligations have changed in recent years, the Area Health Services and management at individual hospitals have embarked upon a course of requiring nurses at all levels to shoulder direct responsibility for these matters. In particular, nurses now have the responsibility for conducting risk assessments, monitoring risks, incident reporting and incident investigation in a way that was not the case prior to 1996.

88 There was extensive evidence from the Association's witnesses regarding occupational health and safety. For example, Ms Coombs in her affidavit referred to the introduction of new occupational health and safety legislation and the following additional functions which are now the responsibility of nursing staff including:-

· Training in relation to occupational health and safety; · Inspections of the work place and risk assessments; · Early return to work programs and management of these; · Increased infection control and sterilisation processes; · Management of the use of hazardous chemicals; · Addressing the reality that as a result of increased acuity and dependency we are now doing more manual handling; · Implementation of minimal lift policy and training in relation to manual handling; · Clinical risk management; · Workplace inspections.

89 Ms Bunt in her evidence said: Many of these changes have occurred since 1996, for example, risk assessments are now required to be performed on every single function within our division. Those assessments have to be repeated whenever there is a change in practise or function. A risk assessment could take 5 minutes, it could take an hour of time. All of these risk assessments have to be documented in some form and these are done in consultation with the occupational health and safety co-ordinator. This takes an hour or more plus additional time to educate all staff to the changes. 90 Ms Lorna Abell, Clinical Nurse Specialist in Anaesthetics, Wagga Wagga Base Hospital, in her evidence said: Nurses are now also required to take on more responsibility for occupational health and safety issues. The operating theatre has an occupational health and safety committee to deal with matters which are specific to theatres. Nurses now undertake safety audits and the work involved in the numerical profile. Risk assessments and the development of safe work practises (sic). Compilation of extensive files for material safety data sheets. There has been an increased emphasis on manual handling in the past four (4) years with an increase in the mandatory training which involves completing competencies and a practical assessment. Staff are reaccredited for manual handling every twelve (12) months.

91 The Association referred to the "no lift" or "minimal lift policies" that have been progressively introduced over recent years but "overwhelmingly" since 1996. It was contended this had provided enhanced safety but had meant that lifting and transferring patients had become more labour intensive and time consuming.

· Obligations in respect of occupational health and safety have existed in essentially the same terms from before July 1996. In that respect there has been no fundamental change to the responsibility placed on nurses. · The obligation to comply with occupational health and safety law does not fall differently on nurses as the rest of the community. To grant a wage rise on the basis that employees are required to comply with the legislation, and because of the increased responsibility and liability it places on managers would create a precedent that could be applied to all employees and managers in NSW. · To increase rates of pay as a result of changes brought about by employers to improve occupational health and safety would penalise employers for doing the right thing, and so discourage such change. · Nursing Unit Managers obtained a substantial pay rise based on work value grounds in 1996, in part to reflect changes to their OH&S responsibilities. · Hospitals now employ staff who have specific occupational health and safety responsibilities to assist management in their occupational health and safety role.

93 As to the no lift/minimal lift policies the HAC contended these policies were in existence prior to 1996; they have just become more prevalent. Like other improvements in occupational health and safety, such policies might be more time consuming, but they improve the environment in which nurses work, by making the work less physically strenuous and safer. To the extent that the work is more time consuming, this can be taken into account in setting appropriate staffing levels, for example in the application of an appropriate workloads planning tool. It would send the wrong message to award a pay rise for progressively introducing a new policy that makes the workplace safer.

94 As the evidence confirms, the introduction of new laws relating to occupational health and safety have added to the responsibilities of nurses. In so doing, of course, the workplace has become safer. Even if we were prepared to have regard to the added occupational health and safety responsibilities of nurses for the purpose of assessing whether wage increases were warranted - something we are disinclined to do for public policy reasons - we do not consider that the added responsibilities are of such a nature as to represent a significant net addition to work requirements. While risk assessments, for example, are now mandatory it would be surprising that public hospitals did not carry out such assessments prior to the introduction of the new legislation. Moreover, it was clearly the case that the impact of occupational health and safety legislation on nursing work was taken into account in the Ministerial Reference Case in 1986 and in 1996 in respect of NUMs.

95 The Association submitted that the reporting obligations of nurses under the Children And Young Persons (Care And Protection) Act 1998 were a further substantial burden on nurses. Reference was made to the requirement on nurses to report children at risk.

96 Whilst conceding the reporting requirement places a new statutory requirement on nurses the HAC submitted it had to be seen against a background in which nurses, as professionals, previously had a responsibility to report situations where their children were suffering from abuse. While the system now is more structured it has the benefit of giving nurses an established system to report such matters pursuant to protocols which gives a level of protection to the nurse, and removes from them the need to make a discretionary decision as to whether to report a particular case.

97 We note the new statutory requirement on nurses but we do not consider, of itself, the requirement places a significant new obligation on them.

98 The Association submitted the workload and pressure imposed upon nurses has also been increased (and the conditions under which work is performed has consequently changed) as a result of the increasingly educated and demanding nature of the client base, both in terms of the patients themselves and their families and friends.

99 Reference was made to the evidence of Ms Janice Stow, Director of Nursing and Manager of Clinical Services, Westmead Hospital (retired), where she said: It's the increased consumer expectations, the fact that people are constantly getting upset because mother's not perhaps put in a single room or mother's been put in with three males. That may not be appropriate in their mind and I'd have to say it probably isn't appropriate, but when you're trying to find beds for patients, then you do the best you can. There are a lot of increased cultural things that people need to be mindful of. There's aggression, there's the relatives, the visitors, you know. There's the having to call security all the time to remove people because they've come in drunk or, you know, they start threatening the nurses. There is just - there's that, but, worst of all, which has really had an effect on me personally, is the - at one time it might have been, you know, power games and various other games between doctors and nurses, you know, the doctor and nurse game.

100 As to accountability the HAC submitted that being accountable is part and parcel of being a professional. The 'obligation' to be accountable via review mechanisms has been recognised in the rates paid to nurses since their professional status was recognised in 1990. The 'changes' the Association relied upon in this regard were in respect of matters that would have only changed incrementally since July 1996.

101 As to aggression, it was submitted aggression exhibited by patients towards nurses is an important occupational health and safety issue that in recent times has been addressed by the HAC in a very active manner. Aggression exhibited towards nurses is not new, and while the reporting of such incidents has increased in more recent times, the HAC's active steps are dealing with it.

102 Accountability is, indeed, part of being a professional and while there may have been an increase in nurses' accountability it has only been of an incremental nature since 1996. We acknowledge that the issue of aggression is a matter of serious concern to the Association and its members but the answer does not lie in a wage increase.

103 The Association referred to the evidence of the increased use of computers in a number of applications (including personnel, pay and finance) since 1996 as evidence of increased work value.

· Computers and the computer programs in question are not new measures introduced since 1996, although their use has increased. · NUMs received a large increase in 1996 as a consequence of the "great increase" since 1991 in information systems. In 1986 Wells SCC took into account the advent of computerisation as a significant work value change, including computerised monitors. · Computers are an example of technological change which is not necessarily a negative factor for nurses, they can assist nurses to do the work more quickly and effectively. · There are obvious time benefits for nurses being able to call up information on screen (particularly if the information was entered in real time, as in an emergency department), rather than having to find and refer to paperwork. Creegan gave evidence that ORACLE [a financial materials management system] assists nurses to order stock items by saving on phone time. Abell thought it was probably correct that email ordering had an advantage over phone ordering. Day was very critical of the fact that she did not have access to a computer, agreeing that doing things manually was time-consuming and not having computer facilities was "manifestly unsatisfactory and inefficient".

105 There is no doubt that the use of information and computer technology continues to grow in public hospitals as elsewhere and this has an effect on the work of nurses. However, we do not consider the growth in use of this technology constitutes a significant net addition to work requirements.

106 The Association referred to the evidence said to support its contention that there had been a significant increase in the responsibility of NUMs for human resource management matters and general administration and finance. It was contended that whilst some of the changes were relied upon in 1996 in respect of the wage increases flowing to NUMs, these changes have continued and resulted in change to a greater extent than was evident in 1996. 107 Reference may be made to Ms Bunt's evidence in relation to changes in human resource management as it affects NUMs: Nurse Unit Managers also now advertise, cull, convene the panel, interview and make recommendations for recruitment for all nursing staff positions within their areas of responsibility. Responsibilities that have changed since 1996 include paperwork on criminal record check, child protection, collecting 100 points for verification, filling in the request to recruit, reference check sheets and EEO. Associated with this there is mandatory attendance at staff selection and recruitment workshops every eighteen (18) months. In my opinion this has been a change of considerable advantage however it must be said that it has added a considerable additional burden on Nursing Unit Managers especially in the past year or so when response to advertising is poor and there is a need to advertise more frequently. And to Ms Campbell's evidence regarding budgetary responsibility: There has been a considerable increase in the NUMs responsibility for budget monitoring in the past three years. I am responsible for monitoring a budget of $3,000,000.00. I am provided with regular cost centre reports and am required to investigate any budget overruns and recommend action. Because there are a number of cost areas where the nursing staff have little or no control over the costs, such as drug costs and pathology testing, this can often require meetings with medical staff or other health professionals to agree on measures that will address the overruns. 108 The HAC contended that the managerial changes referred to by the Association have previously been recognised. It was submitted:

· A substantial part of the change relied upon was change which had substantially occurred about 10-15 years ago when nursing management changed as a result of increasing unit autonomy and budget responsibility. Those changes in management were accompanied by changes in the structure of positions, with managerial roles being created (NUMs in particular) to fulfill those managerial/administrative functions, and were paid accordingly. Further, NUMs received a large increase in 1996 in recognition of their expanded role, which has not changed significantly since then. · Nurse managers, whose pay level recognises that they are both professionals and managers, are remunerated at a level that incorporates the work value of being able to deal with, and indeed implement, workplace change. The Commission has to be mindful not to allow any double counting for managers arising from the natural progression of their management roles, and to only take into account real changes to their level of responsibility and work. · Nurse managers are affected by general system change (eg reducing bed numbers, increasing length of stay, increasing occupancy rates), in that they are required to manage the consequences of such change. However these are matters that were expressly taken into account in 1996 for NUMs who obtained significant increases at that time for such change. · A close analysis of what NUMs were doing (and recognised to be doing) in July 1996 shows that there has been only limited and incremental change in the role of NUMs since that time.

109 We acknowledge that the nursing management role has increased in its complexity and brings with it additional stresses not experienced by others. However, NUMs received significant wage increases in 1996 in recognition of their role. Any consideration of whether changes in the nursing management role since 1996 should attract further wage increases would need to take account of these increases. Nurses performing work of other staff

110 The Association asserted that since 1996 there had been an increased requirement for nurses to perform work previously done by other staff, such as physiotherapy, speech pathology, psychological counselling, cleaning and dietician work. It was submitted that as a matter of practical necessity nurses have been required to broaden the scope of their role in a range of different directions including professional skills on the one hand, and on the other more mundane tasks at a time when their core nursing duties are also changing rapidly.

111 The HAC referred to the evidence of Dr Horvath that in her view there had been no significant change to the burden of allied health tasks falling on nurses. Further, that whilst it had been reported that there was a deficiency in the number of allied health staff across metropolitan hospitals, there was no evidence that the situation has changed significantly since 1996.

112 We accept that there are areas where nurses are performing more of the work traditionally undertaken by allied health staff. However, we do not consider that in the context of the work value principle there has been such shift in the work of allied health staff to nurses that it represents a significant net addition to work requirements.

113 It was submitted for the Association that technology generally has substantial benefits for the patients but also in some cases increases the workload of nurses. It invariably requires the acquisition of new skills on the part of nurses. Further, that the equipment to be operated and the procedures to be carried out by nurses are constantly changing and this is reflected in the training of nurses and the equipment required to train them.

114 Reference was made to new drugs in mental health, self-medication of drugs for mental health patients and the requirement to update skills and knowledge to use the new technology, drugs and procedures.

· The development of ever more sophisticated ventilation machines with a greater number of modalities which have obvious benefits for patients. However, the degree of monitoring and the consequent workload for nurses has increased, particularly with the introduction of non invasive ventilation. · The impact of new technology in the ICUs. Professor Skowronski illustrated his view by reference to the ECMO system which has recently been (re) introduced after being trialled in the 1970's. This technology by bypassing the lungs altogether saves lives which otherwise may have been lost, but it requires an extremely intensive monitoring regime on the part of nurses. · Computerised monitoring systems in ICU which have provided better patient information but have increased the nursing workload.

116 The HAC submitted that professional nurses always need to update the skills and knowledge necessary in the application of changing technology or drugs or procedure. This is not a new requirement. In 1986 in the Ministerial Reference Case Wells SCC found that there was "ever-changing mechanical and electronic technology that pervades our hospital system" requiring nurses to learn new skills. Further, the process of obtaining that knowledge and updating skills is part and parcel of being a professional. Nurses, having been given professional recognition, cannot rely on the requirement to maintain and update their knowledge as a basis for an increase in work value because it is already recognised in the work value of being a professional. In any event, to the extent that nurses are merely asked to apply the professional skills they already hold to operating new plant and equipment, that is not sufficient to show any work value increase.

117 It was also submitted for the HAC that technological change is not necessarily a negative factor for nurses, it can assist nurses to do the work more quickly and effectively. For example, new technology in the ICU which has resulted, at least in part, in an easing on the burden of nurses as a result of the more user friendly technology; new procedures in coronary care, are less invasive and prevent further damage to the heart, resulting in patients that are easier for nurses to care for; and, new procedures in mental health nursing for young people, where clients are educated to self-medicate involves additional work in the education and monitoring, but saves on the work required to medicate the patient on a regular basis.

118 We recognise that the introduction of new technology will often require nurses to update their skills and knowledge and no doubt since 1996 that has occurred. But apart from the fact that updating skills and knowledge is an intrinsic part of the work of nurses, we do not consider that in the period since 1996 the requirement to do so constitutes a significant net addition to work requirements.

119 It was submitted for the Association that the evidence disclosed a heavy increase in the requirement for paperwork to be completed by nursing staff. This particular increase was felt most heavily amongst the Nurse Unit Managers, however it also affects other classifications of nurse. In the aged care area the evidence was that there had been a significant increase in the requirement for documentation flowing from the changes instituted by the Aged Care Act 1997. In the acute sector reports for patients and patient charts have increased significantly.

120 It was submitted that particularly for Nursing Unit Managers there seemed to be an increased emphasis upon meetings and meeting time since 1996.

121 The HAC contended that obligations on NUMs to attend more meetings including "a wide range of committees", to deal with "a great increase in the amount of information" including monthly reports, to design quality assurance programs, to investigate incidents and be proactive regarding occupational health and safety were matters in relation to which NUMs obtained a substantial wage increase in 1996.

122 Further, in 1986 Wells SCC took into account in setting the new rates the evidence led by the Association as to "a dramatic increase in the amount of paperwork that now needs to be undertaken by registered nurses". The documentation connected with patient care had "become more sophisticated". It was submitted that any change since 1986 has been incremental rather than significant.

123 The HAC submitted that whilst the Association relied on increased paperwork in the aged care area in particular, the substantial increase awarded by the Commission to Assistants in Nursing in 1991 was on the basis of evidence that in the aged care sector they had taken on new obligations in respect of collecting daily information and maintaining accurate nursing care plans and assisted in charting results and the like. While such evidence was in respect of the private sector, the HAC submitted this was taken into account in setting rates that applied in the public sector as well. The fact that since 1996 such work is now more prevalent in the public hospital aged care sector cannot be the basis of increased work value in circumstances where that change has already been built into the rates of pay.

124 Moreover, the HAC submitted, increased paperwork arising from admission and discharge have been offset by the introduction of pre-admission clinics and peri-operative units, which remove some of that work from the staff on the ward.

125 Again, we do not consider the increase in paperwork since 1996 and requirement to attend more meetings represents a significant net addition to work requirements.

126 The Association referred to Professor Creegan's evidence that all nursing practice is now very highly regulated and impacted upon by an ever increasing range of legislative controls and that: Some of the Legislation is accompanied by a mandate education requirement, which is usually done within existing resources. This requires staff to be freed from clinical area to receive instruction or in many cases depending on the scope of the mandate be required to act as trainers. The burden on those staff that are trainers is considerable as is the burden on the clinical area in which they work. As a trainer they are required to be relieved of their normal duties to enable them to train others. However, increasingly relief staff are not available so the other ward nurses work short whilst the trainer is training.

127 The HAC agreed that although there have been several courses which have been introduced since 1996 mandatory training for nurses was not new. Further, it was submitted, it was part and parcel of being a professional to stay informed and up to date, and training obligations flowing from that requirement are properly seen as being recognised by the professional rates paid to nurses.

128 We can understand the additional burden placed on ward nurses when one of their numbers is required to act as a trainer especially in a period where shortages are being experienced. Further, we note the additional training required. These developments, however, are not new and are not of such a nature as to warrant additional wage increases across the board for nurses. Policy development and protocols

129 The Association submitted that there has been an increase in nursing involvement in the establishment of policies and protocols. The HAC submitted while the introduction of protocols do require nurses to understand and apply them, they tend to assist nurses by providing guidance and remove a level of discretionary decision making.

130 The increase in nursing involvement in the establishment of policies and protocols does not constitute a significant net addition to work requirements.

131 The Association submitted that there was increased responsibility for mentoring and preceptorship of less experienced nurses. The HAC submitted, however, that this was something that has always been part of nursing, and part and parcel of a being an experienced professional. It was submitted the evidence cited by the Association was in respect of some particular new programs, principally being programs designed to assist nurses who are new to a particular area (such as the ICU). These are programs that, at least to some extent, replaced earlier programs that involved less mentoring work. The HAC submitted these were not evidence of a major or significant shift in work value. 132 There have not been sufficiently widespread and significant increases in the responsibility of nurses for mentoring less experienced colleagues to be able to conclude that this constitutes a significant net addition to work requirements.

Comparison with Physiotherapists and Other Health Care Professionals

133 The Association submitted that the work of nurses overlaps substantially with the work of other professionals such as physiotherapists, psychologists and social workers, and the extent to which nurses perform duties traditionally associated with other professional roles has increased over time. The skills of nurses generally encompass, but are much broader than, those of comparable professionals. Reference was made to the evidence of:

· Professor Skowronski who whilst describing the extent to which nurses performed physiotherapy work, also noted that nurses in ICU have a much higher order of decision making responsibility than physiotherapists; · Mr Helmut Obmann, Clinical Nurse Specialist in Mental Health, Maroubra Centre, Maroubra, who gave evidence that in the area of mental health in which he works (early psychosis intervention) the case load was shared between clinical psychologists and nurses with nurses tending to care for the patients who were more unwell and consequently dependent on medication which only nurses could administer, whereas social workers did not take a case load at all. He noted that both clinical psychologists and social workers were paid considerably more than he was. · Ms Hoot who confirmed that the work of nurses and psychologists could be expected to be similar in the mental health area, although nurses tended to have a caseload of more seriously ill patients because of their qualification to administer medicine. Ms Hoot noted that there is substantial overlap between the two roles in the mental health field. Whilst nurses were not trained to perform psychometric testing, they performed all other duties performed by psychologists, and in addition Ms Hoot observed: Nurses of course have the capacity to do a full biopsychic assessment which psychologists don't have, and nurses also have medication as part of their repertoire of knowledge and skills.

134 The HAC referred to the Association's reliance on the evidence of Professor Skowronski (regarding physiotherapists and nurses in the ICU), Mr Obmann (regarding nurses working in a team with psychologists) and Hoot (regarding the similarity of work between nurses and psychologists). It was noted that Professor Skowronski accepted that while nurses in the ICU have a greater role than physiotherapists, in other parts of the hospital, physiotherapists have the greater role. In the mental health context, while nurses and psychologists do work together in teams, they have different skills and training and patients are allocated to them accordingly. It was submitted that the very limited evidence on this subject is simply insufficient for the Commission to determine how nurses are to be compared with other health professionals.

135 We agree with the submission put by the HAC that the evidence is not sufficient to conclude that the work value of nurses is the same as or greater than those classes of health professionals referred to by the Association, other than in a general way as explained in our Interim Decision. We had only the most oblique evidence before us of the work performed by physiotherapists. Enrolled nurses

136 The agreed datum point for enrolled nurses is 1 January 1993. In 1990, in Re Public Hospital Nurses (State) Award, (1 August 1990, Cahill VP, Sweeney and Hill JJ) the respondent and the applicant agreed on new rates for enrolled nurses in recognition of the increased work value, which were accepted by the Commission with the exception of the proposed 5th year rate for enrolled nurse. As part of that agreement the applicant agreed that any enhancement to the role of the enrolled nurse arising out of the 1991 Review of the Education Role and Function of the Enrolled Nurse in New South Wales ("EN Review" - to be conducted after the 1990 proceedings had concluded) would not be the basis of any application for a further increase in salary for enrolled nurses. That Review led to changes to the training and role of ENs.

137 The HAC contended that the Association should be required to adhere to that agreement and that any changes to the work of enrolled nurses prior to 1 January 1993 should not be taken into account by the Commission in these proceedings. The HAC submitted that, in any event, the changes to the work of ENs arising out of the 1991 review were largely implemented before 1 January 1993.

138 The Association submitted that subsequent to the 1990 proceedings before the Commission its position regarding changes to the work of ENs following the 1991 EN Review were clarified to the extent it was made clear to the HAC in a letter dated 22 May 1991 that: The Association's understanding as to the outcome of the Special Wage Case and its effect on future wage rates for enrolled nurses is that the Department sought from the Association an undertaking that we would not (indeed, could not) rely on evidence adduced in the special wage case as to the enhanced role of enrolled nurses in any future wage negotiations. The Association clearly has no difficulty in giving such an undertaking. What was clearly not envisaged by the Association - and the Department could not possibly expect us to have done so - is that the Association is not able to rely on any changes which may occur in the future in relation to Enrolled nurses, particularly in the area of education and further skills development. 139 The Association contended that the HAC never disputed the letter of 22 May 1991. The Association also relied on a Recommendation in the EN Review which was issued in August 1991 which said: That the position of the NSW Nurses Association that the Special Case increases for Enrolled Nurses in NSW in matter No 289/89 cannot be relied upon by the Association in any future application for wage adjustments be noted (our emphasis).

140 The Association submitted that the HAC did not demur from this Recommendation. It was also submitted that in 1997, when the datum point of 1 January 1993 for ENs was agreed, the HAC did not seek any limitation or qualification to the effect that changes flowing from the 1991 EN Review could not be taken into account, notwithstanding that it was aware of both the Association's position articulated in its letter of 22 May 1991 and the Review's Recommendation.

141 As to the HAC's contention that changes to the work of ENs flowing from the 1991 EN Review were implemented prior to 1 January 1993, the Association submitted that there was no evidence that any of the 750 ENs who graduated in October 1992 under the new training regime started to work in the public hospital system (as opposed to the private sector) prior to 1 January 1993. The Association submitted that at best it was possible that a small number of the 750 might have commenced work in the public hospital system prior to that date but for the overwhelming majority of ENs already employed in the system their role and work did not change prior to 1 January 1993. Rather, the change would have come about gradually as ENs completed either the new training or the bridging course that commenced in 1993.

142 Whilst we have some reservations, we are prepared to have some regard to changes to the work of ENs arising out of the 1991 EN Review because of the significance of the new approach to the role of ENs and the upgrading of the training regime to Advanced Certificate level. Whether or not it could be said the Association sought to recast the nature of its commitment by its letter of 22 May 1991, the HAC was clearly aware of the Association's position when it made the agreement in 1997 regarding the datum point for ENs and did nothing to qualify its agreement in respect of changes flowing from the 1991 EN Review. We must state, however, the weight we would otherwise give to the changes is discounted by the fact that in approving the wage increases agreed between the parties in 1991 for ENs the Commission did so in the knowledge that the role of ENs was likely to be enhanced as a consequence of the EN Review and that the Association had agreed in the proceedings before the Full Bench at the time: [W]ith any enhancement of the role of the enrolled nurse which may come out of the review and further the Association agrees to not seek any increase in salary for the classification as a result of any such enhancement.

143 We also consider that, at least to some extent, the changes to the work of ENs flowing from the 1991 EN Review would have manifested themselves in the public hospital system by 1 January 1993.

144 The Association contended that the role of the EN as facilitated by the Advanced Certificate was a new role altogether involving a substantial range of functions which ENs now perform which they were neither trained nor permitted to perform prior to the introduction of the Advanced Certificate as follows: -

· Checking of medications · Drug calculations for medication dosages · Contribute to the development of nursing care plans · Dressing of drain sites and wounds · Apply the wound field concept to cleaning of wounds · Checking of drip rates and monitoring IV sites · Use of anti embolic stockings · Use of lifting mobility and patient lifting devices · Blood sugar level monitoring · Nursing clients who are on cardiac monitors · Nursing care for patients who are having ECGs · Taking and recording neurological observations · Reporting and recording of patient health status including their physical, social, emotional and spiritual needs · Naso gastric drainage and feeding.

145 The Association contended that the role of ENs had become increasingly patient orientated, rather than task orientated. Whereas previously ENs would commonly have responsibility for a particular task, they have increasingly been required to take a direct patient load. The level of responsibility assigned to ENs has increased and the level of supervision has decreased. The taking of a patient load inevitably leads to a broader range of responsibilities and duties and a higher level of accountability.

146 It was submitted that one aspect of the change in role of ENs was that they are now increasingly engaged as community nurses, a practice which was unusual prior to the early 1990s. As a consequence of this trend, a post certificate course in community nursing was introduced in 1994 and redesigned in 2001. The course was been further revised and developed since its introduction to reflect "changes in the amount of technology going home attached to the client". The trend towards earlier discharge is affecting the work of ENs along with other community nurses. Wound care in particular is an area where the scope of practice of ENs has increased very significantly. Similarly, the trend to palliative care in the home has directly affected the work of many ENs.

147 The Association referred to a number of other post certificate courses that have been introduced since 1992 that underpin the expanding EN role and allow for a higher level of practice. These include courses in wound care (introduced in 1993) peri-operative nursing (introduced in 1994 and expanded in 2000), disability, rehabilitation, and aged care, parent-craft nursing (from 1992, rewritten in 2001), and evidence based practice. 148 The Association referred extensively to the evidence of Ms Christine Manwarring, Manager, Health & Aged Services for the New South Wales Department of Education (TAFE), who described the further changes to the Advanced Certificate course that have been implemented since 1992. These changes have included major developments such as risk assessment (1996), expanded occupational health and safety content, major changes in accountability, and the introduction of wound field concepts. Taken together, it was submitted, the above matters constituted a very significant change to the work value of enrolled nurses as described in the wage fixation principles. Reference was also made to the evidence of Ms Rich, an EN, which was said to confirm that the role and duties of the EN are now very substantially different to and more demanding than those that existed as at December 1992.

149 The HAC contended that apart from some further incremental change on some aspects, the change in the role of the enrolled nurse since December 1992 was principally the change that had come about as a result of the enhancement of the role in accordance with the August 1991 ministerial report following the EN Review - change which the Association had conceded was not to be the subject of a future wage claim. However, we have already determined that we will have some regard to that change in assessing whether the work value of enrolled nurses has increased.

150 We do accept, however, that many of the changes identified by the witnesses for the Association were changes taken into account by Wells SCC in 1986 and in the 1990 proceedings. And whilst we can have regard to the changes since 1990 many of them must be seen in the light of the fact that, despite their inclusion in the Advanced Certificate course, they are not new changes but rather an enhancement of the role of ENs. For example, in 1986 Wells SCC took into account the following changes in respect of ENs:

a. increased in-service education providing greater clinical skills; b. participation in "total patient care", as part of "patient care team", for patients allotted to the enrolled nurse, with the exception of medications and injections; c. extended role, including: taking of routine ECGs; colostomy care; removal of sutures; simple dressings and with supervision complicated dressings; theatre scout for all surgery; checking medications, including dangerous drugs; and initiating cardiac resuscitation; d. an upgrading of work, involving a change in knowledge and skill, and an acceptance of more responsibility.

151 In the 1990 proceedings the Full Bench had regard to:

a. the transfer of enrolled nurse education to TAFE "with a consequent significant expansion and upgrading of the standard of education"; b. a "dramatic increase in the number and range of post-basic and continuing education programmes for enrolled nurses"; c. there was a "shortage of registered nurses"; d. there was a "shortage of hospital beds"; e. the "norm" was patients that were " short stay/high dependency"; f. enrolled nurses were operating with "a significantly increased level of skills and range of knowledge in a greatly expanded range of health care settings"; g. enrolled nurses were being trained in "pharmacology, drug administration and general nursing sciences"; h. enrolled nurses were performing a much more extensive range of duties and procedures, as evidenced in duty statements tendered in the proceedings; i. enrolled nurses were "regularly undertaking duties and responsibilities that until very recently would have been the sole domain of registered nurses"; j. enrolled nurses were "regularly required to care for the critically ill or unconscious patient and undertake procedures traditionally seen as the doctor's responsibility".

152 Our task is to assess whether the changes that have taken place in the work of ENs since 1 January 1993, having regard to what had previously been taken into account in 1986 and 1990 and having regard to the changes brought about by the 1991 EN Review, amount to a significant net addition to work requirements. In doing so it is necessary to consider whether the requirement on ENs to perform work that hitherto has been regarded as the province of a registered nurse, such as more complex wound dressing procedures or having a more extensive knowledge of infection control, for example, is an indication of the acquisition of new skills and knowledge or merely an extension of their existing skills and knowledge.

153 The Association identified a number of changes that have been introduced since 1993 affecting the work of ENs including changes to the Advanced Certificate course and the introduction of a number of post certificate courses. As to the changes to the Advanced Certificate course, these should be taken into account to the extent that they enable ENs to acquire new skills and knowledge or enhance existing skills and knowledge. We note the existence of post certificate courses that provide the opportunity for ENs to increase their skills and knowledge. However, the course are not mandatory and there was no evidence of the extent to which ENs have undertaken these courses and gained new skills and knowledge. 154 We note also that whilst there is an agreement between the parties to an earlier datum point from which to measure changes in work value in respect of ENs than that agreed for registered nurses, it is not apparent to us that the Association is seeking a higher wage increase for enrolled nurses. Furthermore, there was no suggestion that the wage relativities between ENs and RNs should be disturbed.

155 We have given careful consideration to the evidence and submissions relating to ENs. We have had regard to the HAC's contentions concerning those matters in respect of which it was agreed would not be taken into account in future wage claims and we have sought to identify what we consider to be the acquisition of new skills and knowledge over the relevant period.

156 We consider that over the relevant period from 1993 the work of ENs has expanded into areas that traditionally belonged to registered nurses. We have concluded there has been an increase in the work value of ENs to the extent that it meets the test under the work value principle that the change constitutes a significant net addition to work requirements.

157 It was common ground that the datum point for assistants in nursing (AINs) is the same as that for registered nurses, namely, 1 July 1996.

158 AINs make up only a small percentage of the overall nursing population employed by the HAC. In 2001/2002 there were 450 AINs out of a total of about 33,590 nurses i.e., 1.3 per cent. AINs are predominantly employed in the private sector. Prior to 1999 the generally recognised TAFE course training for assistants in nursing was at least in the community services and aged care sector was the certificate III in nursing (assistant in nursing). This course consisted of 320 hours of training. The last intake of students for this course was completed in the year 2000. In 1999 a community services training package aligned to national training standards was endorsed. The course is entitled Certificate III in community services (aged care work - nursing assistant). This training consists of 360 hours of off the job and on the job training.

159 In its submissions the Association said: The work value case advanced on behalf of AINs also relies upon all of the evidence advanced in relation to changes in acuity and decreases in the bed base, increases in bed occupancy and decreases in length of stay. The consequence of this evidence is that it provides the basis for a conclusion that patients or residents returning to nursing homes after surgical intervention, treatments or other therapies in the acute sector are likely to be patients of higher acuity and dependency, and patients and residents requiring higher and more intensive levels of care. The nursing home and rehabilitation facilities in the public hospital system are apt to be affected by the significant changes in the way in which the public health system provides care and services, just as there is an impact on the community nursing sector and the acute hospital system itself.

160 The Association relied on the evidence of Ms Manwarring. In relation to the course content she said: The units of competence have increased in number. AINs are now required to have a greater knowledge of the aged care industry, ethical issues, patient advocacy and services to assist the client. Reporting and recording procedures in aged care have been expanded to ensure accountability in the work place. Modules are offered on resident classification systems and collecting data for quality units … course content in the area of occupational health and safety has been expanded with particular emphasis on infection control, manual handling and risk assessment … student AINs also require a greater understanding than previously of technologies in the workplace such as basic computer usage, facsimile machines, calculators and paging systems. 161 Ms Manwarring was of the view that there have been increased demands placed on AINs working in aged care during the past four to five years. In her evidence she said: This change is due in large part to the fact that acuity levels of clients have increased dramatically in nursing homes and hostels. AINs are expected to provide bed side care and therefore exercise a broader range of skills then they have done in the past. It is my understanding that there is no prescribed ratio of RNs to AINs in aged care facilities. This has implications for the level of responsibility which AINs are now required to exercise.

162 The Association submitted the significance of these observations included the fact that they acknowledge that where there is no prescribed ratio of RNs to AINs there is a tendency for AINs to have to work relatively unsupervised even though they will still ultimately be providing care under the indirect supervision of an RN pursuant to prescribed protocols, nursing care plans and the like.

163 Ms Manwarring said AINs are required to have a greater understanding of medical conditions. In her view in order to be able to assist clients with their personal care needs student AINs must learn basic anatomy and physiology. They must also become familiar with health problems common to the age such as rheumatoid arthritis and dementia and study the management of these conditions.

164 The Full Bench also heard evidence from Ms Carol Penning, Deputy Director Aged Care and Rehabilitation Services for the Hunter Area Health Service, a position that she has held since January 2001. From 1997 to December 2000 she held the position of Director of Nursing/Executive Officer at Allandale Aged Care Facility. Allandale is a 336-bed residential aged care facility located at Cessnock.

165 Ms Penning noted the changes which were introduced to the industry as a result of the introduction of the Aged Care Act 1997 which moved away from dedicated care funding under the "Cam/Sam" model and the introduction of a greater emphasis upon creating a homelike environment and providing flexible care and flexible conditions under which residents are provided with support. Ms Penning made the following observations about the role of AINs at Allandale: The role of the AIN at Allandale is to assist the registered and enrolled nurses in the delivery of nursing care. While traditionally Allandale utilised an institutional custodial model of task focused care Legislative change in aged care has led to a shift in focus towards team based nursing. Although the AIN works under the direction and supervision of a registered nurse this supervision tends to be indirect in nature. Generally the AIN is required to work predominantly on his or her own in carrying out the majority of daily resident care tasks … the role of the AIN at Allandale includes the following:- i. assisting residents with their activities of daily living including bathing, shaving, dressing, feeding and toileting; ii. transporting and escorting residents to medical and other appointments; iii. assisting residents with maintenance of their personal clothing, personal effects and toiletries; iv. bed making; v. cleaning and sterilising pans and urinals; vi. cleaning wheelchairs and mechanical lifters; vii. disinfecting beds and spot cleaning as required.

166 Ms Penning said that since 2001 the AIN has been required to make notations of a clinical nature in progress notes and observation charts. The AIN was also required to act as advocate on behalf of residents and provides personal and emotional support to the residents under their care. Ms Penning said that the AIN is called on to exercise a significant level of communication skills in dealing with grieving families and handling general family enquiries, phone calls and incoming messages. She noted that the AIN might be called on to be the second person to check and counter sign for a registered nurse administering or checking medications or drugs including scheduled drugs. AINs may also undertake approved clinical duties such as checking temperature, pulse, respiration, urine analysis and blood pressure and the application of simple dressings.

167 Ms Penning noted that the additional tasks added to the AINs role since the 1997 legislative reform included participation in resident care conferences, awareness and understanding of resident classification scale requirements, responsibility for continuity of the physiotherapy care plan, supporting the provision of information to residents and interpreting policy for residents in relation to the care options available to them, the implementation for residents of significant changes in routines or policies in the facility, clinical documentation, simple dressings and responsibility for ensuring the safety of residents and other staff by being able to identify safety issues. Ms Penning referred to the requirement for certificate level III qualifications and the current first aid certificate. The Association submitted that this made it apparent that this is a requirement that has operated since at least 1998. That is to say Ms Penning identified that prior to 1997 there were no pre entry employment requirements for AINs at Allandale including in the areas of literacy and numeracy skills. She said further: - A literacy skills assessment was introduced for AINs at Allandale in 1997. Prior to 1997 an AIN with previous nursing experience was required to undertake a recognition of prior learning course in their own time. This qualified them for a certificate level III which became a pre requisite for employment at Allandale from 1998.

168 Ms Frances Monypenny, Director of Nursing at the Royal Rehabilitation Centre, Sydney (Royal Rehab), also gave evidence. She said that the staff mix at Royal Rehab has changed over time both away from enrolled and trainee and enrolled nurses and wards persons towards AINs. She noted that: The decrease in the numbers of enrolled nurses and wards persons occurred over time despite ongoing efforts to recruit these positions. Faced with a staffing crisis Royal Rehab sought to improve the education and training of the AINs that it employed. Since 1996 AINs have picked up tasks commensurate with their level of education which were previously undertaken by the enrolled nurses. The introduction of no lift policies and procedures and the greater availability and use of appropriate lifting devices means that all nursing staff including AINs are now able to move, transfer and lift Weemala residents a role previously requiring the assistance of male ward persons.

169 Ms Monypenny also gave evidence to the effect that:

· AINs are employed at Royal Rehab either as a trainee or on the basis that they hold a level III assistants in nursing certificate. · The introduction of competency assessments in the year 2000 following the review of Weemala against the disability services standards. · Prior to 1996 there was no requirement for AINs to attain a level III certificate but that, in 1997, 17 AINs employed at Royal Rehab completed the assistants in nursing care support services certificate III recognition course. Since then and in particular in November 1997 Royal Rehab gained accreditation as a registered training organisation and conducted the first certificate III in care support services (nursing assistants) traineeship in 1999 followed by another course in 2000.

170 In relation to AINs the Association submitted: It is apparent from the evidence that the changes in activity and in particular increases in acuity and dependency of residents in these facilities are changes which are conformable with those which have affected the public hospitals systems since particularly the acute care sector since 1996. The other changes and in particular the changed emphasis upon occupational health and safety requirements changes in the use of technology and equipment have also affected AINs in the aged care and disability services area. As a result the work value change for AINs may readily be accepted particularly having regard to the introduction of extended and enhanced courses and the introduction of an industry requirement that AINs actually possess a level III TAFE qualification since 1996. Almost all of these changes seem to have occurred in the period between 1996 and the commencement of the year 2000. In particular the comparison of job descriptions for Garrawarra as between the job description current for the year 1999 and that which operated in 1994 provides a stark indicator of the difference.

171 The HAC contended that the evidence shows that much of the 'change' in the role of AINs relied on in these proceedings is an expansion of the role and responsibility in a manner that was recognised as part and parcel of AIN duties in the private sector as long ago as 1990. That is, the public sector has in more recent years started to use AINs in the manner and to the extent that they were used in the private sector and recognised in their pay rates for many years. In those circumstances, it was submitted, the Full Bench would be very mindful of two factors: a. the real potential for flow-on into the private sector in circumstances where (given the very small percentage of AINs who work in the public sector) 'the tail would be wagging the dog' (noting that there is some evidence that the public sector rates have already been flowed on to the private sector, at least to some degree); and

b. when the work value for publicly and privately employed AINs was last examined by the Commission in 1990 the increases then awarded were in recognition of a change in duties and skills then apparent in the private sector, but which later flowed also to AINS in the public sector. AINs in the public sector should not be permitted to obtain increases in reliance on those same changes even though, in the public sector, they have only occurred in more recent years.

172 The HAC referred to the 1990 proceedings where the Commission awarded AINs an increase in pay on the basis of a change in work value. The HAC identified the changes taken into account in those proceedings and submitted: While it is true that much of the evidence cited above came from the private sector, the rates fixed in the 1990 proceedings, to which the Respondent was a party, applied to AINs in both the public and private sectors. AINs employed by the Respondent got those new rates on the basis of that evidence. 173 The HAC submitted that the evidence of 'new' duties of AINs led by the Association in these proceedings overwhelmingly was evidence that AINs in the particular places in question have in recent years been required to undertake the duties recognised by the Commission in 1990. None of the witnesses had a working knowledge of the private sector such that they could comment on the changes that had occurred there. It was contended that the Association's witnesses concentrated on change in their particular institutions, without being able to say whether those places had seen a change in the role of AINs reflective of what had occurred elsewhere. The HAC noted that no assistant in nursing was called to give evidence.

174 In relation to Ms Penning's evidence regarding Allandale the HAC submitted Allandale was not representative of changes occurring in the aged care industry generally, given its unique funding history and the fact that for some time it had been ear-marked for sale. Further, Allandale had no AINs at all prior to 1997, and so there was no ability to examine the duties before July 1996 at that particular facility to note the change, and Ms Penning had no working contact with AINs before 1997.

175 The HAC submitted with a few exceptions the roles of AINs since they were employed in 1997 at Allandale were duties expected of AINs as identified in 1990. As to Ms Penning's evidence regarding the requirements brought about as a result of the Aged Care Act, it was submitted she agreed that the outcomes required by that Act were not different to that which she would have expected prior to its introduction and, in any event, the requirements under that Act identified by Penning ("individualistic, holistic, person-centred care for residents"), where patient's rights are recognised, and their choices respected, are matters that were recognised as part of the new landscape brought about as a result of the federal legislation in place in 1990. 176 The HAC referred to the evidence of Ms Monypenny. It was submitted like Allandale, but for different reasons, Royal Rehab could not be described as 'typical', but rather a highly specialised and unique institution. Like at Allandale, Royal Rehab had no AINs before 1996 and has since 1997 increased the number of AINs and decreased the number of enrolled nurses, resulting in AINs doing more of the work that was previously shared with enrolled nurses. It was submitted in that way Royal Rehab has used more AINs, but not changed the work value of AINs, whose duties were essentially the same as the duties of AINs identified in the 1990 proceedings. They remain under the strict supervision of registered nurses. As to other changes identified by Ms Monypenny it was contended for the HAC that these were essentially the same as those identified in the 1990 proceedings. 177 The HAC referred to the Association's reliance on evidence given by Ms Manwarring as to an increase in acuity levels at nursing homes and hostels that has impacted on the responsibilities given to AINs in aged care facilities. That evidence, it was submitted, was directed principally to changes that have occurred in the private sector.

178 In referring to the introduction of new courses for AINs the HAC submitted that would not, of itself, demonstrate an increase in work value. The Commission would need to be satisfied that the course has led to new work or skills being exercised so as to constitute a significant net increase in work value. It was submitted that having regard to the substantial changes identified in the 1990 proceedings, the evidence failed to establish that there had been a significant net increase in work value since 1996, notwithstanding the new training courses.

179 The Association challenged the HAC's attempt to rely on evidence in the 1990 proceedings. The HAC, however, maintained its position in that respect. In relation to the Association's submission that the evidence before the Commission in the 1990 proceedings in respect of AINs was drawn only from the private sector, the HAC accepted this as correct and submitted: [B]ut the rate set by the Commission on the basis of that evidence was applied to the public sector as well. It is accordingly appropriate to ask, as the Respondent has done, what change has there been between the role of AINs in 1990, as demonstrated in the evidence presented to the Commission at that time by the Applicant (being evidence relied upon to award AINs a substantial increase), and the role of AINs today as demonstrated by the evidence presented in these proceedings.

180 We address later in this judgment a claim by the Association seeking pay equity for AINs. In light of what we say in that respect, and given the connection between work value and pay equity under the principles, we propose to reserve any decision as to the work value of AINs until the pay equity claim is dealt with. However, we state that AINs should not be disadvantaged by this course. If it is determined that their rates of pay should be increased, it is likely that the adjustment would be made to apply retrospectively.

181 In our Interim Decision we left open the question of whether any increase in the work value of agency nurses has been of a different nature to the increase in work value for nurses employed on a permanent basis, such that we would determine a different outcome for agency nurses in this part of the proceedings. This was a matter we required the parties to address in their submissions.

182 Whilst the HAC contended there were grounds upon which the Commission could find that agency nurses as a group have a lesser work value it accepted that it would not be industrially appropriate to create separate rates for agency nurses.

183 The Association submitted that in many cases agency nurses did not have familiarity with hospital and ward practice, and they did not have involvement in ongoing responsibilities of regular nurses, and accordingly the excessive use of agency nurses caused difficulties of supervision and workload for permanent and long term casual nurses. However, it submitted: The Applicant did not advance a detailed evaluation of the value of the work of agency nurses, for (at least) three reasons. Firstly, the Respondent did not contend (prior to its final submissions) that the value of agency nurses' work was less than that of other nurses, nor that this was a relevant consideration with respect to work value. Secondly, the number of agency nurses in the Public Hospital system is in relative terms extremely small, albeit currently inflated somewhat by the shortage of nurses. Thirdly, to the extent that distinctions can be made between the work of agency nurses and the work of regular nurses, those distinctions have always existed. They have not suddenly arisen over the last six years to drag down the average work value of RNs.

184 The Association submitted a proper analysis of the work of agency nurses would show that it has inevitably been affected by most, if not all, of the matters relied upon by the applicant in its primary work value case for RNs. Accordingly, whether or not they started from a lower work value 'base' than RNs generally, the movement of work value would be similar, and the relative position has not changed from that when previous work value exercises were undertaken.

185 Given the respective positions of the parties, we do not propose to treat agency nurses any differently from permanently employed nurses. Reasonable workload

186 The HAC contended that any assessment of increasing quantity and/or intensity of the overall work required to be done must be considered mindful of the staffing levels for that work. If the amount or intensity of work increases, but the staffing level also increases to a similar degree (eg an increase in the dependency of patients, responded to by an increase in the staffing levels), then there is no increase in the overall work value. Similarly, if the staffing levels were low, but active steps were taken to reduce the work so as to equate the work with the available staff, then again there would be no change that would affect work value. It was submitted in this regard that it was important for the Full Bench to take account of: a. the evidence that nursing management have been careful to ensure that the workload matches the staffing levels and have taken many other active steps to relieve the pressure on nurses; b. the evidence as to the proposed Reasonable Workload Clause; and c. the potential impact of a workload planning tool, such as the one set out in the document titled 'Management of Nursing Resources Reference Manual - A Business Planning Model'

187 The HAC referred to the evidence of nursing management being careful to ensure that the workload matches the staffing levels, and who have taken active steps to relieve pressure on nurses. In relation to the reasonable workloads clause, on 6 March 2003 the Association made a new claim, namely for the Award to be varied to include a Reasonable Workloads clause. On 13 March 2003 the Full Bench delivered an ex tempore judgment dealing with matters arising from that new claim. In that judgment the Full Bench directed that the parties confer as to the claim and to provide a detailed report to the Commission on the next hearing date. That occurred on 9 April 2003. On that date correspondence between the parties as to the claim was tendered, indicating the positive progress that had been made as to the claim, including a letter from the HAC dated 9 April 2003 that summarised the position. On the basis of that progress the Association indicated that it did not wish to press for arbitration of that aspect of the claim at that stage, but was content to proceed in accordance with the approach outlined in the correspondence tendered. 188 The HAC indicated that at the time of preparing its submission in these proceedings no agreement had been reached, although the HAC said it did not have any reason to believe an agreement would not be reached that accords with the position of the parties as recorded in the HAC's letter of 9 April 2003 (noting that both parties have reserved their position in the eventuality that final agreement cannot be reached). The HAC indicated it had recently written to the Association proposing the text of a draft Reasonable Workloads clause for insertion into the Award that reflected the in-principle agreement recorded in the correspondence of 9 April 2003. 189 In the final stages of drafting this decision we were provided with a copy of the terms of an agreed reasonable workloads clause. The parties have sought an early hearing to vary the Award to include the agreed clause. We should indicate that we are prepared to make such a variation. However, rather than wait to hear further from the parties regarding the clause prior to giving our decision in this matter we have decided that the decision should not be unduly delayed. The reasons for taking this course are explained below.

190 The HAC's Reasonable Workloads clause "would include a responsibility on the part of the employer to provide reasonable workloads for nurses in situations other than meeting emergency or extraordinary circumstances of an urgent nature". The clause would contain "principles elaborating on this duty", which would be based on those that were set out in the Association's claim. They included:

· "the work performed by an employee will be able to be completed within the ordinary hours of work of a regular, periodic roster"; · "the work will be consistent with the duties within the employee's classification description . . ."; · "the workload expected of an employee will not be unfair or unreasonable having regard to the skills, experience and classification of the employee for the period over which the workload is imposed"; · "an employee's workload will not prevent reasonable and practicable access to leave for professional development".

191 The HAC noted that the Association, by way of its proposed award clause, sought the introduction of hospital workloads and area workloads committees. The correspondence between the parties tendered on 9 April 2003 recorded that there was in principle agreement to the establishment of committees which would "provide a structured and transparent forum for all nurses to be genuinely consulted about workload matters through an appropriate mechanism, to contribute to the decision making process and have the ability to resolve disputes about workloads, should they arise".

192 The Association, by way of its proposed clause, further sought the introduction of a Reasonable Workloads Taskforce, which would examine appropriate systems for management of nursing workloads, including (but not limited to) consideration of the appropriateness of an approach of the type set out in the document 'Management of Nursing Resources Reference Manual - A Business Planning Model'. The HAC had agreed to establish such a taskforce, with such a brief. The taskforce is to have no more than 10 members, with equal membership nominated by the Association and the HAC, to be chaired by the Chief Nursing Officer. The HAC indicated that in respect of any 'workloads tool' or approach that the taskforce might develop (i.e., a tool to properly determine the appropriate staffing levels for units), the question of whether that might be included in any award has not been determined. 193 The Association's proposed award described the tool that is to be developed as a "tool to achieve fair and reasonable workloads". 194 In its submission the HAC said the approach of the business planning model was (references deleted): to review the whole of a health service, and each individual unit, to determine appropriate nursing resources and align them to the clinical service requirements. In assessing the whole of the health service the tool requires the user to know a great range of factors that will affect the outcome, including: a. nurse staffing levels, availability (including leave issues), competencies and flexibility; b. technology and IT availability; c. the layout of wards/units and distances from other units; d. occupational health and safety; and e. availability of ward clerks and allied health support. Further statistical information as to the service and unit is required to understand the nature of the nursing work. That includes 'bed benchmarking', by which the average bed usage by DRG is compared against State benchmarks for those DRGs. Further, rostering issues must include examination of leave entitlements for nurses.

195 As to the impact of the Reasonable Workload clause and business planning tool on the Association's work value claim, the HAC submitted the claim rested on a number of assertions, but principally upon a claim that the work of nursing had become more intense during the relevant period due to the higher acuity of patients, the shorter length of stay, the higher bed occupancy rates and the increased case flow. Further, that the Association claimed that the intensity of the work was a contributing factor to the nursing shortage, as it caused retention problems. 196 The HAC noted that the Association accepted that the reasonable workloads measures might affect its claim for a retention allowance, but resisted the suggestion that they could have any effect on the balance of the Association's case. The HAC submitted, however, the measures had a real and obvious potential to also impact upon those matters that underpin the work value claim. The HAC contended that to the extent the Association's claim for a general increase in pay was based upon the claimed stress and pressure in the system, it must be impacted by the Reasonable Workloads clause.

197 Further, it was submitted, any change to acuity levels (sometimes referred to as the 'intensity' of nursing required) can only be properly evaluated if one also takes into account changes to staffing levels. Any claim resting on a claim of higher intensity of work, it was submitted, must be affected by a tool which is used to determine appropriate staffing levels taking into account a wide range of factors, and which will result in adjustments to staffing levels at in individual unit level to reflect changing acuity levels. If nurse numbers increase in line with any increase in patient acuity, the HAC contended there was no overall change in work value, as evidenced by the fact that nurses in intensive care working with patients of the highest acuity were regarded as having the same work value as nurses in general wards, because of the different numbers of nurses per patient.

198 The HAC noted that the Association, in support of its claim for a workloads tool, relied on evidence that asserted an increasing intensity of work arising from a claimed increase in acuity and complexity of patients and shorter length of stay. It was submitted that this was the same type of evidence that the Association relied upon to justify a general increase in pay on the basis of a change in work value. In those circumstances, it was submitted, it could not be seriously suggested that there was not an obvious link between steps to be taken to alleviate workloads (in particular to adjust workloads to meet changing acuity levels) and the general claim for a pay rise based on changing work value.

199 The Association contended that the HAC's reliance on the Reasonable Workload clause was flawed because: a. the proposed clause is not in place and it is not possible to determine now what kind of measure will be introduced. It may take a considerable period for this to have effect and in the meantime steps must be taken to address the crisis in the system; b. the proposed measure is not relevant to work value because it is actually directed at excessive or unreasonable workloads but does not preclude there being workloads which when coupled with other relevant change, may attract a recognition of changed work value. 200 The Association submitted industrial tribunals have held that workload or increases in workload of themselves cannot be a basis for work value change or work value based increases. By parity of reasoning it must also be the case that a measure aimed to prevent excessive workloads will not result in a diminution of work value. It was submitted the Association's case did not rely upon excessive workloads as a basis for its work value claims. Excessive workloads may not be uniform. Therefore, any steps that might be taken to ameliorate excessive workloads and their effect cannot diminish the workload claim being advanced.

201 As to the HAC's reliance on evidence that nursing management have been careful to ensure that the workload matches the staffing levels, and have taken many other active steps to relieve the pressure on nurses, the Association contended the HAC took no steps at any stage of the proceeding to provide any evidence to establish that this was a general practice and took no step to examine the effectiveness or otherwise of the measures.

202 In respect of the proposed reasonable workload clause, the Association submitted a number of matters needed to be noted about the clause and its relevance to the assessment of work value:

a. The clause was the subject of vigorous opposition by Counsel on behalf of the Respondent. b. The Reasonable Workloads Clause does not yet have agreement. The suggestion … by the Respondent that the Respondent does not have any reason to believe an agreement will not be reached, does not assist the Commission. Agreement, even if it is reached may be on terms substantially different to that which constitute the present claim. c. The Respondent cannot ask the Commission to take into account the effect of a clause which not only is not yet agreed, but which may not come into effect for some considerable period of time, and whose impact upon workloads, let alone work value cannot at this stage be assessed. d. The Reasonable Workloads Clause does no more than seek to require that workloads not be excessive and that the employer ensure that workloads are not excessive (except to the extent where an emergency or extraordinary circumstances require it). e. The Reasonable Workloads Clause may result in an identification in some places that there are more staff than are necessary to meet the requirements of workloads. f. The evidence disclosed that workloads vary from time to time which is one very good reason why no equation should be drawn between excessive workloads and work value. g. The authorities in the Federal Commission to which the Respondent has referred make clear in terms that workloads of themselves cannot be a basis for work value increases. h. The Queensland decision relied upon heavily by the Respondent contains no assertion that the workloads management tool (the Queensland model was based upon New South Wales Business Planning Framework) would constitute a basis for discounting work value increases.

203 The Association submitted that reliance on the workloads tool or "Business Planning Model" by the HAC was also misplaced because: a. The Reasonable Workloads Clause envisages that the taskforce may consider a range of options to be used as a workloads management tool. There has been no foreclosure on the outcome on this question, and the Business Planning Model has by no means yet been settled upon. b. The Business Planning Model is a tool which requires the user to make an overall and comprehensive assessment of the function and performance of the health care unit under examination, having regard to the nature of the health care which is provided, the extent of the health care which is provided and the resources which are available to meet those needs. The resources available includes, so far as the Business Planning Model is concerned, a reference to budgetary considerations.

204 The Association conceded the reasonable workloads management measures may affect the claim for a retention allowance, but contended they could not have an effect upon the Association's claims for work value increases and its special case. It was submitted that the claim for work value increases was not predicated upon nurses being required to work unreasonable hours or excessive workloads; that it would be contrary to public policy for work value increases to be granted on that basis, and it would also be contrary to public policy for the Commission to discount work value increases by reference to the fact that a measure was being taken to reduce workloads so that they were no longer excessive and contrary to a basic duty of employers not to require excessive workloads of their employees.

205 The Association submitted work value change capable of justifying a wage increase does not require unreasonableness. The relevant change is a change in the way the work is done, the quality of the task and the character of the role. For example, it was submitted, a shorter length of stay means that the whole focus of the nurse's work is directed to the management of acute episodes and the preparation of a person for handover still at a relatively acute stage but to the care of another member of the nursing team, including, for example community nurses, and nurses in aged care facilities, or carers at home. It was no longer part of the ordinary role of nurse to manage across a continuum of care from relative wellness through to the acute episode and then back again to relative wellness. It was a change in orientation rather than simply saying that more of a particular function is performed. While that may be the case, it was submitted that was not the essence of the work value change that was being claimed in this case by the Association.

206 It was true, it was submitted, that stresses result from the change in the intensity or demand of the nursing. That was a matter that was separate from unreasonable or excessive workloads which was sought to be addressed by the reasonable workloads clause and the workload management tools. Those mechanisms were aimed to address a problem that concerns the way staffing resources and other matters that impact on workloads are managed or probably not managed. They were aimed to discourage the employer from allowing nurses to work excessive workloads, particularly unpaid overtime, excessively long shifts without appropriate breaks and shifts where there is inadequate assistance and support. The Association contended that is something which is materially different from the increased work value which nurses are claiming and which is impacted upon by shorter length of stay, increased bed occupancy and increased case flow and the like, together with functional changes in role. Those factors, it was submitted, may be relevant to the question whether nurses are required to undertake unreasonable or excessive workloads. However, the mere fact that occupancy rates increase in a unit, or that length of stay is reduced may not of themselves produce excessive or unreasonable workloads. However, it was submitted these factors would impact upon the role of the nurse in a manner that is relevant to work value. 207 In responding to the Association's submissions the HAC submitted:

· The Association cannot seriously seek as part of these proceedings a new clause that is obviously intended to impact on the workload and the claimed 'stress and tempo' of the work, obtain an agreement to introduce a clause in substantially the form sought, but having obtained that in principle agreement submit that it should not be taken into account. It should be noted that since the evidence closed there has been a further meeting between the parties, and further agreement reached as to matters of detail. The HAC is currently awaiting a written proposal from the Association that confirms those further agreed matters and sets out any further matters that need to be resolved.

· The Association wrongly characterised the HAC's submissions in respect of the proposed Reasonable Workloads clause as being advanced on the basis that excessive workloads demonstrate work value change, and so the removal of them will remove such work value change. The proposed clause and related Reasonable Workloads tool are intended to do more than simply remove 'excessive workloads'. The HAC's submissions as to the Reasonable Workloads clause were rather put on the basis that, to the extent that the Association relied on increased workload (whether directly or by nature of increased tempo or stresses that the Association claimed was associated with such an increase) that is a matter that will be addressed by the Reasonable Workloads clause. Further, any tool that will increase staff based on increases in workload, taking into account factors such as fluctuations of acuity, will likewise positively impact on the environment of nursing.

· The Association in its submissions does not point to any particular evidence that would contradict a conclusion that management generally acts in the interests of nurses, by ensuring that the workload is consistent with staffing levels.

· The submissions of the HAC made on 12 March 2003 were not submissions in opposition to the merits of the Reasonable Workload claim, but rather opposition to the application being amended to include the claim in circumstances where the HAC would not have a proper opportunity to consider and respond to the claim. The only opposition was to the manner by which the Association was attempting to deal with the issue.

· The Association conceded that the measures regarding workload may affect the claim for a retention allowance, but stated that not only does the clause have no impact on the work value claim, it also cannot effect the Association's claim for a special case. This cannot be correct. The Association's claim for a special case rests in part on the shortage of nurses and the need to address that shortage by pay increases. If, as the Association correctly concedes, the claim affects retention, it affects the basis of the special case claim.

· Levels of acuity do not change as staffing numbers change, but staff levels directly affect the work value of nursing more acute patients. The Association's case was that the change in work value arising from increased acuity derives not from the increased workload, but from the increased intensity and complexity associated with the higher acuity, that is from the 'stresses and tempo' of the work. Yet clearly (as a comparison between an Intensive Care Unit and a general ward demonstrates) provided increased acuity (with its associated intensity and complexity) is matched by increased staff per patient, work value does not change. To say otherwise is to say that nurses dealing with more complex and acute patients must be paid more than the rest of the nursing workforce.

208 The proposed reasonable workloads clause and business-planning tool are commendable initiatives and it is quite apparent that if they had been in operation they would have implications for the Association's special case claim including the claim for a retention allowance. As we understand the Association's special case claim, it is based on the shortage of nurses and the wage disparity with other graduate professionals. Additionally, the Association seeks an allowance that will act as an incentive for nurses to remain in the profession and thereby alleviate the shortage.

209 The reasonable workloads clause is aimed at addressing many of the reasons for the nursing shortage: unreasonable or excessive workloads; short staffing; the absence of relief; the absence of backfilling for nurses on study leave; and, the unreasonable burden that falls on a nurse due to the skill mix on a unit. Consequently, the reasonable workloads clause would have a direct bearing on the special case claim, including the claim for a retention allowance. Any assessment, however, of the impact of the reasonable workloads clause and business planning tool in relation to the Association's special case claim, including the claim for a retention allowance, becomes academic because as it will be seen we do not propose to further increase wages on special case grounds nor do we propose to grant the claim for a retention allowance.

210 As to the implications of the proposed clause to the work value claim, we consider it would also have some relevance. Clearly, the Association's claim relates to the claimed high intensity work environment - or "stresses and tempo" as the HAC put it - of nursing in the public hospital system. We also refer to the Association's submission that "a shorter length of stay means that the whole focus of the nurse's work is directed to the management of acute episodes and the preparation of a person for handover still at a relatively acute stage" as opposed to the "ordinary role of nurse to manage across a continuum of care from relative wellness through to the acute episode and then back again to relative wellness". The reasonable workloads clause and planning tool are not just about avoiding excessive workload but are also about determining appropriate nursing resources in terms of such matters as skill and competency and aligning them with clinical requirements. If the implementation of the proposed reasonable workloads clause had the effect of reducing the work intensity and complexity in the nursing environment associated with higher patient acuity and matching the clinical requirements with properly skilled and competent nurses using the optimum technology then it must have implications for work value.

211 However, the clause and the proposed planning tool are yet to be implemented and in the context of the Association's work value claim we are reluctant to presume the clause and planning tool will prove effective within a reasonable timeframe or at all. We do not consider it is appropriate that we delay our decision in this matter until the clause has been implemented and assessed as to its effectiveness.

212 The HAC identified specifically a number of changes in work that have assisted nurses, and/or ameliorated the effect of other negative changes to their work that, it submitted, the Full Bench should take into account. These included: The creation of speciality units - the creation of stroke units and specialist geriatric units, allows the 'heavy' patients with special needs, being patients that place particular demands on nurses in general wards, to be moved to specialist units which have the facilities and staff to best deal with such patients. The patients are of course still being cared for by nurses, and in that sense it is a question of relocation of the work. However by relocating the work to specialist units, with nurses with the particular skills and interest to do that work, it relieves the impact such patients would otherwise have on a greater number of nurses. Similarly, the trend to create 'hot floors', where high dependency units are co-located in one area assists staff by concentrating the experienced staff in one area so they can provide assistance; Improved drugs and technology - changes in drugs, technology and procedures do not necessarily add to the work of nurses, and can often assist them to do their work. Improvements have been at the routine level (eg electronic thermometers and electronic monitoring). They have been in areas that have benefited from computerisation. They have been in the form of drugs that have better effect, such as the shorter acting anaesthetics and regional anaesthesia which allow patients to wake up and become independent more quickly. And they have been in the form of new surgical techniques (particularly key-hole surgery) which have allowed patients to recover more quickly and remove much of the 'heavy' nursing required to be given to patients with no or limited mobility. The resultant shorter length of stay is better for patients, who have fewer complications as a result, which removes potential work for nurses. Increased use of standard protocols - Many hospitals have progressively introduced 'pathways' or standard protocols for certain typical procedures, which standardise the care for that procedure. This reduces the complexity of that otherwise arises for nurses in having to deal with the differing requirements of different medical staff, and operates as a guide to assist nurses as to the various steps that need to be taken; Streamlining and improving admissions and discharge - A major positive change to the system of work for nurses working on wards with patients who have elective procedures has been changes in the system of admission, in particular arising from the use of pre-admissions clinics and peri-operative units: i) At a pre-admission clinic a patient attends usually 1-2 weeks prior to their admission. Such units have extra staff employed to do the preparatory work, much of which falls on the attending doctor. The staff specialise in pre-admission work. Protocols have been developed to streamline the admission process. The staff assess the appropriateness and preparedness of the patient for surgery. Medical and nursing histories are taken. Tests, such as x-rays, can be conducted and ordered. Any problems that need to be addressed prior to surgery can be identified and the patient can be referred for the appropriate tests and medical advice. Appropriate information can be given to patients before they attend for the procedure, when they are more likely to understand it. Patients are informed as to how to undertake their own pre-operative dosing regime at home, and attend on the day of surgery. This work is removed from the ward, relieving the nurses on the ward of a major aspect of their work (particularly from those wards where there is an increasingly high turnover of patients). By way of contrast, before such units the ward nurse would need to do a full ward admission, perform or arrange for the necessary tests to be conducted, educate the patient as to the procedure to be undertaken, seek and obtain the necessary consents, and in circumstances where complications were identified in the admission that meant the surgery would have to be postponed, advising the patient and often the patient's family as to the reasons for that. These admissions could take ward nurses a long time to complete. Further, the next morning the ward nurses previously had to then give the pre-operative medication, assist in any other pre-operative preparation and closely monitor the patient, and then arrange for the transport of the patient and the paperwork required to transfer the patient; ii) Peri-operative units are normally close to the operating suite. The patient presents to this area on the day of surgery where the patient is prepared for surgery (and as such bypassing the ward where they would otherwise have been admitted by the ward nurses, prepared for surgery, and arranged for transport to surgery). iii) Hospitals have improved their discharge planning procedures. Discharge planning now commences at the pre-admission clinic stage or is handled by general practitioners. Many hospitals have established discharge liaison nurse positions. In those ways some of the work and pressure involved in planning an appropriate discharge has been removed from the role of the ward nurses; iv) Patients are happier with these procedures, which increase their education, reduce their length of stay, reduce their rate of complications and readmission and make them accordingly easier to nurse; v) In respect of medical admissions the work involved in admitting day only patients has been streamlined and is now much more efficient. Further, there has been a significant decline in overnight admissions. There is far more work involved in admitting and discharging overnight admissions. Active steps being taken to ensure nurse workload is appropriate. Any assessment of increasing work must be done mindful of the staffing levels for that work. In that regard nursing management have been careful to ensure that the workload matches the staffing levels and have taken many other active steps to relieve the pressure on nurses.

213 The Association's response to these positive and/or ameliorating factors may be summarised as follows: The creation of specialty units - there was no suggestion in the evidence that the creation of specialty units was widespread. There was evidence to the effect that the so-called specialist units themselves were often in high demand and were not able to cope with those demands, thereby necessitating a practice of sending specialist patients to wards that would not ordinarily cope with those patients. This practice is known as the practice that results in there being "outliers". The existence of specialty units indicates that the trend towards specialisation has continued and that this reflects a different way of providing care in the acute public hospital setting. Improved drugs and technology - here the HAC refers to its argument that new surgical techniques, particularly keyhole surgery have had an ameliorative affect upon the work of nurses. The difficulty with this proposition is that it fails to take account of the fact that such surgery enables a greater number of procedures to be undertaken and this impacts upon work value. Secondly, while it may well be that these procedures are better for patients, this does not mean that workload is reduced, or that work value has not changed. Increased use of standard protocols - The evidence does not show that the complexity of the work of nurses is reduced, and even if that were so, that of itself would not mean that there had not been work value change. Streamlining and improving admissions and discharge - The introduction of streamlining and improving admissions and discharge programs, particularly the pre-admission clinic, simply accentuates the fact that significant workplace change has occurred in the work and role of nurses. Even if the admission work is not being done by the nurses in a particular ward, but has taken place in a pre-admission clinic, that work is still having to be performed by some nursing staff somewhere in the system. It simply shifts the location and the timing of the work, it does not mean that the work is not being performed by nurses. Active Steps - The overwhelming body of the evidence was to the contrary, namely that workloads are excessive and that there has been significant change. What is also apparent is that there were nurses in situations of crisis and distress and that nothing was being done to alleviate this.

214 We consider the positive and/or ameliorating factors identified by the HAC are appropriate to be taken into account in assessing whether there has been any change in work value. We have given what we consider to be the appropriate weight to the HAC's factors in balancing the competing considerations as we have in the earlier decisions in this and the related applications. Work value - other considerations

215 There were a number of other considerations which the HAC urged us to take into account in the context of assessing any change in the work value of nurses. Firstly, it was submitted that the Association relied on various changes that have occurred which, to the extent they have occurred, would properly be seen as improvements in productivity. They included claims of: higher numbers of patients per year; increased bed occupancy; shorter length of stay; increased acuity; and decreasing numbers of nurses to do the work. It was submitted that improvements in productivity do not, in themselves, justify an increase in pay under the change in work value principle. Where an increase in productivity is relied upon, an increase will only be awarded under the change in work value principle where the increase in productivity is coincidental with a change in work value.

216 The HAC submitted that if improvements in productivity were to be taken into account, then as for work value change, any increases in productivity that have been taken into account in negotiating past increases would not be considered again. In this respect, it was contended improvements in productivity that have occurred since 1996 have been compensated by wage rises obtained by the Association in that period under both the 1996-99 Agreement (as set out in the December 1996 MOU) and the 2000 MOU. The HAC asserted that the parties expressly agreed that there was to be improvements in efficiency and productivity as a result of those agreements. It was submitted that even if the 2000 MOU did not have the effect of improving productivity because the HAC had failed to insist on its entitlements under that agreement, that does not assist the Association which still received the money on the basis that the HAC could obtain such entitlements. We consider there is no doubt that the 2000 MOU had the intention of obtaining improved productivity improvements.

217 The HAC referred to the amount of wage increase received by nurses in the period between 1 July 1996 and 1 July 2004 and contended that such increases could not be disregarded. The HAC noted that the overall increase for nurses, before the effect of compounding, has been an increase of 36 per cent, with some grades obtaining higher increases. For example, NUMs have obtained increases of 43-45 per cent before compounding since 1 July 1996. The effect of increases after compounding meant that since July 1996 an RN 8th year had received a 44 per cent increase, an NUM 1, 56.4 per cent and an NUM 3, 55.5 per cent.

218 The Association's position regarding productivity improvements was that even if some of the measures relied upon might indicate increases in productivity, money that might have been paid in respect of them for productivity purposes does not necessarily result in a correct valuing of the work for remuneration purposes. Further, it was submitted whilst the 2000 MOU may reflect an intention on the part of government that there might be some restructuring which in turn might have improved productivity, there is simply no credible evidence that any of this was carried out (other than perhaps the reference to salary packaging), nor is there any evidence of an appropriate costing being made. Counsel submitted: The mere fact that there were agreements about improvements in efficiency and productivity does not establish either that those improvements occurred or that they were compensated for. It is more arguable that the wage increases granted pursuant to the 2000 MOU were aimed to buy industrial peace. This is so because:- a. there is simply no reference to either work value or productivity datum point; b. there is no specification of the outcomes expected; c. any productivity increases must have had different effects for different classifications of worker, and this is not treated in the 2000 MOU; d. the increases granted were the same for all classifications across all sectors and industries. This could hardly have been involved in assessment of work value. 219 We are satisfied that the objective of the 2000 MOU was to achieve improvements in productivity and efficiency in return for an increase of 16 per cent. We are also satisfied that the 1996-99 agreement between the HAC and the Association involved wage increases in consideration of work value factors, particularly in respect of NUMs. As the HAC contended, some of the more significant matters now relied upon by the Association in support of an increase based on changed work value were matters relied upon to justify wage increases under the 1996-99 agreement and are matters representing improvements in productivity. For example: higher numbers of patients per year; increased bed occupancy; shorter length of stay; increased acuity; and decreasing numbers of nurses to do the work.

220 Clearly, if an increase in work value has already been compensated for, a further wage adjustment in respect of the same work value increase would be double counting. Similarly, if improvements in productivity have brought about changes in work which have already been recognised by the payment of wage increases, care must be taken to avoid any double counting by awarding further increases in respect of those changes.

221 The second consideration that the HAC submitted the Commission should take into account in assessing work value was the flow on implications of any increase. It was submitted that an assessment of the change in work value of one group of employees would not give any other group an automatic right to claim a similar increase. However, in an environment where all public sector employees are obtaining the same wage increases within the framework of a public sector wages agreement, if one group goes outside that agreement and obtains greater increases it will inevitably lead to other union parties seeking similar increases.

222 Further, the HAC submitted, much of the change in work value change claimed by the Association in these proceedings relies on changes to the public hospital system in recent years, being changes that must also have had an effect on other groups of employees working in that system. It was contended that it is impossible to conclude that matters such as a decrease in beds, increased throughput and greater acuity have not affected other health workers as well. Any increase in work value based on such 'system' changes would inevitably be relied upon by other groups of employees in the health system in seeking equivalent wage increases.

223 It was submitted these considerations help to emphasise the importance of not awarding any work value increase before the end of the current MOU, so as to avoid the pressures for flow-on that would otherwise inevitably arise. The Commission would not depart from its approach as to the sanctity of agreements in respect of the 2000 MOU save in the most extreme of cases. That would be the case even if the only signatories to the MOU were the Association and the HAC. The position is a fortiori given the other union parties to the MOU and the consideration that must be given to the implications for flow-on arising from awarding an increase to one party to that MOU during its life. The HAC contended even if the Full Bench were to confirm that any increase would only apply from 1 July 2004 that does not remove the issue of flow-on as a consideration.

224 It was further submitted for the HAC that the question of flow-on also arises in respect of nurses employed in the private sector. It was said there is a strong nexus between the rates in the public and private sectors and that wage increases in the public sector have in recent times flowed quickly through to the private sector.

225 In relation to flow on the Association submitted:

· A genuine and substantial change to work value should not go unrecognised merely because other workers may believe they have similar genuine and substantial changes to work value. What are prohibited under the principles are wage increases that may be used as a basis for 'leapfrogging'. There is no single group of workers identified in the HAC's submission that would have the ability to successfully "leapfrog" on the basis of any increase awarded to nurses on the basis of work value.

· The asserted "inevitability" of other public sector unions seeking similar wage rises is an unfounded assertion.

· As to the possibility of other unions seeking a further increase during the term of the MOU, it would be difficult in a practical sense for any proceeding of a significance to be run and determined prior to 1 July 2004. More importantly, the Full Bench interim decision clearly set out the difficulties facing any group seeking a pay increase during the term of the MOU. The obstacles to such a course are formidable.

226 We consider there is some force in the HAC's submissions regarding the potential for flow on, both in respect of the public and private sectors. There is also merit in the Association's contention that a genuine and substantial change to work value should not go unrecognised merely because other workers may believe they have similar genuine and substantial changes to work value.

227 In the present circumstances, however, we consider the potential for flow on of any wage increase granted on work value grounds requires us to take a conservative approach for the following reasons: a. Notwithstanding the special circumstances that led us to grant an increase to nurses in our Interim Decision, the Association moved with alacrity and purpose to flow the increase on to the private sector; b. The changes identified by the Association to justify wage increases in these proceedings was change said to be systemic change, brought about by deliberate policy decisions which have led to a decrease in beds, increased throughput and greater acuity amongst patients. It is difficult to avoid the conclusion that other groups of health workers would regard these changes as also having an impact on their work although such other workers would carry the onus of satisfying the relevant wage fixing principle. 228 The third consideration raised by the HAC was the Association's special case claim based on the nursing shortage and the disparity between nursing rates of pay and other graduate professionals. The HAC submitted that the Commission considered and essentially determined the special case aspect of these proceedings in its Interim Decision leaving for consideration in this stage of proceedings only the work value aspect of the case. The Association, on the other hand, submitted it was clear from the Interim Decision that the special case aspect of the claim was not in any respect finally determined by that decision. The shortage of nurses, in particular, was a primary basis on which the interim increase was granted and is a matter to which further consideration was to be given. The relationship of RN pay rates with other professional rates such as those of physiotherapists and the loss of relativity is one further aspect of the special case that is open for further consideration.

229 The fourth consideration was the economic impact of the claim. In this respect, the HAC submitted:

· The Commission has a duty to consider the state of the economy of NSW and the likely effect of its decision on that economy.

· Any further increase in wages on the basis of work value, and any new allowances (particularly given the substantial cost associated with the new allowances claimed) would need to be carefully considered in light of that duty.

· The HAC put submissions as to these matters as part of its submissions as to the Interim Decision, and relies on those submissions.

· The HAC reiterates its submission that any increase in the cost of employing nurses has the potential to affect the HAC's ability to fund initiatives to address the nursing shortage. The HAC is pursuing a significant number and range of initiatives, many of which carry a substantial cost. The HAC notes the Full Bench's conclusion, in the Interim Decision, that "a proper balance will need to be struck between the level of wage increase awarded, if any, and other initiatives that may be appropriate or necessary". Given the 6% already awarded, and the expansive range of initiatives in place, the Full Bench would not award any further increase in wages at this time. 230 The Association submitted that the HAC relied on mere assertion that any pay increase would adversely affect other measures put in place to deal with the nursing shortage. It did not identify which measures would be affected. It does not explain why this should be so, given that the State Government has committed to full funding of any increases granted. 231 In relation to the economic impact of the Association's claims Ms Brus, for the Minister, relied on the material referred to in the Interim Decision. Ms Brus provided an update in relation to the State's fiscal position comprising excerpts from the NSW Half-Yearly Budget Review 2002-03. The information showed that the previously cited budget surplus of $168 million in 2002-03 and $101 million in 2003-04 as contained in the 2002-03 Budget had reduced to $86 million and $71 million respectively.

232 It was submitted for the Minister that in relation to the commitment to fully fund any increase granted by the Commission the Association had wrongly interpreted this as being some exceptional act on the part of the Government. Further, it was submitted that: A reduced revenue source coupled with a considerable increase in expenditure in the general government sector will have a significant effect upon the ability of the government to exercise its discretion in spending. There is no dispute that governments have discretion over where public funding will be directed. Subject to the agreement of Parliament, the government can choose to direct more or less funding into areas of its responsibility. But the fact that the government has such discretion, does not increase the government's capacity to spend in the aggregate.

233 As the HAC contended, the Commission is required, pursuant to s 146(2) of the Act, to take into account the public interest in the exercise of its functions and, for that purpose, must have regard, inter alia, to the state of the economy of New South Wales and the likely effects of its decisions on that economy. Hence, even though wage increases may be justifiable under the work value principle, if to grant them were to have an adverse impact on the economy, a case may exist for restraint. The onus of demonstrating the need for restraint would fall on those opposing the increase because unless it can be convincingly demonstrated that real harm will be done to the economy by the granting of any increase, the employees concerned are entitled to receive remuneration commensurate with the value of their work.

234 The fifth consideration related to interstate rates. The HAC tendered comparisons that showed that the rate for an RN8 in New South Wales in July 2003 was higher than RN8s in every other State even taking into account qualification allowances paid to nurses in Victoria and Queensland. The HAC submitted (references deleted): The interstate comparisons are considerations that must have a moderating effect on any decision to grant any additional wage increase, as determined in the Interim Decision. This is also a matter considered by the AIRC Full Bench in the Queensland Decision [Print PR931289, Munro J, Marsh SDP, Deegan C, 16 May 2003 at [95]]. The AIRC Full Bench determined that in circumstances of a national shortage of nurses regard is to be had to the market rates for nurses. The rates determined upon placed Queensland nurses in a "relatively competitive position in the national market for nurses" (being rates below the rates for NSW nurses from July 2003).

235 The Association's response on the question of interstate rates was that the HAC's comparisons show a slight advantage in pay rates to New South Wales nurses. Any difference, it was submitted, was more than outweighed by the greater cost of living in New South Wales and particularly in metropolitan areas where the majority of nurses are based. Having regard to the cost of living in urban New South Wales and the attractions of lifestyle available in Queensland it is apparent that the rates of pay for nurses in New South Wales are uncompetitive with those in Queensland.

236 The fact that nurses in New South Wales are the highest paid of all the States is a consideration that we are prepared to take into account and it must have a moderating influence.

237 It will be seen that we have attempted to address all of the considerations that have been put to us by the parties in these proceedings. In relation to each of the individual factors identified by the Association as contributing to an increase in the value of nurses we have expressed a view as to whether or not we regard those factors as meeting the test laid down in the work value principle. Most of the changes relied upon by the Association, with the notable exception of the effects of higher levels of acuity and dependency do not, taken in isolation, constitute a significant net addition to work requirements for registered nurses generally. On the other hand, we have found that the changes affecting ENs do represent a significant net addition to work requirements.

238 In assessing whether the changes to work requirements discussed in this decision constitute a significant net addition to work requirements and in determining the level of any pay increase, it does not seem to us that we should limit our consideration to the impact of higher levels of acuity and dependency on registered nurses. Whilst it is the case that the other changes we have identified do not, of themselves, constitute a significant net addition to work requirements we consider it is appropriate to ask whether these other changes, in combination, meet the test under the work value principle. That is, whilst the requirement to keep pace with the introduction of new technology does not, of itself, constitute a significant net addition to work requirements for nurses is a different answer arrived at when one also has regard such other matters as: the ageing population; additional duties that it is claimed nurses are now required to perform, such as nurses performing functions previously performed by doctors; discharge planning; implementing child protection legislation; greater accountability; mentoring and preceptorship of less experienced nurses; increased paperwork and meetings; undertaking mandatory and other training; and, having a greater role in policy development and protocols in the context of the overall change that the Association contended has occurred in the public hospital system?

239 We have come to the conclusion that the answer is in the affirmative. We accept the Association's submission that when one has regard to the combination of all of the factors that have been canvassed in this judgment the conclusion must be that there has occurred a significant change in the role of nurses within the public hospital system. As it was submitted for the Association, the public hospital system provides a different service in a different way to the one which it provided prior to 1996 and this is exemplified by the emphasis on confining the patients' stay in hospital to the most acute phase and providing for all other phases, including high acuity phases, to be managed in the home or other facilities in the community. This phenomenon has had its own impact on nurses' work through increased levels of acuity and dependency but at the same time the other demands on nurses that we have identified have continued to grow.

240 This is not to say that the change in the public hospital system is for the worse. Whilst the change has increased the demands on nurses we consider on the evidence available to us, despite the occasional crises and the budgetary constraints, the system is improving. This was evident, for example, in the treatment and care of the elderly. Nurses have made a significant contribution to these improvements.

241 We find that there has been a significant net addition to the work requirements of registered nurses and ENs over the relevant periods such as to warrant an increase in rates of pay. In assessing the level of pay increase we have concluded that only a moderate increase is justified. Our reasons for arriving at this conclusion are as follows:

1. Many of the changes referred to by the Association as having occurred since 1996 are not new. Many have been the subject of previous inquiries into the work value of nurses going back to 1981 or 1990 respectively. Care has had to be exercised to avoid taking into account the change that occurred prior to the datum points.

2. In many occupations, particularly professional occupations, change, and the requirement to cope with it by coming to terms with new methods and new technology, is an inherent and accepted characteristic of the employment part of the evolutionary process of change which does not provide a basis to award pay increases. 3) The wage increases received by nurses under the 1996-99 agreement; the 2000 MOU and the Interim Decision were, in part, in recognition of work value change or improvements in productivity and efficiency. In order to avoid double counting any wage increase would have to have been substantially discounted. In the seven years to July 2003 the benchmark classifications of registered nurse 8th year received an increase (compounded) of 44 per cent and grade 3 nursing unit manager an increase of 55.5 per cent.

4. The flow on implications of granting further substantial wage increases to nurses on work value grounds are such that a cautious approach is necessary. 5) The fact that nurses' wages in New South Wales are higher than their counterparts in all other States has had a moderating influence in determining the amount of pay increase. 6) The increases in work value across the nursing workforce in the public hospital system have not been uniform. Change is more readily apparent in such areas as emergency departments, intensive care units and community nursing. However, in some other clinical areas it is arguable that in net terms the change is only marginal. In light of the claim for an across the board increase and in the absence of any specific proposals from the HAC as to how any increases might be targeted, a proper balance has to be struck.

242 Having regard to the conclusions reached that a cautious and moderated approach must be adopted to any wage increase, we consider that neither the HAC nor the Minister has demonstrated that an increase at the level we grant is not available on economic or public interest grounds.

243 The Association has made a claim for retention allowances, namely $10,000 on the award being made (for those with more than 2 years service - for those with less service, they are to be paid $10,000 upon achieving 2 years' service) and a further $5,000 per annum thereafter, to be paid on the anniversary of the making of the award.

244 The HAC estimated the cost of the claim to be $271.42m for the initial $10,000 payment, and an ongoing $151.83m per year for the $5,000 payment, a total of $423.25m. The HAC submitted this was an extremely high cost to the respondent. The ongoing component would be roughly equal to the cost of awarding an 8.5 per cent across the board wage rise. 245 The Association submitted the retention allowance claim was conformable with an offer made to teachers. It was asserted the rate at which it is set would be a powerful incentive to nurses to remain in the system.

246 The HAC submitted the retention and recruitment benefits paid to teachers are not arbitrated allowances, nor even a matter dealt with in an award, and so have very limited weight as a precedent. There was no evidence as to the precise problems the teacher benefits were designed to deal with, or their success rate. In any event, it was submitted, they are quite different to the retention allowance claimed. The teacher policy involves a $5,000 per annum retention benefit paid only to teachers at 20 regional schools, and which is only payable after they have been there for two years and then for a maximum of five years. There is a further $10,000 recruitment benefit that is paid on entry into duty at a school that is only payable where the position has otherwise remained unfilled following conventional measures and only on the condition the teacher agrees to stay in that position for at least three years (or two years if it is a position at the 20 schools).

247 Further, it was submitted, retention allowances would not be granted by the Commission, consistent with long-standing authority, because they do not reflect a fair rate of pay, and once in the award they become part of the ongoing rate of pay and are very difficult to remove even after the need for them has gone. The HAC contended there were real flow-on implications. A retention allowance would create a precedent that could be relied upon in other situations where there is a shortage, for example teaching or other classifications within the public hospital system, such as pharmacists.

248 The HAC described the retention allowance as a "blunt instrument" given the evidence that recruitment and retention is not a problem across the State, or across all disciplines. A fundamental problem with the claimed allowance is that it is to be paid to large numbers of nurses who have no intention of leaving nursing.

249 The HAC referred to the Queensland Decision where the parties were in agreement that there should be a retention and attraction component to any wage increase, but disagreed as to the way it would be provided and the quantum. The Full Bench of the AIRC ultimately determined to award a 4 per cent attraction and retention allowance to the NO1 grade and a further 2 per cent attraction and retention allowance at the NO2 grade. The HAC submitted that the circumstances of the AIRC awarding such allowances was unusual and was a departure from what the Full Bench described as the "usual practice adopted by the Commission", namely that it "would not as a general proposition [grant a wage claim] on the basis of attraction and retention for particular classes or categories of employees".

250 The HAC contended that the Association's claim was fundamentally unsound. The HAC submitted it was difficult to see what utility there is for the initial one-off payment. It cannot be said it will retain nurses. Further, it was submitted the annual payments of $5,000 are to be paid on the anniversary of the award being made. This will give nurses who would otherwise resign a strong financial incentive to do so in the period immediately after that anniversary date, and discourage resignations in the period leading up to that date. This will cause an unnatural peak in resignations shortly after a particular date each year, which will exacerbate difficulties in managing the nurse workforce. 251 In response to the HAC's submissions the Association said that in so far as the respondent's objection based upon the putative cost of the claim for retention allowances was concerned, the Government made clear during the course of the proceedings that it would fully fund any increases which may be granted by the Commission. While it may be said that any allocation of additional remuneration for nurses will have an impact on Government's budget overall, the evidence did not establish that there was a financial incapacity on behalf of Government to cope with its promise to fully fund all increases, nor did it establish that there was no discretionary spending within the Government's recurrent budget expenditure which would be incapable of adjustment.

252 The Association submitted that the HAC's description of retention allowances as a "blunt instrument" does not adequately answer the claim, particularly in circumstances where the HAC's own strategies, while well intended and no doubt a useful sub-stratum for action, have singularly failed to "turn the ship around" or dampen the trend towards high turnover and increasing vacancies and other manifestations of the shortage, including recourse to agency nurses and the casual pool.

253 In relation to the Queensland Decision the Association submitted the mere fact that there was agreement about the need for attraction and retention payments would not have justified the Commission in awarding retention and attraction payments in terms that differed from proposals made by either of the parties, unless the Commission was satisfied that there was an appropriate basis to do so. In those circumstances, that part of the decision is of assistance to this Commission.

254 We do not see any intrinsic merit in granting an across the board retention allowance. There was no convincing evidence that granting the allowance would, in the longer term, have the effect of retaining nurses in the public hospital system; the cost is too high (see Re Health and Community Employees Psychologists (State) Award (2001) 109 IR 458 at 479); it is not a targeted strategy and in that respect it is a different approach to that adopted in respect of teachers; it has real flow on potential; and, as the HAC submitted, it is likely to produce an unnatural peak in resignations shortly after a particular date each year, which will exacerbate difficulties in managing the nurse workforce. The claim is refused.

255 The Association seeks the following scale of allowances for registered nurses and enrolled nurses who hold the relevant qualifications:

Hospital certificate or Graduate $40.00 per week Certificate Post graduate diploma or degree (other than a nursing undergraduate degree) $60.00 per week Master's degree or doctorate $75.00 per week

256 The Association submitted significant numbers of nurses in New South Wales have since obtaining their primary registration qualifications proceeded to obtain further qualifications that may be described as postgraduate qualifications. This has been the case for both hospital based nursing graduates who received their pre-registration educational preparation in hospital based programs and also for the University graduate in nursing. The qualifications sought and obtained by registered and enrolled nurses included postgraduate certificates, diplomas, degrees and masters and doctorate qualifications.

257 The Association contended that the motivation for obtaining post graduate qualifications has been far more directed to enabling those nurses to perform the work which is required of them to the standard which is required of them than it has been for aimed at obtaining promotions or improvement in remuneration.

258 Reference was made to the HAC's contention that the qualification allowances should not be paid because of the transfer of nursing education to the tertiary sector in the late 1980's. The Association referred to the HAC's reliance on the fact that in granting professional rates the Commission did away with degree allowances which then applied by saying that obtaining qualifications was now a necessary part of the professional nurses undertaking and that no special remuneration should be provided.

259 The Association submitted the primary difficulty with the rejection of a qualification allowance by the HAC was that the deletion of qualification allowances from Award prescription in connection with the Professional Rates Case was based upon the notion that a graduate qualification or degree was now a requirement resulting from the transfer of nurse pre-registration education to the tertiary sector. The Association said the developments which have occurred since that time include the fact that pre-registration nursing education has been transferred from what was the College of Advance Education Section to the University Sector and, moreover, that the degrees which are now being obtained by registered nurses are post graduate in nature. Furthermore, those qualifications are not being obtained as part of a registration requirement or for the purposes of career advancement but rather because nurses recognise that in order to perform their work adequately and to the standard that is required both of them and of the employing authority and of the community at large requires that they obtain such further qualifications.

260 It was submitted the claim for qualification allowances was based upon the unchallenged proposition that the public hospital system, as the provision of care becomes more specialised, more technologically driven, and more intense, increasingly requires nurses to have a range of graduate qualifications. In this respect the situation has altered dramatically since the Professional Rates Case.

261 The Association referred to the Queensland Decision by the Full Bench of the AIRC. It was contended that that Decision recognised and applied the fundamental industrial principle that where employees acquire and may be required to use skills beyond the basic qualification, there should be recognition of those skills. The decision of the AIRC was that, in addition to an accelerated advancement, allowances of 3.5 - 5 per cent are to be payable to RNs at level RN8 and above where the skill acquired is directly relevant to the competency and skills used by the employee in the duties of the position. In so determining the Full Bench noted (at par [138]) the earlier introduction of qualification allowances in Victoria, Western Australia, South Australia and Tasmania.

262 The Association submitted that the allowances sought in the present case would only apply where the qualification was "relevant to nursing". It was submitted that whilst the quantum and form of the allowance sought in the present case differs from that awarded by the Full Bench of the AIRC to Queensland nurses, the underlying principle was identical. It was noted that in respect of the Queensland allowance the Full Bench prepared a draft clause and invited submissions on the particular form of the clause. It was submitted that in the present case this might be a useful approach.

263 The HAC opposed the introduction of qualification allowances. It was thought that about 60 per cent of registered nurses have an additional qualification that would entitle them to one of the allowances sought by the Association in these proceedings. The cost of granting such a claim was estimated to be about $55m, equivalent to awarding a general increase of about 3 per cent.

264 The HAC submitted the general rule in awards for professional employees is that allowances are not separately prescribed for the possession of specific qualifications: Professional Rates Case (Re Public Hospital Nurses (State) Award, Cahill VP, Bauer J and Sheils CC, 10 July 1989).

265 It was contended for the HAC that the qualification allowances sought for registered nurses were allowances for holding post-graduate qualifications. The same type of allowances were removed as part of the Professional Rates Case on the basis that the new rates of pay recognised the professional qualifications required to do the work.

266 It was submitted the qualification allowances claim as drafted was industrially unsound because it required a payment based on the holding of a qualification where the qualification was not necessary to hold or undertake the position. This in fact goes beyond even what the Association sought to maintain in the aftermath of the Professional Rates Case. The claim in that case (which was rejected by the Bench) was a claim limited to preserving those allowances that were required to be utilised in the performance of duties on which employees were engaged.

267 The HAC submitted that just because a registered nurse has a doctorate, that was not in itself an industrially sound reason to pay them an additional amount every week. For example, they might be doing relief agency work on a ward while they do further study, being work which does not require them to exercise any of the knowledge they gained from that doctorate. Yet, if the claim were successful, they would get more money for doing the same work as another nurse because of their personal qualifications. In that manner the claim is industrially unsound because it would lead to nurses being paid differently for doing the same job. It would mean nurses were paid more based on their personal attributes, rather than on the work value of the job they were doing. 268 It was contended that to the extent the claim for qualification allowances was a claim for holding the minimum qualifications that were currently determined necessary for a position that was industrially unsound because, at least to that extent, the claim amounts to 'double counting' those qualifications. This was because: a. rates of pay assessed on work value principles are set taking into account, amongst other factors, the qualifications necessary for the job and the training period required; b. in the Interim Decision rates were increased, in part, in recognition of the fact that nurses had fallen behind the rates for other professionals; c. qualifications necessary for promotional positions, such as managerial positions can be taken to be recognised in the rates of pay for those positions; and d. even below managerial grades there exist higher classifications which attract higher rates of pay on the basis of nurses holding relevant post-registration nursing qualifications, including: (i) in respect of registered nurses, Clinical Nurse Specialist and Clinical Nurse Consultant Grades 1-3; and (ii) in respect of enrolled nurses, Enrolled Nurse Special Grade.

269 The HAC submitted that the recent Queensland Decision of the AIRC provided no real assistance to the Association's current claim for qualification allowances. In that case the AIRC Full Bench determined that higher qualifications would give rise to accelerated advancement. Upon reaching the top pay level of a grade (e.g., RN8) the AIRC determined qualification allowances would then be payable, namely 3.5 per cent for holding a certificate, graduate diploma or second degree and 5.5 per cent for a masters or doctorate. However, the AIRC Full Bench determined that such allowances were only payable where the credential was "accepted by the employer to be directly relevant to the competency and skills used by the employee in the duties of the position", provided that an employee can pursue a grievance where the employer has unreasonably refused such approval. It has to be a qualification that is "in a clinical field relevant to the employee's current position". The Association's claim in these proceedings does not contain qualifications of that type.

270 As to the flow on implications of granting qualification allowances to nurses, the HAC submitted that if professional employees were granted an allowance for choosing to seek and obtain post-graduate qualifications, that would have the real potential for flow-on to other professional groups (particularly where the allowance was payable regardless of whether the qualification was necessary to hold that particular position).

271 The HAC noted that the claim for enrolled nurses was for an allowance for holding a TAFE Certificate Level IV. It was the qualification that Ms Manwarring described as the Advanced Certificate, which has been accredited as a Level IV classification. It was submitted the claim for an allowance for enrolled nurses was misconceived for two reasons. First, it was a claim for an allowance for holding the minimum qualification held by those commencing as an enrolled nurse since 1992. The claim, apparently designed to benefit those who started before 1992, would give a windfall to all those who started after 1992. For those nurses the allowance would be, in effect, an allowance for being an enrolled nurse. 272 Second, and in any event, it was submitted, the Association's claim for an increase in pay for enrolled nurses was squarely based on the change that occurred from 1992 in the training of enrolled nurses (when the Advanced Certificate began to be taught) and the consequent expansion in their skills, knowledge and responsibility. That change in training and the consequent enhancement of the role was recognised by agreement between the parties in the consent rates put before the Commission in the 1990 proceedings, and so cannot not be relied upon again in these proceedings to justify a further increase, including by way of a new allowance. Even if that were not to be accepted it was submitted, the Association's claim for a qualification allowance would be an attempt to double-count this training requirement.

273 The HAC submitted that if, contrary to its submissions, the Full Bench determined to award qualification allowances in some form, it would be inappropriate to make that variation take effect before July 2004. That was because the claim for such an allowance was in the nature of a general wage increase and so would be precluded by the MOU during its term in the same way as a general wage rise was precluded as recognised by the Full Bench in the Interim Decision unless there were exceptional circumstances.

274 We agree with the HAC's submission that the Association's claim in respect of qualification allowances as it is framed, is "industrially unsound" especially because there is no relationship between the employer's needs, the qualification gained, and the skill and responsibility exercised by the nurse holding the qualification. Accordingly, we reject it. We are, however, attracted to the approach adopted by the Full Bench of the AIRC in the Queensland Decision in relation to a targeted continuing education allowance for nursing staff. In its decision the Full Bench observed (references deleted): [136] The foundation of entitlement we have determined is an accelerated advancement within the incremental scale for the acquisition of additional qualifications. In reaching our decision we have had regard to the requirements of the Work Value Changes and the Adjustment of Allowances and Service Increments Principles, in particular the tests which must be met to create a new allowance. [137] In our view, the conditions of eligibility for the allowance also serve to justify the introduction of the allowance. These conditions require not only the possession of a relevantly defined qualification but also that the credential be one which is " accepted by the employer to be directly relevant to the competency and skills used by the employee in the duties of the position ". Those criteria afford a sound basis upon which an increase in the value of the work performed by a Nursing Officer in Queensland can be identified within the respective classification structure. [138] We note the introduction of a three tiered qualification allowance into the Nurses (Victorian Health Services) Award 1992 through an arbitrated recommendation about the content of an agreement. Industrial instruments in Western Australia, South Australia and Tasmania also provide for a form of qualifications allowance. Each of those entitlements would appear to have its rationale in an attributed relationship between the recognised credential, work competency, and appropriate remunerative reward. A degree of relationship of that kind has been asserted in this case. We accept that such a relationship could be demonstrated in particular circumstances. The existence of such a relationship becomes a factor of some weight in justifying an allowance for continuing education in a form primarily of an accelerated advancement entitlement within the classification structure. Such an approach may be conceived to be compatible with the reasoning of the Full Bench which, when introducing national rates, phased out qualifications allowances on the basis that they " are not, in our view, appropriate to the new career structure". In the National Rates (Nurses) decision, the Full Bench stated that the new rates for registered nurses " take into account basic education qualification, work requirement and responsibilities". It also concluded that, " We are not however opposed to accelerated advancement within the incremental scale for additional qualifications or skills". … [140] The continuing education allowance we propose builds upon an approach adopted by Queensland Health. By a step consistent with the Full Bench National Rates (Nurses) decision, it introduced one year accelerated advancement at entry point for a registered nurse. Another instance of accelerated advancement was provided for in clause 7B of the QPHS Award, for ENs and 12-month trained AINs. That clause allows for paypoint progression based on post-enrolment qualifications recognised by the employer. The scheme of accelerated advancement will evolve to an allowance under the provisions agreed for inclusion in the final awards. The mechanism is an additional (6th) paypoint established for AINs. It is accessible by attainment of a nationally accredited qualification plus 12 months service at the 5th paypoint. After a further 12 months service at the 6th paypoint, the entitlement converts to an allowance of $21.50 approximating to 2% of the maximum rate at the 5th paypoint for AINs not in possession of the credential. A similar provision for accelerated advancement, followed by a retained allowance of $31.50 will apply to AAINs. Enrolled Nurses who are entitled also to accelerated advancement under clause 7B of the QPHS Award will be entitled under the final awards to be appointed to a special 6th payment, for Enrolled Nurse (Advanced Practice), set about 3% above the highest paypoint for ENs not similarly qualified. [141] The allowance we determine will relate to a post graduate qualification held by a registered nurse and acquired as a response to the need for continuing education. That form of allowance should not reflect upon, nor create, a tension with the form of accelerated advancement upon entry currently provided for registered nurses. … [144] …The provision determined will provide, in the case of nurses classified at NO1, for accelerated advancement up to NO1.8, and after 12 months service at that level for an allowance of 3.5% or 5.5% of NO1.8 according to the qualification held. Any such allowance will be retained upon appointment to NO2 to NO4 level classifications. Upon satisfying the continuing education entitlement conditions, nurses classified at NO2 to NO4 will also be entitled to accelerated advancement within their respective classification. Upon 12 months service at the highest point, they will be entitled to a retained allowance of the monetary value set for nurses with 12 months experience at NO1.8. [145] We have paraphrased at [137] the conditions that must be satisfied for the entitlement to be payable. Some conditions, not necessary to detail here, will apply to the retention of the allowance. The 3.5% rate of allowance will apply where the credential held in accordance with the conditions is in a clinical field relevant to the employees current position, and is a graduate certificate or diploma, or second degree, or credential of equivalent value recognised by the employer. The 5.5% rate of allowance will apply to Masters or PhD degrees of similar relevance. The provision determined appears as clause 27 of the final award for Queensland Health facilities. [146] We have restricted the entitlement to NO1 to NO4 levels for several reasons. Beyond those levels, the correlation between advanced credentials and work based competencies is more tenuous. Queensland Health in its alternative proposal did not concede any justification for accelerated advancement at higher levels. We doubt that any additional continuing education entitlement of the kind proposed would add much by way of attraction or retention at those levels. [147] The ANF was concerned that some qualifications especially those which are not university based may not be given appropriate recognition by the employer. In response to that concern, the final awards will include provision for a continuing education credential grievance procedure. It may be accessed on the ground that the employer has unreasonably refused the requisite approval, or ceased an allowance entitlement. The approach adopted in our view will strike the appropriate balance between ensuring that the integrity of the allowance is maintained, and providing discretion in the employer to determine which credentials satisfy an equivalent value standard to an extent warranting approval. It will also ensure that Nursing Officers have a process available to them to have a grievance resolved.

275 The new provisions determined by the AIRC Full Bench in the Queensland Decision are set out in the Nurses (Queensland Health) - Section 170MX Award 2003 (Print PR932194). We have not come to any final view about the specific approach taken in the Queensland Decision, including the amount of allowances there awarded, but we consider that the principles enunciated in that Decision may well be capable of being, and appropriate to be, applied in the New South Wales context. We propose to direct the parties to confer on the form and content of a "Continuing Education Accelerated Advancement Entitlement" provision for registered and enrolled nurses having regard to the provision of the Queensland Nurses' Award. The parties will also be required to consider the feasibility of introducing a similar concept for AINs.

276 The Association contended that there has been a significant disparity in the remuneration and other benefits accorded to assistants in nursing when compared with those applicable to wardspersons. It was submitted the evidence disclosed that wardspersons were a relevant comparator group for assistants in nursing; they have traditionally performed similar functions; and, have both operated under the direct supervision of registered nurses. Their responsibilities have extended to lifting, moving and transferring patients or residents, performing ancillary care functions, assisting in the implementation of care programs and performing a range of other ancillary functions that do not necessarily involve direct care for residents.

277 It was submitted the evidence disclosed that assistants in nursing have always had enhanced responsibility or at least more complex responsibility for the provision of care to patients and residents than that which has been required of the wardspersons. Nevertheless, wardspersons have continued to be remunerated significantly better than assistants in nursing. Further, that evidence also disclosed that the assistant in nursing classification is predominantly female whereas wardspersons have been predominantly male. In this way, it was submitted, it can be demonstrated that there is a significant pay equity issue for assistants in nursing.

278 Both the Association and HAC presented a comparative breakdown of the rates of pay applicable to AINs and those applicable to wardspersons. The table presented by the HAC is set out in annexure A to this decision and the Association's table is set out in annexure B.

279 The Association referred to the evidence of Ms Penning where she noted there is no specific qualification that a wardsperson must attain in order to gain employment but rather they are required to have knowledge of hospital services and equipment and previous experience in assistance and supporting the provision of patient care. Ms Penning observed as follows:- In general terms the wards persons role is to provide support and assistance in patient care predominantly in the area of physical and manual handling. The wards person usually works directly with an enrolled or registered nurse in the delivery of day to day patient care on the other hand the AIN is responsible for direct patient care and is usually the front line member of the care team providing all inclusive care.

280 Ms Monypenny in her evidence noted that there were no specific or mandatory continuing education programs for wardspersons at the Royal Rehab and that in general terms the AIN works under the registered nurse to provide support care for residents in their activities of daily living with a high emphasis upon holistic care. She contrasted this with the role of a wardsperson who works under the supervision of the registered nurse assisting the nursing staff with the transfer, transport and escort of clients, residents at Royal Rehab. Wardspersons assist nursing staff with personal hygiene and dressing of residents and clients. They also assist with the checking of equipment for damage and fault, changing bed linen, handling and replacing full linen bags, cleaning equipment and vacated bed areas.

281 Ms Monypenny also noted that AINs are required to demonstrate genuine efforts towards their professional development, attend in-services on the unit, attend mandatory in-service education programs and maintain and update their skills utilising educational opportunities where there is no professional development requirement for wardspersons.

282 The HAC's submissions regarding equal remuneration for AINs may be summarised as follows:

· The purpose of the Equal Remuneration Principle is to correct under-valuation. The rates for AINs were set by arbitration in 1990 based on the work value principle, and moved by consent in 1996, again on work value grounds. In these proceedings the Commission will determine whether there is any further adjustment necessary on work value grounds. Whether or not a further adjustment is thought necessary on those grounds, that exercise will lead to a determination by arbitration of a proper valuation of rates for AINs. There would then be no proper basis to submit that the rates so determined are under-valued. In those circumstances the Commission would have a proper basis to conclude that nothing is gained by consideration of the Equal Remuneration Principle.

· To the extent it might be argued that there would still be room for the application of the Equal Remuneration Principle because of an historical under-valuation of AINs on a gender basis, the evidence fails to demonstrate such a case.

· Even if historically wardspersons were predominantly male and AINs were predominantly female (something which the Association has asserted but without an evidentiary basis) one cannot conclude from that alone that any disparity in their respective rates arises from gender related reasons. The Applicant has not led any evidence to justify a conclusion that to the limited extent that AINs are valued at a lower level than wardspersons that has come about for historical gender related reasons. There is a differential, but there is no evidence to explain why that differential exists, other than evidence which shows that the duties and training in respect of the positions are not the same.

· The evidence cited by the Association does not make out a case that AINs and wardspersons do the same work or have the similar skills and training. There was no evidence from an AIN or a wardsperson. Of the witnesses who gave evidence, there was no evidence as to the historic duties of AINs or wardspersons.

· The Association's submissions pay no regard to the fact that the work value of AINs was fixed by arbitration in 1990 and since then AINs have had agreed increases that reflect work value up to July 1996. Given that work value determination, and the consequent consent work value adjustment in 1996, there is no basis for a conclusion that the rates for AINs have been historically undervalued.

· The submissions of the Association pay no regard to the fact that the rates for wardspersons have not been the subject of any work value arbitration in recent years, and so cannot be said to be properly fixed rates that are appropriate to be used as a comparator. While the record of wage movements for wardspersons since 1967 does not record the reason for every movement, it does not assert that there was any arbitrated work value adjustment in that period. The HAC's investigations have not turned up any arbitration that has specifically dealt with wardperson rates since the decision of Taylor J, President, in 1959: In re Hospital Employees (State) and Hospital Employees (Metropolitan) Awards [1959] AR (NSW) 566 at 611. This is to be compared to the situation being considered by the Commission in the Crown Librarians Case ((2002) 111 IR 48) where other professional classifications relied upon as comparators had rates set on the basis of proper work value reviews conducted by arbitration in the relatively recent period. The best that can be said in this regard is that there have been agreements reached between HREA and the Department in respect of increases in the rates of pay, which might be said to reflect work value considerations.

· The fact that the Association has not presented evidence as to the basis of previous wage increases for wardspersons leaves the Commission in a position where it is unable to know whether the under-valuation is sought to be demonstrated by reference to a comparator award rate that has factors incorporated into it other than work value, such as labour market attraction or retention rates or productivity factors: see Principle 14 (c). Indeed the Commission is aware that the rates for wardspersons do include some level of productivity payments, as evidenced by the 1997 MOU entered into between HREA and the HAC.

· In the 1990 proceedings the Association argued that rates for assistants in nursing were inadequate compared to hospital assistants due to an 'inequity and anomaly' (ie on the basis of a comparison with the same category of employees now apparently selected) and that argument was rejected. The claim succeeded on work value considerations alone. There is no reason to believe that anything that has occurred since 1990 would make a claim based on inequity compared to wardspersons rates any stronger.

· The relativities in the award were set in 1990 and further agreed in 1996. The Association does not now suggest that relativities in the award should be changed. In that respect, Principle 14(f) is relevant. Indeed the Applicant does not set out how the Commission is to deal with the equal remuneration claim in circumstances where the Association is seeking the same increase for AINs as for other nurse classifications.

· The Commission would move from the premise that the rates of pay for Assistants in Nursing have in the past been set relative to professional rates (i.e., the rates for Registered Nurses) which in turn have been rates assessed as appropriate by the Commission and the parties on work value grounds. Accordingly there is no basis for concluding that the rates for AINs have been historically undervalued, either on gender grounds or otherwise.

· If the Commission considered there was a basis to consider altering the rates of pay for Assistants in Nursing by application of the Equal Remuneration Principle it would do so as part of a separate case, for reasons including: a. Assistants in Nursing, who work primarily in aged care, are predominantly employed in the private sector or by other State government agencies, such as the Department of Aging, Disability and Home Care. There is only a small number employed by the Respondent. Any pay equity case that focused on Assistants in Nursing would be more appropriately run in respect of those institutions, or at least with the involvement of those institutions; b. the Commission would need more detailed evidence as to a variety of matters to properly determine the question than that which has been filed in these proceedings. The very limited evidence led by the Applicant does not allow for the conclusion that work value of Assistants in Nursing and Wardspersons should be considered the same, nor that there has been a gender inequality in the setting of rates for these two occupations in the past.

283 In reply, the Association submitted the Equal Remuneration Principle has as its aim the correction of undervaluation where it can be shown that there is a manifest preponderance of women working in a particular classification and men in the comparator classification. It was submitted the evidence establishes that this is so in relation to AINs and wardspersons. The rates for AINs may have been set by arbitration in 1990 based upon the work value principle. They were moved again by consent in 1996, but it is unsustainable for the HAC to assert that this was done on work value grounds. The Association submitted all that happened in 1996 was that agreement was reached; including an agreement by the Association that increases in wages would take account of work value considerations up to and including 1 July 1996. As a matter of fact, the agreement stands for no more than a contractual disavowal. It does not stand for the proposition that there was a correct assessment of work value in 1996.

284 The Association further submitted that it is not necessary for an applicant relying on the Equal Remuneration Principle to point to the fact that decisions in relation to remuneration were taken deliberately because of gender issues. Rather, the principle allows the Commission to draw inferences in an appropriate case that an apparent differential relates to gender issues where the preponderance of the workforce is of one particular gender and in the comparator group another. The fact that the differential of 10.9 per cent might have been contributed to because of the different industrial approach taken by the HREA as compared to the Association in 1996 is not to the point. The differential existed and was in the order of five per cent after a so-called work value assessment in 1990. That differential, having regard to the nature of the duties performed, ought to be enough to indicate a serious equal pay issue.

285 The Association asserted that a simple comparison of the award histories, and an examination of the competing job descriptions and evidence concerning responsibilities of AINs on the one hand and wardspersons on the other, particularly the evidence of Ms Penning, was sufficient for the purposes of the application advanced. It was submitted that what the evidence identified was that the role of the Assistants in Nursing is far more demanding, more sophisticated and required greater skill and knowledge, and that in the circumstances it was apparent that the AINs rates of pay involve a serious undervaluation.

286 There is clearly a disparity between the wages paid to AINs and those paid to wardspersons. Moreover, it may be inferred from what evidence there was about this that AINs are predominantly female and wardspersons predominantly male and there was some evidence albeit, in our opinion, quite limited, that indicated the work value of AINs may be higher than that of wardspersons. However, the evidence was not sufficient to make a proper comparison of the work of AINs and wardspersons and come to any determination as to whether the work of AINs is undervalued on gender grounds. We are, of course, in a position to assess the work value of AINs. We do not consider, however, that the evidence provided a proper basis upon which to make an informed assessment of the work of wardspersons noting that the last work value inquiry in relation to this occupation appears to have been in 1959.

287 Given that there are indicators suggesting that a pay equity issue may exist in relation to AINs and that the issue remains unresolved, we propose to grant leave reserved to the Association to make out a separate case.

288 There were two issues outstanding from the Conditions Case: a. the final rate for allowances under clauses 10(i)(a), nurse in charge of hospital, 10(vi) nurse in charge of hospital/in charge of shift, and 10(v), nurse in charge of shift; and b. whether a new allowance should be created for those who work away from a designated health facility, being the proposed clause 10(viii). 289 In relation to the allowances, we consider the method to calculate those allowances was appropriately set in the Conditions Case: (2002) 115 IR 183 at pars [36], [66]. Although we have decided to increase rates of pay by a modest amount we do not propose to make any change to the method previously adopted for determining these allowances.

290 In the Conditions Case the Full Bench considered a claim for a new allowance of $4.00 per shift for nurses who spend more than 50 per cent of their period on duty working away from a designated health facility in compensation for disabilities claimed to be associated with community nursing. The Full Bench held that: a. there was an arguable case that community nurses do experience disabilities above the norm which include: exposure to inclement weather and dirty and unpleasant working environments; and lack of staff amenities: 115 IR 183 at [85];

b. however other claimed 'disabilities' that go to health and safety are not appropriate to be compensated by allowance: 115 IR 183 at [86];

c. the Full Bench was not satisfied that the rate of pay for community nurses had not been fixed having regard to environmental factors: 115 IR 183 at [85] and [87];

d. if the rates of pay for community nurses were fixed having regard to environmental factors (" and it is difficult to believe that was not the case ") any allowance now to be determined may involve double counting and may also lead to flow on claims: 115 IR 183 at [88];

e. the Full Bench determined the time to determine the claim for an additional allowance is as part of this Wages Case, which would allow the claim to be considered in the wider context and "provide the Association with the further opportunity of demonstrating that the granting of its claim . . . would not amount to double counting": 115 IR 183 at [89].

291 We have had regard to the evidence and submissions regarding the history of the community nurse classification and the rates of pay for that classification. In particular, we note the HAC's contention that following the Public Service Board Determination in 1974 the rate of pay for community nurses was set to include an allowance for "all incidents of employment", being both compensation for working unusual hours and, it was submitted, additional environmental factors.

292 The rates of pay for community nurses were subsequently the subject of various considerations. As the HAC observed, when the Crown Employees (Public Health Nurses) Award came before Senior Conciliation Commissioner Wells in the Ministerial Reference Case, it still contained separate rates for community nurses that were higher than the rates for registered nurses. Further, that community nurses continued to have a three-grade structure, compared with a single five-year structure for registered nurses. In that case the respondent sought to have the classification of community nurse abolished so that community nurses were paid the same as registered nurses. The Association had originally sought for registered nurse rates of pay to be increased in line with the community nurse classification, but claimed that it had never been suggested that there had been an agreement that would effectively depress the increase in rates for community nurses. As the HAC explained, Wells SCC determined that the best approach would be to maintain separate rates of pay for community nurses and registered nurses. This would permit community nurses to continue to be paid more at grade 1 (i.e., the first five years of practice), but less at grade 2 (so that registered nurses at years 6 to 9 would get paid more than community nurses).

293 After the decision of Wells SCC the parties agreed that: Community Nurse Grade 2 employees would be transferred onto the Registered Nurse scale and the classification deleted. Existing employees on the Community Nurse Grade 1 scale would be maintained on that scale until they reached their 6th year of service as a registered nurse and then were transferred to the RN scale. The Community Nurse Grade 1 classification was subsequently deleted from the award some years later.

294 The effect of this consent position was to allow community nurses in the first five years the right to continue to receive the higher rates traditionally paid (as a result of the allowance being incorporated into their rate of pay), but then transfer over to the higher registered nurse rates of pay, on reaching their 6th year of service.

295 The HAC submitted: Wells SCC was made aware of the industrial history behind Community Nurses being paid more than Registered Nurses. Wells SCC determined the rate of pay for Community Nurses, which had traditionally included the benefit of the allowance, should be increased, but (other than for the first few years) to a rate lower than the rate of pay for the new grades for Registered Nurses years 6-9. In other words, Wells SCC determined that the work value of community nurses (incorporating as it does the environment of the work) was less than that of experienced registered nurses. The parties agreed to increase community nurse rates to the equivalent of registered nurses.

296 The HAC submitted that Wells SCC made his determination in circumstances where he found that, like today, community nurses were "now responsible for caring for many more acute clients in their own homes or in the home of a carer". This was because of "hospital bed closure, hospital nurse shortage and doctor's problems with Medicare" and the fact that "many more aged clients [were] being nursed at home". He also identified "a pattern showing that more terminally ill patients choose to remain in their own homes for as long as possible".

297 The HAC submitted: If community nurses were now to get the claimed allowance (essentially an allowance for being a community nurse), then that would have the effect of double counting the environmental factors, because those factors were taken into account in setting the rate of pay for community nurses. Indeed, but for the consent position of the parties in 1986, the rates for community nurses would be lower for years 6 to 8 (where the bulk of registered nurses are ) notwithstanding those environmental factors. It would accordingly not be appropriate to grant an allowance that would value community nurses higher than other registered nurses. That is a fortiori in circumstances when it can properly be said that all registered nurses work in challenging environments (see further the Respondent's submissions in the Conditions Case regarding the various positive and negative factors that arise in an in-hospital as against extra-hospital environment. Once one group of registered nurses successfully claims an allowance for the disabilities inherent in their particular type of work it will create a precedent for other groups to use claim an allowance in respect of their circumstances.

298 The Association contended that the interpretation placed by the respondent on the history of the community nurse grades did not withstand analysis. It was submitted there was no basis whatsoever for concluding that the various community nurse rates of pay and classifications found in industrial instruments prior to 1986 were based on consideration of the disabilities identified in the Conditions Case. Reference was made to the decisions of Commissioner Cansdell in 1978 where he considered the question of appropriate rates of pay for community nurses under the Crown Employees (Public Health Nurses) Award and the Public Hospital Nurses' (State) Award. In doing so, it was submitted, the Commissioner at the time determined the new pay rates on the basis of inspections of four community health centres.

299 The Association contended that because the focus of deliberations was substantially on the role of community nurses in community health centres, any reference to "all incidents of employment" could not be taken to refer to the disabilities presently relied upon. It was further submitted by the Association that: The respective wage rates fixed for registered and community nurses by Deputy President Wells in 1986 show the impossibility of simplistically attributing the differential rates to disabilities. At the bottom end of the scale community nurses received higher rates of pay, whereas at the higher end of the scale community nurses received lesser rates of pay. It could not be thought that community nurses at the bottom end of the scale suffered relevant disabilities whilst those at the top of the scale did not.

300 The Association contended that: The anomaly in the rates between community nurses and RNs was fixed by agreement of the parties after the 1986 decision of Wells SCC when community nurses were fully integrated into the RN pay scale. There is no evidence whatsoever to support the proposition that the parties at this time intended that the general registered nurse rates were intended to compensate any nurses, including community nurses, for disabilities suffered when working away from a designated health care facility. The proposition advanced by the Respondent that, although RNs who work outside of a designated facility receive the same wage rates as any other RNs, they are somehow compensated within that rate for relevant disabilities associated with work away from a designated health facility defies logic as well as history. Even if consideration were limited to the situation of community nurses, inherent in such a proposition is that the work of community nurses is of lesser value than of general nurses, and therefore, but for relevant disabilities, they would receive a lower rate of pay. However those community nurses who work largely in a designated health facility would be receiving compensation for disabilities they do not suffer. The only safe conclusion based on the history of the community nurse classifications is that there was never an intention that the rates set should compensate for the disabilities of working away from a designated health facility.

301 The evidence about whether or not the disabilities referred to in the Conditions Case had been previously taken into account in fixing the rates of pay for community nurses is somewhat obscure. Whilst we opined in the Conditions Case that it would be surprising if such disabilities had not been taken into account, it is equally surprising that in the long history of the fixation of rates for community nurses no mention is made at all of the disabilities identified by us in the Conditions Case. Whilst the various tribunals involved in setting the rates for community nurses over the years were obviously aware of the fact that community nurses not only worked in health clinic but also visited the homes of patients, it is not apparent to us that those tribunals turned their minds to the disabilities identified by us in the Conditions Case.

302 Given the evidence we have received in these proceedings we have come to the view that no relevant distinction should be made between the work value of registered nurses in hospitals and the work value of registered nurses in the community. That leaves the question of whether community nurses who experience disabilities above the norm including: exposure to inclement weather; dirty and unpleasant working environments outside the hospital environment; and, lack of staff amenities, should be compensated for such disabilities.

303 The wage fixing principle governing the adjustment of allowances provides that: (e) Where changes in the work have occurred or new work and conditions have arisen, the question of a new allowance, if any, will be determined in accordance with the relevant principles of these principles. The relevant principles in this context may be Work Value Changes or First Award and Extension to an Existing Award.

304 The relevant principle in this case is the work value principle. We consider that the work of community nurses and nurses working in public hospitals should, in terms of work value, be regarded as being at the same level. It is the case that community nurses do experience such disabilities as exposure to inclement weather; dirty and unpleasant working environments; and, lack of staff amenities. It may equally be submitted, as the HAC has done in this case that ICU nurses, for instance, work under the disability of a particularly high-pressure environment caring for acutely sick patients. To grant an allowance to community nurses in recognition of the disabilities they experience would inevitably lead to claims by other sections of the nursing workforce seeking disability allowances. The allowance is refused.

305 In its Interim Decision the Full Bench left open the possibility of further wage increases being granted from a date prior to 1 July 2004 subject to how any recruitment and retention initiatives were progressing. The Full Bench said at par [125]: We intend to monitor the effectiveness of this strategy [to alleviate the nursing shortage], and its success or otherwise may be an important consideration in assessing the claims for qualification and retention allowances and in determining whether or not it is appropriate to apply any additional wage increase that might be awarded on work value grounds from a date earlier than 1 July 2004. If it can be demonstrated, for example, that the various initiatives implemented by the respondent to overcome the difficulties in attracting and retaining nurses in the public hospital system are working and that wage increases that have been awarded in this decision have had a limited impact, then it would be most unlikely that the Commission would be convinced to grant further increases prior to 1 July 2004. On the other hand, if the initiatives are having little or no effect and there is evidence that the wage increase has had a positive effect, there may be a case for any increase to be payable earlier than 1 July 2004.

306 In so far as the qualification allowance claim is concerned, we have decided in principle that there is scope to introduce an appropriate entitlement and that is to be the subject of discussions between the parties. We will await the outcome of those discussions before making any decision about operative date. However, we should indicate that unless it can be shown that an earlier operative date is justifiable, any new allowances in the nature of qualification allowances would not apply before 1 July 2004.

307 A further consideration is whether there is scope for increasing the six per cent granted in our Interim Decision on special case grounds. In our Interim Decision we said at [124]: Although the effect of our decision, in a formal sense, will be to vary the Interim Award, in substance a new interim award is being made in which case the principles discussed in the Conditions Case apply. That is, any interim wage increase must be approached on a cautious basis so as not to "embarrass the final result". Such an approach, in the context of a final determination in this matter, will permit the Commission to have regard to all of the relevant factors in setting fair and reasonable rates of pay, including other relevant graduate rates then existing. 308 We also said at [107]: Nonetheless, in circumstances of a nursing shortage where nurses' wages are at levels lower than they historically have been compared to all other comparable health professionals, we consider a wage increase at this time that redresses this situation in significant measure will have a positive effect on nurses' decisions about whether they stay in their chosen profession. If we were not to address this issue there is no doubt that it would be, and would be seen by nurses to be, a negative signal and lack of appreciation which could have the effect of exacerbating the nursing shortage and the mounting problems facing the public health system. 309 The HAC strongly submitted that there should be no further increases based on nursing shortages because: a. it is contrary to long-standing principle to set rates to address shortages; b. there are strong public interest reasons why industrial tribunals do not award increases to address shortages including: (i) the rates do not reflect true work value; (ii) once awarded such rates are almost impossible to remove even after the shortage has gone; (iii) the new rates become the 'market rate' and inevitably flow on to those working elsewhere (in this case to nurses in the private sector); and (iv) they create real pressure for further flow-on to different classes of employees (in this case other employees in the public health sector, being both employees who are likewise affected by a shortage and those who are not, but can claim similar work value); and c. consistent with such principles the Applicant in opening its case expressly disavowed that the claims for a 15% increase or the qualification allowance were justified on the basis of the shortage of nurses, saying rather that such claims if granted would have the collateral consequence of helping to address the shortage issue.

310 The HAC also submitted that to grant further increases on the basis of a nursing shortage would undermine the Government's efforts to put in place policies and programs designed to overcome the shortage by diverting scarce resources into wages to pay for the increases.

311 We have given careful consideration to the parties' submissions regarding the recruitment and retention initiatives including past initiatives which have continued but with increased budgets, including: a. scholarships (increased from $259,000 to $1.44m); b. professional development funding (increased from $3.97m to $5.25m), in particular orientation programs for specialist clinical areas; c. Ministerial Standing Committee projects, in particular the Reconnect Program; and d. Promotions, in particular the 'Real Thing' advertising campaign.

312 The foregoing measures fall within the control of the Chief Nursing Officer (CNO) and her office. We note there are ongoing measures that fall outside the remit of the CNO and the Ministerial Standing Committee which, the HAC submitted, have positively affected nurse recruitment, including the Centre for Mental Health (which has provided a further $5.3m in 2002/03 for a range of initiatives in mental health nursing) and the Greater Metropolitan Transition Taskforce (GMTT) which has allocated funds in areas designed to assist in retention of nurses.

313 The HAC referred to initiatives of a more recent nature, including the following (references deleted): a. a substantial 2003 media campaign titled ' Nurses - The Real Thing ', with a budget of $570,000. It ran from 26 January 2003 to 23 February 2003. It featured radio and television advertisements and a special telephone hotline. It generated by early March 2003 over 2300 telephone enquiries, including 1376 from those interested in a career in nursing who were sent an information pack. The campaign also had a website which generated 27,000 hits to 20 February 2003. While the campaign had an obvious recruitment role, Mr Craft gave evidence that it also had some impact on retention, as it reinforced to existing nurses that they were appreciated; b. the 'Nursing Reconnect' strategy, launched in January 2002, which is designed to attract nurses back into the public health system. As at 13 February 2003 it had led to the employment of 724 nurses, with a net gain (after resignations) of 621 nurses. This program is continuing in 2003, with a budget for the 2002/03 year of about $2.9m; c. the development of an Environmental Survey by sub-committees of the Ministerial Standing Committee with a view to finding out more information to assist in achieving 4 particular objectives identified by the Committee's Action Plan which has led to a draft report on 6 June; d. overseas recruitment activities, which resulted in 129 nurses being recruited in July 2002 and a further 245 nurses in January 2003, with a budget for the year 2002/03 of about $2.2m; e. expansion of the nurse practitioner project, to increase the number of specialised nurse practitioners (being senior clinical specialist positions with appropriately high pay, which provide a career opportunity for nurses); f. dissemination of innovative ideas developed by various Area Directors of Nursing, via the Ministerial Standing Committee, which are numerous and disparate, and include: (i) establishing various orientation and training courses; (ii) establishing various positions to support nurses, including clinical consultants and nurse educators; (iii) engaging a 'Nursing Workforce Officer'; (iv) arranging for job application process to be conducted electronically; (v) various local nursing recruitment projects; (vi) 'upskilling' or 'step-up' programs where AINs and enrolled nurses are trained up, including enrolled nurses to registered nurses; and (vii) new rostering arrangements, including 12 hour shifts; g. expenditure of $1.2m on a nursing workload research project to enable a better understanding of nursing workloads to enable better staffing arrangements.

314 The HAC referred to the in-principle agreement to the Association's demand for a Reasonable Workloads Clause, and the potential impact of a proposal to introduce a workload-planning tool. The workloads issue, it was submitted, was expected by the Association to have a real impact on retention. The Association has stated that its proposal, now largely agreed, would "help solve the current nurse shortage". It was submitted in those circumstances the HAC's agreement to amend the award to add a Reasonable Workloads clause was a matter that would be given significant weight in considering whether appropriate steps are being taken in respect of retention and recruitment.

315 The HAC presented statistics on the recruitment and turnover of nurses and concluded: The statistics show that overall there has been an improvement in the period since the Interim Decision, at least to the extent that there are now more nurses employed in the public health system. The level of vacancies, at least to the extent that PARs [positions being actively recruited] measure vacancies have come down, although not by more than in the previous year in the same period. The permanent headcount has been positively affected by the reduced turnover rate for permanent staff.

316 The HAC submitted that the factors that would have contributed in varying degrees to the improvement in total permanent headcount in the public health system during the short period January to May 2003 include (references deleted): a. the pay increase effective from 1 January 2003 of about 10%; b. the fact that the period in question is confined to the period immediately following such a pay increase (noting the evidence of Mr Craft that such increases have an initial effect that could be expected to diminish over time); c. the disparity in pay between the public health system and the rates applicable in private hospitals and aged care facilities which existed during much of this particular time period (discussed below); d. the fact that the period in question coincides with a usual period of increase in headcount, presumably in part because it is the time when new graduates commence practice; e. the January-February 2003 'Nurses - The Real Thing' advertising campaign; f. the "public call" by the Nurses Association in January for nurses who are not working as nurses to return to the public health system; g. the ongoing recruitment and retention initiatives of the Respondent (with a 25 per cent increase in their overall budget) including further scholarships, further professional development expenditure and the ongoing reconnect program; h. the new recruitment and retention initiatives; i. a significant reduction in the numbers of persons travelling overseas in recent times due to SARS and global uncertainty leading to reduced turnover rates at this time (noting that nursing is a profession in which it is common to travel overseas to work, particularly in the early stages of a career); j. drought in rural areas (which causes nurses who might otherwise work on the land to return or remain in nursing); k. local campaigns to recruit nurses (such as the campaign run out of Orange Base Hospital).

317 The HAC also submitted that the higher rates of pay that prevailed for a short period following the Interim Decision in public hospitals compared to the private sector would have had the effect of dampening the turnover rate.

318 As to whether the initiatives and/or the pay rise have been effective the HAC submitted the Commission would not conclude that the increase in pay awarded in the Interim Decision was the significant factor that has assisted to improve the overall situation. It has been a significant factor in improving turnover rates, but only in conjunction with other factors that have also been significant.

319 Overall, the HAC submitted, the anecdotal evidence was of such a limited nature, and of such a quality, that it would not be preferred over evidence as to the general statistical position coupled with the evidence of the numerous initiatives undertaken by both parties to this proceeding, and certainly would not be relied upon to conclude that the only factor of significance has been the pay rise.

320 The Association was critical of the HAC for failing to take steps to monitor the effect of the interim pay increase in the weeks immediately following its introduction. The Association submitted the HAC took no step until late March, early April 2003 to establish a committee aimed at monitoring the impact of the pay increases granted. In these circumstances, the Association invited the Commission to draw a conclusion that as a matter of simple logic the significant increase of 10 per cent (6 per cent interim increase and 4 per cent derived from 2000 MOU) must have been a very substantial factor impacting upon the decision of nurses to rejoin the public hospital system workforce to the extent that they did so. The Association asserted that it was elementary that a substantial pay increase would have a significant effect upon the decision of non-participating nurses to consider employment or re-employment within the public hospital system in New South Wales.

321 The Association contended that the evidence of Ms A N Claude, Manager, Industrial Services, of the Association, was consistent with the proposition that the pay increase of 1 January 2003 would have been a very significant factor in the return of nurses to the public hospital system. It is to be noted in this context: - a. the turnover figures offered by the Department reflect a significant decline in the turnover trend for nurses in the public hospital system since January 2003. That is to say a decline that is more pronounced than that which has occurred in the corresponding periods in previous years;

b. to the extent that anecdotal evidence is available, that anecdotal evidence provided through Ms Claude indicates that a significant number of nurses, including nurses from the private sector had elected to seek employment and take up positions in public hospitals in the period since the introduction of the 10% pay increase.

322 As to the effect of other measures on the recruitment of nurses post the Interim Decision, the Association submitted as follows:

· So far as the old measures were concerned, namely scholarships, mentoring, career advice, the establishment of nursing bodies and supported efforts concerning environment and culture, Mr Trevor Craft, manager industrial relations, employee relations division, New South Wales Department of Health and a key witness for the HAC acknowledged that those measures were not measures which were or would have been capable of "turning the ship around", although he insisted that these were measures which provided an important and useful basis for maintaining the pressure on the shortage, and a basis which would enable other measures, presumably the new measures to be more effective.

· So far as the media campaign was concerned, no steps were taken to measure its effect, which, therefore, is unfortunately relegated to analysis by reference to anecdotal information, such as may be available. The "Real Thing" campaign seems to have been concentrated upon recruitment, although Mr Craft contended that it may have been relevant in making existing nurses feel good about the continuation of their employment and its worth. This needs to be seen against the evidence given by Ms Bunt, Ms Needham, Ms Campbell, Ms Morris and others, to the effect that they consider that the morale of nurses is at a low ebb and that there is a strong sense of undervaluing within the system. The media campaign on any analysis cannot be a long term or sustainable basis for seeking to address and combat chronic nursing shortages. It would not be suggested by the Department that media campaigns would constitute such a mechanism. · So far as new scholarships were concerned, these need to be seen as a basic measure aimed at providing some amelioration of what would otherwise be the natural attrition process. The difficulty with additional scholarships is that they operate in relation to a small number of nurses. The statistics provided by Mr Craft indicated that only a relatively small number of nurses would be assisted by such programs, in addition to those provided for by the traditional Scholarship Programs. In any event, such scholarships would not provide an answer to the need evidenced by not only positions being actively recruited, but also the significant evidence to the effect that Government intends to provide additional services pursuant to its new Health Budget; services which will necessarily require additional nursing staff.

· So far as the Reconnect Program is concerned, the chart and data provided by Mr Craft indicates that: - a. the overall net introduction of nurses due to the Reconnect Program would appear to have been some 600. What was also apparent was that there has been a significant attrition rate, or lapse rate of those who have re-entered the workforce as a result of the Reconnect Program. It was also of relevance that Mr Craft indicated that there would be no extension of the Reconnect Program and the Commission may conclude that a decision has been taken to the effect that the cost involved, or the resources involved, did not warrant the continuation of the program having regard to its results. b. The evidence of Mr Craft concerning the numbers of nursing staff in the system, raises difficulties for the Commission. It is suggested that there has been an increase in the number of positions in the system, however what is not made clear is whether those are establishment positions or positions actually filled. A further difficulty is that there has always been some confusion as between FTE positions and headcount. That difficulty has been exacerbated by the fact that, as Mr Craft noted, there are some 40% of nursing positions which are part-time and this tends to contradict a suggestion that the FTE and headcount figures given are correct.

· The suggestion by Mr Craft that 50% of private sector nurses moving into the public sector in 2003 did so due to the differential in rates of pay is not substantiated by evidence. The Department did not provide a monitoring facility, and it is in those circumstances not appropriate for this assertion to be accepted unequivocally.

· In the circumstances, it would have been open to the HAC and the Department of Health to do the following things: a. The Respondent should have set up a Monitoring Committee in January 2003, not in April 2003. b. The Respondent should have done entry surveys for all new nursing staff re-entering the public hospital system. c. The Respondent should have followed up the enquiries which were made to the telephone number provided as part of the "Real Thing" media campaign in relation to the "new nurse" category, whether by mail or otherwise to ascertain what the outcome of those enquiries was. d. The Respondent should have looked at the possibility of allocating more money for pay increases, and to recommending to the Commission some form of pay increase, but chose not to do so. e. The Respondent has failed to acknowledge, where it should have acknowledged, that Government has in its own publicity material, claimed an advantage by saying "we've paid nurses more money". This is an acknowledgement by Government and thereby the Respondent that pay increases are a significant matter in recruitment and retention. The Respondent is in a very real and practical way estopped from denying that pay increases are not significant for the purposes of attraction and retention. f. The Respondent should have introduced workload measures, including either workload amelioration provisions or provisions aimed at preventing unreasonable and excessive workloads at the same time as this was undertaken in other States. Its failure to do so, and its belated preparedness to agree to an appropriate provision, or at least the negotiation of an appropriate provision, is telling in relation to the question whether there is a problem with unreasonable and excessive workloads. g. The Respondent should have addressed itself to more appropriate childcare arrangements for nurses, and car parking arrangements, rather than simply refusing to entertain measures in relation to these matters. The Respondent refused even to conduct an appropriate inquiry into car parking arrangements, when it is apparent, not only from the Best Practice Surveys but from any intuitive analysis that childcare and car parking arrangements would be substantial incentives to assist in recruitment and retention.

323 In responding to the Association's criticisms of its efforts regarding recruitment and retention initiatives, the HAC submitted:

· the Association relied on the evidence of Mr Craft to the effect that the increase in January did have a significant effect. The Association does not note that this evidence was given in circumstances where Mr Craft thought that the disparity in rates between the public and private sectors was itself significant.

· the Association referred to the evidence of Mr Craft as to the effect on morale of the 'Real Thing' campaign and submitted that such evidence was to be "seen against the evidence given by Ms Bunt, Ms Needham, Ms Campbell, Ms Morris and others, to the effect that they consider that the morale of nurses is at a low ebb and there is a strong sense of undervaluing within the system". The only evidence as to morale that post-dates the 'Real Thing' campaign and the Interim Decision was that of Professor Dwyer, given via the statement of Ms Claude, namely that: "morale is definitely improved". In these circumstances it was difficult to know what the Association was suggesting the Commission should make of its reliance on the pre-interim increase evidence of Bunt and others that morale is at low ebb. The Association appeared to invite the Commission to accept that there was a strong sense of undervaluing within the system notwithstanding the substantial increase awarded in the Interim Decision and that morale was poor notwithstanding the evidence of Professor Dwyer. The conflicting conclusions urged by the Association demonstrate how hard it is for the Commission to draw any real conclusions about the impact of the interim increase and its relevance to the question of whether the Commission should make any decision relating to an increase in salary based directly on a nursing shortage.

· the Association submitted that the Commission should award a further increase to avoid the effect of the increases already obtained this year dissipating. This submission is made in circumstances where nurses obtained a 10% increase in January and a further 5% increase in July this year. To suggest that a further increase is immediately needed due to the effect of dissipation is a submission that entirely accepts the evidence of Mr Craft as to such increases - namely that within a fairly short time period the impact of pay increases quickly dissipates. If the Association's submission were correct, the Commission would presumably be enjoined to keep awarding further increases every 6 months.

· the Association set out a series of things that it believed the HAC should have done to alleviate the nursing shortage. Such suggestions have the benefit of hindsight. It is noted that the Association at the time made none of these suggestions. The effectiveness of each of the suggestions is not clear. For example, the suggestion that something useful would have been obtained by the Department of Health contacting each person who had contacted the 'Real Thing' hotline and was assessed as a 'new nurse' must be questionable when one understands that these were people considering a career in nursing, and so included school students and others who would not necessarily be in a position to take immediate steps to start nursing.

· The Association submitted that the Commission would learn from the increases granted in 1981 and 1986 that significant pay increases are a very effective mechanism for dealing with nursing shortages. This submission ignores the fact that in 1990 the Commission found that there existed a nursing shortage that was apparently serious enough to support the findings in that case. There is simply no evidence that the increases in 1981, 1986 and 1990 removed a nursing shortage. To the contrary, in each of the 1981, 1986 and 1990 proceedings the Commission found there was a nursing shortage, notwithstanding the previous increases. This is consistent with the view that any effect of such increases dissipates - as the Association appears to accept that a further increase is now required to ensure that the effect of the January and July 2003 increases are not dissipated. The Association now asks the Commission to ignore findings that it asked the Commission to make in those earlier proceedings.

324 We consider that, on what evidence there is available to us, the interim increase of six per cent payable contemporaneously with the four per cent increase flowing from the 2000 MOU on 1 January 2003, followed by a further five per cent increase from 1 July 2003, had a very positive effect in contributing to an alleviation of the nursing shortage in the public hospital system. The proceedings initiated by the Association and the outcome achieved has brought an urgent and necessary focus to a serious problem. Nevertheless, we accept that the pay increase of six per cent was not the only factor at work and the other Government initiatives and steps taken by the Department of Health, including the recruiting campaign, would also have made a positive contribution to addressing the nursing shortage.

325 We have noted the more long-term initiatives being pursued by the HAC to address recruitment and retention of nurses and we commend them. Whether they are sufficient, only time will tell. But it would seem to be a significant waste of resources if those initiatives are not followed up and maintained and in a few short years the Government is faced with yet another crisis caused by the shortage of nurses, with the Commission being called upon to deal once again with a special case claim for wage increases to address the shortage.

326 As we observed in our Statement in Re Public Hospital Nurses (State) Award (No 2), (2002) 118 IR 336 at par [20]: Wage increases are unlikely to be a panacea in addressing the nursing shortage and a proper balance will need to be struck between the level of wage increase awarded, if any, and other initiatives that may be appropriate or necessary. There is unlikely to be long-term benefit in granting wage increases as a contribution to resolving the nursing shortage unless other initiatives, which are arguably just as, or more, important, are set in train.

327 We consider that the case for a further increase in wages on special case grounds has not been made out for the following reasons, namely: 1. As much of the available resources as possible should be channelled into addressing the broader issues relevant to the retention and recruitment of nurses in both the short and long term. 2. We are satisfied that the HAC is committed to pursuing initiatives aimed at overcoming the current shortage of nurses and breaking the cycle of nursing shortages. 3. The Association has made out a case for a moderate increase in nurses' pay on work value grounds, which should assist in addressing any continuing shortage. 4. Nurses in public hospitals in New South Wales have received significant wage increases since 1996 and are the highest paid of all the States. 5. Nurses who obtain postgraduate qualifications relevant to their employment will become entitled to additional allowances. 6. It is inevitable, given the experience with the six per cent increase, that if we were to grant further wage increases to nurses in public hospitals on special case grounds, the Association would seek to flow on those increases to the private sector regardless of whether the flow on was justifiable.

328 That leaves the question of whether the wage increase we have determined on work value grounds for registered nurses and ENs should apply prior to 1 July 2004 given what we have said about recruitment and retention initiatives. This is a difficult question of judgment involving considerations that, on the one hand, go to the economic impact of an unanticipated wage increase, the efforts by the HAC in seeking to overcome the nursing shortage and the need to direct resources to that end, the prospect of flow on and the implications for the integrity of the MOU between the Association and the Public Employment Office. On the other hand, we consider there are benefits to be gained by applying the moderate increase we have in mind from a date earlier than 1 July 2004.

329 There is no doubt that last year there was a crisis of confidence amongst nurses regarding the public hospital system, fuelled by a nursing shortage and a perception that their work was undervalued. As we have observed, the interim increase of six per cent was an important contribution to addressing that crisis. Against that background nurses are waiting to see whether their perception about undervaluation has been borne out by the evidence in these proceedings. It has, and we can see no point in allowing the benefits derived from the interim increase to dissipate through disillusionment or an ebbing of morale amongst nurses by having them wait a further six months to gain the benefit of a wage adjustment that is rightfully theirs.

330 That we have decided to increase rates of pay for nurses during the currency of the MOU is an exceptional move and should not be taken as a signal that such agreements can be made and then broken using the processes of the Commission and an artful use of the wage fixing principles. The Commission will guard against such contrivances.

331 We have decided on work value grounds to increase the rates of pay for registered nurses and enrolled nurses in public hospitals by 3.5 per cent. The increase will be incorporated into a new Public Hospital Nurses' (State) Award to operate from the beginning of the first pay period to commence on or after 1 January 2004 and to remain in force for a period of 12 months.

332 We make the following orders and directions: 1. Rates of pay for registered nurses and enrolled nurses under the Public Hospital Nurses' (State) Interim Award are increased by an amount of 3.5 per cent from the beginning of the first pay period to commence on or after 1 January 2004. The increase will be incorporated into a new Public Hospital Nurses' (State) Award that shall operate for a period of 12 months. 2. The Association is directed to file and serve orders reflecting order 1 hereof within 21 days of today. 3. The claim for retention allowances is refused. 4. The claim for an environment allowance for community nurses is refused. 5. In accordance with the terms of this Decision, the parties are directed to confer on the terms of an appropriate provision relating to qualification allowances for nurses and assistants in nursing. The parties will report on the progress of their discussions at a mention at 9.30 am on Tuesday 10 February 2004 before the Full Bench. 6. The new Award will include a leave reserved provision granting leave to the Association to pursue further the pay equity and work value claims for assistants in nursing and a leave reserved provision in relation to qualification allowances. 7. The claim for further increases on special case grounds is refused. Annexure A Comparison of Award Rates of Pay for Assistants in Nursing and Wardspersons Assistants in Nursing Wardsperson Date 18 Years & Over Thereafter Differential (%) Thereafter $ per week $ per week

1/3/68 35.00 (female) 41.40 (male) 44.10 (male) 35.70 (female). 6.6% comparing male rates and 2% comparing female rates

1/1/74 75.00 (female) (79.80 male) 85.00 13.3% (but is 6.5% if using male rate)

6/4/85 247.80 Not known 4/11/85 257.20 304.00 18.2% DoH Cir 85/243 (3.8% State Wage increase) 1/7/86 273.70 311.00 13.6% after Ministerial Ref. Case & State Wage 14/12/89 330.00 375.30 Nurses Association's Annexure H of Exhibit BT shows a different rate 13.7% State Wage increase 27/6/90 372.00 390.30 4.9% after EN case 20.12.91 382.00 400.00 4.7% last State Wage 1/1/02 503.60 558.50 10.9% 1/1/03 555.10 580.80 4.6% current rates

Dates in bold are as per Nurses' Association Exhibit BT Annexure H with the exception that male and female rates are shown above.

Annexure B Comparison of award rates on pay for assistants in nursing and wardspersons Date Rate pw ($) AIN 18 and Over Thereafter Rate pw ($) Wardsperson Thereafter Differential (%) 1/3/68 35.001 44.10A 26 1/1/74 75.002 85.00B 13.3 6/4/85 247.803 14/12/89 330.004 340.10D 3.1 1/1/02 503.605 558.50E 10.9

1Weekly rate of pay for females, adult, third year of experience and thereafter: Public Hospital Nurses (State) Award A Weekly rate of pay for male wardsman, second year of service and thereafter: Hospital Employees (State) Award 2 Weekly rate of pay for females, adult, second year of experience and thereafter: Public Hospitals Nurses (State) Award B Weekly rate of pay for male wardsman, second year and thereafter: Hospital Employees (State) Award 3 Weekly rate of pay, 18 years of age and over, third year of experience and thereafter: Public Hospital Nurses (State) Award 4 Weekly rate of pay, 18 years of age and over, third year of experience and thereafter: Public Hospitals Nurses (State) Award D Weekly rate of pay for wardsman, second year and thereafter: Hospital Employees (State) Award 5 Weekly rate of pay, 18 years of age and over, fourth year of experience and thereafter: Pubic Hospitals Nurses (State) Award E Weekly rate of pay for wardsperson, second year and thereafter: Health Employees (State) Award

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.