Ground Two - Consideration
107 We do not accept those submissions. As the Full Court said in Construction, Forestry, Mining and Energy Union v Anglo American Metallurgical Coal Pty Ltd (2017) 252 FCR 337 at 347, [29], in making a variation pursuant to s 156(2) of the FW Act, the question whether the terms of an award, or the terms of a variation, are necessary to achieve the modern awards objective, is one which involves an "evaluative judgment". That question, unlike the issues that arise in cases like Carrascalao v Minister for Immigration and Border Protection (2017) 252 FCR 352 upon which the Unions placed much reliance, does not "address a jurisdictional fact about the need for change, but [is] to review the award and evaluate whether the posited terms with a variation met the objective" (Construction, Forestry, Mining and Energy Union v Anglo American Metallurgical Coal Pty Ltd (2017) 252 FCR 337 at 349-350, [46]). As French CJ said in Plaintiff M70/2011 v Minister for Immigration and Citizenship (2011) 244 CLR 144 at 179, [57] "[w]hen a criterion conditioning the exercise of statutory power involves assessment and value judgments on the part of the decision-maker, it is difficult to characterise the criterion as a jurisdictional fact, the existence or non-existence of which may be reviewed by a court". See too One Key Workforce Pty Ltd v Construction, Forestry, Mining and Energy Union [2018] FCAFC 77; (2018) 356 ALR 535 at 554, [100] (Bromberg, Katzmann and O'Callaghan JJ) ("Not all conditions precedent or criteria for the exercise of a statutory power or discretion are jurisdictional facts. That depends on whether, as a matter of statutory construction, Parliament intended that the question of satisfaction of the conditions or criteria be left to the administrative decision-maker or, in the final instance, to a court on judicial review".)
108 It is also important to appreciate in this case "that by s 601, the Commission was not required to give written reasons, though under s 601(2) it may do so" and that "to the extent that reasons given display a misunderstanding of the statutory task, that may ground a conclusion of jurisdictional error. If, however, such reasons as are given do not completely explain the conclusion reached, jurisdictional error is not demonstrated by such inadequacy": Construction, Forestry, Mining and Energy Union v Anglo American Metallurgical Coal Pty Ltd (2017) 252 FCR 337 at 347, [30].
109 Along the same lines, the Full Court in National Retail Association v Fair Work Commission (2014) 225 FCR 154 at 174-175, [109] explained that the factors listed in (a) to (h) of s 134(1) of the FW Act:
109. … are broad considerations which the FWC must take into account in considering whether a modern award meets the objective set by s 134(1), that is to say, whether it provides a fair and relevant minimum safety net of terms and conditions. The listed factors do not, in themselves, however, pose any questions or set any standard against which a modern award could be evaluated. Many of them are broad social objectives. What, for example, was the finding called for in relation to the first factor ("relative living standards and the needs of the low paid")? …
110. The relevant finding the FWC is called upon to make is that the modern award either achieves or does not achieve the modern awards objective.
110 With those considerations in mind it is necessary next to see how the Commission approached that task in the 2018 decision.
111 The 2018 decision comprises 76 paragraphs. By way of background, the Full Bench referred to the CFMEU's 2013 application for removal of the transitional provision in respect of accident pay (see [77]-[78] above), the 19 December 2014 determination deleting it, and then quoted in detail from the 11 February 2015 decision (which gave the detailed reasons for the 19 December 2014 determination). See the 2018 decision at [7]-[12].
112 Having set out the procedural history before August 2015, the Full Bench continued:
In subsequent developments, on 18 August 2015 the Full Bench handed down its decision (the August 2015 Decision) concerning the various union applications to insert accident pay and/or district allowance provisions into a number of awards. In the absence of any further application(s) relating to the BCMI Award, the Award was not considered in the proceedings which lead to that decision.
(Emphasis added).
113 The Full Bench then set out the statutory framework (including ss 3, 134 and 156 of the FW Act) and set out extracts from Shop, Distributive and Allied Employees Association v The Australian Industry Group (2017) 253 FCR 368 at 381, [38] and Construction, Forestry, Mining and Energy Union v Anglo American Metallurgical Coal Pty Ltd (2017) 252 FCR 337 at [28]-[29] (set out above at [97] and [59] of these reasons respectively), noting that those passages reflected the approach that it would adopt. See [14]-[29] of the 2018 decision.
114 The Full Bench then set out the whole of clause 18 of the BCMI Award, and having done so, set out in detail CMIEG's submissions (at [33]-[45], occupying almost 10 pages) and the Unions' submissions (at [48]-[58], occupying 5 pages).
115 The CMIEG's submissions in chief were, relevantly, summarised as follows:
34. The CMIEG also contended that the accident pay provision of the BCMI Award did not meet the modern awards objective for a number of reasons including that:
• the accident pay entitlements contained in the BCMI Award are more generous than those contained in any other modern award;
• the evidence discloses inter alia that:
- the rate/frequency of injuries for the coal mining industry as recorded by Safe Work Australia (SWA) for serious injuries is ranked 67 out of 190 industries when sorted from the highest average incidence rate to lowest average incidence,
- the average time lost to serious injuries in the coal mining industry is no worse and is in fact better than other industries,
- there are industries like coal mining that are hazardous by their nature without having warranted differential treatment as to accident pay provisions, and
- the methods and processes for rehabilitation and return to work of injured workers have improved substantially over time since the introduction of accident pay;
• in light of the above evidence the alleged rationale underpinning the January 1980 CIT decision no longer prevails;
• the issue of whether clause 18 of the BCMI Award is a "fair and relevant minimum safety net" was not considered as part of the award modernisation process, adding that the provision among other things provides entitlements that erect an overly high threshold which discourages any genuine bargaining and productivity trade-offs; and
• its proposed variation provides a benefit which is consistent with the purpose of accident pay provisions.
35. With regard to the modern awards objective, the CMIEG posited that its proposed variation satisfied the modern awards objective as:
• it would encourage collective bargaining by imposing a more relevant safety net as a platform for enterprise bargaining [s.134(1)(b)];
• the imposition of a more relevant safety net would encourage genuine collective bargaining and associated productivity trade-offs [s.134(1)(c)];
• it would bring the BCMI Award closer in line with other modern awards for similar industries [s.134(1)(e)];
• it would impact on productivity, employment costs and the regulatory burden and employment growth by encouraging collective bargaining and productivity trade-offs [ss.134(1)(f) and (h)];
• it would ensure a simple, easy to understand, stable and sustainable modern award system by bringing the BCMI Award closer in line with other modern awards for similar industries [s.134(1)(g)]; and
• ss.134(1)(a) and (d) do not arise in this case.
116 The Unions' submissions in chief were, relevantly, summarised as follows:
48. The Unions opposed the CMIEG's application on several grounds including that the matter had been recently decided by the Commission and in view of the potential impact on employees.
49. Drawing on the underlined text in extract from the August 2015 Decision (set out at paragraph [13] above), the Unions submitted that at the same time as determining that a maximum accident pay entitlement of 52 weeks for other awards was appropriate the Full Bench also determined that the BCMI Award should not have such a cap because it considered the Award to be in a different category to the awards before it. The Unions further submitted that it was clear from paragraph [212] of the August 2015 Decision that the underlined text [see the bolded text at [74] above] was not a finding intended to apply to the BCMI Award. The Unions also submitted that the Full Bench reached its conclusions "having regard to the evidence and submissions in the present proceedings" and that no new event had occurred post the August 2015 Decision. The Unions contended that for these reasons, or for reasons that included these reasons, the Commission should refuse the CMIEG application.
50. The Unions posited that the CMIEG's case relied on the proposition that the accident pay provisions of the BCMI Award should be reduced because they were inconsistent with other modern awards, adding that the CMIEG had not identified any financial, economic, industrial, practical or other imperative for change. The Unions also posited that the CMIEG had not contended that employers were unduly burdened by the current level of benefit.
51. The Unions also made a number of observations regarding the CMIEG's case. Those observations included that:
• the proposition that the variation sought should be made because the accident pay provision in the BCMI Award was higher than other awards has no proper basis and does not engage the modern awards objective;
• no evidence had been led by the CMIEG that any employers would be encouraged to collectively bargain if the accident pay standard were reduced, describing the suggestion as nonsensical and hypocritical;
• the CMIEG's submissions do not identify the consequences of the variation sought nor does the CMIEG attempt to identify the detriment to employees caused by the withdrawal of benefits; and
• the CMIEG did not address the impact of the proposed change on employers, e.g. the CMIEG did not contend that premiums will be reduced, that employers were unable to meet their existing Award obligations or that there is a need for the relief sought.
(Footnotes omitted).
117 The Full Bench then recorded the substance of some of the evidence relied upon by the Unions (not the subject of any cross examination), as follows:
58. Mr Simm deposed inter alia in his witness statement that the coal mining industry had traditionally been regarded as a high priority and unique industry with respect to occupational health and safety. In particular Mr Simm referred to coalmine specific occupational health and safety legislation, specific coalmine workers' compensation and specific coalmine working conditions such as accident pay. Mr Simm further deposed that occupational health and safety in the coal industry is approached from many directions, adding that removing or diluting any one of them is a detriment to the prevention or treatment of occupational health and safety in the coal industry.
Ms Bolger in her witness statement referred to the 2014 Employment and Remuneration Survey Report prepared by APESMA's Collieries Staff Division which showed that 80.2% of APESMA members have their terms and conditions set by a written common law contract and some 15.5% of Staff are covered by an enterprise agreement. Ms Bolger deposed that a review of employment contracts applicable to Staff and available to APESMA indicates that 73% of the contracts analysed either made no mention of accident pay or did not contain an accident pay entitlement above that of the BCMI Award, with 27% of the contracts analysed that contained an accident pay clause all providing that accident pay is paid as if Staff are at work or on paid sick leave. Ms Bolger deposed that the lack of enterprise agreement coverage of Staff is the product of a number of factors, foremost being the in-principle opposition of employers to enterprise bargaining. Against that background, Ms Bolger opined that the attitude of employers and therefore the prevalence of enterprise bargaining in respect of Staff was unlikely to be affected in any material degree by the introduction or otherwise of the 52 week cap on accident pay sought by the CMIEG in this case.
(Footnotes omitted).
118 The relevant reply submissions by the CMIEG were described in these terms:
36. … With regard to the Unions' contention that its application should be refused because the matter had been recently determined by a different Full Bench, the CMIEG submitted inter alia that to the extent there was any doubt that the Commission had not determined the CMIEG's application or not examined the merits of the accident pay provision in the BCMI Award it was quelled by the 2016 Decision … [citing 24]-[26] of that decision set out at [78] above].
119 The Full Bench then dealt with those submissions under the heading "Consideration of Issues", firstly with the "jurisdiction" point, relevantly as follows:
59. We deal firstly with the Unions' contention that the issue of accident pay in respect of the BCMI Award has already been determined by the Commission. In particular we note that … the then CFMEU applied to delete the transitional provision which was inserted in the BCMI Award (see paragraph [2] of the October 2014 Decision and paragraph [65] of the February 2015 Decision). We further note that in those Decisions the Full Bench also stated that it considered "that the accident pay provision in the Award provides a clear national standard for the particular industry as described in the Award Modernisation Decision 2008" (see paragraph [7] of the October 2014 Decision and paragraph [71] of the February 2015 Decision).
…
60. The Full Bench in the October 2016 Decision stated as follows:
"[24] The Full Bench acknowledged in the August 2015 decision the difference between its decision to insert accident pay provisions into a number of awards and its earlier decision to effectively maintain the existing accident pay provision in the BCMI Award (see underlined text in the above extract from the August 2015 decision). However, we note that:
• the Full Bench's consideration of the accident pay clause in the BCMI Award was limited to the deletion of the transitional provision, i.e. the question of whether the 78 week maximum period continued to be appropriate was not canvassed by any party …" (Underlining added in original)
61. Nowhere in the decisions referred to above is there anything pointing to the issue of what quantum of accident pay is appropriate for the BCMI Award having been the subject of consideration by the Commission. This does not support a finding that the issue of accident pay in respect of the BCMI Award has been determined by the Commission. Accordingly, consistent with the October 2016 decision, we see no impediment to the Commission determining the CMIEG's application.
120 The Full Bench then turned to consider the merits of the issues, as follows:
68. The above evidence does not support a finding that the particular injury risks associated with the industry and the special regime for regulation of safety, workers' compensation and accident pay warrant a minimum safety net in respect of accident pay in the black coal industry which is in advance of other industries.
One of the other grounds on which the Unions opposed the CMIEG's application was that it would have a negative impact on injured workers, particularly in terms of loss of income. While it was not disputed that the CMIEG's proposed variation would impact on employees, the estimates of the reduction in payments that would result varied between those provided by the Unions and the CMIEG. Specifically, the estimated reductions varied from $6,850 to just over $50,000. Further, it is clear from the parties' respective estimates that the greatest reduction stems from the reduction in the period which an employee receives accident pay at the paid personal leave rate from 39 weeks to 26 weeks. In its oral submissions, the CMIEG, without urging such an approach, acknowledged that an alternative approach open to the Commission would be to reduce the cap on accident pay from 78 to 52 weeks but not alter the basis on which the first 39 weeks of accident pay is paid. The Unions in their oral submissions noted that this would reduce from 40% to in the order of 30% of workers who would be affected by the reduction in entitlements.
…
70. Mr Vickers' evidence [on behalf of the CFMEU] regarding the accident pay clauses in 145 enterprise agreements applying to employees of coal mining companies which were analysed by his staff indicated that 92 of those enterprise agreements had varied the approach to accident pay provided for in the BCMI Award, primarily by way of significant enhancements to the Award provision. This points to there already being considerable bargaining in respect of accident pay which is particularly relevant in respect of s.134(1)(b) of the Act.
71. Having regard to the above analysis and the material before the Commission, we have concluded that the current accident pay clause in the BCMI Award in providing 78 weeks accident pay exceeds what is necessary for the Award to provide fair and relevant safety net of minimum terms and conditions. Consistent with the conclusion reached by the Full Bench in the August 2015 Decision, we consider that a period of 52 weeks provides an appropriate safety net for accident pay in this industry. In coming to that view, we have had regard to the history of accident pay in the industry, the industry's relative safety performance and as set out below the modern awards objective. Accordingly, we intend to vary the BCMI Award to reduce the period of accident pay from 78 to 52 weeks.
72. As to the second element of the CMIEG's application, i.e. that the periods of accident pay payable at the paid personal leave rate and the employee's "classification rate" both be reduced from 39 weeks to 26 weeks, the material before the Commission indicates that the bulk of the negative impact on injured workers arises from the reduction of the period of accident pay payable at the paid personal leave rate. Having particular regard to the modern awards objective requirement that modern awards provide a "fair and relevant minimum safety net of terms and conditions" (emphasis added [in original]), we do not intend to vary the Award in this respect in the terms sought by the CMIEG. Rather we intend to vary the Award to reflect the alternative approach which the CMIEG acknowledged at the hearing was open to the Commission, i.e. we intend to maintain the basis on which the first 39 weeks of accident pay is paid and reduce from 39 to 13 weeks the period of accident pay which is paid at the employee's "classification" rate. This approach will minimise the impact of our decision on affected employees.
73. Finally, we note that, consistent with the clarification provided by the CMIEG in its oral submissions, the variations will only apply to injuries which occur on or after the date on which the variation commences operation. In other words, the variations will not affect the existing entitlement to 78 weeks accident pay of an employee who is currently injured and currently receiving the entitlement.
74. With regard to the modern awards objective, the variations we intend to make are, as previously noted, likely to encourage collective bargaining [s.134(1)(b)] and, if anything, are likely to impact positively on employment costs and the regulatory burden [s.134(1)(f)]. The proposed variations will also contribute to ensuring a simple, easy to understand, stable and sustainable modern award system [s.134(1)(g)]. Beyond that, the other elements of the modern awards objective are either neutral considerations [ss.134(1)(a), (d) and (h) - with regard to s.134(1)(a) being a neutral consideration we base our view on the Unions' submission referring to the generally high level of income in the industry as being one of the special features of the industry] or are not relevant in this case [ss.134(1)(c), (da) and (e)].
75. In summary, the variations to the accident pay provision of the BCMI Award which we have outlined above will as required by the modern awards objective ensure that BCMI Award, together with the NES, provides a fair and relevant safety net of minimum terms and conditions.
Conclusion
76. For all the above reasons, we have decided to vary the BCMI Award to reduce the period of accident pay from 78 to 52 weeks and to reduce the period of accident pay paid at the employee's "classification rate" from 39 to 13 weeks. We do not intend to vary the basis on which the first 39 weeks of accident pay is paid. The variations will only apply to injuries which occur on or after the date on which they commence operation. A draft determination reflecting our intended variations is attached to this decision. Interested parties have until 17 October 2018 to comment on the draft determination. The final variation will take effect on 1 November 2018.
121 In our view, it is plain that the Full Bench properly understood the nature of the task that it undertook, summarised the competing submissions and the evidence before it, including the history of accident pay in the black coal mining industry and the industry's relative safety performance, and considered that the accident pay clause in the BCMI Award in providing 78 weeks accident pay exceeded what was necessary for it to provide a fair and relevant safety net of minimum terms and conditions. The FWC was required to resolve an inherently contentious issue. It was for the FWC, not this court, to evaluate the competing contentions that were advanced. It formed the view, consistent with the August 2015 decision, that a period of 52 weeks provides an appropriate safety net for accident pay in the industry and that the variation was necessary for the BCMI Award to meet the modern awards objective of a fair and relevant minimum safety net. In doing so, it directed itself to the statutory task and dealt with the matters raised by the parties. No error in its understanding of its statutory legal task is revealed in its reasons. No jurisdictional error is disclosed.