Crown Employees (Teachers in Schools and TAFE and Related Employees) Salaries and Conditions Award, Re [2003] NSWIRComm 479

CITATION : Crown Employees (Teachers in Schools and TAFE and Related Employees) Salaries and Conditions Award, Re [2003] NSWIRComm 479 APPLICANT New South Wales Teachers' Federation

PARTIES : RESPONDENT Department of Education and Training TAFE Commission

INTERVENOR Minister for Industrial Relations FILE NUMBER: IRC 3749 of 2003 CORAM: Wright J President; Walton J Vice-President; Boland J; Grayson DP; McLeay C Award - Wage fixation - Application for increased rates of pay and allowances - Teachers in schools and TAFE and related employees - Application for interim relief - Work value - Special Case - Economic considerations - Interim award made CATCHWORDS : Wage Fixation - Application for increased rates of pay and allowances - Teachers in schools and TAFE and related employees - Application for interim relief - Work value - Special Case - Economic considerations - Interim award made LEGISLATION CITED : Industrial Relations Act 1996 s 16(4) Australian Liquor, Hospitality and Miscellaneous Workers' Union, New South Wales Branch and Employers First [2002] NSWIRComm 207 Crown Employees (Administrative and Clerical Officers State) Award, (No. 2) Re (1993) 52 IR 243 Crown Teachers Case [1980] AR (NSW) 910 Health Employees Pharmacists (State) Award and other Awards, Re [2003] NSWIRComm 453 Operational Ambulance Officers (State) Award, Re (2001) 113 IR 384 CASES CITED : Public Hospital Nurses' (State) Award, Re (No 4) [2003] NSWIRComm 442 Public Hospital Nurses (State) Award, Re (2002) 115 IR 183 Public Hospital Nurses' (State) Award, Re (No 3) (2002) 121 IR 28 Public Hospital Nurses (State) Award, Re [2002] NSWIRComm 100 Social Community Services Employees (State) Award, Re (2001) 113 IR 119 Storeworkers - IGA Distribution Pty Limited New South Wales Distribution Centres Award 2002 [2002] NSWIRComm 156 State Wage Case 1989 (1989) 30 IR 107 State Wage Case 2003 (2003) 121 IR 446 HEARING DATES: 08/08/2003; 09/11/2003; 09/23/2003; 09/24/2003; 09/25/2003; 09/26/2003; 10/16/2003; 10/17/2003; 10/21/2003; 10/22/2003; 10/28/2003; 10/29/2003; 10/30/2003; 11/03/2003; 11/04/2003; 11/05/2003; 11/17/2003; 11/18/2003; 11/19/2003; 11/20/2003; 11/24/2003; 11/25/2003; 11/26/2003; 11/27/2003; 11/28/2003; 12/16/2003; 12/17/2003; 12/18/2003 DATE OF JUDGMENT: 12/19/2003

APPLICANT Mr S Crawshaw, SC and Mr A Hatcher and Mr M Gibian of counsel NSW Teachers Federation Ms B Seymour

RESPONDENT LEGAL REPRESENTATIVES: Mr R C Kenzie, QC with Mr P Ginters of counsel Department of Education and Training TAFE Commission Mr G Boyd

INTERVENOR Mr P M Kite, SC with Mr S E Prince of counsel Minister for Industrial Relations

JUDGMENT: INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES

CORAM: WRIGHT J, President WALTON J, Vice-President BOLAND J GRAYSON DP MCLEAY C

Matter No IRC 3749 of 2003 CROWN EMPLOYEES (TEACHERS IN SCHOOLS AND TAFE AND RELATED EMPLOYEES) SALARIES AND CONDITIONS AWARD - APPLICATION BY NSW TEACHERS' FEDERATION FOR A NEW AWARD

DECISION OF THE COMMISSION [2003] NSWIRComm 479

1 The New South Wales Teachers' Federation ("the Federation") has made application for a new Crown Employees (Teachers in Schools and TAFE and Related Employees) Salaries and Conditions Award. The existing Award expires on 31 December 2003. The application seeks the following: 1. An increase in salaries and allowances increases totalling 25 per cent over the two-year nominal term of the proposed award. 2. Enhancement of the top of the common incremental salary scale by achieving a higher rate of increase at Step 13. 3. Rectification of anomalies that exist in the current award with respect to TAFE head teachers' salaries and year advisers' allowances for schoolteachers. 4. Leave reserved in respect of other salary-related matters. 2 The Director General of the Department of Education, the Managing Director, TAFE New South Wales ("the respondents") and the Minister for Industrial Relations opposed the Federation's application. Their position, consistent with the policy of the Government in relation to public sector wages, is that the salaries for teachers in schools and TAFE should increase by no more than three per cent per annum over the next two years. Such increases, it was submitted, would maintain the real value of wages.

3 The hearing of the Federation's claim has been concluded. The hearing extended over 28 days and evidence was taken from 67 witnesses. Additionally, the Full Bench inspected Sarah Redfern public school and high school at Minto and the Passfield Park special school also at Minto, Model Farm High School, Winston Hills primary school, the TAFE College at Petersham and the Sydney Institute at Ultimo. We should record the fact that we found these inspections most helpful in placing the oral and documentary evidence in perspective and we express our appreciation to the staff and students of those institutions for their assistance.

4 At the close of the evidence in the case on 28 November 2003 the Federation informed the Full Bench that it was seeking an interim increase of 10 per cent payable from 1 January 2004. The Federation was directed to address the question of an interim increase by providing submissions in writing by 9 December 2004. The respondents were directed to provide their response in the course of making final submissions. The final submissions of the parties were heard on 16, 17 and 18 December 2003. We should indicate at the outset that in relation to the claim for an interim increase the position of the respondents and the Minister was that as this matter may not be completed this year (the parties having agreed to an operative date for any increase in the first year of 1 January 2004) the Commission may "determine" an interim increase but such increase should not be more than three per cent. 5 Whilst the case proper has concluded and we have heard all of the evidence and submissions, we are in no position to indicate a final view of the Federation's claims. The parties and the intervener have presented a mass of material in support of their respective positions and it will take some time to analyse that material and to make a final assessment as to its weight and probative value against the background of the relevant wage fixing principles and statutory provisions. However, we are in the somewhat unusual position when an application for an interim increase is sought of having fully heard the cases put by all parties and thus being able to assess the claim for interim relief on that basis.

6 This decision, therefore, is limited to addressing the claim for an interim increase. In doing so, we have followed the usual course of taking a cautious approach to avoid embarrassment of the final result: see Re Public Hospital Nurses (State) Award (2002) 115 IR 183 at [35]; Australian Liquor, Hospitality and Miscellaneous Workers' Union, New South Wales Branch and Employers First [2002] NSWIRComm 207 at [16].

7 The primary issue for determination is whether an interim salary increase for teachers is justified having regard to the bases of the claim and, if so, what that increase should be. The secondary issue is the operative date of any increase. The Federation's salaries claim is brought pursuant to Principle 6, Work Value Changes, and Principle 10, Special Case, of the Wage Fixing Principles ordered in the State Wage Case 2003 (2003) 121 IR 446. In the recent judgment in Re Public Hospital Nurses' (State) Award (No 4) [2003] NSWIRComm 442 the Full Bench at [16] - [22] discussed the requirements of the work value principle in the following terms: 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.

8 We respectfully adopt this approach for present purposes. We also adopt the following passages from Re Health Employees Pharmacists (State) Award and other Awards [2003] NSWIRComm 453 at [128], [129] and [130]: 128 Before turning to the question of qualifications it is appropriate at this juncture to deal with some more general considerations. As we have mentioned, we do not accept as the HAC contends, that the additional knowledge and skills required of Hospital Pharmacists can or should in the context of these proceedings, be consigned to the realm of continuing historical professional work and although minds may differ as to what should reasonably be expected by way of professional development, such issues are in the sense of industrial regulation, ultimately matters of fact and degree and must in their determination rest on what is, in the judgment of the Commission, fair and reasonable in terms of rates of pay and conditions of employment. 129 The test of whether there have been changes in work value such as to satisfy the relevant wage fixing principle is necessarily a global one. It is not amenable to microscopic evaluation of discrete functions of the particular classification or classifications under review and we agree in that regard with the HSU submission that although a thorough and exhaustive analysis of the work in question is required in each case, the application of an unduly rigid or function specific approach to changes in the work of professionals such as Hospital Pharmacists (which in our view are amply demonstrated by the evidence) would render it virtually impossible for a professional classification to satisfy the test. We do not consider such a result to be a fair and just one, and nor do we consider such a result to be consistent with the spirit and intention of the Commission's wage fixing principles. 130 We would, emphasise that those principles would dictate that such a realistic evaluation of the nature of the work of professionals would be tempered by the requirement to avoid the double counting of features said to constitute the elements of work value change (so as to avoid compensation for features of the work that merely arise from ordinary professional development or have been previously taken into account in wage reviews). However, we do not agree with the HAC's submission that changes in work value that have occurred since 1 July 1996 have been or will be adequately compensated by existing arrangements.

9 The special case principle, as the name implies, allows a party in relation to a contested claim over wages and conditions of employment to have the matter dealt with by the Commission in circumstances where the claim cannot be pursued under any of the other wage fixing principles. A special case claim is to be processed before a Full Bench of the Commission, unless otherwise allocated by the President. In Re Operational Ambulance Officers (State) Award (2001) 113 IR 384 at [168] the Full Bench discussed the requirements of the special case principle in the following terms: A number of principles may be distilled from these authorities bearing upon the contention advanced by the HAC. In order to make out a special case the applicant is required to make out that the variation is necessary to establish fair and reasonable conditions of employment and that the matter has special attributes. In doing so, the applicant is not required to meet a higher onus or standard of proof. The evidentiary requirements of a special case are no more strict than would apply in an ordinary matter, although the applicant to a special case will need to establish an adequate evidentiary foundation for those factors which are relied upon as showing the special case attributes of the case. Whilst respect will be afforded earlier decisions of the Commission or its predecessors, the conditions of employment earlier established need to be ultimately tested against the requirements of s 10 of the Act and that which we have discussed as being applicable to making out a special case. Where, as here, the former decision involved a test case, particular care should be taken to ensure that the factors relied upon by an applicant in support of its claim do not replicate factors which were taken into account by the Commission or its predecessors in establishing the general standard emerging from such case. In any event, the basis for and circumstances under which the conditions in the award were established will be significant considerations in the Commission's deliberations in order to assess whether the factors relied upon by the applicant in support of a special case have already been accommodated by the earlier made award (in which case the present prescription may adequately compensate for those factors). See also Re Crown Employees (Administrative and Clerical Officers State) Award (No. 2) (1993) 52 IR 243 at 376 - 377; Re Social Community Services Employees (State) Award (2001) 113 IR 119 at [22]-[25], [312]-[313]; Storeworkers - IGA Distribution Pty Limited New South Wales Distribution Centres Award 2002 [2002] NSWIRComm 156 at [38] - [50]; Re Public Hospital Nurses (State) Award (2002) 115 IR 183 at [11]-[16].

10 The Federation seeks to have its work value claim assessed on the basis of changes alleged to have occurred in the work of teachers over the period since 1991. That is, from the date of operation of the second structural efficiency adjustment allowable under the State Wage Case 1989. It was submitted there has been no work value consideration with respect to teachers covered by the Award since that time.

11 The changes relied upon by the Federation, which were described as "systemic", may be summarised from the Federation's contentions, which were reflected in the Federation's final submissions. Those contentions included the following: 1. Significant additions to the school curriculum, including extensive new syllabuses, a shift to outcome based education, more frequent revisions to the curricula and syllabuses and loading of the curriculum with components outside traditional subject areas; 2. The introduction of Vocational Education and Training in schools with associated requirements including teacher retraining, accreditation of courses, competency-based training approach, increased workplace placements and liaison with employers and the regular auditing of courses; 3. The introduction in TAFE of competency-based training and assessment, recognition of prior learning, new training packages and national regulation of consistency in teaching and learning, Technical and Vocational Education and Training in TAFE, new apprenticeships, traineeships and the new Higher School Certificate; 4. The introduction of new standards and accountabilities with respect to assessment and reporting including more regular and detailed reporting requirements, the assessment of students against stipulated learning outcomes, greater emphasis of consistency in assessment and greater accountability of teachers for assessment decisions; 5. Changes to disciplinary practices, the nature of teacher/student relationships and expectations, increased stress and uncertainty and additional reporting requirements and accountabilities as a result of the introduction of child protection legislation and associated requirements; 6. The integration and mainstreaming of students with special needs (i.e. intellectual and physical disabilities) including challenges to classroom management techniques, liaison with parents and care professionals, management of student needs and development of appropriate individual learning/teaching techniques; 7. Increased accountabilities and reporting with respect to occupational health and safety, registered training organisations, quality endorsed registered training organisations, International Standards Organisation, Australian Quality Training Framework, and the National Reporting System; 8. The introduction of new computer technology and its introduction into classroom delivery, and associated developments such as distance/online access and delivery, preparation of intranet material, development of school/college-to-home online access and delivery, screening of online resources for pedagogical quality and relevance, adaptation of technology for classroom use, and the teaching of web research techniques; 9 The introduction and increased use of computer technology in performing administrative tasks, including reporting, recording assessments and maintaining contact with students and parents as well as administrative work involved in technology maintenance. Specifically to TAFE, the introduction of the electronic educational management systems including computerised Class Management System (CLAMS), e-mail, online lecturing and accessing of course information and TAFE and Board of Studies documents; 10. Increased expectation and necessity for self-education, and for training and development to be provided by teachers to other teachers, as a result of a lack of provision of training and development by the Department; 11. Increasing demands placed on permanent teachers as a result of the increasing use of short-term casual and overseas trained teachers; 12. Increased behavioural problems among students and greater expectations and accountabilities with respect to behaviour management, including negotiation and mediation, risk identification, dealing with racial/cultural vilification, dealing with traumatised adults and children, and appropriate record-keeping and reporting; 13. Greater parental, student and community expectations, resulting in higher demands placed on teachers with respect to educational and behavioural standards, greater demands by parents for regular and detailed reporting, feedback and follow-up on individual students, parental aggression, and a more litigious environment requiring considerable care in dealings with parents and the community and in record-keeping; 14. Deterioration in the physical conditions of schools and TAFE colleges and inadequate provision of resources such as computer facilities and textbooks, placing greater strains on teachers as well as greater demands to maintain an appropriate learning environment; 15. Greater demands of teachers resulting from the introduction of global budgeting. In TAFE, competitive tendering, requirements to write submissions, undertaking commercial courses, requirements to generate income and access funding from external sources and the requirement (reflected in the current award) to generate Annual Student Contact Hours; 16. An increasingly competitive environment in which schools and TAFE now operate, involving a private school system operating with significantly increased government funding and support, the growth of private vocational and technical training providers, and greater specialisation and competition within the public school and TAFE systems, which has added to the demands, work pressures and accountabilities of teachers and has required them to engage in marketing activities; 17. Structural changes within the Department of Education and Training which have involved the significant devolution of authority, both financial and administrative, to schools, which has had the result of adding to the duties and responsibilities of teachers. Further such devolution is expected in the light of recent announcements of reductions in Department of Education and Training staff.

12 The respondents' position regarding the Federation's claim, including the datum point, was that it accepted that since 1991 there have been changes in the nature of the work of employees the subject of the Federation's application such as to amount to a significant addition to the work requirements of these employees. However, the respondents contended that the Federation's case had fallen short of establishing that there had been a "significant net addition" to work value that had not otherwise been recognised or compensated by wage increases since 1991 (whether by agreement or arbitration) or offset by various ameliorating factors.

13 The respondents contended that many of the changes relied on by the Federation have been: (a) the subject of earlier recognition by the Commission and have provided the basis for substantial salary increases; or (b) part of a continual development of matters recognised by the Commission.

14 Further, it was contended to the extent that changes have occurred in the period since 1991, employees the subject of the Federation's application have been substantially compensated for these changes by salary increases received on and from 1991.

15 It was submitted for the respondents that a number of the work value changes relied upon by the Federation do not affect the employees the subject of the Federation's application universally. In addition, many of the changes relied on would properly be regarded as being part of the ongoing role of a professional teacher.

16 The Federation's contentions and evidence, it was submitted, failed to acknowledge the existence and impact of factors which have ameliorated the effect of changes or which have otherwise been of assistance to employees the subject of the Federation's application. Moreover, it was contended that the respondents had provided significant resources to assist with the implementation of and address the ongoing consequences of changes that had impacted on the work of teachers.

17 As to the areas of change relied upon by the Federation, the respondents' response included the following: 1. Curriculum change

· Changes to curriculum do not in and of themselves satisfy Principle 6. · Accommodating changes to curriculum is part of the ongoing role of the professional teacher. · The requirement for teachers to accommodate changes to curriculum has been a factor that has been recognised in earlier decisions of the Commission and agreements between the parties. · Teachers have been supported and assisted by the Department in the implementation of curriculum changes through the provision of resources, training and support materials. 2. Vocational education and training

· The provision of vocational education and training in schools affects only a small proportion of teachers and does not support an across the board salary increase. · Affected teachers have been supported and assisted by the Department in the provision of vocational education and training in schools through the provision of resources, training and support materials. · In 2003, an activity-based Student Guide to Workplace Learning was distributed to secondary teachers. This booklet provides teaching and learning strategies to support teachers introducing workplace learning to students. 3. Competency based training

· The introduction of competency based training and assessment regimes have been in place in the TAFE sector since the early 1990s. · The requirements introduced by these regimes have been recognised and compensated for (at least in part) by the TAFE Case and in agreements struck between the parties. · Affected teachers have been supported and assisted through the provision of resources, training and support materials. 4. Assessment and reporting

· Whilst new standards and accountabilities with respect to assessment and reporting have been introduced, the introduction of these assessment and reporting regimes has assisted teachers as they provide teachers with objective criteria against which to assess and report on students' progress. · Teachers have been supported and assisted by the Department in the implementation of these new standards and accountabilities through the provision of resources, training and support materials. 5. Discipline

· Discipline has always been part of the ongoing role and responsibilities of a teacher. · Societal change and the impact that has had on the disciplinary role of teachers has already been recognised by the Commission in awarding salary increases to teachers. · Teachers have been supported and assisted by the Department in undertaking their disciplinary functions through the provision of resources, training and support materials. · Child protection legislation has been in place in NSW and other states for many years. To assist teachers to respond to changing requirements the Department has introduced and updated procedures and provided training and advice to teachers to ensure they are aware of their responsibilities and the support available in dealing with this issue. 6. Special needs students

· To the extent that teachers' responsibilities have changed in relation to students with special needs they have been supported and assisted by the Department through the provision of resources, training and support materials. 7. Occupational health and safety and TAFE reporting responsibilities

· Statutory obligations in respect of occupational health and safety have existed in similar terms since 1983. · The statutory obligations in respect of occupational health and safety are of benefit to teachers as they operate to make the working environment of teachers safer. · Insofar as the Federation's contentions refer to the reporting responsibilities of TAFE teachers the matters therein referred to are all part of the ongoing professional responsibilities of such teachers. 8. Computer technology generally

· It has always been a part of the professional responsibilities of a teacher to undertake research for the purpose of course delivery. The introduction of computer technology has assisted teachers by providing access to information and a broad range of materials and teaching aids. · Teachers have been supported and assisted by the Department through the provision of resources, training and support materials in relation to the introduction and application of computer technology. 9. Computer technology in performing administrative tasks

· Whilst it is acknowledged that there is always an element of training associated with the use of computers, the use of computer technology has undoubtedly been of benefit to teachers in that it has replaced previous manual paper based reporting and recording requirements. Moreover it has allowed for more expeditious and efficient document retrieval and storage. For example the CLAMS system that has been introduced in TAFE has replaced the traditional paper based roll book. · Teachers have been supported and assisted by the Department through the provision of resources, training and support materials in relation to the introduction and application of computer technology. For example in TAFE NSW training programs are available to teaching staff in the use of administrative programs such as Microsoft Outlook, CLAMS and SCIS. 10. Self education and training

· Self education and training has always been part an ongoing part of being a teacher and has been expressly recognised in the establishment of teachers' rate of pay by the Commission. · Insofar as the Federation contends that there has been a lack of provision of training and development by the Department the respondents note, for example: o TAFE teachers are, and have been since 1994, provided with one hour per week professional development time over and above the professional development time provided by individual institutes. o Schools teachers have been entitled to three school development days per annum since 1997 for professional development. · Teachers have been supported and assisted by the Department through the provision of resources, training and support materials in relation to their self-education and training requirements. 11. Increasing demands on permanent teachers

· Implicit in the Federation's generic salaries claim is an assertion that the work of short-term casual and overseas trained teachers is of equal value to that of permanent teachers. · There is a fundamental inconsistency involved in: (a) claiming that the demands on permanent teachers have increased because of the increased use of overseas trained teachers; and

(b) claiming an across the board salary increase that embraces such teachers.

· The Department has put in place a number of initiatives to assist with the integration of overseas trained teachers. 12. Behavioural problems with students

· Teachers have always had responsibilities in relation to addressing students with behavioural problems. This is a matter that has been previously recognised by the Commission as a foundation for increases in teachers' rate of pay. · To the extent that teachers have assumed increased responsibilities in relation to students with behavioural problems, they been have been supported and assisted by the Department through the provision of resources, training and support materials. 13. Greater parental, student and community expectations

· Teachers have always had to respond to parental, student and community expectations. It is part of the ongoing professional responsibilities of a teacher. · The increasing role of parents and the community in school decision-making was specifically referred to in the Education Teaching Service Case (September 1991). · Whilst it may be accepted that there have been additional reporting requirements these also assist teachers as they provide them with objective criteria against which to assess, report and respond to enquiries about students' progress. · Insofar as it is contended that teachers now operate in a more litigious environment it is to be noted that the teachers have been supported and assisted by the Department through the provision of resources, training and support materials in relation to how to respond and deal with potential or actual litigious situations. 14. Deterioration in the physical conditions of schools and inadequate provision of resources

· By definition the physical condition of schools and the provision of resources to schools will be variable. This has always been the case. · Given the above the matters identified in the Federation's contentions do not warrant an across the board salary increase. 15. Global budgeting and competitive tendering in TAFE

· Global budgeting in schools enables each school principal in conjunction with the school finance committee to determine how available funds are applied to meet the school's educational priorities and curriculum requirements. With the move away from the centralised control of funds, schools now have greater flexibility in the overall management of their finances. · Global budgeting and its impact was a matter that was specifically identified in the Education Teaching Service Case. · In response to the development of competitive tendering requirements, TAFE institutes have set up structures that have had the effect of ameliorating teachers' responsibilities in relation to the delivery of these services. · Further, in addition to the above, the responsibilities defined in the Federation's contentions are part of the ongoing professional responsibilities of TAFE teachers. 16. The increasing competitive environment

· Teachers have always been involved in marketing activities. · The promotion of schools and teaching was a matter that was specifically identified in the Education Teaching Service Case. · The responsibilities that TAFE teachers have in this regard are all part of the ongoing professional responsibilities of TAFE teachers as identified in the 2000 Award and were part of the package of agreed matters included in the consent award as part of the quid pro quo for the salary increases that were awarded to TAFE teachers. 17. Structural changes within the Department

· The devolution of authority described in the Federation's contentions does not affect all teachers equally. · Given the above the matters identified in the Federation's contentions do not warrant an across the board salary increase. · The devolution of financial and administrative authority to schools has also meant that schools have the flexibility to respond and target resources to areas of particular need. · The devolution of financial and administrative authority was a matter that was specifically identified in the Education Teaching Service Case.

18 In broad terms the Federation contended that the following 'special case' factors supported its salary claim: The need for an economic adjustment. Teachers are entitled to an economic adjustment which will maintain the real value of their rates of salary over the nominal term of the proposed award. It should be noted that teachers are not entitled to State Wage Case adjustments under the provisions of the Wage Fixing Principles; accordingly, no question of double counting arises here. Productivity, efficiency and quality of work improvements. Improvements in the productivity, efficiency and quality of work of teachers is readily demonstrable. On a weighted average basis, the State Government's employee-related costs per student declined over the period 1997/8 - 2002/3 once such costs are properly deflated in accordance with the wage costs index. The high standards of productivity, efficiency and work quality of NSW teachers has been confirmed in a number of reports, and by the responsible Minister, who has described NSW public schools as leading the world in literacy, numeracy and science. A significant risk of a future teacher shortage. Although recent years have seen in general terms a balance in teacher demand and supply in New South Wales, this is expected to turn to a shortfall in the near future. Public schools will feel the effects of this shortfall disproportionately, because private schools are attracting increasing government and other funding and are consequently better equipped to pay "market" salaries to their employees. Within the public school system, those schools which already have problems attracting staff because of geographic or socio-economic considerations will find themselves in an even worse position. One factor linked to the impending shortage is a low retention rate of experienced teachers. Average attrition rates of school teachers over a fifteen year period are about 44%, with the figure being over 50% for secondary teachers. Teachers shortages have a direct effect on the quality of education, particularly at disadvantaged schools, because they mean high staff turnover, a lack of teachers in specialist areas, and a higher use of casual teachers. There is also a direct effect on the workload of teachers. An increase in rates of salary in order to ensure that teachers are attracted to and retained in the NSW system is accordingly justifiable. A decline in the relativity of teachers' salaries to both average earnings for employees generally and average earnings for professionals. Associated with the low retention rates of experienced teachers has been a long-term and ongoing decline in the relativity of teacher's salaries compared to average total earning of both male and female employees, and average total earnings for other professional occupations. This decline is both unjustifiable having regard to increases in the work value and productivity of teachers and a cause of teachers leaving the system for other careers. The statistics demonstrating this decline in relativities provides objective justification for the widespread feelings amongst teachers that their salaries are unsatisfactory and that they are undervalued by the community. The Vinson Report; Inquiry into the Provision of Public Education in NSW Report of the 'Vinson Inquiry' 2002. An independent inquiry into the provision of public education in NSW, which was chaired by Professor Tony Vinson, issued a report in 2002 recommending, inter alia, a "catch-up" increase in teachers' salaries of at least 5%. This increase was seen as necessary to give proper recognition to the social value of the role performed by teachers, to signify support for a new level of professionalism amongst teachers, and to attract quality new recruits to the profession. Changes to the qualifications of teachers. It was contended that the qualifications held by teachers are now at a higher level than they were in 1991.

19 The respondents' response to the Federation's special case factors was, in general terms that, firstly, in respect of an economic adjustment the respondents have offered a six per cent increase over two years designed to maintain the real value of wages but this has been rejected by the Federation. Secondly, as to the productivity, efficiency and quality of work improvements relied upon by the Federation: (a) These appear to traverse the same or similar ground as is relied upon by the Federation in the work value changes aspects of its case. (b) To the extent that there have been productivity, efficiency and quality of work improvements by employees the subject of the Federation's application these matters have been compensated for by the salary increases received since 1991. (c) Further, in addition to the above, to the extent that productivity, efficiency and quality of work improvements are taken into account by the Commission in its assessment of the Federation's work value changes application it would be erroneous (and amount to double counting) for those matters to be taken into account in the Federation's special case application. Equally, to the extent that productivity, efficiency and quality of work improvements are taken into account by the Commission in its assessment of the Federation's special case application it would be erroneous for those matters to be taken into account in the Federation's work value application.

20 Thirdly, as to the risk of a future teacher shortage: (a) The Commission would not overturn the well-established industrial principle that wage rates should not be set on the basis of shortages (even in the case of important professions). To increase rates on the basis of a labour shortage would be contrary to the public interest: Re Public Hospital Nurses (State) Award (No 3) (2002) 121 IR 28 at [90]. (b) In considering the issue of a shortage of teachers the Commission would follow the long-standing principle that it is not appropriate to set rates to address shortages because that would cause rates to be set other than on the basis of the true value of the relevant work: Equal Remuneration Case (2000) 97 IR 177 at 214.7 - 215.3 at [151] - [152], particularly the reference to Local Courts Anomaly Case [1989] AR(NSW) 638 at 645.9 - 646.1; see also Mills and Sorrell, Federal Industrial Law , 5th Edition, 1975 at [173]; In re Academic Officers (University of Technology) Award [1958] AR(NSW) 55 at 57.7 - .8 ; Re Railways Professional Officers Award (1958) 89 CAR 40 at 48.02 - 49.5; Re Metal Trades Award; Re State Electricity Commission of Victoria (1964) 106 CAR 535 at 564.09 - 566.07; In re Crown Employees (Teachers) Awards [1980] AR(NSW) 910 at 930.9 and Re Australia Nursing Federation - s 170MX Arbitration [PR931289] (Australian Industrial Relations Commission) at [59]. (c) There are strong public interest reasons for not setting rates based on the existence of a labour shortage. To do so: (i) would lead to rates being set that were not based on what the Commission determined to be a fair and just rate for that work: see the Objects of the Industrial Relations Act 1996 (NSW), in particular s 3(a); (ii) would be inequitable to do so for one group, in circumstances where wages are not otherwise moved on this basis. Further, it would lead to inequity in comparison to employees working in areas where there is no current shortage; (iii) would lead to consequential pressure for flow-on outside the area of need, creating other difficulties; (iv) would be contrary to the Commission's long standing practice of not setting wages based on a "market rate" approach where shortages are addressed in classic economic theory by the market increasing the "cost" of labour (i.e. higher wages); and (v) would be to artificially increase rates of pay to cover short term labour shortages which come and go, and even in the case of persistent shortages, heighten or lessen in intensity over time. In the present case, a labour shortage may or may not be affected by changed economic conditions, changes in the population profile, or a combination of such factors. In these circumstances any artificially increased rate of pay would remain after the circumstances giving rise to it had changed or been removed. (d) Whilst the Commission may be concerned to see steps taken to alleviate a potential shortage of teachers such a concern cannot lead the Commission to ignore well established industrial principles and thereby create a new basis for wage increases which could have widespread and unpredicted ramifications. In particular, if the Commission were to award an increase based on the fact that there is a shortage in an important profession or trade it would inevitably lead to similar claims being made by others. (e) The position is a fortiori here when the Commission is addressing a claim based on a potential labour shortage, the dimensions of which, by definition, cannot be assessed. In any event, insofar as any predictions can be made as to areas where shortages are likely to be required to be addressed the respondents have put in place a number of strategies to address this situation.

21 Fourthly, as to the decline in the relativity of teachers' salaries to both average earnings for employees generally and average earnings for professionals: (a) The Commission would not conclude that a special case (i.e. on the ground contended for by the Federation) has been made out simply by reference to the rates payable to other professional and/or non-professional groups. (b) Reference to the statistical comparators relied on by the Federation do not make out a special case. Changes in average earnings or average award wages, each average involving thousands of occupations, can provide no guide at all as to how the value of the work of teachers, being one of the thousands of occupations concerned, has altered relative to the value of the work of other occupations: In re Crown Employees (Teachers) Award Reference 1981 AR (NSW) 217 at 223.6 - 223.7 (albeit in the context of a work value changes application). That is, the Federation's reliance on statistical comparators does not "establish an adequate evidentiary foundation for those factors which are relied upon as showing the special case attributes of the case": Ambulance Officers Case (2001) 113 IR 384 at 420.10; par [168].

22 Fifthly, as to the Vinson Report: (a) It is entirely unclear how it is said by the Federation that the Vinson Report in globo provides a justification, on special case grounds, for a 25 percent, across the board, salary claim.

(b) Relevantly, the Vinson Report (at p 370.4) concluded by commenting that it had difficulty "seeing how anything less than a 5% increase, resulting in annual gains of the order of $2,000 - $3,000 for the majority of teachers, would be just and supportive of the scale of system change recommended." This is a conclusion far more in tune with the respondents' case than the applicant's case.

(c) Further, insofar as the Vinson Report recommends a particular salary increase it is relevant that it does not, on its face, appear to have factored into its consideration the history of salary movements of employees the subject of the Federation's application.

23 Sixthly, as to the changes to teachers' qualifications: (a) The changes to the qualifications of teachers relied upon by the Federation appear to traverse the same or similar ground as is relied upon by the Federation in the work value changes aspects of its case. (b) To the extent that there have been changes to the qualifications of teachers these matters have been compensated for by the salary increases received since 1991.

(c) Further, in addition to the above, to the extent that changes to the qualifications of teachers are taken into account by the Commission in its assessment of the Federation's work value changes application it would be erroneous (and amount to double counting) for this matter to be taken into account in the Federation's special case application. Equally, to the extent that changes to the qualifications of teachers are taken into account by the Commission in its assessment of the Federation's special case application it would be erroneous for this matter to be taken into account in the Federation's work value application.

24 The submissions by Mr P Kite SC for the Minister focused on the impact of the Federation's claim on the State's finances and the implications for the State's economy. The respondents also made submissions as to the economic impact of the claim.

25 The parties provided an agreed statement of facts. The agreed facts did little to narrow the differences between the parties as reflected in the summary of their respective positions outlined above. The statement did, however, contain some useful information, both historical and current, under the following headings: 1. The changing educational environment since 1990. 2. Statewide personnel programs, operations and initiatives - schools. 3. Teaching and learning in schools. 4. TAFE New South Wales. 5. Regulation of vocational education and training. 6. Legislation. 7. Child protection procedures and reporting requirements. 8. About the Department of Education and Training. 9. Employment data. 10. Awards covering teachers.

26 The Federation's submission in support of the granting of an interim increase of 10 per cent from 1 January 2004 may be summarised as follows: 1. The present teachers' award expires on 31 December 2003. 2. The overall salary rates, allowances and hourly rates of pay have not changed since 1 January 2003. 3. It is impractical for the Commission to be in a position to deliver a decision in relation to the application on a fully reasoned and final basis for some time after the expiry of the current award on 31 December 2003. 4. The course of awarding an interim increase in salary rates, allowances and hourly rates of pay is a course adopted by the Commission and its predecessors on many occasions in the past: See, for example Re Crown Employees (Teachers - Department of Education) Award (1970) 70 AR (NSW) 345 at 348-9; Re Crown Employees, Teachers, Departments of Education and Technical and Further Education [1980] AR (NSW) 127 at 130-133; Re Public Hospital Nurses (State) Award (No 3) (2000) 121 IR 28 at [124]. 5. The Commission can be completely satisfied, without any lengthy deliberation, that the existing salary rates, allowances and hourly rates of pay of teachers are less than are just and reasonable and that a full and final deliberation will result in substantial increases being awarded. It is also apparent from the quantity of the evidence called and the comprehensive nature of the submissions being put that the full and final deliberation by the Commission might take some time to be completed in 2004 and that it would be unjust and also against the public interest that an adjustment of salary rates, allowances and hourly rates of pay should be postponed until such deliberation has been completed. 6. Deferment of salary increases would irreparably prejudice the superannuation rights of teachers who would retire before a final award could be made. 7. The Federation is prepared in this case to accept that if an interim increase is awarded: (i) The Federation would not argue for any retrospectivity of any final increase in salary rates, allowances and hourly rates of pay, over and above any interim increase; and,

(ii) Any final increase in salary rates, allowances and hourly rates of pay, over and above any interim increase, would not take effect before the 30 June 2004. 8. There is an agreed statement of facts from which the Commission can draw conclusions about some changes in work value and the respondents have conceded that there have been work value changes.

27 The respondents accepted that the necessary special circumstances existed to enable the Commission to grant an interim increase. However, it was submitted: 1. The respondents' position remains that the increases of 3 percent per annum from 1 January 2004 and 1 January 2005 remain appropriate.

The respondents support the objective of having a new two year award in place by 1 January 2004 and it is recognised by them that as the case may not be completed this year the Commission may determine an interim increase.

To this extent, the respondents' position has been that a 3 percent increase should apply from 1 January 2004 and this should take account of all the issues relied upon by the Federation in its application for a new award.

In the abovementioned circumstances it is clear that the 10 percent interim increase (to take effect from 1 January 2004) proposed by the Federation is entirely inappropriate.

The above circumstances (including the significance of the case, its impact and the important issues squarely drawn as between the parties) make it appropriate for the Commission to adopt a most cautious approach to the present application for an interim increase.

In this respect it is important to appreciate the relationship between the interim increase now claimed and the final relief sought by the Federation. It is also important to bear in mind the nature of that final claim.

The Federation's claim is for an across the board 25 percent increase. With the exception of "the Vinson 5%" it is relevantly identical to the claim discussed by Dey J in the Crown Teachers Case [1980] AR (NSW) 910 at 928 where his Honour referred to the resolution of the Federation supporting the claim confirming it as one for a 20 percent increase on all salaries and allowances. His Honour said: Although this percentage was stated … to have been arrived at after twelve months of work by the 'Salaries Committee' and a membership wide survey no explanation was advanced for the selection of that figure. The arguments for an across the board increase based on changes in primary/infant, secondary and TAFE teaching are set out in a 24 page document. The problem with the decision to seek a 20% flat increase as 'the claim' is that it is liable to build up expectations among the Federation's membership as to the likely increase, which has no explicable foundation. 8. No attempt having been made (subject to the inclusion of the Vinson 5 percent) to justify the selection of 25 percent as an appropriate increase, the Federation's claim would be correctly perceived by the Commission to be an ambit claim.

9. As to that ambit claim it is important in the present context to bear in mind the history of its development and the basis on which it was increased from 20 percent to 25 percent. The Respondents refer in this respect to their submission on "the Vinson 5%" detailed below.

10. The Federation's claim is correctly to be perceived for what it was as developed by the conference in July 2002 - namely, an ambit claim for 20 percent - one which has subsequently been artificially inflated by reference to the Report of the Vinson Inquiry.

o 10% from 1 January 2004; o 5% from 1 July 2004; and o 5% from 1 January 2005. 12. In essence, the Federation is now seeking final relief by way of interim relief in the circumstances detailed above. This would be entirely inappropriate, particularly having regard to the liability "to build up expectations among the Federation's membership, as to the likely increase" in the sense discussed by Dey J in the Crown Teachers Case. 13. The above circumstances suggest that the Commission should take a cautious approach and it is submitted that if the Commission is disposed to make an interim award it should be in terms consistent with the Respondents' position.

28 We have been presented with extensive evidence and submissions regarding the changes that have occurred in the work of teachers both in schools and TAFE since 1991. The very broad scope of the present case is evident from the summary we have provided in this interim decision. It is, however, unnecessary in the context of considering a claim for an interim increase to go into any detail regarding our findings. We note the respondents maintain that teachers have already been compensated for the increased value of their work, or that the changes relied upon by the Federation are part of a continual development of matters recognised by the Commission over many years or were earlier recognised in decisions of the Commission or in agreements. They have also referred to other offsetting or ameliorating factors that, it was submitted, also remove the need for as great an increase in salaries as might otherwise be justified. Accordingly, the respondents contend that if the Commission were to grant an interim increase it should be no more than three per cent economic adjustment.

29 The Minister contended that the total cost of the Federation's claims will have a very significant effect on the New South Wales State Budget and financial position and hence on the economy of the State.

30 We have given particular consideration to the submissions of the respondents regarding the implications of any salary adjustments that have been made in the past and the basis of those increases. We have not reached any concluded view on the full extent to which those past adjustments have compensated for increases in work value. We are, however, of the view that the increases in rates of pay for teachers since 1991 have not compensated them to the extent submitted by the respondents and in that respect, on the basis of the evidence and submissions in these proceedings, we are satisfied beyond any doubt that there has been a significant net addition to the work requirements of teachers since the datum point in 1991 such that it would warrant an increase in salaries.

31 On the basis of the material presented to us we consider the change in teaching work has been profound and that there are features of this matter that warrant the finding that a special case has been made out. Consequently, we consider there is greater scope for ultimately awarding more than the six per cent increase over two years as proposed by the respondents.

32 In arriving at this interim view we have also taken into consideration the Minister's submissions regarding the economic impact of the claim. We have not formed any concluded view on the ultimate increase to be awarded. However, the interim increase we have decided upon would not on the economic evidence, in our opinion, have adverse implications for the economy. In this regard, we note the New South Wales economy is in good shape at the present time and the outlook is favourable. In these circumstances we consider it to be unnecessary at this interim stage to address in any more detail the issues arising from the Minister's submissions except to note that in answer to a question from the Full Bench Mr Kite indicated that it was not the Government's position that because it had budgeted for wage increases in the public sector of 3 per cent per annum over the next two years the Commission should not award more than those amounts. Mr Kite said that his client's role in the proceedings was to put economic information before the Commission to allow the Full Bench to exercise its statutory functions having regard to the requirements of s 146 of the Act.

33 As we have already noted and as the Full Bench observed in Re Public Hospital Nurses' (State) Award (No 3) (2002) 121 IR 28 at [124], any interim increase must be approached cautiously so as not to embarrass the final result. Moreover, the applicant for an interim increase must show there are special circumstances existing that would justify granting such an increase, apart from the fact that the wage fixing tribunal has accepted that in any final decision wage increases will be granted: See s 16(4) of the Industrial Relations Act.

34 Bearing in mind those limitations, we nonetheless consider that an interim increase is warranted essentially upon the grounds put for interim relief by Mr Crawshaw SC for the Federation. We take particular note in that regard of the undertakings provided by the Federation in its written submissions on interim relief and the further undertakings made by Mr Crawshaw in his oral submissions. In this latter respect, Mr Crawshaw was questioned by the Full Bench regarding reports that the Federation may have been planning industrial action in the new year. We were informed that no final decision had been made by the Federation in this regard and that, in any event, the Federation undertook that it had no intention of taking any form of industrial action in relation to any decision given by this Full Bench.

35 We would add that we consider the grant of an interim increase would serve two other important purposes: 1. It will give appropriate recognition to the very significant contribution of teachers to the community through the provision of significantly enhanced education services, particularly in recent years; 2. The grant of an interim increase is entirely consistent with the more mature industrial position adopted by the parties in relation to these proceedings whereby they have resorted to the arbitral processes available under the Act to resolve issues in an efficient manner prior to the expiry of the Crown Employees (Teachers in Schools and TAFE and Related Employees) Salaries and Conditions Award. In that respect, the submissions made during final submissions by Mr Crawshaw as to the avoidance of future industrial action were very significant. 36 Further, in view of the basis upon which the interim increase is granted, there should be no prospect of, or any basis for, the flow on of the interim increase.

37 A further important consideration is that the respondents and the Minister accept that special circumstances exist and that the Full Bench could award an interim increase from 1 January 2004, although it was contended this should be no more than three per cent.

38 We have decided to make an interim award for six months to provide for an increase in all salary rates under the Crown Employees (Teachers in Schools and TAFE and Related Employees) Salaries and Conditions Award. Allowances will be dealt with in the final decision. The increase shall be 5.5 per cent and shall apply from the beginning of the first pay period to commence on or after 1 January 2004. We consider the grant of the increase in salaries is completely consistent with the requirements of s 10 of the Act. Orders and directions

39 We make the following orders and directions: 1. Pursuant to s 16(4) of the Industrial Relations Act 1996 the Commission makes the Crown Employees (Teachers in Schools and TAFE and Related Employees) Salaries Interim Award 2004. 2. The Interim Award shall provide for an increase of 5.5 per cent in all salary rates under the Crown Employees (Teachers in Schools and TAFE and Related Employees) Salaries and Conditions Award and shall operate in conjunction with that Award. 3. The Interim Award shall apply from the beginning of the first pay period to commence on or after 1 January 2004 and shall remain in force for a period of six months. 4. The parties are directed to file and serve within 28 days of today a document setting out the terms of the Interim Award to give effect to this Decision. In the event that there is any remaining disagreement about the terms of the Interim Award the areas of disagreement are to be identified together with the respective positions of the parties. 5. The terms of the Interim Award shall be settled by Boland J in proceedings before his Honour at 10.00 am Wednesday 28 January 2004.

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