Health Services Union & Australian Education Union [2025] FWCFB 131 | Case summary

[2025] FWCFB 131

Health Services Union & Australian Education Union [2025] FWCFB 131 | Case summary | Zoe

[8]

[7] The matter was initially listed for directions on 22 November 2023. The Applicants requested an extended timetable for the filing of material which was accommodated by the Commission. The Applicants filed their material on 2 February 2024, and the Respondents filed their material on 15 March 2024. The Applicants filed material in reply on 2 April 2024, and the matter was listed for further directions on 4 April 2024.

[8] Because this is the first contested application for a supported bargaining authorisation, we invited the Australian Government, peak employer organisations and the Australian Council of Trade Unions (ACTU) to make submissions in the matter. The Australian Industry Group (Ai Group) and the ACTU accepted this invitation and were granted leave to make written and oral submissions in the proceedings. National Disability Services (NDS), a national peak body for disability service organisations, also filed written submissions in the proceedings.

[9] The application initially sought to cover 19 employers. On 23 February 2024, the Applicants sought leave to amend the application to remove five of the Respondents. The application to amend was not opposed by any of the Respondents. On 12 March 2024, the application to amend was granted by Deputy President Wright.

[10] At the directions hearing on 4 April 2024, the Applicants requested that the matter be listed for a half day conference in Melbourne to work through some of the issues that had been raised by the Respondents with the view to avoiding a lengthy hearing and the associated cost and resources. A number of the Respondents consented to participating in a conference while others were opposed on the grounds that they did not believe that the issues between the parties were likely to be resolved, based on the material filed.

[11] Given the divergence of views in relation to the proposed conference and the hearing, directions were made requiring the parties to have direct discussions with the view to identifying agreed facts and potentially reducing the number of witnesses required for cross examination and other matters. The Applicants were required to report back by email the outcome of those discussions in May 2024 and the matter was listed for conference in Melbourne before Deputy President Wright on 24 June 2024. Following the conference, the parties requested an opportunity to file further evidence in relation to the 'common interest' criteria and that the matter be listed for hearing in November 2024.

[12] The Respondents filed supplementary written submissions in relation to the application of section 243(1)(b)(ii) of the FW Act on 30 August 2024 and the Applicants filed their responses on 4 October 2024.

[13] The matter was listed for hearing on 11 and 12 November 2024. We granted the parties permission to be legally represented at the hearing pursuant to s.596 of the FW Act on the grounds that it would enable the matter to be dealt with more efficiently, having regard to the complexity of the matter.

[14] The following witnesses gave evidence on behalf of the Applicants:

Ms Elaine Gillespie, Vice President (TAFE and Adult Provision Sector) of the AEU, Victorian Branch

Mr Justin Mullaly, Branch Deputy President of the AEU Victorian Branch

Ms Angela Carter, Disability Policy Officer, HACSU

[15] The following witnesses gave evidence on behalf of the Respondents.

Ms Katrina Ray, Head of People and Culture, Amicus Community Services Ltd

Ms Annie Constable, Chief Executive Officer, ASTERIA Services Inc

Ms Jacinta Taylor, Executive Director, Aurora Support Services

Mr Rick Lawford, Chief Executive Officer, Community Accessability Inc

Ms Sara Murray, Acting CEO/Operations Manager, Dame Pattie Menzies Centre Inc, trading as Menzies Support Services

Mr Ernie Metcalf, Chief Executive Officer, Distinctive Options, and Acting Chief Executive Officer, Noweyung Ltd

Mr Peter Green, Chief Executive Officer, George Grey Centre

Ms Carole Broxham, Chief Executive Officer, Life Skills Victoria

Ms Danielle-Carey Munro, Chief Executive Officer, Mambourin Enterprises Limited

Ms Lauren Baker, Executive Manager People and Culture. McCallum Disability Services Incorporated.

Ms Doreen Milne, Chief Executive Officer, Mirridong Services Inc

Mr Simon Hill, Chief Operating Officer, Windarring Limited

[16] The evidence of all witnesses was admitted without objection. Only Ms Gillespie and Ms Carter were required for cross-examination at the hearing.

[9]

[17] Ms Gillespie provided evidence on behalf of the AEU. Under the Rules of the AEU, Ms Gillespie has responsibility for the AEU disability sector in Victoria including collective bargaining, advocating for members' professional interests and for research and campaigning.[1]

[18] Ms Gillespie explained that most of the AEU's disability sector members are employed as 'Instructors' in 'Day Services' and that this work has been regulated under federal industrial laws since 1993. Before this, industrial conditions were set by determinations or awards made pursuant to the Victorian industrial relations system laws.[2]

[19] Ms Gillespie gave evidence that person-centred planning for individual needs and support is a key feature of the work of Instructors. This involves planning programs of instruction in accordance with the interests and capabilities of persons living with disability. Instructors liaise with carers and parents; maintain records; plan programs; and monitor and assess progress. Instructors are also employed to provide services called 'Community Access'. Instructors who provide community access services conduct programs for adult persons living with disability to develop their skills, educate them and enrich their experiences. Such programs include a wide range of living skills (food preparation, purchasing, banking, and independent travelling), pre-employment training and general interest topics. The programs aim to integrate persons living with disability into the community to the greatest extent possible. Programs may be conducted at a centre or in the wider community (that is, in outreach programs). [3]

[20] In 1993, the Australian Industrial Relations Commission (AIRC) made the Disability Services Award (Victoria) 1993, which was reviewed and amended by the AIRC in 1999 and became the Disability Services Award (Victoria) 1999 (Pre-modern Award). The Pre-modern Award covered, and applied to, Instructors.[4] The conditions of employment of Community Access Employees and Day Services Employees have also been governed by agreements certified, or approved by, the AIRC and successor bodies.[5]

[21] In 1999, the AEU and a large number of employers operating day services entered into a certified agreement known as the Disability Services Victoria (Part 1) Enterprise Agreement, 1999 (MECA).[6] In the 2000s, and prior to the commencement of the FW Act, a number of employers covered by the MECA entered into separate certified agreements and collective agreements, which covered and applied to Instructors. These included certified agreements and collective agreements entered into by some of the Respondents (now known as 'zombie agreements').[7] Some of these agreements cover residential services that employ disability sector workers who are within the coverage of HACSU. Ms Carter explained that HACSU's members work in disability services across Victoria in both residential, in-home support, community participation and day services settings.[8]

[22] With effect from 1 January 2010, Fair Work Australia (FWA) made the SCHADS Award, which is a modern award that succeeded the Pre-modern Award. The SCHADS Award has been varied over the years and covers disability sector workers, including Community Access Employees and Day Services Employees.[9]

[23] On 22 June 2012, FWA made the Social, Community and Disability Services Industry Equal Remuneration Order 2012 (ERO) under Part 2-7 of the FW Act. The ERO applies to employees classified under Schedule B of the SCHADS Award referred to as 'social and community services employees', which includes Community Access Employees and Day Services Employees.[10]

[24] The ERO sets the wage rates of disability support workers. The wage increases were funded by the Commonwealth under, and in accordance with, the Social and Community Services Pay Equity Special Account Act 2012 (Cth). The AEU considered that the terms and conditions set under the Workplace Relations Act 1996 (Cth) were better than the SCHADS Award and, given the financial constraints of employers in the disability sector, did not consider that there were prospects of obtaining better terms and conditions of employment for its members in the disability sector.[11]

[25] Ms Carter explained that in Victoria, disability providers previously received 'block funding' from the Victorian Government to deliver disability services that gave disability services discretion as to how they allocated those funds. The introduction of the NDIS changed the delivery of funding to service providers from block funding to individualised funding. Under the NDIS, funding is provided to a person with a disability on an itemised basis similar to Australia's Medicare system.[12]

[26] The National Disability Insurance Scheme Disability Support Worker Cost Model (NDIS DSW Cost Model) caps the cost of disability support workers to the SCHADS Award minimum pay rates and does not fund all conditions under the SCHADS Award.[13]

[27] Ms Carter said that the NDIS DSW Cost Model has greatly impacted bargaining in the disability sector to the extent that bargaining has almost completely shut down in the sector. During bargaining discussions, employers are reporting to HACSU that they cannot pay disability support workers more than the ERO minimum rates of pay because they are only funded for what NDIS pay, and this is aligned to the ERO.[14]

[28] Ms Carter explained that in about 2017, the AEU and HACSU were approached by Jobs Australia, an employer organisation with members who provided disability services in Victoria. Jobs Australia reported that their members were operating on zombie agreements that contained above award terms and conditions that these employers were struggling to afford as a result of the NDIS DSW Cost Model. These discussions resulted in the parties commencing a bargaining process with the assistance of the Commission through what was then called the New Approaches Program (now called the Collaborative Approaches Program).[15]

[29] In 2019, the Commission approved the Victorian Disability Services (NGO) Agreement 2019 (2019 VDSEA) which was succeeded by the Victorian Disability Services (NGO) Agreement 2023 (2023 VDSEA).[16]

[30] A number of key entitlements that were preserved under the terms of the 2019 VDSEA included:

[39]

[34] The nominal expiry date of the 2023 VDSEA was 30 June 2024. The AEU and HACSU intend to bargain with the employers covered by the 2023 VDSEA in accordance with the principles set out in the Bargaining Charter. They will be assisted by Mr Roe.[21]

[35] In addition to the 2023 VDSEA, the AEU has negotiated a small number of single-enterprise agreements for Instructors employed by Victorian employers. The rates of pay in these enterprise agreements are set in accordance with, or marginally above, the SCHADS Award.[22]

[36] Ms Carter explained that the 2023 VDSEA dealt with some of the complex above Award zombie agreement entitlements through the grandfathering of those provisions for certain workers which has enabled the employers who are parties to the VDSEA to continue running viable disability services businesses.[23]

[37] Ms Carter explained that throughout the course of bargaining for the VDSEA from 2017 to the present, there has been three major bargaining representatives with some additional bargaining representatives. However, the majority of employers have been represented by one major bargaining representative with an 'employer bargaining committee' who also attends bargaining. Ms Carter said that the bargaining process has been manageable and has worked well. The parties have developed a good working relationship and continue to work together in an effort to develop solutions to the issues presented by the NDIS DSW Cost Model.[24]

[38] Ms Carter explained that in July and August 2023, HACSU wrote to the majority of the Respondents as most of them were covered by zombie agreements that would expire on 6 December 2023 unless an application was made to extend those agreements. According to Ms Carter, the zombie agreements contain terms and conditions which are more favourable than the SCHADS Award including 21 days personal leave, six weeks annual leave, shift penalty provisions that apply on weekends, first aid allowance and make up pay. Ms Carter said that HACSU wrote to the Respondents to ascertain whether they were willing to bargain and whether they were interested in making a joint supported bargaining application to deal with the issues presented by the NDIS DSW Cost Model which does not fund above Award conditions.[25]

[39] Ms Carter said that the Respondents either did not respond, advised that they were not interested in bargaining or did not provide a firm commitment to explore bargaining further.[26]

[118]

[57] The Full Bench in Application by UWU, AEU and IEU observed that the principal construction consideration in relation to the provisions of Division 9 of Part 4-2 is that the scheme for supported bargaining effected by the SJBP Act represents a modification of the previous low-paid bargaining scheme, rather than a complete innovation. The objective of the supported bargaining scheme is to make it more accessible and therefore more widely used.[29]

[58] The Full Bench explained that there has been no substantive change to the provisions in s.242 as to who may make an application for an authorisation and the content of such an application. The legislative purpose of improving accessibility and take-up is primarily achieved by the amendments to s.243 in respect of the circumstances in which the Commission is required to make an authorisation.[30]

[59] The Full Bench identified the key changes to s.243 as including:

The former requirement in subsection (1)(b) that the Commission be satisfied that it is 'in the public interest to make the authorisation' has been replaced by one that the Commission be satisfied that 'it is appropriate for the employers and employees (which may be some or all of the employers or employees specified in the application) that will be covered by the agreement to bargain together'. This reflects a substantially lower statutory threshold for the required exercise of power. An appropriateness standard connotes that which is 'fair and just' or 'suitable' or 'fitting' and involves an evaluative assessment of a broader and less prescriptive nature than the previous public interest requirement.

• The consideration of 'the degree of commonality in the nature of the enterprises to which the agreement relates, and the terms of employment in those enterprises' under former subsection (2)(e) has been replaced by 'whether the employers have clearly identifiable common interests', with examples of such common interests given in subsection (2). One of the examples, the nature of the enterprises to which the agreement will relate, and the terms and conditions of employment in those enterprises, is substantially reflective of former subsection (3)(e), but the other two examples, a geographical location and being substantially funded, directly or indirectly, by the Commonwealth, a State or a Territory refer to circumstances which do not necessarily relate to commonality in the nature of the enterprises and their terms and conditions of employment. This indicates that a broader range of circumstances may be taken into account in assessing commonality of interests.[31]

[60] In relation to whether the FW Act evinces a preference for enterprise level bargaining in favour of multi-enterprise bargaining, the Full Bench said:

[129]

[71] The evidence provided by Ms Gillespie is that the AEU has members who support persons with disability in 'day services' and 'community services'. HACSU also have members working in day services and community services as well as residential and in home support.[41] The AEU rules appear to use language to describe its disability services coverage which may no longer be fit for purpose when referring to contemporary community-based disability services in that there is no longer a teaching requirement. Nevertheless, the purpose of the work, which is to enhance the lives of persons with disability in a community-based setting, appears to be the same, albeit involving a shift from teaching to person centred planning and support. We have doubts about whether this shift in emphasis in the delivery of community-based disability services would result in the AEU rules no longer covering employees at Mambourin and McCallum.

[72] However, this is not a matter which we are required to determine for the purpose of the application before us. Section 242(2) simply requires the application to be made by an employee organisation that is entitled to represent the industrial interests of an employee in relation to work to be performed under the agreement. There is no requirement that the application is made by an employee organisation that is entitled to represent the industrial interests of an employee working for each of the employers who will be covered by the agreement. It is likely that the AEU is entitled to represent the industrial instruments of at least one employee in relation to work to be performed under the agreement. For example, George Gray,[42] Distinctive Options and Noweyung[43] all operate day services amongst other services and do not dispute that the AEU and HACSU share coverage of the Respondent. However, even if this is not the case, the rules of the Health Services Union establish that it is entitled to represent the industrial interests of an employee in relation to work to be performed under the Proposed Agreement. In this regard Rule 3A(b) provides that:

[137]

[77] Ms Carter said that it is difficult to provide accurate data about prevailing rates in the disability sector because data about the size and makeup of the NDIS workforce is limited due to the absence of a national census of disability support workers and limitations relating to occupational coding through the Australian and New Zealand Classification of Occupations (ANZSCO). Currently, disability support workers are predominantly captured in the Australian Bureau of Statistics (ABS) Labour Force Surveys and Census data and the ANZSCO classification of 'Aged and Disabled Carers' (4231).[46]

[78] Ms Carter said that it is also difficult to obtain accurate data about the disability workforce because there is not a mandatory registration scheme or a requirement for all disability support workers to complete the NDIS Worker Orientation Modules that enables the sector to capture information about the workforce. Although it is difficult to obtain accurate data, low rates of pay prevail because the NDIS DSW Cost Model is based on the ERO rates. The most common classifications in the SCHADS Award in the disability sector are levels 2 and 3, with most disability support workers classified at level 2.[47]

[79] HACSU submitted that there is evidence which clearly demonstrates there are prevailing low rates of pay in the disability sector. That evidence is as follows:

In the Disability Royal Commission Final Report (DRC Report) it is identified that the majority of the disability workforce are employed under the SCHADS Award.

The NDIS DSW Cost Model caps the cost of disability support workers to the SCHADS Award minimum rates of pay. Above-award rates of pay are rare in the disability sector because the disability support providers are reliant on NDIS funding and any above-award payments come at an additional cost to the disability support provider.

Even in circumstances where enterprise agreements exist in the sector, the rates of pay provided by those Agreements are tethered to the SCHADS Award or rarely exceed the rates of pay provided by the SCHADS Award due to the constraints of the NDIS DSW Cost Model.

Jobs and Skills Australia provide a summary of the most specific ABS data available, concerning both aged and disability carers based on ANZSCO classification 4231. The data identified that out of 293,500 employed as aged and/or disability carers - approximately 73% of which are women - the median earnings for full-time employees, before tax, is about $1,382.00 per week. By contrast the median earnings for full-time employees across 'all occupations' is about $1,593.00 per week. These statistics show that aged and disability employees are low paid, having weekly earnings that are approximately 14% below those of all employees.

e. The disability sector has been specifically identified as being a low-paid industry in which the supported bargaining scheme was intended to be utilised.[48]

[80] HACSU submitted that the employees of the Respondents are paid at SCHADS Award rates and therefore the prima facie position is that they are deemed to receive low rates of pay.

[81] HACSU submitted that rates in the SCHADS Award cannot be viewed as 'relatively high' because the role of modern awards under Australia's industrial relations system is to provide a minimum floor or safety net of wages and conditions. Instead, the National Disability Insurance Agency (NDIA) through the NDIS DSW Cost Model has reappropriated the SCHADS Award as a ceiling on wages and conditions across the disability sector. In any event, the minimum weekly rates of pay attaching to the most common SCHADS classifications in the disability sector sit well below the average weekly ordinary time earnings for full time adults in Australia, which the ABS recently put at $1,838.60.[49]

[82] HACSU submitted that the statutory task, which is to have regard to the 'prevailing pay and conditions within the relevant industry or sector', requires consideration of whether low rates of pay prevail in the industry; and whether employees in the industry are paid at or close to the relevant award rates.[50]

[144]

[99] Mambourin submitted that the weekly rate for a disability support worker with around one year of experience ($1,223.85) is favourable compared to pay rates for similar work in other streams or awards. Accordingly, it is not clear that the rates of pay in the disability sector should be considered to be low.[68]

[100] Mambourin submitted that the Commission will need to consider whether the pay and conditions across the Respondents are largely consistent or divergent for the purpose of determining whether it is appropriate for the parties to bargain together. Mambourin notes that the AEU appears to concede that divergent pay and conditions within an industry or sector would be a factor weighing against a finding of appropriateness.[69]

[101] Mambourin submitted that it was previously covered by the Mambourin Enterprise Inc Disability Services Victoria (Part 1) Collective Agreement 2008 (Mambourin Agreement) which was terminated by the Commission effective 6 November 2020. Mambourin currently employs all of the employees who would be covered by the proposed authorisation (excluding warehouse staff and supported employment) either in accordance with the SCHADS Award, or on permanent employment agreements with a fixed annual salary. Mambourin continues to provide for long service leave accrual at the rate of 13 weeks of leave after 10 years for all staff who were employed by Mambourin prior to 1 January 2020, and who were previously covered by the Mambourin Agreement. Attempts to negotiate a new enterprise agreement have so far been unsuccessful, however Mambourin intends to continue attempting to negotiate an agreement with its staff and the AEU (subject to the possible application of section 172(7) of the Act). Mambourin's current pay rates for the employees who would be covered by the proposed authorisation (excluding warehouse staff and supported employment services, and with the exception of staff on annual salaries) are marginally higher than the SCHADS Award rates. 34 of Mambourin's staff who may be covered by the proposed authorisation (depending on the breadth of the term 'employed in disability support work' used in the application) are on total remuneration packages, and are not paid directly under the SCHADS Award.[70]

[150]

[106] In Application by UWU, AEU and IEU, the Full Bench observed that 'low rates of pay' will generally prevail in an industry or sector if employees are paid at or close to the award rates of pay for their classification,[76] however, in a particular case, a prevailing rate of pay which is at or close to the relevant award rate may not be regarded as a 'low rate of pay' because the award rate itself is relatively high.[77] The needs of employees who are paid at award rates include improving their terms and conditions of employment in circumstances where there have been constraints on their ability to bargain.[78]

[107] Most of the Respondents have not sought to cavil with the findings of the Full Bench in Application by UWU, AEU and IEU that 'low rates of pay' will generally prevail in an industry or sector if employees are paid at or close to the award rates of pay for their classification. However, the Respondents point to rates of pay being set by the ERO, and not the SCHADS Award, and that the rates of pay are higher compared to other awards, to submit that the prevailing rates of pay are not low.

[108] Submissions from the Respondents also include that it is necessary to not only compare award rates, but also pay in other sectors and the levels within industrial instruments that employees are paid, to determine whether there are 'low rates of pay'.[79] It was submitted that there is nothing in the statute or the surrounding context that would indicate 'low' is intended to focus purely on the pay relative to the legal minimums in the industry/profession. Doing so would ignore the 'levels' under which employees are at within awards, and how the award rates in that industry compare to rates in other sectors. Windarring urges an interpretation of 'low rates of pay' in the context of the constraints of the NDIS pricing framework and suggests that what may be considered low paid in a different context may not be the case within the disability sector.

[109] Many of the Respondents sought to compare the pay of disability support workers with employees under the Children's Services Award given that the Full Bench in Application by UWU, AEU and IEU found that low rates of pay prevailed in the Early Childhood Education and Care (ECEC) sector because most employees in the ECEC sector were employed pursuant to that award and received award rates of pay.[80] This is an appropriate comparison given that both ECEC employees and disability services employees are largely award dependent. We note that since the hearing of this matter, the Expert Panel in the Gender-based undervaluation - priority awards review case.[81] has indicated a provisional view that there should be a new, simplified classification structure in the Children's Services Award which is substantially based on the qualifications framework for the ECEC sector, with the rates of pay structured by reference to the Caring Skills benchmark rate.[82] If implemented, this would result in the rates of pay for a level 3 educator being the same as a Level 2, Pay point 1 disability support worker under the ERO.

[110] Some of the Respondents sought to compare rates of pay for disability support workers with rates of pay for employees covered by other awards, including the Legal Services Award 2020 and the Nurses Award 2020. We do not regard these comparisons as particularly useful in circumstances where there is no evidence before us about the extent to which employees covered by those awards are paid either the minimum rates of pay prescribed by those awards or higher rates set by enterprise agreements or other instruments or contracts.

[111] This is the sixth occasion that the Commission has considered a supported bargaining application and the fourth occasion in which a supported bargaining authorisation has been sought in relation to employees covered by the SCHADS Award and ERO. Supported bargaining authorisations have been granted in relation to employees covered by the SCHADS Award and ERO in Australian Municipal, Administrative, Clerical and Services Union v Australian Capital Territory Council of Social Service Inc T/A ACTCOSS and Others (ASU v ACTCOSS),[83] Australian Municipal, Administrative, Clerical and Services Union v Inner Melbourne Community Legal Inc T/A Inner Melbourne Community Legal, Young People's Legal Rights Centre Inc T/A Youthlaw (ASU v Inner Melbourne Legal and Youthlaw),[84] and The Health Services Union & The Australian Education Union v Alkira Disability Services Ltd T/A Alkira Centre and Others (HSU and AEU)[85]

[112] In HSU and AEU, Commissioner Lee said that he was satisfied, based on the evidence before him, that the prevailing pay and conditions within the disability sector are at or close to the award rates and conditions provided in the SCHADS Award. Further, Commissioner Lee noted that the SCHADS Award rates of pay are not 'relatively high' and that the most commonly used classifications in the SCHADS Award in the disability sector sit well below the average weekly ordinary time earnings for a full-time adult (most recently $1923.40).[86]

[113] In ASU v ACTCOSS,[87] Deputy President Hampton observed that the following matters in relation to pay weighed in favour of making the authorisation:

• Nationally, the majority of social and community services (SACS) workers are award dependent and that over award payments are uncommon in the industry.[88]

• Even outside the lower classification levels of the SCHADS Award, workers engaged in degree qualified positions often receive a low rate of pay relative to their level of qualification, experience, role complexity, and responsibility.[89]

• SACS workers in the community sector tend to earn less than their public sector counterparts for comparable roles, despite the adjustment of pay rates undertaken through the ERO increases.[90]

• SACS workers generally have less beneficial conditions of employment in comparison with ACT Government employees when it comes to leave and other entitlements.[91]

[114] In ASU v Inner Melbourne Legal and Youthlaw,[92] Deputy President Hampton observed that the majority of the employees engaged by the employers are generally paid by reference to the SCHADS Award classifications and rates, with some likely exceptions, and that some of the employees who would be covered by the authorisation are award reliant and low paid.[93]

[115] The rates of pay for disability support workers in the SCHADS Award were recently considered by the Expert Panel in the Gender-based undervaluation - priority awards review case.[94] In that case, the Expert Panel observed that the evidence before it amply demonstrated that disability support workers deal with persons with a wide range of conditions and are required in each case not merely to engage in functions associated with the direct physical care of clients but also to be constantly engaged in verbal and non verbal communication with clients in order to be responsive to and meet their ongoing physical, intellectual and emotional needs,[95] and that the requirements of the NDIS have made disability support work more varied and complex than previously.[96]

[116] The Expert Panel found that based upon this evidence and the findings made by the Queensland Industrial Relations Commission in the Queensland CSCA Award decision and by this Commission in the SACS Equal Remuneration decisions:

• the minimum wage rates prescribed by the SCHADS Award for employees within the classifications in Schedules B, C and E do not properly reflect the value of the work to which those classifications apply and that this is the case for reasons related to gender.[97]

• The work to which the classifications apply is caring work involving the exercise of 'invisible' skills.[98]

• The workforce which performs this work is, and has historically been, female-dominated.[99]

• The rates of pay applying to the classifications in Schedules B, C and E are not the product of any proper work value assessment by this Commission or the Australian Industrial Relations Commission of the skills utilised in undertaking work of this nature.[100]

• There has never been proper recognition of the skills involved in undertaking the work covered by Schedules B, C and E when setting award wage rates and this has operated to the disadvantage of a highly-feminised workforce.[101]

• Although the ERO rates which apply to schedule B were not made in the exercise of the award-making and variation powers under the FW Act, the way in which the rates were set essentially proceeded on what may be characterised as work value grounds within the meaning of s.157(2A). They were fixed on the basis that they ensure equal remuneration for work of equal or comparable value and can therefore be relied upon as being free of assumptions based on gender. The ERO rates are therefore broadly indicative of what the SCHADS Award rates would be if they were properly based on a gender-neutral assessment of work value.[102]

[117] The effect of the ERO is that strictly speaking, disability support workers are not paid the SCHADS Award rates of pay but at 123% of the SCHADS Award rate of pay (with respect to level 2 employees). The Applicants correctly contend that the ERO is the minimum rate of pay, that most of the Respondents pay employees at this minimum rate and that the NDIA provides funding based upon this rate.

[118] The SCHADS Award has eight classification levels. The NDIS DSW Cost Model indicates that it assumes that disability support workers will be classified at level 2, 3 or 4 of the SCHADS Award, depending upon whether they are performing the work of a Disability Support Worker 1, 2, 4, or 4 as determined by the NDIA.[103]

[119] The evidence of Respondents who provided information about the classification of their employees establishes that they employ the majority of their disability support workers at level 2 and pay them in accordance with the ERO level 2 rate. The ERO weekly rates of pay for a level 2 worker at the time of the hearing[104] were:

[151]

[120] This is consistent with the NDIS DSW Cost Model[105] which states that Disability Support Level 1 worker is assumed to have a SCHADS classification of level 2, pay point 3. It is also consistent with the classification descriptors in the SCHADS Award which specifically refer to the delivery of disability services in level 2 and level 3.

[121] We accept that the rates of pay for disability support workers are higher than the current rates of pay for employees covered by the Children's Services Award. However, this does not establish that the prevailing rates of pay for disability support workers are high. Further, the fact that disability support workers are paid above the SCHADS Award rates in accordance with the ERO does not automatically lend itself to a conclusion that the rates are high. The Respondents have pointed to numerous examples where the rates of pay in the disability sector are higher than other sectors. It is also likely that there are sectors where the prevailing rates of pay are higher than those in the disability sector. There is nothing in the statute which indicates that the expression 'low rates of pay' should be construed in a narrow way which requires comparison only with other award dependent roles or roles that have similar skill requirements and characteristics. To do so would undermine the legislative purpose of improving accessibility and take-up for multi-enterprise bargaining by employers and employees in sectors traditionally excluded from enterprise bargaining.

[122] The Respondents have urged us to exercise caution when referring to statistics to make findings about prevailing rates of pay, however ABS statistics are a far more reliable indicator of the prevailing rates of pay across the economy than the award rates referred to by the Respondents. For the period from August 2023 to August 2024, the median weekly earnings in main job was $1,396.00 and for full time employees it was $1,700.[106] The average weekly ordinary time earnings for full-time adults was $1,975.80 in November 2024.[107] It is not entirely accurate to compare these figures to the Level 2 ERO rates as the Level 2 rates do not include penalty rates and overtime. However, it should be noted that in many cases, disability support workers will be receiving less than the full time ERO rate because of the prevalence of part-time and casual work in the sector.[108]

[123] We find that low rates of pay prevail in the disability sector because:

most employees are employed in the lower levels of the SCHADS Award classification structure and specifically at level 2,

most employees are paid at the minimum rate determined by the ERO,

• the level 2 ERO full time rates at the time of the hearing ($1,269.73-$1,385.35)[109] are lower than:

median weekly earnings ($1,396.00),

the median weekly earnings for full time employees ($1,700) and

the average weekly ordinary time earnings for full-time adults ($1,975.80).

[124] These findings weigh in favour of granting the authorisation sought.

[167]

[132] Amicus submitted that it does not provide additional benefits to staff under the SCHADS Award, unless they perform a sleepover shift. Payments for sleepovers are in accordance with the SCHADS Award. Any 'active' time during the eight hour sleepover is paid at the night shift rate, after the first hour. In addition, instead of paying the sleepover allowance under the SCHADS Award, Amicus pays a flat rate of $100.[123]

[133] Given its remoteness, ASTERIA decided to pay 12% superannuation in July 2021 to attract new employees.[124]

[134] Employees of Aurora are currently covered by a zombie agreement, the Whittlesea District ATSS Disability Services Victoria (Part 1) Collective Agreement (2008). Aurora submitted that if this agreement is terminated, it would honour to the best of its capacity some of the above-award entitlements that its employees would no longer be receiving. For example, Aurora's Committee of Management was prepared to allocate seven days of ex gratia leave to all employees between 27 December 2023 to 5 January 2024 so that employees could have a two week end-of-year break in addition to the leave entitlements provided to them by the SCHADS Award. It is Aurora's intention that this will continue in years to come, provided that organisational finances can sustain this.[125] Aurora states that its support workers are paid at level 3 of the SCHADS Award.[126]

[135] The majority of Community Accessability's employees are classified at Level 2 of the SCHADS Award.[127] To incentivise employees to work sleepover shifts, Community Accessability pays an allowance of $150 which is more than what is required under the SCHADS Award.[128]

[136] McCallum has recently undergone an extensive six month process of consultation with staff relating to the planned transition away from zombie agreements and in that process, it identified particular benefits it can offer to staff upon transition to the SCHADS Award, but which are unique to its organisation. These include the introduction of a number of above award conditions being by way of policy provisions with respect to matters like sleepover allowances, parental leave and wellbeing leave days.[129]

[137] Mirridong provides Day Services Support Workers with six weeks annual leave (and four weeks holiday loading) and Residential Support Workers with five weeks annual leave.[130]

[138] Mambourin provides 13 weeks of long service leave after 10 years to all staff who were employed by Mambourin prior to 1 January 2020, and who were previously covered by the Mambourin Agreement. Mambourin's current pay rates for the employees who would be covered by the proposed authorisation are marginally higher than the SCHADS Award rates.[131]

[185]

[146] Community Accessability submitted that the ordinary meaning of the words 'common interests' do not allow for an interpretation relating only to a 'common interest' and that having only one common interest is unlikely to be a significant persuasive factor in favour of joint bargaining.[157]

[147] Community Accessability submitted that because of the breadth of factors that may be considered 'common interests', not all such 'interests' will have much or any bearing, in a particular case, on the ultimate question of whether joint bargaining is appropriate. For example, employers may be in the same geographic region and substantially funded by the Commonwealth but be in entirely different industries. In these circumstances, even if the employers have 'common interests', it would not have much or any bearing on whether joint bargaining is appropriate.[158]

[148] Community Accessability submitted, it is appropriate to consider, even if the Applicants' purported 'clearly identifiable common interests' are made out, if this makes joint bargaining any more appropriate.[159]

[149] In relation to each Respondent being a provider of disability services wholly or predominantly in the State of Victoria, Community Accessability submitted that the breadth of services covered by 'disability services', and the variety of work hours, casual employment rates, work schedules and duties in this sector, does not significantly support the view that joint bargaining is appropriate.[160]

[150] In relation to geographical location, Community Accessability submitted that not all employers and employees are based in Victoria. For example, Community Accessability operates in Victoria and Southern New South Wales. Further, although 'geographic location' is an example of a common interest that employers 'may have', for a common interest to be established, there must be something about the geographical location that makes it of interest to all employers. The employer's interests must be determined by reference to their objectives. For example, operating in certain rural areas may affect how services are provided and the need for travel as part of work. In the application, the wide geographic location of Victoria and Southern New South Wales, which covers a range of metropolitan and rural areas, is insufficient to demonstrate a common interest between employers. [161]

[151] In relation to the Respondents' need to:

develop the skills, knowledge, and abilities of their employees to improve their performance, productivity and capabilities,

attract and retain a skilled and quality workforce to ensure their businesses remain viable,

[190]

[156] Windarring submitted that apart from the application of zombie agreements, the common interests relied upon by the Applicants are common interests that apply to thousands of disability support providers who are based in and employ disability support workers in Victoria, and are not specific to the Respondents. Windarring submitted that the different interests between Respondents are potentially far more significant than the common interests identified by the Applicants which may make it difficult for supported bargaining to achieve the objectives of flexibility and meeting business needs.[169]

[157] Windarring submitted that the Applicants have failed to identify more nuanced common interests that can genuinely be expected to promote cooperation and agreement on a group of 14 employers on terms and conditions that provide enough flexibility to meet their individual needs. If commonalities are too general, practical difficulties may arise when interests diverge due to distinguishing factors such as different service offerings, different workforce compositions, different structures, different operational requirements and different revenue sources. This can complicate negotiations and undermine the purpose of the FW Act more broadly and the supported bargaining stream more specifically by resulting in a one size fits all approach that provides inadequate flexibility to businesses with distinct needs and circumstances.[170]

[158] Windarring submitted that its service offerings, dire financial position, service area and staff limitations are examples of features which distinguish it from many other not for profit disability service providers in Victoria and which directly shape its needs and interests.[171] Windarring does not have the financial resources or funding capabilities to increase the pay and other entitlements of its employees. While it may be that the other Respondents have these financial capabilities, it would be unfair and detrimental to Windarring if it were forced to match the pay rates and entitlements of the other Respondents without at least a commensurate increase in NDIS pricing limits and more flexible NDIS pricing limits.[172]

[191]

[159] In relation to the Applicants' submission that the Respondents share a common geographical location, being that they all operate in the State of Victoria, Mambourin submitted that while its location may indicate that it has a common interest with other metropolitan Respondents, Respondents who operate solely in the regions face different circumstances and pressures and as such the geographical locations of the Respondents as a whole do not indicate a common interest.[173]

[160] In relation to the Applicants' and the ACTU's submission that all of the Respondents operate registered NDIS disability services businesses and employ staff to perform disability support work in those services, Mambourin submitted that there are differences between the enterprises with respect to the services they provide. For example, Mambourin provides supported employment services, accounting for around 25% of its total staff, Mambourin is not a provider of supported accommodation or independent living supports, and Mambourin does not provide aged care services.[174] There appears to be significant disparity in the size of the organisations covered by the application. Mambourin has a relatively high proportion of participants with complex care needs or behaviours of concern, which is another point of difference, giving rise to differences in services and business models.[175]

[161] In relation to the submissions by HACSU, Mambourin agreed that the limitation on bargaining imposed by the NDIS is a common interest. It is correct that the Respondents provide disability services in Victoria, although there is some disparity in the overall makeup of the businesses. Mambourin employs more women than men, however it is certainly not an overwhelming majority. With regard to the fact that workers are covered by the Victorian Disability Workers Commission, while this is a point in common, it could hardly be considered to be a relevant common interest, as it has little apparent application (if any) to the terms and conditions of employment.[176]

[162] Mambourin submitted that its employees are not covered by a zombie agreement and as such, the terms and conditions of employment applying to the Respondents are quite different from those applying to Mambourin's staff. This factor does not indicate the presence of a common interest.[177]

[163] Mambourin submitted that all of its government funding comes through the NDIS, and this accounted for 89% of its operating revenue this financial year. Last financial year NDIS funding made up 86.1% of Mambourin's operating revenue. Unlike those Respondents who provide aged care, supported accommodation, independent living, and other services which are funded outside the NDIS, none of Mambourin's funding comes from the State Government or other Commonwealth Government Departments.[178]

[164] Mambourin recognised that it has some common interests with the other Respondents, largely stemming from the fact that they all participate in the same sector and they are all registered NDIS providers. However, Mambourin submitted given the many differences between it and the other Respondents, in terms of:

[205]

[172] We agree with the Full Bench in Application by UWU, AEU and IEU that the expression 'common interests' used in s.243(1)(b)(ii) extends to any joint, shared, related or like characteristics, qualities, undertakings or concerns as between the relevant employers. We also agree that the references to geographical location and being substantially funded, directly or indirectly, by the Commonwealth, a State or a Territory as examples of common interests in s.243(2) indicate that that a broader range of circumstances may be taken into account in assessing commonality of interests than simply the nature of the enterprises to which the agreement will relate, and the terms and conditions of employment in those enterprises.

[173] We accept the submissions of the Applicants that the Commission's consideration of whether the employers have clearly identifiable common interests does not involve weighing points of commonality and points of difference but simply asking whether there are clearly identifiable common interests.

[174] We do not accept the submissions of Windarring that at this stage of the inquiry, the Applicants are required to identify nuanced common interests that can genuinely be expected to promote cooperation and agreement. We also do not accept the submission by McCallum that there must be a deep analysis of any purported common interest. Such narrow readings of the meaning of 'common interest' are not available when the phrase is construed in accordance with his ordinary meaning and having regard to the objects of the FW Act in ss.3, 171 and 241.

[175] Some of the Respondents have conceded that they have some common interests with the other Respondents. For example, ASTERIA accepted that it operates in a common regulatory system with the other Respondents, that it is funded via the NDIS and there is a common interest for the funding through the NDIS to be increased and to better support employers of disability support workers. Mambourin recognised that it has some common interests with the other Respondents, largely stemming from the fact that they all participate in the same sector and they are all registered NDIS providers. McCallum submitted that it is likely that the extent of commonality might extend to all of the Respondents operating businesses to one degree or another in the disability sector in Victoria, being registered NDIS providers and being subject to the same NDIS rules, regulations and expectations.

[206]

[176] In relation to geographical location, we accept that in some circumstances, the location of employers in a specific state or territory of Australia may be regarded as a common interest. For example, in Independent Education Union of Australia & The United Workers' Union v Aberdare Pre School Inc and Others,[187] the Employers were found to have clearly identifiable common interests for numerous reasons including that they all operated in New South Wales and were entirely or substantially funded by the NSW Government.[188]

[177] In ASU v ACTCOSS,[189]each of the employers was based in the Canberra and ACT area. The services provided by the employers were localised and focused on the Canberra and ACT region and community. They also largely drew upon the same pool of potential employees. The employers were not large and did not operate across multiple jurisdictions. As not-for-profit organisations the employers drew on volunteer networks in the Canberra and ACT community for governance and service provision. Many of the employers operated as ACT specific peak and advocacy organisations.[190]

[178] In HSU and AEU,[191] each of the employers operated a business, or part of a business, in the disability services sector in Victoria. Commissioner Lee observed that although there were variations in the locality of each of the employers, (regional and metropolitan), the significance of the state geographical indicia being a clearly identifiable common interest was that all the employers operated in a state which historically had state funding in the disability sector, and regulators being the Victorian Disability Worker Commission and the Disability Workers Registration Board of Victoria.[192]

[179] The Respondents in the matter before us all operate a business, or part of a business, in the disability sector in Victoria, historically had funding from the Victorian Government in the disability sector and are regulated in part by the Victorian Disability Worker Commission and the Disability Workers Registration Board of Victoria. For these reasons, we find that the Respondents have common interests because of their geographical location.

[226]

[202] Although a number of the Respondents were jointly represented in these proceedings, there is no evidence before us which establishes that any of the Respondents will choose to be jointly represented in bargaining. In these circumstances, it is possible that each of the 14 Respondents will be separately represented in bargaining and that there may also be a number of individual employee bargaining representatives in addition to the AEU and HACSU. The number of Respondents is not large, particularly when compared to the number of bargaining representatives which can be involved in bargaining for single-enterprise agreements.[212]

[203] Most of the Respondents contend that the process will not be manageable because they have a diversity of views and interests.

[204] There is no recent history of bargaining, apart from with Mambourin, however all of the Respondents have engaged in bargaining with their employees represented by one or both of the Applicants in the past. It appears to be the intention of the Applicants to bargain for an agreement which preserves the conditions of the zombie agreements which are more generous than the SCHADS Award. The employees who will be covered by the Proposed Agreement are currently covered by either the SCHADS Award or by zombie agreements which have some enhanced leave entitlements. Some Respondents whose employees are not covered by zombie agreements provide their employees with above award entitlements such as higher leave entitlements and a higher sleepover allowance. The types of conditions which apply to the Respondents and their employees, such as pay rates, leave, penalty rates and allowances are similar, however the value of each of these conditions varies depending upon whether employees are covered by the SCHADS Award, a zombie agreement, or over award conditions.

[205] Given that only one underpinning award applies to the employees who will be covered by the Proposed Agreement and that the type of conditions which currently cover them are similar, we do not believe that the bargaining will be legally or industrially complex although it may take time to work through all of the parties' respective claims.

[206] At least some of the employees will be represented by HACSU and the AEU who the evidence establishes have a long history of bargaining in the disability sector. It is possible that employees could nominate additional bargaining representatives but there is no evidence that if this occurs, it will lead to a collective bargaining process which is not manageable.

[207] Taking all of these matters into account, we are satisfied that the likely number of bargaining representatives for the Proposed Agreement will be consistent with a manageable collective bargaining process. These findings weigh in favour of granting the authorisation sought.

[235]

[214] AI Group submitted that the scope of the parties who will be covered by a proposed authorisation is a relevant consideration when determining whether the authorisation should be made. It is conceivable that decisions about the scope or coverage of a proposed authorisation will be made pragmatically by parties, with a view to limiting the impact of potentially divergent views amongst bargaining representatives being advanced during bargaining. The scope of a proposed authorisation could give rise to a raft of relevant discretionary considerations, depending on the circumstances of a particular matter which could include:

(a) Any foreseeable potential impact of bargaining between the relevant parties on the economy, specific sectors and/or members of the community that rely upon services of the employers that will be covered by the proposed authorisation; and

(b) The impact on other employers that might be said to have a common interest with those covered by the proposed authorisation but who have been selectively excluded from the scope of any application. This should include a consideration of the possibility that such employers may subsequently be roped into the coverage of the authorisation or any agreement ultimately made.[219]

[215] AI Group submitted that to some extent, the matters that the Commission must take into account pursuant to s.243(2)(b)(iv) will differ between applications for authorisations, depending on the matters in issue in each set of proceedings, the circumstances of the relevant employers and employees, the context in which the application has been brought, and the characteristics of the industry or sector in which the employers and employees are engaged.[220] It will typically, if not always, be appropriate for the Commission to take the following matters into account:

(a) The views of the employers who would be covered by the proposed agreement. This is a matter that should be given significant weight.[221]

(b) Any history of bargaining between the relevant employers and employees.[222]

(c) Any intention or efforts to make a single-enterprise agreement amongst the relevant employers and employees.[223]

[216] AI Group submitted that depending on the circumstances of a given matter, it may also be appropriate to take into account the following:

(a) Where there is a third party 'who exercises such a degree of control over the terms and conditions of the employees who will be covered by the agreement' that their participation in bargaining is 'necessary for the agreement to be made', or there is some other third party who directly or indirectly funds the employers who would be covered by the agreement; the willingness, capacity and ability of that other party to provide the requisite support, assistance, funding etc, that would enable an improvement in the terms and conditions afforded by the employers to the employees.

(b) Any potential implications for the customers, clients or other users of the employers' products or services.

(c) Any potential implications for other employers and employees who work in the same supply chain as those that are the subject of the application.

(d) Whether the making of a multi-enterprise agreement may unfavourably distort the labour market, by delivering significantly enhanced conditions to certain cohorts of workers vis-à-vis others who, for example, work alongside the relevant employees and undertake work that is substantially similar in nature.

(e) The size of each of the respondent employers.[224]

[289]

[272] In the previous decisions which have determined applications under s.242 of the FW Act, all of the respondent employers have supported the application which is not the case here. This is a matter which may weigh against the granting of the authorisation, depending upon the reasons that each of the Respondents opposes the application and whether an objective analysis of these reasons, having regard to the objects of the FW Act in ss.3, 171 and 241, and the criteria in s.243(1)(b,) leads to a conclusion that it is not appropriate for the Respondents, or some of them, to bargain together. The Respondents have a range of reasons for opposing the application, but the major issue is the NDIS pricing and scepticism about whether the supported bargaining process will result in rates of pay increasing. We deal with these issues below.

[273] In our view, one of the most significant considerations that may arise if an employer opposes a supported bargaining authorisation relates to the prohibition upon that employer engaging in bargaining for any type of agreement other than a supported bargaining agreement under s.172(7)(b) once an authorisation is in operation.[283] However, this is unlikely to be an issue for the majority of the Respondents, apart from Mambourin, as they have either expressed an unwillingness to bargain or have taken no steps to initiate bargaining.

[274] Some Respondents have also raised concerns about the resources involved in participating in bargaining and the possibility of feeling pressured to accept conditions during bargaining for a multi-enterprise agreement which do not meet their needs. Compliance with the FW Act is a requirement of all national system employers which will inevitably involve the investment of resources, including in relation to bargaining where this occurs. Further it is possible the assistance available to the parties from the Commission may result in bargaining for a multi-enterprise agreement proceeding more efficiently than for a single-enterprise agreement. As to the concern about employers feeling pressured to accept conditions, there is no requirement that employers agree to any claim. Further, a multi-enterprise agreement is not made until each employer asks its employees to approve the agreement by voting for it and a majority of the employees of at least one of those employers who cast a valid vote have approved the agreement. If the terms of a multi-enterprise agreement are not acceptable to an individual employer, that employer is not required to ask its employees to vote for it. In these circumstances, we believe that it is unlikely that an employer covered by a supported bargaining authorisation would find themselves agreeing to conditions that were not acceptable to them.

[294]

• Mambourin provides 13 weeks of long service leave after 10 years to all staff who were employed by Mambourin prior to 1 January 2020, and who were previously covered by the Mambourin Agreement. Mambourin's current pay rates for the employees who would be covered by the proposed authorisation are marginally higher than the SCHADS Award rates.[290]

[277] Apart from those conditions which continue to be provided for in zombie agreements, these arrangements are not currently provided for in an industrial instrument, so they are not regulated by the FW Act. It would be consistent with the objects of the FW Act for employees to have certainty in relation to these above award conditions and to be able to collectively negotiate these conditions. The range of above award conditions provided by some of the Respondents, which may be reflective of their varying needs and those of their employees, could be accommodated by negotiation of distinct terms and conditions set out in schedules to a multi-enterprise agreement. In our view, the fact that some employers offer over award conditions, which are not currently protected by an industrial instrument, is a matter which weighs in favour of grating the authorisation, with respect to those Respondents.

[278] We accept that it is likely that it will be difficult for employees of all of the Respondents to negotiate conditions that will satisfy the 'better off overall test' unless there is an increase in NDIS funding. Some of the Respondents have also expressed concern that the retention of leave entitlements in zombie agreements will increase their costs without in any way increasing the wages of employees or improving productivity.

[279] However, lack of financial capacity to bargain appears to be one of the reasons why the Commission has the power under s.246(3) to compel a person who is not an employer to attend a conference. Before exercising such power, the Commission must be satisfied that the person exercises such a degree of control over the terms and conditions of the employees who will be covered by the agreement that the participation of the person in bargaining is necessary for the agreement to be made. In other words, a pre-condition of the exercise of the power is that the Commission must be satisfied that the employers and employees covered by the supported bargaining authorisation will not be able to reach agreement without the participation of the person in bargaining.

[280] Community Accessability submitted that it is inappropriate to require employers to enter ineffective bargaining to pressure the government to change its policy, however it appears that s.246(3) contemplates a process which is akin to this in that the participation of a third party such as a funding body may be regarded by the Commission as a necessary step towards reaching agreement when the employer and employees have been unable to do so because of the employer's financial constraints.

[281] Although the Commission is not required to provide assistance to parties in relation to bargaining for a proposed multi-enterprise agreement or to exercise powers under s.246(3), the existence of such powers indicates that any apprehensions about lack of funding and unlikelihood of reaching agreement are contemplated by the supported bargaining scheme and are therefore not matters which would weigh against the making of a supported bargaining authorisation.

[282] Section 246(3) is also relevant to submissions made by Windarring and McCallum that the focus of supported bargaining is to address obstacles to bargaining and not unsuccessful bargaining or an absence of bargaining. McCallum submitted that it is capable of negotiating and agreeing terms of an enterprise agreement if it chooses to take that course as a means of regulating its employment terms and conditions, but it does not want to take that course at the present time. It does not require any assistance or support as envisaged by s.241(1)(a) or (c). George Gray and Life Skills, Distinctive Options and Noweyung also submitted that they have successfully bargained for an enterprise agreement so no issue of lack of skills, resources, bargaining strength or previous bargaining experience arises.[291] However, the constraints to bargaining referred to in s.241(c) being a lack of skills, resources, bargaining strength or previous bargaining experience is not an exhaustive list. We accept that where an employer's operation is dependent upon a fixed funding model provided by the Government either directly to the employer or to its clients, that this is an obstacle to bargaining and that this is contemplated by the Commission's powers under s.246(3).

[283] In Annual Wage Review 2023-24,[292] which was issued on 3 June 2024, the Expert Panel referred to the decision in Application by UWU, AEU and IEU and noted that bargaining facilitated by the Commission pursuant to the authorisation had proceeded since the decision and that the Australian Government had participated intensively in the bargaining process since it is recognised that it will need to be the primary funding source for any wage increases that result from the bargaining.[293] The Expert Panel also noted that the 2024 Budget had confirmed that the Australian Government is 'committ[ed] to providing funding towards a wage increase for early childhood education and care workers, with details to be settled following Fair Work Commission processes' and that this support 'builds on ... changes to the Fair Work Act to consider gender equality.'[294]

[284] Since that time, the Commission has approved the Early Childhood Education and Care Multi-Employer Agreement 2024-2026 (the ECEC Agreement)[295] which originally covered 64 employers and now covers 353 employers and their employees as a result of variations to the ECEC Agreement.

[285] The approval decision for the ECEC Agreement explained the supported bargaining process as follows:

[302]

[289] Many of the Employers point to the VDSEA as evidence that a multi-enterprise agreement will not increase rates of pay. Mambourin submitted that the VDSEA negotiation process commenced at some point in 2017 but the first VDSEA did not commence operation until 2 March 2020. On this basis, it seems that any benefit to the employees arising from the granting of a supported bargaining authorisation is some years away.

[290] Mambourin submitted that if there are two parallel multi-enterprise agreements applying to different groups of not-for-profit disability service providers in Victoria, arising from this application and the decision of Commissioner Lee in HSU and AEU presumably with differences in terms and conditions this would appear to be contrary to the public interest.

[291] We are unable to draw conclusions about the likely outcome of any multi-enterprise agreement negotiations based on the VDSEA given it was made under different provisions of the FW Act and prior to the commencement of the supported bargaining authorisation provisions. The VDSEA was not made pursuant to a supported bargaining authorisation and there is no indication that the Australian Government was involved in the negotiations.

[292] As to Mambourin's submission that it would be contrary to the public interest two parallel multi-enterprise agreements applying to different and arbitrarily selected groups of not-for-profit disability service providers in Victoria, it is difficult to accept that this would be the case given that the scheme permits such an outcome and that ultimately any agreement made would be the product of negotiations between the employers and employees covered by the Agreement. In this regard we note that in ASU v Inner Melbourne Legal and Youthlaw,[299] Deputy President Hampton granted a supported bargaining authorisation covering two community legal centres in Victoria, being Inner Melbourne Community Legal Inc T/A Inner Melbourne Community Legal (IMCL) and Young People's Legal Rights Centre Inc T/A Youthlaw. The employers covered by that authorisation were subject to an earlier bargaining process that led to the making and approval of the Victorian Community Legal Centres Multi-Enterprise Agreement 2024-2027 (VCLC EA). However, that agreement was not approved by the majority of employees of IMCL and Youthlaw and consequently IMCL and Youthlaw are not covered by the VCLC EA. The consequence of the authorisation being made in relation to IMCL and Youthlaw is that if it leads to a multi-enterprise agreement being made and approved, this will result in two multi-enterprise agreements operating in Victoria in relation to the community legal sector.

[293] Having regard to these matters, we find that the VDSEA is not a matter which weighs against the making of the authorisation.

[304]

[294] There has been a history of recent bargaining with just one of the Respondents, Mambourin. Mambourin put a proposed single-enterprise agreement to a vote, shortly after the application was made, however, employees voted against it. George Gray showed a willingness to bargain during the period from September 2023 to November 2023 but did not issue a notice of employee representational rights and has not otherwise commenced the process to bargain for a single-enterprise agreement. Windarring said it is 'open' to bargaining as an individual organisation[300] but has not initiated bargaining. Life Skills, Distinctive Options and Noweyung submitted that their 'preferred option' is to bargain for a single-enterprise agreement, however they have not initiated bargaining. McCallum and Amicus have specifically ruled out any form of bargaining. The remaining Respondents have not expressed a willingness to bargain for any type of agreement and have not initiated bargaining.

[295] McCallum submitted that there should be a presumption against supported bargaining where an employer has demonstrated that it has the capacity to bargain at an individual level without need for support and where there has been no initiation of bargaining by an applicant prior to commencing proceedings for a supported bargaining authorisation application. In Application by UWU, AEU and IEU, the Full Bench said that a submission in similar terms 'must be treated with caution and cannot be accepted without qualification.'[301] The Full Bench went on to say that it is not the case that the Commission must be satisfied that supported bargaining under Division 9 of Part 4-2 is 'more' appropriate than any other mode of bargaining available under that Part and that such an approach would constitute an impermissible and erroneous alteration to the statutory test.[302]

[296] The submission that the Applicants have not established why they cannot bargain with the Respondents individually is a somewhat hollow one given that the Respondents almost universally submit that they have no capacity to bargain and that bargaining will not result in any increase in pay. It is likely that this is one of the reasons that the Applicants have applied for the authorisation rather than seeking to make individual single agreements with each of the Employers. As noted above, the Commission may, on its own initiative, assist parties covered by a supported bargaining authorisation by facilitating bargaining for the agreement. Such assistance may not be as readily available to parties negotiating a single-enterprise agreement which is why a supported bargaining authorisation might be regarded as a more effective pathway towards negotiating an enterprise agreement.

[297] While the relevant parts of the objects of the FW Act in ss.3(f), 171(a) and 241(c) indicate that enterprise-level bargaining is intended to be the primary and preferred mode of agreement-making under the FW Act, we do not accept that the Applicants are required to establish that they cannot bargain with the Respondents individually before we can find that it is appropriate for the Respondents to bargain together. The AEU pointed out in its submissions in reply that such a consideration would undermine the purpose of the supported bargaining legislative regime that was aimed at remedying the defects of the low-paid bargaining stream. Such defects included that the Commission had required applicants to prove that the parties had availed themselves of alternative industrial mechanisms of bargaining before seeking to progress the application in the low-paid bargaining stream.[303] In the circumstances, we do not find that this is a matter which weighs against a finding that it it is appropriate for the employers and employees to bargain together.

[298] However, we believe that the recent history of bargaining at Mambourin is relevant to our consideration. Although agreement has not been reached between Mambourin and its employees, we are not satisfied, based on the evidence before us, that there are no prospects of agreement being reached. The fact that an employer is engaged in bargaining for a single-enterprise agreement will not automatically exclude that employer from a supported bargaining authorisation. However, it is a matter which is relevant to whether it is appropriate for the employers and employees that will be covered by the agreement to bargain together, having regard to the emphasis on enterprise level bargaining. We accept the submission of Mambourin that given that there has already been progress towards drafting the single-enterprise agreement, and some progress in negotiations, if Mambourin is able to proceed with single-enterprise bargaining, any single-enterprise agreement would likely commence operation before the multi-enterprise agreement. This is a matter which weighs against a finding that it would be appropriate for Mambourin to bargain with the other Respondents. As there is no recent history of bargaining with the other Respondents, this is a matter which weighs in favour of a finding that it would be appropriate for the Respondents (apart from Mambourin) to bargain together.

[310]

[301] ASTERIA submitted that we should take into account the extent to which it is fair for a small collection of employers to be forced into an unknown industrial process with the hope that the Minister may offer up more funding. The other side of this argument is that if successful, bargaining could result in an enterprise agreement which benefits employers to attract and retain skilled workers into their services. In other words, it is difficult to predict, at this early stage of the process, whether the outcome for the Respondents in bargaining will be positive or negative and therefore whether it is fair or unfair for specific employers to be covered by the authorisation. We believe that perceived notions of unfairness do not provide a sufficient basis for a finding that it is not appropriate for the Respondents to bargain together.

[302] However, we accept that the proposed coverage of the multi-enterprise agreement is a relevant consideration as to whether it is appropriate for the Respondents to bargain together.

[303] The Applicants made the application to coincide with the termination of zombie agreements on 7 December 2023. The Applicants have made an application to extend the zombie agreements applying to the Respondents and their employees which was granted by the Commission and submit that employees will be worse off if the zombie agreements are terminated.

[304] The Respondents who continue to be covered by zombie agreements are:

ASTERIA

Aurora

Community Accessability

Distinctive Options and Noweyung

George Gray

Life Skills

McCallum

Milparinka

Mirridong

Windarring

[305] ASTERIA and Mirridong both submitted that they no longer apply the zombie agreements which cover them.

[306] Mirridong submitted that it has not operated under the zombie agreement since February 2012 as it did not cover all of Mirridong's employees and its business model has changed. Mirridong submitted that all employees were provided with an offer of employment in February 2012 with new terms and conditions of employment. Employees retained six weeks annual leave with four weeks holiday loading for Day Services Support Workers and five weeks annual leave for Residential Support Workers. Employees accepted a change to 10 days Personal Leave pro rata. Mirridong provides four paid training days per annum plus individual training and paid First Aid training. Mirridong submitted that the SCHADS Award was identified as being more beneficial to its employees in respect of wages and for casual employees working weekends, public holidays and overtime rates.

[307] We understand from the submissions of Mirridong that it has elected to apply conditions of the SCHADS Award which are more favourable than the zombie agreement and to continue to apply some aspects of the zombie agreement. However, the fact that Mirridong has adopted these practices does not mean that the zombie agreement no longer applies. In determining the application by the AEU to extend the zombie agreements which cover some of the Respondents in these proceedings,[304] the Full Bench said,

[312]

[308] We agree with the these observations of the Full Bench. Having regard to the coverage clause, and that it has not been terminated, we believe that it is likely that the zombie agreement continues to apply.

[309] In the case of ASTERIA, it claims that the ASTERIA Services Disability Services Victoria (Part 1) Collective Agreement 2008 (ASTERIA zombie agreement) does not cover or apply to any ASTERIA employee and that it is a redundant industrial instrument. ASTERIA submitted that the ASTERIA zombie agreement covers instructors and that in 2008, the instructor model was the only model of disability support work provided by ASTERIA and other similar providers. ASTERIA submitted that instructors delivered education to persons with a disability with a view to developing and promoting independence. Such work was delivered by persons generally with an education background (including a Certificate IV in Community Training), and in some cases by degree-qualified teachers, and at all times in a classroom environment.

[310] ASTERIA submitted that the instructor model was aligned to particular conditions of employment, including six weeks of annual leave. ASTERIA said that it no longer employs instructors and that the vast majority of its disability support work is delivered one on one and in the community, with some services provided in a group setting. No employee is required to have a background in training or education. ASTERIA submitted that the ASTERIA zombie agreement ceased to be relevant to ASTERIA's workforce and operations many years ago. Therefore, ASTERIA does not agree with HACSU's submission that the ASTERIA zombie agreement is relevant to setting the minimum conditions of employment for its workforce.

[311] We note that ASTERIA made submissions to this effect in relation to the application by the AEU to extend zombie agreements which cover some of the Respondents in these proceedings and which is referred to above.[305] ASTERIA opposed the application. In that matter, the decision of the Full Bench records the AEU submissions that coverage is not a matter that is determined based on an employer's operational changes but a question of fact regarding the nature of work being performed by employees. Since there are still some employees who perform work of an 'instructor', including to deliver group supports, the AEU submitted in those proceedings that these employees continued to be covered by the ASTERIA zombie agreement.[306] The Full Bench did not determine the issue of whether the ASTERIA zombie agreement applied to any employees, but extended the agreement for reasons which included the application before us.[307]

[312] Clause 4.2 of the ASTERIA zombie agreement states, 'This Agreement shall apply to all employees employed by the employer as an Instructor.' The term 'Instructor' is defined in clause 3.7 as 'an instructor as outlined in clause 11 and appendix 1 (A) - 1 (E) of this agreement.' Clause 11 is in relation to types of employment and does not refer to 'instructor'. Appendices 1(A) - 1(E) of the ASTERIA zombie agreement provide the classification descriptors for Band 1 Instructors (Appendix 1(A)), Band 2 Instructors (Appendix 1(B)), Band 3 Instructors (Appendix 1(C)), Program Manager (Appendix 1(D)), and Assistant Program Manager (Appendix 1(E)). Appendices 1(A) - 1(C) define the various levels of 'Instructor' as 'a person appointed as such to provide ongoing program support and skills training to assist persons with a disability in a day program.' There is no reference in the descriptors to such work being delivered by persons generally with an education background, and in some cases by degree-qualified teachers, and at all times in a classroom environment. In the circumstances, the descriptors appear to be sufficiently broad to cover the services which ASTERIA says it provides in a group setting. In this regard, we note the AEU's submissions that ASTERIA's website refers to the delivery of group supports provided on weekdays between 8:30am-3:30pm and that employees are required to prepare, deliver and facilitate such supports, which is a major and substantial proportion of work of instructors.[308]

[313] Taking all of these matters into account, we believe that it is unlikely that the ASTERIA zombie agreement has no application to current employees.

[314] The employees of the Respondents who are covered by zombie agreements enjoy some of the over award benefits which come with enterprise bargaining. This is consistent with the object of the FW Act to achieve productivity and fairness through an emphasis on enterprise - level collective bargaining. We note that employees who are covered by zombie agreements are likely to suffer some disadvantage when the zombie agreements terminate and that access to bargaining to preserve these entitlements is consistent with the objects of the FW Act. Some of the Respondents have expressed a preference to be covered by a single-enterprise agreement but only Mambourin has initiated bargaining. These circumstances weigh in favour of a finding that it is appropriate that the following Respondents bargain together:

ASTERIA

Aurora

Community Accessability

Distinctive Options and Noweyung

George Gray

Life Skills

McCallum

Milparinka

Mirridong

Windarring

[314]

[315] In previous decisions of this Commission which have determined applications under s.242 of the FW Act, other matters which have been considered under s.243(1)(b)(iv) which are relevant to the current application, and which weigh in favour of making the authorisation are:

(a) That granting the authorisation sought would open the prospect of improving rates of pay of a female dominated workforce, which would be consistent with that part of the object of the FW Act in s.3(a) concerned with the promotion of gender equality.[309]

(b) That there has been a relatively low uptake of enterprise bargaining in the sector.[310]

(c) That the making of the authorisation will more readily facilitate participation of funding bodies in the negotiations.[311]

[316] The objects of the FW Act include the provision of workplace relations laws that promote job security and gender equality. Of those Respondents who provided information about the gender profile of their workforce, all of them employed a majority of women. In the 2024 Annual Wage Review Decision, the Expert Panel referred to a report, prepared by the Social Policy Research Centre at the University of New South Wales, which identified 29 occupations covered by 13 modern awards which were large (containing over 10,000 people); very highly feminised (over 80 per cent female); and located within feminised industry classes (over 60 per cent female).[312] The report identified that there are 62,122 'Aged and Disabled Carers' covered by the SCHADS Award and that 86.5% of these employees are women. On the basis of this research, we can be comfortably satisfied that the majority of disability support workers are women and that they are award dependent. As employees must be better off overall under a proposed enterprise agreement as a condition of the agreement being approved by the Commission, it follows that if a multi-enterprise agreement is made following an authorisation being granted, that this will improve conditions of employment, (as employees will be better off overall compared to the SCHADS Award) and enhance gender equality (given that most of the employees are women). Many of the Respondents have submitted that multi-enterprise bargaining will not improve gender equality because there is no ability to offer higher wages without increased funding. As noted above, the statutory provisions do not require us to be satisfied, at this early stage of the process, that the authorisation will in fact result in an agreement being made with higher rates of pay in order to find that it is appropriate for the Respondents to bargain together.

[317] We find that granting the authorisation will open the prospect of improving rates of pay of a female dominated workforce, and that there has been a relatively low uptake of enterprise bargaining in the disability sector. We accept that the making of the authorisation will more readily facilitate participation of funding bodies in the negotiations. These are all matters which weigh in favour of the making of the authorisation.

[318]

[319] The AEU submitted that in reaching that state of satisfaction or considering whether that state of satisfaction has been reached, there is a broad discretionary scope that allows the Commission to place weight as it considers appropriate on both the mandatory considerations but also any additional considerations that are identified in s.243(1)(b)(iv). No single matter in section 243(1)(b) is considered determinative.[316] The Commission does not need to be satisfied that supported bargaining is more appropriate than any other form of bargaining, or bargaining at all, and it is not a requirement that there has been bargaining at the single-enterprise level or that such bargaining has been attempted before the state of satisfaction in subsection (b) can be reached.[317]

[320] In our view, the AEU's submissions correctly describe the Commission's task in applying s.243(1)(b) and we have adopted this approach in our consideration of the matter.

[321] We have found that the Respondents have clearly identifiable common interests and that the likely number of bargaining representatives for the Proposed Agreement would be consistent with a manageable collective bargaining process. We have also found that rates of pay and conditions that are the same as, or close to, the minimum rates of pay in the ERO and the conditions in the SCHADS Award are prevalent in the disability sector and that low rates of pay prevail in the disability sector. These are all matters which weigh in favour of a finding that it is appropriate for the Respondents and their employees to bargain together.

[322] We have found that the funding model and lack of capacity of the Respondents to fund over award entitlements do not weigh against a finding that it is appropriate for the Respondents to bargain together.

[323] Each of the Respondents have sought to distinguish themselves based on matters such as size, participants, financial position, types of services, workforce compositions, operational requirements and/or revenue sources. On this basis they contend that they will each have different priorities in bargaining and that there is a risk that consensus will not be reached or that the interests of some Respondents, especially those with larger numbers of employees and financial resources will be prioritised over others. Although we are not required to predict the outcome of bargaining or find that bargaining is likely to be successful in our determination of the matter, we accept that the different characteristics of the Respondents are matters which are relevant to the objects of the supported bargaining scheme which include to assist and encourage employees and employers to make an enterprise agreement that meets their needs.

[324] If the consequence of the differences between the Respondents is that it is unlikely that an agreement will be made that meets their respective needs, this may weigh against a finding that it is appropriate for the employers and employees that will be covered by the agreement to bargain together. However, in this case, the operational differences between the Respondents have not resulted in significantly different conditions applying to their employees. This is not surprising as differences in, for example, hours of operation, are readily accommodated by industrial instruments which have different provisions and conditions which apply to day workers and shift workers. In other words, the fact that some Respondents operate residential services that operate 24/7 and that other Respondents offer community-based programs that operate during the day is a matter that can be reasonably accommodated in a single industrial instrument.

[325] Most of the Respondents have at least some employees who are employed pursuant to the SCHADS Award. Where the Respondents have employees who are covered by zombie agreements, the intention of all the Respondents, if the authorisation is not made, appears to be to apply the SCHADS Award when the zombie agreements terminate, and in some cases apply over award conditions by way of policy in respect of leave entitlements and/or sleepover allowances. The granting of the authorisation will enable the Respondents and their employees to consider whether any specific modifications of the SCHADS Award conditions should be made to meet their needs, however there is no evidence before us which indicates that the SCHADS Award conditions are not working well for each of the Respondents and that significant changes to current conditions are likely to be sought. In relation to the different financial circumstances of the Respondents, we repeat our earlier observations that we accept that for most of the Respondents, their capacity to fund pay and conditions greater than the SCHADS Award is severely constrained by the NDIS pricing model and that where an employer's operation is dependent upon a fixed funding model provided by the Government, that this is an obstacle to bargaining contemplated by the Commission's powers under s.246(3).

[326] Having regard to these matters, the operational differences identified by the Respondents do not weigh against a finding that it is appropriate for the Respondents and their employees to bargain together.

[327] Most of the findings that we have made which favour the authorisation being made are likely to be available in respect of most, if not all, disability services funded by the NDIS in Australia. In ASU v Inner Melbourne Legal and Youthlaw, Deputy President Hampton observed that in some circumstances, the grouping of a small number of employers within a proposed authorisation of this kind, from amongst a much wider cross-section of employers in a sector, may need to be considered.[318] In our view, the reason for the selection of the Respondents in this matter is an important consideration as to whether it is appropriate for them to bargain together.

[328] In this case, the common 'need' amongst many of the employees covered by the application (compared to the needs of employees in the disability sector generally) is the retention of above award conditions currently provided in zombie agreements which continue to apply. As noted above, many of the Respondents provide some above award conditions, however, apart from those conditions which continue to be provided for in zombie agreements, these arrangements are not currently provided for in an industrial instrument, so they are not regulated by the FW Act. It would be consistent with the objects of the FW Act for employees to have certainty in relation to these above award conditions and to be able to collectively negotiate these conditions.

[329] This common need is not shared by employees of Respondents who are no longer covered by zombie agreements. Although these employees may wish to receive the enhanced leave conditions and other entitlements previously provided by expired zombie agreements, there is no evidence that they continue to receive those benefits, apart from some employees at Mambourin, who receive enhanced long service leave as an over award benefit. These employees may have previously experienced a reduction in their conditions, but they are in a different position to the employees who are covered by zombie agreements which remain in force, who wish to maintain and protect above award conditions that they currently receive by operation of an industrial instrument.

[330] Generally, the way that employees secure above award conditions under the FW Act is through bargaining. However, as already noted in this decision, there has been no recent history of bargaining with most of the Respondents (apart from Mambourin) due to unwillingness to bargain and/or funding constraints. Although some of the Respondents have indicated that they are willing to bargain for a single-enterprise agreement, they have taken no steps to initiate bargaining (apart from Mambourin) and it is difficult to see how bargaining for a single-enterprise agreement could be successful given the barriers that all the Respondents have identified.

[331] As there is no recent history of bargaining with most of the Respondents, we have found that this is a matter which weighs in favour of a finding that it would be appropriate for the Respondents (apart from Mambourin) to bargain together.

[332] In circumstances where the Respondents covered by zombie agreements have not initiated bargaining for a single-enterprise agreement and at least some of their employees will be disadvantaged by the zombie agreements terminating, we find it is appropriate that the Respondents who are covered by at least one zombie agreement bargain together having regard to all of the matters in s.243(1)(b). These Respondents are:

ASTERIA

Aurora

Community Accessability

Distinctive Options and Noweyung

George Gray

Life Skills

McCallum

Milparinka

Mirridong

Windarring

[333] It follows that we are not satisfied that it is appropriate for the following Respondents, that are not covered by zombie agreements, to bargain with the Respondents that are covered by zombie agreements:

Amicus;

Menzies; and

Mambourin

[334] As such, Amicus, Menzies and Mambourin will not be covered by the authorisation.

Health Services Union & Australian Education Union [2025] FWCFB 131 (1 July 2025)

At a glance

Court

Decision date

Source

Judgment (376 paragraphs)

Health Services Union & Australian Education Union [2025] FWCFB 131 (1 July 2025)

Legislation Cited (4)