Metal Trades Training Wage (State) Award [2008] NSWIRComm 59

Metal Trades Training Wage (State) Award [2008] NSWIRComm 59 - NSWIRComm 2008 case summary — Zoe

[17]

1 These proceedings were initiated by the award review process prescribed by section 19 of the Industrial Relations Act 1996 ("the Act"). 2 Proceedings in Matter No 1634 of 2007 before Commissioner Macdonald in September 2007 established that the Metal Trades (Training Wage) (State) Award 238 IG 1045 ("the Metal Trades Training Award") had not been varied to include wage increases pursuant to the 2004 State Wage Case 132 IR 190, the 2005 State Wage Case 142 IR 337, the 2006 State Wage Case 153 IR 268, or the 2007 State Wage Case 163 IR 253. 3 The parties were in agreement that the 2004, 2005, and 2006 State Wage Case (SWC) increases could be incorporated into the Metal Trades Training Award from 16 January 2008. The parties were unable to agree on the operative date for the 2007 SWC increase. 4 Macdonald C made an ex tempore determination (TR 16/01/08, p10) to the effect of varying the Metal Trades Training Award to reflect the consent positions of the parties and, on the same day, referred the matter for consideration by his Honour the President to be dealt with as a Special Case in accordance with State Wage Case Wage Fixation Principles. 5 On 18 January 2008 the Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union, New South Wales Branch (AFME&PKIU) filed an application, pursuant to s 17 of the Act (Matter No IRC 57 of 2008) for variation of the Metal Trades Training Award to incorporate the determination of Macdonald C and seeking application of the 2007 SWC increase from 20 January 2008. 6 Matter No IRC 57 of 2008 was subject to conciliation by his Honour Deputy President Sams. The parties were unable to agree. Matter No IRC 57 of 2008 was subsequently joined to Matter No 1634 of 2007 and came before the Commission as presently constituted on 28 March 2008 as a Special Case. 7 On that day an ex-tempore decision was enunciated (TR p15 28/3/08) in the following terms: The Full Bench has given consideration to the submissions and arguments put by the parties. We formally grant leave to amend the application in the terms of exhibit 1. We are satisfied that a special case has been made out and we vary the award in terms of exhibit 1. We will publish our reasons for judgment in due course and in that process we will also conclude the s 19 review process in this award. In effect the award is varied to apply the 2007 State Wage Case from 31 March 2008. 8 We now publish our reasons in full. 9 The essence of the difference between the parties is the operative date of the 2007 SWC increase. Principle 8 of the Wage Fixing Principles determined in the 2007 SWC states: 8. State Wage Case Adjustments In accordance with the State Wage Case 2007 decision awards may, on application, be varied to include a State Wage Case adjustment of $20.00, subject to the following:

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7 The principles which apply in Special Cases are well settled. The onus falls on the applicant (see Re Pastoral Industry (State) Award 2001 104 IR 168 at [73]), who must demonstrate matters of the kind discussed in Re Operational Ambulance Officers (State) Award (2001) 113 IR 384 at [166]: 166 In order to satisfy the requirement for a special case, the applicant must demonstrate that the case has "special attributes" or is "out of the ordinary" so as to take it outside the restrictions which may otherwise apply under the wage fixing principles. In Re Social and Community Services Employees (State) Award [2001] NSWIRComm 274 , a Full Bench stated (at [24]): Thus it can be seen, ... that strict compliance with the wage fixing principles generally or with the work value principle and structural efficiency considerations in particular is not required where as here a case is advanced as a special case. In saying that we should not be taken to mean that such considerations will necessarily be excluded from the special case. As much is clear from the Crown Employees case. It is however appropriate to observe ... that the present Special Case principle unlike its 1990 predecessor does not require that cases be considered "in accordance with the structural efficiency and other relevant principles". It requires, as was said in the Transport Industry case, that special attributes exist which warrant approval by the Commission despite the restrictive considerations imposed generally by the principles of wage fixation and that is the essential basis upon which the Commission will approach the determination of the present application. (See also Re Health and Community Employees Psychologists (State) Award [2001] NSWIRComm 302; Re Corrections Health Service Nurses (State) Award (No 2) [2001] NSWIRComm 58; Metal, Engineering and Associated Industries Award 1998 - AIRC Print T4991, 29 December 2000 for discussion of special case principle). 14 Mr Walkaden accepted that the applicant bore the onus of establishing the elements of a Special Case. He submitted that one of the special attributes in this case was the considerable delay experienced by employees in achieving State Wage Case increases, which he put is atypical of a contemporary award and sufficiently out of the ordinary to satisfy the criterion of "special". 15 Mr Walkaden further submitted that s10 of the Act specifies the requirement that awards must fix reasonable conditions of employment, which includes timely application of the State Wage Case increases applying the 12 month rule. It was Mr Walkaden's submission, however, that the delay in this Award has created circumstances which are not reasonable, justifying remedy by departure from the 12 month rule as a Special Case. 16 Mr Walkaden refuted the proposition put by the Australian Federation of Employers and Industries (AFEI) that this matter is distinguishable from the Professional Engineers case on the basis that the applicant did not provide evidence to demonstrate that trainees are paid minimum award rates only. Mr Walkaden acknowledged that survey data was not available. However, he relied on the premise that trainees are often those employed in their first job, are inexperienced and are predominantly teenagers with limited bargaining power. 17 The Electrical Trades Union of Australia, NSW Branch (ETU) and the Australian Workers' Union, New South Wales (AWU) supported the submissions of the AFME&PKIU. 18 Australian Business Industrial (ABI) supported the application and did not oppose an operative date for the 2007 SWC increase of the date of the proceedings, namely 28 March 2008, or no earlier than 31 March 2008. 19 Mr Marriott, appearing on behalf of AFEI, relied on the decision of a Full Bench of the Australian Industrial Relations Commission (AIRC) in the Safety Net Review Wages April 1999 [R1999] (paras 88, 89 Reasons for Decision): " [88] The date at which increases flowing from this decision should be available was a matter of debate during the case. The Joint Governments and some employers asked us to ensure that there is a twelve month gap between the increases provided for in our April 1998 decision and any increases provided for in this case. It was said that if safety net adjustments occur too close together intolerable pressures will be placed on many employers and ultimately jobs will be lost. The ACTU opposed the proposal. We consider a case has been made out by the Joint Governments and the employers concerned. The Statement of Principles will be amended to require that at least twelve months have elapsed since the rates in the award were increased in accordance with the April 1998 decision before the award is varied as provided for in this decision.

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(iii) This award rescinds and replaces the Training Wage Interim (State) Award published 26 April 2002 (332 IG 1248). It shall take effect from the beginning of the first full pay period to commence on or after 6 September 2002 and shall have a nominal term of 12 months. 25 ABI submitted that the Metal Trades Training Award can only apply where its provisions are "in line" with the Training Wage Award. ABI submitted that the Metal Trades Training Award is not "in line" as the rates of pay lag those in the Training Wage Award and accordingly, the Training Wage Award applies, not the Metal Trades Training Award. This could result in undesirable confusion for employers and trainees. 26 ABI submitted that the available remedy is to rescind the Metal Trades Training Award, leaving the Training Wage Award as the operative industrial instrument, or to vary the Metal Trades Training Award to bring it "in line" with the Training Wage Award. ABI submitted that these circumstances contribute to satisfaction of the necessary Special Case criteria such that the application can be accommodated within the SWC Principles. 27 AFEI did not support this argument and submitted that as well as creating confusion, it would be inconsistent with the objects of the Act to allow a situation where an award could be rendered inoperative by the terms of another award. 28 AFEI canvassed the history of training wage awards and submitted that the range of different awards eventuated due to the opposition of a number of unions to a uniform training wage award which had been proposed by employers. AFEI put that agreement had been reached to establish a number of independent training wage awards for particular industries on the understanding that their terms would be broadly the same as the terms under the proposed Training Wage Award. 29 AFEI further submitted that the Metal Trades Training Award was one of those described by AFEI as "splinter awards", which were made in identical terms as the Training Wage Award, but for the area, incidence and duration clause. 30 AFEI referred to the submissions of ABI in Matter No IRC 5147 of 2000 and 5171 of 2000 (the Training Wage Award case), which were adopted and supported by AFEI in those matters, in the following terms: "10. The parties recognise that it is important that the parity between traineeship rates of pay in New South Wales and federally is preserved. For this reason the parties propose that consideration in any future State Wage Cases be given to the peculiarities of traineeship rates. It is appropriate that the Award and any other specific traineeship award, for example the Clerical Industry (State) Award, Retail Industry (State) Award, Rural Industry (State) Award and the Metal (State) Industry Award be subject to State Wage Case variations on and from the same date.

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ABI recognises that many unions modernised and updated the traineeship provisions in their awards as a result of the award review process in accordance with section 19 of the Industrial Relations Act 1996. The majority of variations were in the same terms as the Award application. Any training wage awards or parent awards with training provisions which are in line of [sic] the terms of the Award are exempt from the application." 31 Mr Marriott submitted that it was always the intention of the parties that the Metal Trades Training Award and others specified in cl 9(i)(b) of the Training Wage Award were independent, with a life of their own, independent of (but in line with) the Training Wage Award. Mr Marriott put that it was the original intention that as soon as the National Training Award variation was made "everybody" would apply for the Training Wage Award to be varied. 32 Mr Marriott concluded that this has obviously not occurred, which he put, further demonstrated the separate identity and course of the Metal Trades Training Award and those referred to in cl 9(i)(b) of the Training Wage Award. 33 AFEI further relied upon variations to other training wage awards in which it was submitted the 12 month rule was applied and no reference was made to any connection with the Training Wage Award. AFEI emphasised that each of these awards was varied to include the 2007 SWC increase with different operative dates to that of the Training Wage Award. 34 The Training Wage Award was varied to include the 2007 SWC increase with effect from 8 October 2007 and adhered to the 12 month rule. Some analysis of the award variations was provided by AFEI in their written submissions. In order to examine their submissions fully, this analysis was expanded by reference to the NSW Industrial Gazettes. Those referred to are: AWARD SWC OP. DATE IG REFNCE 2002 6/9/02 341 IG 569 2003 1/8/03 344 IG 977 Training Wage (State) Award 2004 1/8/04 348 IG 1107 2005 30/9/05 355 IG 517 2006 30/9/06 361 IG 1489 2007 4/10/07 364 IG 1159 Coachmakers, &c, Road and Perambulator Manufacturers (State) Award 2006 11/10/06 361 IG 1237 2007 11/10/07 364 IG 442 2004 Rural Traineeships (State) Award 2005 1/12/04 348 IG 1151 2006 1/12/05 354 IG 916 2007 2005 26/11/05 357 IG 258 Private Hospitals, Aged Care and Disability Service Industry (Training) (State) Award 2006 26/11/06 361 IG 837 2007 26/11/07 364 IG 1043 2002 12/3/03 336 IG 1061 Nurses' (Private Sector) Training Wage (State) Award 2003 2004 2005 9/11/05 356 IG 1219 2006 2007 29/1/08 365 IG 328 2004 AWU Training Wage (State) Award 2005 8/10/04 348 IG 1148 2006 8/10/05 354 IG 919 2007

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38 The delay is self evident and, in our view, clearly satisfies the requirements of a Special Case. 39 It is regrettable that this matter suffers from a lack of evidence of the wages actually paid to trainees. However, we accept the proposition that trainees and juniors are generally paid at the minimum wage as was supported by the evidence in the Child Employment Principles Case 2007 (2007) 163 IR 41. 40 However, it is open to reasonable conclusion that employers, either paid the minimum rate and consequently have had the benefit of the delay to the detriment of employees, or have paid in excess of the Metal Trades Training Award and will not be unduly inconvenienced by the variations sought in the time frame put by the Unions. These circumstances, in our view, materially add to the particular circumstances required to constitute a Special Case. We are satisfied that, having regard to the length of delay and the propensity for young people in their first employment to be paid minimum rates, a Special Case has been made out. 41 We are reinforced in this conclusion by the analysis that, if we be incorrect as to payment of trainees at the minimum wage, variation of the Metal Trades Training Award, in the terms of the application, will not result in financial hardship to any affected employer. 42 A further relevant consideration is that should this Award not be varied in the manner sought, it could forever be a 'lagging' award. This would be contrary to the public policy expressed in s 10 of the Act requiring the Commission to set fair and reasonable conditions of employment for employees and would conflict with the repeated efforts of the Commission, through the SWC Principles, to eliminate 'lagging' awards. 43 We further conclude that the use of the term "in line with" cannot mean that an award must be identical with another for it to be "in line with". There may be many and varied circumstances which emerge that justify a particular course in an award and which should be considered on a case by case basis. While it is unnecessary to take this question any further in these proceedings, we note that the original intention of the parties as to uniformity has not been achieved. 44 For these reasons, we grant the application brought by the Unions and supported by ABI and note, in so doing, that a review of variations to the training wage awards referred to by the AFEI reveals that these matters either met the 12 month rule, or were by consent, and consequently neither the application of Principle 8(g) nor the effect of cl 9(i)(b) of the Training Wage Award were subject to any consideration. Section 19 Award Review Matters

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