Re Crown Employees (New South Wales Department of Family and Community Services) Residential Centre Support Services Staff Award 2015; ; Re Crown Employees Ageing, Disability and Homecare - NSW Department of Family and Community Services (Community Living Award) 2015 [2017] NSWIRComm 1058 - NSWIRComm 2017 case summary

Industrial Relations Commission (NSW)|2017-07-28

easury [2014] NSWIRComm 23; 87 NSWLR 41 Re Crown Employees (Christmas, New Year and Easter Half-Day Award [1991] 39 IR 440 Re Operational Ambulance Officers (State) Award [2001] NSWIRComm 331; 113 IR 384 State Wage Case 2016 [2016] NSWIRComm 12 Category: Principal judgment Parties: Public Service Association and Professional Officers Association Amalgamated Union of New South Wales (Applicant) Industrial Relations Secretary (Respondent) Representation: Counsel: M Gibian for the Applicant R C Kenzie QC with R Warren and A Perigo for the Respondent

Solicitors: Maurice Blackburn Lawyers for the Applicant Crown Solicitor for the Respondent File Number(s): 2017/177634 and 2017/177667

The Awards

By its two amended applications the PSA seeks variations to two awards relating to employees presently employed in the delivery of disability services by the New South Wales Department of Family and Community Services ("FACS"). Consistent with section 50 of the Government Sector Employment Act 2013 (NSW) (the "GSE Act") the Industrial Relations Secretary ("Secretary" or "respondent") appeared on behalf of the employer.
The two awards to which variations are sought are: the Crown Employees Ageing, Disability and Homecare - NSW Department of Family and Community Services (Community Living Award) 2015 (the "Community Living Award") and the Crown Employees (New South Wales Department of Family and Community Services) Residential Centres Support Services Staff Award 2015 (the "Residential Centres Award").
The Residential Centres Award and the Community Living Award (together "the Awards") regulate the employment of persons engaged in or in support of the delivery of disability services in larger supported living centres, community group homes and in home support. It is anticipated that staff working in such services will be transferred to non-government sector service providers from about 1 September 2017 to 31 December 2017.

The Nature of the Claims

The two applications seek: 1. an increase in rates of pay and allowances of 2.5% with effect from the first full pay period commencing on or after 1 July 2017; 2. insertion of a clause dealing with salary packaging arrangements, including salary sacrifice to superannuation; 3. insertion of a clause providing for paid "special sick leave"; 4. a clause providing for consultation arrangements; and 5. the removal of the "no extra claims" clauses in each award.
In addition, in the Community Living Award, the applicant seeks the inclusion of a clause dealing with rostering principles.
The respondent opposes each of the claims. The nature of that opposition is limited. There is no suggestion of any jurisdictional barrier to making variations of the kind sought. Mr Kenzie QC, senior counsel for the Secretary, repeatedly disavowed any such challenge. Nevertheless, the Secretary pressed opposition to the claims. The extent and nature of that opposition is best understood in considering each of the particular claims.

Related Proceedings

Salaries and allowances for employees covered by these two awards were, until July 2017, regulated by the Crown Employees (Public Sector - Salaries 2016) Award (the "Salaries Award"). In June of this year, the Commission, then constituted by the Chief Commissioner, considered competing applications by the applicant and respondent for the making of a 2017 Salaries Award. The difference, relevant to these proceedings, between the two applications was whether to include prescriptions for the salaries and allowances of employees otherwise regulated by the Community Living Award and the Residential Centres Award.
The PSA sought to exclude these employees from continuing coverage by the Salaries Award with a view to having the rates considered as part of these proceedings. The Secretary sought to include the employees, (and thus make provision for a 2.5% increase in their salaries and allowances with effect from the first full pay period on or after 1 July 2017). The Secretary's application however would have reactivated a no extra claims provision. The counterpart provision in the Salaries Award had been relied upon by the Secretary to resist an earlier claim by the PSA for variations of these awards. The PSA wanted to avoid having to run the gauntlet of such an argument in these proceedings.
The Commission determined that matter in favour of the PSA. There was no challenge to that decision.

The Legislation

The objects of the Enabling Act are set out in section 3. It provides: Objects The objects of this Act are as follows: (a) to ensure that implementation of the National Disability Insurance Scheme of the Commonwealth is managed in a way that promotes service continuity for people receiving disability services and community care supports, (b) to provide arrangements for the transfer of staff to promote retention of a skilled disability services workforce and continuity of services, (c) to provide for the transfer of disability services assets to maximise the capacity of the disability services sector and ensure continuity of service while achieving value for the State. (Our emphasis)
It is apparent from the emphasised words in the Objects that a major concern of the Government was continuity of care. The evidence led in the proceedings, particularly from Ms Anne Campbell, employed in FACS in the position of Executive Director, Service Delivery Programs, confirmed the Government's aim of transferring the provision of disability services as a "going concern". In cross-examination by Mr Gibian, counsel for the PSA, Ms Campbell said: What was envisaged to occur and what was occurring in relation to the transfer of services is that the State Government group home services and other disability services are being transferred to non‑government operators [as] ongoing concerns as it were? A. Yes. Q. The intention is that the private sector operators will continue to operate those same services? A. That's correct. Q. It is not closing those services down? A. No. Q. They are being transferred as ongoing operations? A. Yes. Q. And indeed and in order to facilitate that employees are being transferred so they can continue to provide [the same] services to clients which they are providing up to now? A. Yes. Q. And I think the Government has been and no doubt FACS have been anxious to assure clients of disability services, that they will have access to the same services going forward? A. Yes.
Sections 5 and 6 of the Enabling Act authorise and facilitate the transfer of assets for the purposes of implementing the "NDIS arrangements" a term defined in section 4 to mean: any agreement, understanding or other arrangement entered into by the State with the Commonwealth in connection with the operation of the National Disability Insurance Scheme of the Commonwealth.
Section 9 makes provision for the establishment of "implementation companies" the shares of which are beneficially held by the State. An implementation company is not and does not represent the State nor are its debts guaranteed by the State except to the extent expressly agreed by the Minister.
Part 3 of the Enabling Act, which contains ss 13 - 17, authorises arrangements for the transfer of staff for the purposes of "authorised implementation", a term defined in s 4 to mean: a transfer of disability services assets authorised by section 5.
Section 13 authorises transfers of staff within the public sector. Section 14 authorises transfers to non-government sector employment. It provides: 14 Transfers to non-government sector employment (1) The Minister may, for the purposes of the authorised implementation, enter into an agreement (a transfer agreement) with an employer in the non-government sector for the transfer of the employment of a disability services employee to the employment of that employer as the new employer of the employee . (2) The Minister may by order in writing transfer the employment of a disability services employee to the employment of the new employer to give effect to a transfer agreement. (3) A transfer of employment under this section does not require the consent of the person transferred. (4) A transfer agreement must contain provision to give effect to the following requirements: (a) the employment of a transferred employee with the new employer is to be on the same terms and conditions as applied under an industrial instrument to the employee as a disability services employee immediately before the transfer of employment, (b) in the case of a transferred employee who is an apprentice or trainee under the Apprenticeship and Traineeship Act 2001, the new employer must apply under section 20 of that Act for approval to the transfer of the apprenticeship or traineeship to the new employer, (c) the provisions of section 15 apply in respect of the transferred employee. (5) A transfer agreement may specify an employment guarantee period for the transferred employee and if it does so must contain provision to give effect to the following requirements: (a) the terms and conditions of employment of the transferred employee with the new employer under an industrial instrument cannot be varied during the employment guarantee period for the transferred employee except by agreement entered into by or on behalf of the transferred employee in accordance with any applicable industrial law, (b) the employment of a transferred employee with the new employer cannot be terminated by the new employer during the employment guarantee period for the transferred employee, except: (i) for serious misconduct, or (ii) pursuant to the proper application of reasonable disciplinary procedures, or (iii) by agreement with the employee. (6) A transfer agreement may include provision with respect to any other matters concerning the terms and conditions of employment of the transferred employee.
Section 15 referred to in s 14(4)(c) provides: 15 Continuity of entitlements of transferred employees (1) On the transfer by order under this Part of an employee's employment from one employer (the current employer) to another employer (the new employer) the following provisions have effect: (a) the employee is entitled to continue as a contributor, member or employee for the purposes of any superannuation scheme in respect of which he or she was a contributor, member or employee (as an employee of the current employer) immediately before the transfer of employment and remains so entitled subject to any variation to that entitlement made either by agreement or otherwise in accordance with law, (b) the new employer is taken to be an employer for the purposes of any superannuation scheme in respect of which the employee continues as a contributor, member or employee pursuant to an entitlement under this section, (c) the continuity of the employee's contract of employment is taken not to have been broken by the transfer of employment, and service of the employee with the current employer (including service deemed to be service with the current employer) that is continuous service up to the time of transfer is taken for all purposes to be service with the new employer, (d) the employee retains any rights to annual leave, sick leave, extended or long service leave accrued or accruing immediately before the transfer (except accrued leave for which the employee has, on ceasing to be an employee of the current employer, been paid the monetary value in pursuance of any other entitlement of the employee). (2) An employee is not entitled in respect of the same period of service to claim a benefit under this section and another law or instrument. (3) The Minister may in connection with the transfer of an employee's employment under this Part give a certificate in writing as to the extent of the accrued rights to annual leave, sick leave, extended or long service leave that are retained by the employee under this section, and such a certificate is evidence of the matters certified. (4) Nothing in the Long Service Leave Act 1955 prevents payment in connection with the transfer under this Part of the employment of a disability services employee to the employment of an employer in the non-government sector of the monetary value of long service leave in lieu of an entitlement to that leave accrued as a disability services employee before the transfer of the employee's employment.
Sections 16 and 17 inform the nature and effect of the transfer provisions. They provide: 16 Operation of other laws and entitlements The following provisions apply in relation to the transfer of a person's employment under this Part: (a) the transfer has effect despite any other law, contract or instrument under a law, (b) the transfer does not constitute a retrenchment, redundancy or termination of employment at the initiative of the Crown or any other public sector agency, Note. For example, the transfer is not a termination for the purposes of clause 4 (Payment of accrued leave on termination of employment) of Schedule 3 to the Public Sector Employment and Management Act 2002. (c) the person transferred is not entitled to any payment or other benefit by reason only of having ceased to be an employee of a public sector agency as a result of the transfer, (d) a public sector agency is not required to make any payment to the transferred person in relation to the transferred person's accrued rights in respect of annual leave, sick leave or extended or long service leave 17 Operation of Commonwealth law A provision of this Part (including a provision to the extent that it imposes or continues a term or condition of employment) has no effect to the extent of any inconsistency with any provision of the Fair Work Act 2009 of the Commonwealth or of any instrument under that Act.
The important features of these provisions may be summarised as follows: 1. The Minister may enter into an agreement with a non-government employer to transfer staff to that employer. 2. The transfer does not require the consent of the employee. 3. The transfer agreement is required to contain a provision that the terms and conditions of employment of the transferred employee are to be the same as applied under an industrial instrument which applied to the employee prior to the transfer. 4. The transfer agreement may contain a requirement for an employment guarantee period (subsequently specified as 2 years). 5. The transfer agreement may contain other provisions as to the terms and conditions of employment of the transferred employees. 6. The transfer is not a termination of employment. 7. The transferred employee is not entitled to any payment or other benefit by reason of the transfer.
These are unilateral transfers from secure public sector employment to non-government sector employers. Employees' accrued rights may well be transferred but the financial obligation to meet those rights in the future is not guaranteed by the Government (see s 9). The precise terms of the transfer agreements are not disclosed to the employees, nor are they parties to such agreements with rights of enforcement of terms potentially made for their benefit.
The only substantial protection the employees have in their future employment is found in the industrial instruments which cover them. That is so because of s 14(4)(a) of the Enabling Act and the terms of the Fair Work Act 2009 (Cwlth).
Part 6-3A of the Fair Work Act makes provision for the transfer of terms and conditions of employment when there is a transfer of business from a State public sector employer to a national system employer. Section 768AD of the Fair Work Act provides: 768AD When there is a transfer of business (1) There is a transfer of business from a non-national system employer that is a State public sector employer of a State (the old State employer) to a national system employer (the new employer) if the following requirements are satisfied: (a) the employment of a person who is a State public sector employee of the old State employer has terminated; (b) within 3 months after the termination, the person becomes employed by the new employer; (c) the work (the transferring work) the person performs for the new employer is the same, or substantially the same, as the work the person performed for the old State employer; (d) there is a connection between the old State employer and the new employer as described in subsection (2), (3) or (4).
There was no debate about the interaction of s 768AD(1)(a) and s 16(b) of the Enabling Act, perhaps because of s17 of the latter Act. In any event it was common ground that Part 6-3A of the Fair Work Act would apply to the transferred employment. In that regard the provisions of Part 6-3A are of importance.
Of paramount current importance is s 768AI. It provides: 768AI What is a copied State award? (1) If, immediately before the termination time of a transferring employee: (a) a State award (the original State award) was in operation under the State industrial law of the State; and (b) the original State award covered (however described in the original State award or a relevant law of the State) the old State employer and the transferring employee (whether or not the original State award also covered other persons); then a copied State award for the transferring employee is taken to come into operation immediately after the termination time. Note 1: Even though a copied State award comes into operation in relation to the transferring employee, it will not be enforceable by the employee or another person (for example, the new employer) unless and until it applies to the employee or other person. In particular, it will not apply to the employee or new employer before the employee becomes employed by the new employer. For when the copied State award applies to a person, see section 768AM. Note 2: A copied State employment agreement for the transferring employee may also come into operation immediately after the termination time, see subsection 768AK(1). If it does, then the State's interaction rules that were in force immediately before the termination time apply for the purposes of working out the interaction between the copied State award and the copied State employment agreement (see item 11 of Schedule 3A to the Transitional Act as that item applies in a modified way because of section 768BY). (2) The copied State award is taken to include the same terms as were in the original State award immediately before the termination time. Note: The State's instrument content rules that were in force immediately before the termination time apply to the copied State award (see item 10 of Schedule 3A to the Transitional Act as that item applies in a modified way because of section 768BY). (3) If the terms of the original State award were affected by an order, a decision or a determination of a State industrial body or a court of the State that was in operation immediately before the termination time, the terms of the copied State award are taken to be similarly affected by the terms of that order, decision or determination.
It will be observed that the provision has the effect of converting the existing State Award provisions into an enforceable federal instrument. The first three claims summarised in paragraph [7] and the claim in paragraph [8] above are important to the applicant because there is no current award provision applicable to these employees providing those benefits. If they had not been removed from the Salaries Award the claims in relation to rates and salary packaging would already be award terms applicable to these employees.
Similarly, there is a consultation provision contained in the Crown Employees (Public Service Conditions of Employment) Reviewed Award 2009 (the "General Conditions Award"), however the applicant seeks a revised version of that provision. Section 768AI(3) has particular relevance when it comes to a consideration of that claim.
The claims for rostering principles and special sick leave are not, or are not unambiguously, award terms and therefore do not, or may not, fall within the protections offered by the Fair Work Act or s 14(4)(a) of the Enabling Act.

The Parties General Submissions

In summary the applicant submitted: 1. the purpose of the applications is to consolidate in one instrument a number of existing entitlements found in one of several sources. 2. the consolidation will assist employees to identify entitlements and reduce risk of confusion. It will remove ambiguity. 3. the applications may need to be dealt with, at least in part, as an arbitrated case in accordance with Principle 8 of the Wage Fixing Principles. 4. the matter should be considered under Principle 8.4 as a special case in accordance with the principles laid down in Re Operational Ambulance Officers (State) Award [2001] NSWIRComm 331; 113 IR 384. 5. the Commission can be well satisfied that the evidence makes out a case with special attributes.
In summary the respondent submitted: 1. the respondent opposes both applications. 2. a variation of an award of which the nominal term has expired may only be made in accordance with s 17(3)(d) of the Industrial Relations Act 1996 (the "IR Act") if the Commission considers it is not contrary to the public interest to do so. 3. the Commission is obliged under s 146 of the IR Act to take into account the public interest. 4. in this case the interests "wider than those of the parties" are of greater than usual importance because the effect of the award variations is to visit upon the new employers, for a section of their workforce, conditions in addition to current award rights. 5. there is no proper basis for the current applications to be considered a special case under the State Wage Case principles. 6. the applications seek to insert into the awards "matters that have been the subject of agreement and in practice for several years". 7. there is no practical controversy between the current industrial parties that would be quelled by granting the applications. 8. in order to make out a special case the applicant is required to satisfy the Commission that the variation is necessary to establish fair and reasonable conditions of employment and that the matter has special attributes. 9. to assert that the Special Case Principle should be used for the purpose of imposing enforceable award obligations on employers not party to these proceedings is clearly contrary to the public interest referred in Principle 8.4.2. 10. the legislative framework in place for the transition to the NDIS is the Enabling Act. The Enabling Act proceeds on the basis that the conditions in the relevant industrial instrument will be transported with the employee to the new non-government sector employer. These applications seek to subvert the legislation. The intention of the applications is to put policies and guidelines into awards, to load up the awards prior to the transition. 11. it is not in the public interest to grant the applications as: 1. they seek to subvert the provisions of the Enabling Act; 2. the imposition of provisions having unknown consequences for new providers operating under the Federal system is contrary to key objects of the Enabling Act; 3. the new non-government sector employers have not been heard on the applications; 4. the consultation clause in the applications is sought to be introduced in an effort to revisit decisions made long ago and already acted upon with respect to the transfer of employees to the non-government sector; and 5. the applications are irrelevant to the resolution of any industrial issue that truly exists between the parties to the Awards.

Evidence

The evidence in the case was in fairly narrow compass.
The applicant led evidence from four witnesses: 1. Mr Thane Pearce, a Senior Industrial Officer of the applicant. 2. Mr Shane Elliott, a Disability Support Worker. 3. Ms Caroline Heads, Team Leader 4. Mr Rex Robert Wylie, Service Support Officer.
Each of the last three witnesses was employed in the Ageing, Disability and Home Care Division (ADHC) of FACS. They provided statements which were marked as exhibits. None of them were required for cross-examination.
The respondent, as earlier noted, called Ms Anne Campbell.
The evidence of Mr Pearce went to: 1. his role as the responsible industrial officer of the applicant in relation to the impact of the NDIS arrangements on members; 2. general background such as the sources of the entitlements claimed by the PSA for inclusion in the Awards; 3. his understanding of the Enabling Act and the timing of transfers of staff pursuant to that legislation; 4. an illustration of "confusion" arising after the transfer in 2016 of the Home Care Service staff pursuant to the Enabling Act; 5. the course of and reasons the withdrawal from the consultation arrangements the PSA, other unions and the State peak council for employees; 6. the earlier application, made in September 2016, which was discontinued without admission when the respondent relied upon the, then current, no extra claims clause.
Mr Pearce was cross-examined. He accepted that the rostering principles sought in the application relating to the Community Living Award were not award entitlements but an agreement reached after lengthy negotiations. He also accepted that the form of the clause sought to be inserted did not contain all of the agreement. The application did not include the Statement of Intent or the specific dispute resolution provision. Mr Pearce also accepted that if a new employer has in place rostering arrangements for existing employees, that employer may have to accommodate two sets of rostering arrangements.
Mr Pearce was also cross-examined at some length about the absence of any dispute with the current employer about the matters sought to be included in the Awards. In relation to rostering principles and consultation he disagreed to some degree stating that rostering disputes were the "bread and butter" of his section at the PSA and there had been disagreements about consultation. He knew of no present difficulties with salary packaging.
As to the existing consultation provision, Mr Pearce accepted that Walton J had made a declaration on the application of the PSA clarifying the effect and meaning of clause 65 of the General Conditions Award.
He was then cross-examined at length about the consultation process, the PSA's belief that important matters were not open to consultation because they were matters decided by Government and the reactions of the PSA to those frustrations.
Mr Elliott had been employed by FACS in ADHC for almost 30 years. At the time of making his statement he was based at Cannell Crescent Group Home.
He described his duties as a Disability Support Worker and indicated his employment was to be transferred to the House with No Steps. Mr Elliott was also a delegate of the PSA and Secretary of the PSA's ADHC Departmental Committee. He had been a member of the committee for about 20 years and on the executive for more than 10 years.
Mr Elliott gave a detailed history of the development of the rostering principles and spoke of their importance to workers in ADHC. His evidence was also directed to the frustrations he and his colleagues felt about the lack of consultation on matters of importance to them. The frustrations led to the PSA members taking strike action in February 2017.
Ms Heads was also employed in a Group Home. She had worked in the ADHC Division for about 25 years. She gave an overview of her duties. At the time of making her statement she knew her employment would be transferred but did not know who the new employer would be. Ms Heads also gave evidence of the importance of the rostering principles not merely for the staff but for the clients. Ms Elliott provided a detailed description of how the principles worked in practice. She also spoke of the frustrations arising from lack of consultation.
Each of Mr Elliott and Ms Heads took issue with some of the evidence of Ms Campbell about consultation and the provision of information to staff.
Mr Wylie had been employed in ADHC for about 12 years. He works at a residential centre in Hamlyn Terrace. He provided an overview of his duties. Mr Wylie said he learnt that his employment would be affected by the NDIS in 2014 or 2015. At that time he and his colleagues were informed their employment would come to an end and were offered retraining. He was aware of some employees who were offered and accepted redundancies. Then in late 2016 or early 2017 he was informed there had been a change of plan and the new provider would require all of the staff. At the time of making his statement he did not know the identity of his new employer. He expressed concern about the lack of information about his transfer including: 1. who the new employer would be; 2. when the transfer would happen; 3. how the employment guarantee would work; 4. what will happen if he is made redundant shortly after the transfer; and 5. what would happen to existing policies and procedures including work health and safety and how that would affect clients?
Given the uncertainty prevailing and the sense of unease he felt, he considered a consultation clause important.
In her statement Ms Campbell: 1. indicated she had worked in FACS or its predecessors for 25 years; 2. provided a summary of her current responsibilities; 3. attached a letter to the PSA dated 7 June 2016 under the signature of Ms Vicki Telfer, Executive Director NSW Industrial Relations, which set out a number of entitlements provided by the Enabling Act for employees and the exchange of correspondence which followed; 4. gave an overview of the transfer program taking place between August 2015 and about June 2018; 5. detailed the consultation and communication with affected staff which had taken, and continues to take, place providing examples of Bulletins sent to staff advising them of developments, a copy of the Employee Information Kit dated May 2017 and examples of frequently asked questions from the Department's "Working Together" website; and 6. attached the 1997 "Consultative Arrangement Policy and Guidelines' document.
As will be apparent from the extract from her evidence quoted at paragraph [14] above, Ms Campbell was required for cross-examination. In the course of her evidence she confirmed that the transfer agreements (which she called Implementation and Sales Agreements or ISAs) were "commercial-in-confidence" documents and the terms had not been disclosed to the PSA or employees, nor had their terms been the subject of negotiation with either the union or staff. She also accepted that the capacity of staff to ask questions and receive responses, such as through the website, was a method of providing information. It was not to facilitate negotiation.

Wage Fixing Principles

As the claims are opposed, the Wage Fixing Principles, reaffirmed in State Wage Case 2016 [2016] NSWIRComm 12, require that the matter be dealt with as an Arbitrated Case under Principle 8. The PSA relied on Principle 8.4 which provides: 8.4 Special Case Considerations 8.4.1 A claim for increases in wages and salaries, or changes in conditions in awards, other than those allowed elsewhere in the Principles, and which is not based on work value and/or productivity and efficiency pursuant to this Principle, will be processed as a special case in accordance with the principles laid down in Re Operational Ambulance Officers (State) Award [2001] NSWIRComm 331; (2001) 113 IR 384 and the cases referred to therein at [165]-[168]. 8.4.2 All special cases shall be tested against the public interest.
In Re Operational Ambulance Officers (State) Award the Full Bench, after considering earlier authorities said at [168]; 168 A number of principles may be distilled from these authorities bearing upon the contention advanced by the HAC. In order to make out a special case the applicant is required to make out that the variation is necessary to establish fair and reasonable conditions of employment and that the matter has special attributes. In doing so, the applicant is not required to meet a higher onus or standard of proof. The evidentiary requirements of a special case are no more strict than would apply in an ordinary matter, although the applicant to a special case will need to establish an adequate evidentiary foundation for those factors which are relied upon as showing the special case attributes of the case. Whilst respect will be afforded earlier decisions of the Commission or its predecessors, the conditions of employment earlier established need to be ultimately tested against the requirements of s 10 of the Act and that which we have discussed as being applicable to making out a special case. Where, as here, the former decision involved a test case, particular care should be taken to ensure that the factors relied upon by an applicant in support of its claim do not replicate factors which were taken into account by the Commission or its predecessors in establishing the general standard emerging from such case. In any event, the basis for and circumstances under which the conditions in the award were established will be significant considerations in the Commission's deliberations in order to assess whether the factors relied upon by the applicant in support of a special case have already been accommodated by the earlier made award (in which case the present prescription may adequately compensate for those factors). (emphasis added)
It will be observed from the emphasised passages that in order to make out a special case the matter must have special attributes. We think this case meets that test. We are not aware of another case in which employees of the Crown have been transferred, without their consent, to a non-government employer. We refer below to a number of cases involving transfer of employees involving a loss of some "benefits", to use a neutral term. Those cases all had the requirement of consent or were to another government employer. The present case appears to us to be unique.
The provisions of the Enabling Act, in particular Part 3 and the definition of "authorised implementation", suggest the employees are regarded as "assets" or cognates of assets whose transfer is necessary to ensure the transfer of assets is successful. The transfer of the assets and staff is necessary to fulfil the object of continuity of care. There is doubtless a public interest in maintaining continuity of care. But that interest must be balanced with the impact on staff.
The legislation seeks to mitigate the impact on staff of this forced transfer process by providing for the employment guarantee period and continuity of award conditions, at least, during that period. There is also provision for a transfer payment. There is however no, or insufficient, recognition of the profound change in employment context.
This case needs to be considered in the light of that profound change. The award conditions of these employees were set in the context of public service employment. To change that context requires reconsideration of the adequacy of the award protections. The second emphasised passage above stands as authority for that proposition if any be needed.
We have no hesitation in concluding the applicant has made out a special case. Before turning to the specific claims we will review a number of authorities dealing with transfers or removal of longstanding benefits with a view to distilling the principles to be applied in the consideration of such claims.

General Observations and Principles

Ideally, awards would contain all of the conditions of employment applicable to the area of employment covered by the award. This is so because it allows both employers and employees covered by a particular award to ascertain their respective rights and obligations in the employment context by reference to the one document. As award provisions, such rights and obligations are legally enforceable.
Historically, however, state public sector employment has been characterised by the establishment and promulgation of certain conditions of employment in a variety of publications such as the NSW Government, Public Service Commission, Personnel Handbook (the "Personnel Handbook"), which stand outside the awards of this Commission.
This characteristic of public sector employment has generally not given rise to difficulties because there is, in effect, only one employer, the State Government, and policy documents such as the Personal Handbook are readily accessible to employees in the public sector. Again, historically, enforceability of conditions of employment contained in such publications has not been an issue.
There have been, however, some notable exceptions in cases where long-standing conditions of employment have been discontinued by unilateral decisions of Government, or of a particular government agency, and the relevant union or unions have responded by making an application to the Commission for an award to restore or preserve the particular condition in issue.

Notification under s.25A of Industrial Arbitration Act by New South Wales Public Service Professional Officers Association of a dispute with New South Wales Government re intention to withdraw half day Easter Eve concession - Unreported. Matter No. 1587 of 1989, 11 April 1990

Crown Employees (Christmas - New Year and Easter Half- Day Leave) Award - Unreported. Matter No. 328 of 1990, 26 March 1991

Re Crown Employees (Christmas, New Year and Easter Half-Day Award [1991] 39 IR 440

On 29 November 1989 the Director-General of the Premier's Department wrote to the two major public service unions, and to the Labor Council (as it was then known), advising them of the Government's decision to withdraw from clerical and administrative officers in public sector employment, the benefit of a half-day free from work on the Thursday afternoon before Easter. This benefit had been available to public sector employees each year from 1911 until 1989 as a consequence of decisions each year by the Premier of the day that the half-day Easter holiday should be granted.
The unions and the Labor Council notified the Commission of an industrial dispute. When the matter came before Cahill V-P the unions sought an order or award of an interim nature requiring that, in 1990 only, the benefit in question should be extended to the same class of employees, and on the same basis, as in previous years, on the understanding that a separate application filed by the unions seeking an award to that effect on a general basis should be heard subsequently. The Public Employment Industrial Relations Authority opposed the making of such an order or award. In considering the arguments against the unions' application, his Honour took into account a number of factors, including the following: Thirdly, the general undesirability of converting concessional benefits into award entitlements. This is a recognised principle of the Commission, the rationale being that the adoption of such a course generally would tend to dissuade employers from extending concessional benefits, thus reacting detrimentally, in the long run, to the interests of employees. However, there are exceptions to this rule, as the authorities show. I do not think that the making of a status quo order or award in the present case would, even remotely, conflict with this principle. To do so would be to require, in a non-judgmental way, the continuation of a long- standing practice for one occasion only, pending and in-depth examination and determination of such matters as the categorisation of the benefit in question, whether have a legitimate and reasonably-based expectation of receiving the benefit, whether a custom, practice or usage exists, whether there is, in reality, an entitlement to the benefit as a condition of employment, and whether, having regard to all relevant considerations, a general provision in respect of future years should be prescribed by award. In this regard it should be stated that, although I have proceeded to determine this case on the basis, but without so deciding, that the benefit in question is a concessional benefit and not a condition of employment, there were substantial arguments mounted by senior counsel for the unions that, on the authorities, a "usage" in relation to the granting of the benefit had been established, thus making the entitlement to the benefit a condition of employment. Fourthly, the high status of the maker of the decision that the benefit should not be granted in 1990. Counsel for PEIRA and the Crown submitted that considerable weight should be given to the fact that the decision in this regard had been made at the highest level of executive authority. Careful and mature consideration is indeed to be given by the Commission to this aspect of the matter. It is acknowledged that Government decisions are taken in what is perceived to be the public interest. Public interest considerations, of course, also impact on decisions of the Commission, which also has a statutory duty under s. 83 of the Industrial Arbitration Act to be "governed in its procedure and in its decisions by equity and good conscience". When matters are properly before the Commission, as the present case is, involving as it does the determination of an "industrial matter", considerations of fairness, equity and good conscience require equal treatment for the parties, and one party should not be favoured because of its asserted or perceived superior status. It is true that a decision by the Commission to make a status quo order or award in the present case would conflict with a considered decision made by Government that the benefit should not be extended to employees in 1990. That consideration, however, cannot inhibit the Commission from making such a decision if it properly considers that such a course is justified.
His Honour proceeded to make an award entitled Public Sector Employees - Easter Leave, 1990 Interim Award.
Following his Honour's judgment, the PSA made an application for an award entitling "white-collar" Crown employees to a half-day's leave on the afternoon of the Thursday before Easter each year on an ongoing basis. In his judgement on this application, Cahill V-P stated: In my view, a strong case for the retention of the benefit and the making of an award to secure that result has been made out. There could hardly be an example of a concession more hallowed by time and practice than the present one. The unions submitted that the practice indeed constituted, in legal terms, a "usage", but I find it unnecessary to embark upon a discussion of the technical arguments put in relation to that point. I find that the benefit is naturally and understandably expected by employees, that it is valued and appreciated by them, and that, although the benefits of this may be intangible, it has a positive effect on staff morale. ………………….. The objections by the respondents to the making of an award have been closely considered. Before discussing them it should again be emphasised that what the unions are here seeking is not the introduction of a new benefit but the continuation of a benefit which their members have in fact enjoyed for many years.
His Honour proceeded to make an award which preserved into the future, the benefit of the half-day leave on Easter Thursday.
His Honour's judgment was taken on appeal. The Full Bench (Fisher P, Hill and Hungerford JJ) set aside the award made by Cahill V-P on the basis that the character of the concessional half-day had changed down the years, the nature of the concession itself had changed and the terms of employment had changed. In particular, the introduction of "flexitime" had enabled the employees to obtain the benefit of the concessional leave within the flexitime program. In its judgment, the Full Bench stated as follows: This rather out-dated privilege of Easter Thursday half-holiday requires to be reviewed in the light of contemporary industrial relations policy. A careful consideration of any loss involved by the termination of this privilege suggests that in this case little indeed need be lost. In any case we have noted the countervailing gain, in new terms, of the confirmation and continuity of the Christmas-New Year half-day. We would add in our view that modernisation issues are best raised in the context of restructuring programmes where the mores of adjustment and reconciliation prevail. The alternative of unilateral declaration of change is often less successful. As we understand it, some attempt was made to initiate discussions in the context of structural efficiency principles, but the matter was seemingly not pursued. Our conclusion is that without any great difficulty, the parties to this case can, by reasonable measures of co-operation already in place, ensure that on future Easter Thursdays officers may enjoy the same half-day privilege as they enjoyed in 1991 by calling upon the resources of the flexitime agreement.

The Department of Community Services salary maintenance case

Department of Community Services v Health and Research Employees Association of New South Wales [1992] 45 IR 453)

Public Employment Industrial Relations Authority v Health and Research Employees' Association (NSW) [1994] 54 IR 162

The case concerned employees engaged in the care of patients with mental disabilities. The employees were transferred, initially from Schedule 5 hospitals, where they were engaged as public servants, to Schedule 2 and 3 hospitals where they were employed by either the relevant hospital or area health services board. Subsequently, the State Government decided that the care of the disabled should become the responsibility of the Department of Community Services. The Community Welfare Employment Corporation (CWEC) was established by the Community Services Act 1987(NSW). On 30 June 1988, the employees, who were employed by public hospital or area health services boards, were "transferred" to employment with CWEC.
A dispute arose as to the position adopted by CWEC in relation to previous undertakings which had been given to these employees as to indefinite maintenance of salaries in situations where an employee had been transferred to a lower paid position. CWEC adopted the position that such undertakings, which were given to the employees when they were in the public health system, no longer applied after they had been transferred to their new employer, CWEC. The union representing those employees sought an award preserving the indefinite salary maintenance. In his judgement, Maidment J stated: Mr Murphy claims that, on the basis of the various undertakings referred to above, a significant number of Crown employees accepted transfer out of the public service and, as a consequence, became employed either by a public hospital or an area health services board. Such transferred staff lost their public servant status and statutory protections. They did however gain the statutory benefit of indefinite maintenance of their salaries as had been promised to them. An example of the success of the promises is that numbers of registered nurses who had been employed in 5th Schedule institutions ceased being public servants and became employed as residential care workers in DDS PEIRA and CWEC express the view that Crown employees in 5th Schedule institutions who left that employment for either public hospital or area health services board employment and who, as a result of ministerial responsibility for DDS being transferred from the Department of Health to FACS (now DCS) are now employed by CWEC and have lost their entitlement to indefinite salary maintenance. (460) ………………….. It seems from the evidence and the manner in which their case has been presented that the attitude of PEIRA and of CWEC to the continuance of salary maintenance is flavoured by concern that such continuance is not authorised by, and is repugnant to, the terms of the Public Sector Management Act. A case based on merit for the discontinuance of salary maintenance has not been put. The view I take is that, in the absence of exceptional circumstances, those in public employment should be comfortable in their expectation that promises, reinforced by legislation, made to them by those in government will be met and not swept away by mechanisms such as those manifested in this matter. (462) …………………… I propose to make an award as sought by HREA, not on the basis that it is my view that those covered by it should necessarily have their salaries preserved for life, but in the expectation that, should PEIRA or CWEC seek to present a case based upon changed circumstances or merit, they will have the opportunity so to do. (463) (emphasis added)
The judgment of Maidment J was the subject of appeal. In its judgment, the Full Bench (Bauer and Peterson JJ and French C) stated: We consider that employees accepting promises of this type from Government are entitled to have them met. For it to be otherwise would not only involve staff acting to their detriment on an unfulfilled promise, but would be contrary to the objects of the Industrial Relations Act 1991. On the merits, we think the case for the award was and is overpowering. It follows that unless we find a lack of jurisdiction, the award of Maidment J must stand. (182)
The Full Bench upheld the appeal on a minor technical point but otherwise dismissed the appeal and remitted the matter to Maidment J for disposition in accordance with the terms of its judgment.
His Honour's judgment, endorsed on appeal, recognises the particular context of public sector employment. So much is recognised in the passages we have emphasised. It has a security which is not a feature of the non-government sector. In that case the employees were induced to accept a transfer, albeit to another government employer, by promises of maintenance of conditions. In the present case there was no opportunity to accept. The alternative, subject to conscientious objection, was loss of employment without compensation.
There have been other cases, beyond the State public sector, where the Commission has moved to protect by award prescription, conditions of employment in situations where an employer has attempted to unilaterally remove such conditions

In re Dispute - Concessional Leave, Fairfield Municipal Council 1969 AR 567

This matter arose as a result of a decision by the Fairfield Municipal Council to cease a practice, which had existed since 1941, of granting employees paid leave of absence on the days between Christmas and New Year holidays, including a half day on Christmas Eve. The matter came before Sheehy J by way of a reference of an industrial dispute from the Senior Conciliation Commissioner. In his judgment, his Honour stated as follows: Various awards apply to employees of municipal councils and, without listing all of them, I refer to the Municipal and Shire Council (Administrative and Clerical Staff) Award and the Municipal and Shire Council Wages Staff Award both of which are still current. In addition, the employees of Fairfield Municipal Council are covered by various industrial agreements which have been filed with the Industrial Registrar and published in the Industrial Gazette, for example, see those published in October, 1966. By virtue of these and similar agreements, the employees receive some benefits which are more favourable than those applying generally under the awards. As instances, Mr Dey referred to the payment of annual increments to some employees, the granting of long service leave on the basis of three months leave on full pay on the completion of ten years service, the payment on termination of employment of accumulated sick leave on certain conditions, over award payments to tradesmen and the making up of full pay to employees receiving workers' compensation - this applies for a period of six months with a discretion to extend it in a proper case. These matters were referred to as examples of favourable treatment of employees by the Council but it should be noted that the leave concerned in this case was granted only as a concession and was not referred to in any of the industrial agreements. However, some attempt appears to have been made to protect conditions not referred to in the agreements by clauses in or to the effect of the following: In the event of Council altering, except with the consent of the Union, any conditions relating to matters other than those dealt with in this Agreement, leave to apply is reserved to the Union. The effect of this clause was not discussed in the present proceedings and I do not base my conclusions on it but nevertheless, I consider that the abolition of the concessional leave after such a long period would amount to a change of circumstances sufficient to justify the reopening or revision of any of the relevant industrial agreements or awards whether they are current or have expired. Although the evidence shows that the extra leave was granted each year by a separate decision of the Council I do not think that the benefit can be described as an "established custom or usage" as Mr Booler claimed. It might have been otherwise if the Council had not given its attention to the matter each year but, as this happened, the possibility must have existed, year by year, that an unfavourable decision could have been given. Nevertheless, it seems that the employees of the Council have regarded the extra leave as one of the benefits of their employment and no doubt, it would have played its part, together with the other fringe benefits mentioned, in attracting people to the Council's service and keeping them there once they had been engaged. (568-569) ……………………. I would not go so far as to say that the extra leave had become a condition of employment but I think that employees of the Council could reasonably have expected a continuance of this benefit and their resentment is justified in the circumstances. The general merit of the unions' claim inclines me to make an order or award as requested but Mr Dey has put several matters against taking such action. (570) (emphasis added)
His Honour then referred to a number of cases cited by counsel for Fairfield Municipal Council, including In re Hairdressers, &c., Females (State) Award (1927 AR 144). In that case an appeal was upheld against the grant of an award provision entitling an employee to one week's holiday on full pay after twelve months' service. Sheehy J then stated: In my view this decision would be relevant only if the leave concerned was being sought for the first time and there was nothing to justify it apart from the advantage it gave to the employees. In the present case, justification can be found in the long-standing practice of granting the leave each year and the change which its cancellation has brought about in the employees' conditions of employment. (571) ……………….. In the result I consider that an award should be made preserving for employees the extra leave which they have been accustomed to receive for such a long period but I see no need to make any express variation of the industrial agreements or the awards applying in the industry. (572)
His Honour proceeded to make an award preserving the three and a half days' paid leave which the Council had determined to discontinue. The justification was the duration of the long-standing benefit and the effect on employees of its removal, notwithstanding it was not a condition of employment but a concession extended by the employer.

Aust. Fertilizers Ltd v. Aust. Workers' Union (N.S.W. Branch) [1983] 4 IR 263

This case concerned, amongst other things, a dispute over a proposal by the employer to change a long-standing custom and practice to conditions, in respect of the terms of employment of day shift employees. The practice was described by Watson J in the following terms: The union's case concerning the first issue is that the company has departed from a long-standing practice that dispatch section employees be treated as shift workers at all times, this practice having been adopted as a matter of convenience to the company in the transferring of employees to afternoon shift or night shift on short notice with fluctuations in demand for product. As a consequence, the company avoids the need to give notice or to pay in lieu the penalty payments prescribed for employees transferred. In accordance with this practice, when one shift only is required, instead of reverting to day work, the employees continue to be treated by the company as shift workers, working day shift only. (263-264) His Honour determined to make an award preserving the practice for a period of time. In doing so, his Honour stated: The history of this particular practice, the basis for it, its certainty, and the evidence concerning what was said to some employees on engagement or transfer to the dispatch section, all point towards suggesting that it is a usage. It must, nevertheless, be read with, and in the context of cl. 21.2 of the award. That provision, which operate notwithstanding any contractual provisions, expressly recognises, it is claimed, the right of the company to act unilaterally to terminate such a practice. These aspects, although issues in contention, I find unnecessary to decide at this stage. Assuming the practice to be a usage, alterable by agreement only, notwithstanding cl. 21.2, the practice even so remains subject to any order or award made by the Commission pursuant to s. 25 in settlement of the present dispute. Whether or not the practice should continue beyond a reasonable period in the present circumstances is, therefore, the more cogent issue. Should some time limit be imposed or the practice modified, if an order or award were to be made? Mr Ferrari submitted that, even if the practice were merely a concession, the Commission should follow the Fairfield Municipal Council Case and order its continuance. But the employees are no longer required, even intermittently, to suffer the particular disabilities for which a shift allowance is normally prescribed. Nor, in the present economic climate, should a party be forced to continue a practice which is no longer referable to circumstances which have materially changed. For these reasons I do not consider that the practice should continue to operate indefinitely (even if it were a usage and assuming, in that contingency, that cl.21.2 did not apply). If it were simply a concession based on a particular set of circumstances or purpose, the company should not be prevented from withdrawing the concession where that basis or purpose is no longer served or operable. It is paramount in the present economic situation facing the community also, in my view, for an employer, as a producer required to compete with other manufacturers and importers, to be enabled to do so without being trammelled by outmoded practices, the reason for which can no longer be sustained. The Commission should be wary also of writing concessions into an award, simply because they may be long standing. As Kelleher J stated in the A I & S Demolishers Case: "Concessions allowed by employers over and above the minimum award requirements are not, however, as a matter of course to be converted into award obligations (Re Government Railways Gangers on Construction etc Works (Permanent Way - Wages Staff) Award [1946] A.R. (N.S.W.) 190." (See also Carpenters etc. Construction Award Case [1956] A.R. (N.S.W.) 348 at p. 352, and Brain and Robinson v. Goodyear Tyre Co. [1959] A.R. (N.S.W.) 643 at p. 655). It is hardly likely that so to act would sound the death knell on concessions. Nevertheless, it is important to consider what was said by the Commission (Cantor J.) In the Crown Employees Stock Inspectors Case [1930] A.R. (N.S.W.) 28 at pp. 40-1 in relation to not discouraging the concession of privileges more favourable than an award may require. (269-270)
The reasons for the introduction of the benefit and for it becoming outmoded are relevant in the assessment not only of whether to award a benefit but to the degree to which it should be preserved.

City of Sydney Wages/Salary Award 2014 [2014] NSWIRComm 49

In this matter, the United Services Union sought to have inserted into an award, the redeployment and redundancy provisions which appeared in the City's Redundancy and Redeployment Policy between 1969 and March 2014. This was opposed by the City which sought the insertion of a clause which, with some variations, reflected the workplace change and redundancy provisions contained in the Local Government (State) Award 2010. In its decision, the Full Bench (Walton J, Stanton C, Newall C) stated: 23 As we noted above, what is sought by the USU is that the terms of an employer's policy, which had been at least recognised in an enterprise agreement, be inserted into an award. 24 In principle, such a step is possible. Section 47 of the Act proscribes the Commission from regarding the terms and conditions set in the enterprise agreements as 'standard' conditions of employment for other employees. This provision does not, however, preclude the Commission, when making an award binding particular parties, from having regard to conditions that have in the past been fixed by an agreement between those parties: IGA Distribution at [49]. ……………………. 30 We have said above that one element of the consideration of what is fair and reasonable, for the purpose of the exercise of powers under s 10 of the Act, is consideration of the effect of any award to be made on employees. We have said that that assessment may include consideration of the history of the parties' approach to their terms and conditions of employment. 31 As a matter of historical fact, the terms and conditions for which the USU argues have been applicable for years. That of itself does not mean that they must necessarily be carried forward, although it is a factor in the consideration 32 What it does mean is that the nature of the bargain made between the parties in 1996 must be taken into account. An assessment must be made of the length of time that the bargain might be held properly to continue. That involves consideration of the parties' dealings with each other on the question of the terms and conditions attaching to redeployment and redundancy. …………………….. 55 We have set out above the basic principles to be applied in the exercising of the Commission's arbitral award making powers, and those which have application to a special case. 56 In our view, the existence of the enterprise agreements, and the representations made to the employees, render this matter analogous to matters determined by the Commission pursuant to s 11 of the Industrial Arbitration Act 1940. 57 Matheson v Electricity Commission of NSW [1978] 2 NSWLR 305, was a case decided in the context of an industrial agreement made under s 11 which was later overtaken by an award. 58 Shortly put, the industrial agreement provided for the payout of sick leave on retirement. Four years later an award was made which did not contain those provisions. An employee claimed an ongoing entitlement to, upon his future retirement, the payout of sick leave. Upholding that claim, the Supreme Court made the following observation: A further matter which I think it is appropriate to take into account is that the purpose of the legislation was to enable the Commission to take over the various electricity undertakings in question with as little trouble is possible… The principal concern of Parliament would have been to reassure employees who were being transferred that they would be treated no differently from the way in which they had been treated by their former employers. That consideration, to my mind, explains why the draughtsman of the legislation sought in the provisions relied upon to make it clear to employees that they were to have the benefits that they would have had if they had continued in their old employment. 59 The situation so describe resembles the position of the City, at least before 2009. 60 Again, in Department of Community Services v Health and Research Employees Association of New South Wales (1992) 45 IR 453, Maidment J held, relevantly to the present circumstances (at 462): The view I take is that, in the absence of exceptional circumstances, those in public employment should be comfortable in their expectation that promises, reinforced by legislation, made to them by those in government will be met and not swept away by mechanisms such as those manifested in this matter. 61 We regard his Honour's observations as very much to the point here. While Community Services was decided under the pre-1996 Act, the decision, and indeed that in Matheson, patently turns on an apprehension of fairness, which is a fundamental statutory element of the Commission's function: see s 3(a) of the Act. ……………………… 66 However, the Commission maintains, consistent with the objects of the Act and its long-established jurisprudence, the view that parties should be held to their bargains. It also maintains a reluctance to allow narrow technical matters to exert too great an influence upon the industrial arrangements between parties, and upon the obligation to ensure that fair and reasonable terms and conditions of employment are set and observed. 67 Section 10 of the Act provides, as we noted above, that the Commission is to set 'fair and reasonable' conditions of employment for employees. 68 'Employees' to be covered by a given award do not comprise a homogenous group of people. A given body of employees to be covered by the newly-made award might, and in this case will, include employees who have worked for the employer for 30 years as well as employees who commenced last week or who will commence tomorrow. 69 That being so, it is apparent that the setting a fair and reasonable conditions of employment does not necessarily mean that those conditions, even within one award, will be identical for each employee. So much is routinely recognised and awards by the provision of incremental scales of salary, for example. 70 What is fundamentally important is that before 2009 the City's employees were permitted, if not encouraged, to believe that the entitlements in the R & R Policy were ongoing and would be ongoing until a definite statement was made to the contrary, that is, until point when an agreement between parties ceased. We do not consider the inclusion of the words "for the life of the agreement" in the clause entitled "Redeployment/Redundancy" appearing in the enterprise agreement from 2008 onward, resulted in such a communication or undermined at the bargain made between the parties. In the circumstances operating after 1996, and indeed until 2009, a much clearer statement of intention was required for the City to reserve to itself a capacity to alter unilaterally the terms of the bargain at relatively short notice. 71 For these reasons it is appropriate to protect the agreement that was made by an award clause of the kind generally referred to as 'grandparenting'. That is, we propose to maintain entitlement to the R & R Policy provisions for those employees who, in our view, reasonably believed that they had those conditions for as long as I worked with the City and acted out of that belief.
All of the above cases demonstrate that the Commission will, in appropriate circumstances, make or vary an award in order to protect long-standing conditions of employment which are under threat of being discontinued by the unilateral action of an employer.

Rates and Salary Packaging

These claims may be dealt with quite briefly. We have already observed that had the Secretary's claim in the Salaries case been successful these would be entrenched award conditions already. The only reason they are not so entrenched is to allow the prosecution of these applications without the complexities of a current "no extra claims" provision.
We note the Secretary submitted that, pursuant to s 17(3)(d) of the IR Act, we must be satisfied that it is not contrary to the public interest to make the award variation. That argument, as we understood it, related to the impact on third parties, who had not been heard in these proceedings, upon whom the ultimate burden of the variation would fall.
There was no attempt to intervene in the proceedings by any party with whom the Minister has made an ISA or with whom the Minister was negotiating an ISA. We can reasonably infer they would be aware of the proceedings and, it follows, that they have made an assessment of commercial risk in the context of their agreement. In any event these particular claims were for benefits the Secretary was prepared to have imposed and therefore are unlikely to come as any surprise to the contracting parties. We are satisfied the variations sought are not contrary to the public interest. We are also satisfied they are necessary to set fair and reasonable conditions of employment for these employees.
We make award variations increasing rates in the Awards by 2.5% with effect from the commencement of the first full pay period on or after 1 July 2017. We also make award variations inserting into the Awards the Salary Packaging clause claimed by the applicant which is in the same terms as that in the Salaries Award.

Paid Special Sick Leave

The applicant seeks to vary the Community Living Award and the Residential Centres Award by the insertion in each of them of the following provision: 13. Paid Special Sick Leave (1) Paid special sick leave shall be granted by the Department if an employee satisfies the following criteria: (i) has ten or more years of service (ii) has been or will be absent for a period of at least three months, and (iii) has exhausted or will exhaust, all sick leave entitlements. (2) Paid sick leave will be granted in accordance with the following table: Completed years of service Number of working days 5 day week 6 day week 7 day week 10 22 26 30 20 44 52 60 30 66 78 90 40 88 104 120 50 110 150 150

This provision is taken directly from the Personnel Handbook. In addition, clause 84.10 of the General Conditions Award makes provision for special leave as follows: 84.10 Special Leave - Other Purposes - Special leave on full pay may be granted to employees by the Department Head for such other purposes, subject to the conditions specified in the Personnel Handbook at the time that the leave is taken.
In support of this aspect of its application, the applicant submits that the "provision for special sick leave constitutes an important entitlement for long serving ADHC employees in the event of serious illness or injury. It is an entitlement recognised in the General Conditions Award. The insertion of provision for special sick leave into the Community Living Award and the Residential Centres Award will ensure this important entitlement is clearly preserved for ADHC employees as part of the transfer arrangement."
In opposition to this aspect of the application, the respondent submits as follows: The PSA's application to include Special Sick Leave into the Community Living Award and the Residential Centres Award seeks to take a policy, applicable to public sector employees and impose that policy on the non-government sector with no evidence as to its likely or potential impact on that sector, including what additional costs may be incurred and without any input or consultation with that sector. The variation, if granted, will also take a policy arrangement and make it binding on the future employer, subject to penalty if breached. Furthermore, the reference in the Personnel Handbook to 6 and 7 day weeks is not applicable to this workforce on the basis that entitlements are paid on the basis of an employee working a maximum of a 5 out of a 7 day week.
It is not in dispute that the opportunity to access Special Sick Leave for long serving employees has been a feature of public service employment in this State for very many years. There can be no doubt that the benefit of up to 150 additional days of paid sick leave for those long serving employees who, unfortunately, find themselves in a situation where they will be absent from work due to ill health for a period of at least three months, is extremely valuable and comforting to those employees.
We consider this benefit to be of a similar kind to that referred to in the Fairfield Council concessional leave case, strengthened by the reference to special leave in the General Conditions Award, the mandatory language of the Handbook and the absence of annual review of the concession. Accordingly, it is unnecessary to decide to finality the submission of the respondent as to whether special sick leave is currently an entitlement under the General Conditions Award.
Further, we note it was not disputed that the employees who are the subject of the application presently before the Commission would have continued to have access to Special Sick Leave as provided for in the Personnel Handbook had the Government not made the unilateral decision to transfer their employment to private sector employers. In practical terms, an employee such as Mr Elliott, who has had almost 30 years of service, will immediately lose, upon transfer to his new employer, the ability to utilise between 66 and 90 days (noting his evidence that the Group Home is "a 24/7 facility") Special Sick Leave to which he would have been entitled, in the event that he suffers a long-term illness, had he not been transferred out of the public service. Considerations of equity and good conscience demand that this entitlement be protected by this Commission.
We observe that each of the witnesses in this case who were employees of FACS, Ms Heads (25 years), Mr Wylie (12 years) and Ms Campbell (25 years), were employees of long-standing.
The respondent's concerns about the imposition of unknown additional costs on the new employers of the affected employees do not constitute a sufficient reason for rejecting this aspect of the applicant's claim. We note that the respondent has not placed before the Commission any material which would allow the Commission to quantify the cost impact which this provision has had in the past in this area of employment and that such material would be peculiarly within the knowledge of the respondent. Moreover we reiterate the observations made above at [82] about the absence of intervention.
We vary the Community Living Award and the Residential Centres Award by the insertion in each of them of the clause proposed by the applicant entitled Paid Special Sick Leave.

Consultation arrangements

We have noted above that a good deal of evidence in this case was directed to "Consultation". The General Conditions Award contains a consultation clause in the following form: 65. Consultation and Technological Change 65.1 There shall be effective means of consultation, as set out in the Consultative Arrangements Policy and Guidelines document, on matters of mutual interest and concern, both formal and informal, between management and Association. 65.2 The Departmental management shall consult with the Association prior to the introduction of any technological change.
The clause was the subject of dispute as to which "Consultative Arrangement Policy and Guidelines" document the clause referred. A declaration was sought by the PSA from the Industrial Court pursuant to s 154 of the IR Act. Walton J, President, determined that the clause referred to the 1997 Policy (which was put in evidence in this case through Ms Campbell and Mr Pearce); Public Service Association and Professional Officers' Association Amalgamated Union of New South Wales v Secretary of the Treasury [2014] NSWIRComm 23; 87 NSWLR 41.
The PSA submitted that, notwithstanding the declaration by the Industrial Court: the Government continues to publish and apply a replacement document known as the Consultative Arrangements Policy and Guidelines (2012).
In those circumstances, the applicant submitted, it is necessary to have appropriate and clear consultation provisions in the Awards.
The Secretary submitted: The Consultative Arrangement Policy and Guidelines July 1997 are specific to the arrangements in FACS. They make reference to the PSA, FACS and its employees and assigns roles and obligations to each party.
The PSA's fundamental thesis was that it sought to consolidate existing arrangements to facilitate ease of identification of relevant terms and conditions and avoid confusion. The clause that it sought did not reflect the existing arrangements. The reasons for seeking a change seemed to be based in dissatisfaction with the consultation, or lack of it, on issues considered important by the PSA related to the transfer of staff proposed by the Government.
We may be inclined to agree that refusal to consult or negotiate on matters such as the length of the employment guarantee, the amount of the transfer payment and the protection of non-award entitlements would be frustrating and inconsistent with normal consultation obligations in circumstances of redundancy. Employers generally have a duty to consult about their decisions with a view to mitigating the adverse consequences on employees. We add that it would be no answer for the employer to say that "these are matters the subject of Government decision" when the Government is, in effect, the employer.
The PSA did not, however, seek to enforce the existing provisions or seek to explain why they were inadequate. In those circumstances we see no basis to change the existing provision.
As we have noted, the existing arrangement in relation to consultation is found in cl 65.1 of the General Conditions Award. That provision was the subject of a declaration by the Industrial Court which clarified its meaning and application.
There may be merit in consolidating the arrangement into the Awards however to do so may raise issues as to the application of s 768AI(3) of the Fair Work Act. We noted at paragraph [28] above that subsection has particular relevance to this claim. There can be no doubt that cl 65.1 of the General Conditions Award has the benefit of the subsection. Were we to insert a new clause, even in identical terms, into the Awards it may provoke unnecessary debate about the operation of s 768AI(3).
In our view any advantage gained in consolidation would be offset by potential ambiguity as to the operation of the s 768AI(3).
We therefore refuse the claim for inclusion of a new consultation clause.

No Extra Claims

This aspect of the claim seeks to exclude "no extra claims" clauses from the Awards on the basis they are obsolete.
It is a corollary of our conclusion in relation to the claim for increases in rates and salary packaging that the clauses should remain. Were these employees still covered by the Salaries Award they would be bound by the "no extra claims" clause therein contained.
We refuse the claim to remove the clauses from the Awards.
The Secretary submitted "no extra claims" clauses should be inserted into the Awards and proposed the form the clauses should take. The current clauses in the Awards refer to the "no extra claims" clause in the Crown Employees (Public Sector - Salaries 2015) Award which has been rescinded and replaced, latterly, by the Salaries Award 2017. These clauses therefore require updating. It is consistent with our reasoning that the form of clause in the Salaries Award 2017 be followed. The form proposed by the Secretary accords with that approach. We will include in the variations clauses in the form proposed by the Secretary.

Rostering Principles

This claim relates only to the Community Living Award.
The evidence led by the applicant, and not disputed by the respondent, was that lengthy negotiations had been undertaken to develop an agreed set of principles related to the development of rosters for staff covered by the Community Living Award. The evidence of Mr Elliot described the "exhaustive process" of consultation which led to consensus on the principles. Ms Heads referred to the many disputes which arose about rosters prior to the development and implementation of these principles.
Apart from its general submission about the imposition of a burden on unknown third parties, which we have rejected, the Secretary submitted that there was no need for an award clause because the agreed principles were observed in practice. A submission which tends to support the utility of the rostering principles. Once the transfer occurs, however, the principles will no longer be binding.
This claim seems to us to fall into a class similar to the Department of Community Services, Australian Fertilizers and City of Sydney Cases. The agreed rostering principles represent the outcome of negotiations between the employer and the employees through their representatives. The parties should be held to their bargain at least for a period of time.
There is no need for us to consider what a reasonable time is in this case. That is a matter to be determined consistent with the employment guarantee period and the Fair Work Act once these and the related awards become copied State awards.
The Secretary also submitted, in the alternative, if the rostering principles were included they should include the Statement of Intent and the particular dispute resolution provision each of which is part of the agreed package. The applicant submitted it did not include them on the basis such provisions were unnecessary once the principles were included in the Community Living Award. But it did not strenuously oppose their inclusion.
It is consistent with the underpinning approach of consolidating existing entitlements that the principles be included in their agreed form. We make an award including the rostering principles as contained in the document found behind Tab 7 of Exhibit TP-1. In our view that will be best achieved by including the seven paragraphs beginning with the Statement of Intent and concluding with Dispute Resolution as a Schedule to the Community Living Award.

Conclusion and Awards

We are satisfied that it is necessary to set fair and reasonable conditions in accordance with s 10 of the IR Act to vary the Awards by inserting and or varying: 1. rates and allowances provisions in accordance with the claims made by the applicant; 2. salary packaging clauses in the form sought by the applicant; 3. "Paid Special Sick Leave" clauses in the form sought by the applicant; and 4. "no extra claims" clauses in the form proposed by the respondent.
We are satisfied that it is necessary to set fair and reasonable conditions in accordance with s 10 of the IR Act to vary the Community Living Award by inserting a "Rostering Principles" clause in accordance with paragraph [116] above.
We are satisfied that it is not contrary to the public interest to make the variations set out in paragraphs [117] and [118] above. We award accordingly.
The awards will take effect on and from 1 July 2017 and have a nominal term of 12 months.
The applicant is directed to file short minutes giving effect to our awards by noon on 31 August 2017.

DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 30 August 2017

Community Services Act 1987(NSW)

Enabling) Act 2013(NSW)ss 3,4,5,6,7,9,13,14,15,16

Re Crown Employees (New South Wales Department of Family and Community Services) Residential Centre Support Services Staff Award 2015; ; Re Crown Employees Ageing, Disability and Homecare - NSW Department of Family and Community Services (Community Living Award) 2015 [2017] NSWIRComm 1058

At a glance

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Judgment (28 paragraphs)

Legislation Cited (4)

Cases Cited (6)

Cited By (3)