State Wage Case 2006 (No 4) [2006] NSWIRComm 160

CORAM: Wright J President; Walton J Vice-President; Harrison DP; Boland J; Bishop C; Stanton C

CATCHWORDS: State Wage Case - Intervention - Application by Commonwealth to intervene in proceedings - Directions - Failure by Commonwealth to comply with directions of Full Bench - Further opportunity to comply - Intervention to be reviewed

LEGISLATION CITED: Industrial Relations Act 1996 Workplace Relations Amendment (Work Choices) Act 2005 (Cth)

CASES CITED: State Wage Case 2006, Re [2006] NSWIRComm 67

APPLICANT Mr M Lennon Unions NSW

Mr J V Murphy of counsel Minister for Industrial Relations and Public Employment Office

Mr E Leahy Catholic Commission for Employment Relations

Mr T McDonald Employers First

LEGAL REPRESENTATIVES: Ms V Paul Australian Business Industrial Australian Industry Group, New South Wales Branch and affiliated associations

Mr P Bickerstaff Local Government and Shires Association of New South Wales

Mr T Abrams Printing and Allied Trades Employers Association of New South Wales

INTERVENOR Mr S Amendola, Solicitor Minister for Employment and Workplace Relations Solicitors: Blake Dawson Waldron

JUDGMENT: INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES

CORAM: Wright J, President Walton J, Vice President Harrison DP Boland J Bishop C Stanton C

Application by Unions New South Wales for a State Decision - State Wage Case 2006 under s 51 of the Industrial Relations Act 1996

1 In Re State Wage Case 2006 [2006] NSWIRComm 67, the Full Bench considered applications by the federal Minister for Employment and Workplace Relations and a number of employer interests, to adjourn the application by Unions New South Wales for a State Decision under s 51 of the Industrial Relations Act 1996. The effect of the union application was to initiate a State Wage Case in which increases of four per cent were sought in wages and allowances in certain awards. 2 The adjournments sought by the employers and the Minister were to apply until the question of adjustments to minimum wages had been dealt with at the federal level by the Australian Fair Pay Commission and the Australian Industrial Relations Commission sometime later this year or early in 2007. 3 The Full Bench determined that it would not grant the adjournments for the reasons given in its decision. Further, the Full Bench made the following directions: We confirm the directions made by the President on 20 December 2005 subject to providing the parties with additional time given the hearing dates we have fixed. The directions are as follows: 1. That Unions NSW file and serve on all parties and intervenors, written submissions and any evidence in support of the application by 4.00pm on 31 March 2006. 2. That the Minister for Industrial Relations, the Public Employment Office and any intervenors file and serve on all parties and intervenors written submissions and any evidence by 4.00pm on 13 April 2006. 3. That all Employer Parties, file and serve on all parties and intervenors written submissions and any evidence by 4.00pm on 21 April 2006. 4. That Unions NSW file and serve on all parties and intervenors, written submissions and any evidence in reply by 4.00 pm on 17 May 2006. The hearing of the application by Unions NSW for a State decision will commence at 10.00 am on 5 June 2006. The following days have been set aside to hear the application: 6, 7, 14, 15, 16, 20, 21, 22, 23 June 2006.

4 In proceedings on 6 April 2006 the Full Bench considered an application by the Commonwealth to intervene in the substantive proceedings. The grounds relied upon by the Commonwealth included that: 3. The Minister has an interest in the proceedings, and it is in the public interest for the Minister to be granted leave to intervene in the proceedings.

4. The Minister is interested in the proceedings given the Australian Government's responsibility for management of the national economy, of which the New South Wales economy is an important part.

5. Consistent with the practice of the NSW IRC in relation to previous State Wage Case decisions, the NSW IRC should consider the state of the national and NSW economies.

6. The purpose of the Minister's intervention is to tender relevant evidence, including economic and related evidence, and where appropriate to test similar evidence adduced by others so as to assist the NSW IRC in making its determination.

7. The Minister also has an interest in any decision or deliberation the NSW IRC makes in respect of those persons within its jurisdiction, as such a decision is likely to be relevant to the national economy and may be relevant to determination of the Australian Fair Pay Commission and the Australian Industrial Relations Commission. 5 At the conclusion of the proceedings on 6 April, the Full Bench issued the following statement: 1 We have decided to grant the application by the federal Minister for Employment and Workplace Relations ("the Commonwealth") for leave to intervene in the proceedings subject to terms as to the extent and nature of that intervention. 2 However, in order to define such matters, it will be necessary for the Commonwealth to specify with greater precision the role it intends to take in the proceedings. It should do so in writing by 4pm Tuesday 11 April 2006 and should, in its documentation to be filed and served by that time, precisely identify: (a) its position in respect of the claim by Unions New South Wales;

(b) the material it intends to rely on in support of its position; and

(c) why it should be permitted to cross-examine in the proceedings; with particular reference to the witness statements and affidavits filed by the applicant on 31 March 2006 and those to be filed on 13 April 2006 (and in respect of the material to be filed on 13 April that should be the subject of a subsequent document to be filed and served by the Commonwealth by 4pm 20 April 2006). 3 The Full Bench in due course shall publish a statement specifying the extent and nature of the limitations on the Commonwealth's intervention. 6 On 11 April 2006, the Commonwealth's solicitors advised the President's Associate by letter that: The Commonwealth's position in respect of the claim by Unions' NSW is that it does not support the timing of the claim. At this stage, the Commonwealth does not have a position on the quantum of the claim. 7 The Commonwealth also advised of the material it intended to rely upon in support of its position and put forward reasons why it should be permitted to cross-examine in the proceedings. These are matters we are yet to rule on. 8 The first sentence of the Commonwealth's statement of position is plainly non-responsive to our directions. That matter was decided by our interlocutory judgment. We are unclear as to what is meant by the statement in the Commonwealth's letter of 11 April: "At this stage, the Commonwealth does not have a position on the quantum of the claim." If it means that the Commonwealth is not intending to precisely identify its position in respect of the claim by Unions New South Wales, or is intending to delay the statement of a position until the hearing has commenced, then that position is not acceptable because it does not comply with our direction of 6 April. 9 Further, in these proceedings the Commonwealth is an intervenor with the extent and nature of its intervention yet to be determined. That the Commonwealth in these proceedings is the federal Minister for Employment and Workplace Relations does not attract any special dispensation to exercise a discretion to decline compliance with a direction of this Full Bench. The Commonwealth's failure to comply has implications for any conditions that may be attached to that intervention or for that matter whether leave to intervene should be revoked. 10 The Commonwealth itself has acknowledged these are important proceedings. They involve this Commission considering a general claim for wage increases to flow to employees that remain within its jurisdiction following the commencement of the Workplace Relations Amendment (Work Choices) Act 2005. This is the first occasion for many years that the New South Wales Commission has embarked on a consideration of award wage movements before its federal counterpart has made any determination. The reasons for this were explained in our earlier decision of 6 March 2006. In particular, we concluded that given the divergent purposes in so far as wage fixing was concerned under the respective Federal and New South Wales statutes, the strength of the contention that comity should be maintained was significantly weakened. Further, we noted that should we adjourn the application by Unions New South Wales for the period proposed it would leave a gap of nearly two years between the last State Wage Case decision in 2005 and any decision that might be made by us regarding the latest application by Unions New South Wales. 11 At [47] we concluded: The divergence between the changes that have been brought about by the Work Choices Act on the one hand and the Industrial Relations Act on the other, in terms of the respective frameworks for setting minimum award wages, seems reasonably clear. There exists, therefore, the distinct possibility that, even if it were to await a decision of the Australian Commission, this Commission would not be satisfied that any decision of the Australian Commission was consistent with the objects of the Industrial Relations Act pursuant to s 50 or that there were other good reasons for not adopting the decision of the Australian Commission. Accordingly, we consider the balance of convenience lies in favour of dealing with the application by Unions NSW in a timely and orderly way, thus avoiding any injustice that might be caused by what would be an inordinate delay that ultimately may prove to have been unjustifiable. 12 We reiterate that we do not propose to adjourn or delay any decision we might make in relation to the claim by Unions New South Wales until either the Australian Fair Pay Commission or the Australian Industrial Relations Commission has considered the question of minimum wages.

13 We recognise the Commonwealth's preferred position is for a nationally consistent approach to minimum wage fixation. It is apparent that the Commonwealth would like to see that achieved through the Australian Fair Pay Commission but if that is not possible that State-based outcomes are consistent with any determination by the Fair Pay Commission. The reality is that adjustments to minimum award wages, and the timing of those adjustments, in respect of employees remaining within the jurisdiction of this Commission and, it seems, those remaining within the jurisdiction of other State industrial tribunals, will be determined on merit by those tribunals and not according to some benchmark set by the Australian Fair Pay Commission or the Australian Industrial Relations Commission. Hence, an indication from the Commonwealth of what view it takes of the claim by Unions New South Wales would be of assistance to this Full Bench in at least enabling us to have regard to the Commonwealth's preferred position in arriving at an appropriate outcome. 14 It is reasonable to expect that the Commonwealth will respond to the recent invitation by the Australian Fair Pay Commission to make submissions regarding movements in minimum wages federally. It is also reasonable to expect, given its consistent practice over many years before the Australian Industrial Relations Commission, the Commonwealth will put what it considers would be the appropriate amount of adjustment, if any, to award wages in these proceedings. We have some difficulty, therefore, in understanding the Commonwealth's reluctance to do so before this Commission (if its response truly represents such an attitude), particularly, as we have stated, having regard to its desire to participate in these proceedings. 15 In summary, we have concluded that the statement of position given by the Commonwealth on 11 April does not comply with our directions of 6 April. That failure has implications for the Commonwealth's application to intervene in these proceedings. What is required is a plain statement of position - one the Commonwealth is well used to providing in various Safety Net Adjustment (and previously National Wage Case) proceedings before the Australian Industrial Relations Commission. Does the Commonwealth agree that a four per cent adjustment to award wages is appropriate or that a nominated higher or lower amount is appropriate or no increase at all is sustainable? Not only are we seeking an indication from the Commonwealth in this respect, but all of the parties opposing the claim will need to be in a position to indicate precisely where they stand on the claim.

16 We have decided to request the Commonwealth, in light of this Statement, to review its decision not to comply with the directions made by this Full Bench on 6 April 2006 and to advise the President's Associate of its position well before the commencement of proceedings on 5 June 2006. In the absence of satisfactory compliance with directions we shall be compelled to review the Commonwealth's application for intervention in these proceedings. ___________________________

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