State Wage Case 2025 (No 2) [2025] NSWIRComm 33 (31 October 2025)

Crown Employees (NSW Police Force (Nurses')) Award 2022 [2024] NSWIRComm 20

Crown Employees (NSW Police Force Special Constables) (Security) Award 2024 [2024] NSWIRComm 10

Crown Employees (Police Officers - 2024) Award [2024] NSWIRComm 24

Employers First v NSW/ACT Independent Education Union (2002) 115 IR 8; [2002] NSWIRComm 13

Fire Brigade Employees' Union v Industrial Relations Secretary (on behalf of Fire and Rescue NSW) [2025] NSWIRComm 1063

Health Employees Pharmacists (State) Award (2003) 132 IR 244; [2003] NSWIRComm 453

Higher School Certificate Marking and Related Casual Employees Rates of Pay and Conditions Award 2024 [2025] NSWIRComm 1054

Industrial Relations Secretary v Unions NSW [2025] NSWIRComm 26

Industrial Secretary & Ors v Public Service Association and Professional Officers' Association Amalgamated Union of New South Wales & Ors (No 2) [2024] NSWIRComm 21

Public Health System Nurses' and Midwives' (State) Award 2023 [2025] NSWIRComm 30

Re Crown Employees (Administrative and Clerical Officers) (State) Award and Other Awards (No 2) (1993) 52 IR 243; [1993] NSWIRComm 104

Re Crown Employees (Public Sector - Salaries 2024) Award - Consent variation re Psychologist rates [2025] NSWIRComm 1045

Re Crown Employees (Teachers in Schools and TAFE and Related Employees) Salaries and Conditions Award (2004) 133 IR 254; [2004] NSWIRComm 114

Re Metal, Engineering & Associated Industries Award 1998 - Part 1 (2000) 110 IR 247; [2000] AIRC 722

Re Operational Ambulance Officers (State) Award (2001) 113 IR 384; [2001] NSWIRComm 331

Re Public Hospital Nurses (State) Award (2002) 115 IR 183; [2002] NSWIRComm 100

Re Public Hospital Nurses (State) Award (No 4) (2003) 131 IR 17; [2003] NSWIRComm 442

Re Social & Community Services Employees (State) Award (2001) 113 IR 119; [2001] NSWIRComm 274

Re Staff Specialists (State) Award (2006) 152 IR 405; [2006] NSWIRComm 124

Re Teachers (Non Government Early Childhood Service Centres other than Preschools) (State) Award 2006 (2009) 191 IR 14; [2009] NSWIRComm 198

Re Transport Industry (State) Award (1996) 95 IR 126

State Wage Case 1983 (1983) 5 IR 1

State Wage Case 2000 (2000) 97 IR 93; [2000] NSWIRComm 83

State Wage Case 2024 - Review of Minimum Rates Awards (No 2) [2025] NSWIRComm 1059

State Wage Case 2024 (No 3) (2024) 337 IR 111; [2024] NSWIRComm 19

State Wage Case 2024 (No 4) (2024) 337 IR 182; [2024] NSWIRComm 25

State Wage Case 2025 [2025] NSWIRComm 22

Teachers (Non-government Preschools) (State) Award (2001) 120 IR 3; [2001] NSWIRComm 335

Australia Bureau of Statistics, Consumer Price Index, Australia June Quarter 2025

Reserve Bank of Australia, Statement on Monetary Policy, (August 2025)

S Meehan SC / H Pararajasingham (Industrial Relations Secretary)

Crown Solicitor's Office (NSW) (Industrial Relations Secretary)

T Duffy (Senior Industrial Officer, Local Government NSW)

C Danu-Asmara (Industrial Officer, Australian Paramedics Association)

1. This is the second State Wage Case 2025 decision. In this decision we consider whether there should be variations to the Award Making Principles (the Principles), whether the paid rates adjustment mechanism provided for in principle 6 should be retained and if so, the quantum of the paid rates adjustment for 2025-26.
2. For the reasons that follow, the Commission has decided:

(1) to retain the paid rates adjustment mechanism;

(2) to set the paid rates adjustment for 2025-26 for public sector awards at 3%;

(3) as a consequential change, to remove the Value of Money Principle at principle 14 which is now redundant;

(4) to alter unnecessarily restrictive language from the criteria required to make out a work value change in principle 10;

(5) to amend principle 9 to permit minor changes that improve or modernise an award without having to establish the Arbitrated Case criteria in subprinciple 9.2;

(6) to make some further minor changes to the Principles; and

(7) otherwise, for the Principles to remain in their previous form for now, whilst foreshadowing the likelihood of simplification in a future State Wage Case.

1. The form of the Principles that we are presently minded to make is annexed to this decision. The parties now have the opportunity to make submissions on our proposed text before the Principles are finalised.

1. The Commission is empowered to make an award by reference to the simple criteria that it set fair and reasonable conditions of employment.[1] In light of that broad discretion it has been considered appropriate for the Commission to set principles that both guide individual members of the Commission dealing with award applications at first instance, and assist parties to understand how award applications will be determined.[2] From 1983 until 2024, these principles were titled the "Wage Fixing Principles".[3]
2. In State Wage Case 2024 (No 4),[4] the Commission - with a renewed purpose unrestricted by the "wages cap" imposed by s 146C of the Industrial Relations Act 1996 (NSW) (the Act) - determined to make these principles in new terms and to rename them as the "Award Making Principles".
3. In remaking the Principles in State Wage Case 2024 (No 4),[5] the Commission considered how it could efficiently adjust public sector awards in line with changes to the value of money, if appropriate, in a manner that would limit potential inconsistencies arising from having multiple award applications separately decided on that same basis. The method proposed by the Commission was for it to determine in each year's State Wage Case a paid rates award adjustment for public sector awards having regard to, among other things, the Annual Wage Review of the Fair Work Commission, changes in the value of money since the last State Wage Case, and each mandatory consideration in the Act.[6]
4. By this method, following the Commission's determination of a paid rates adjustment, an expeditious application could be made to vary public sector awards outside their nominal term, if they have not had an increase in rates of pay in the last 12 months and on the provision of a no extra claims undertaking by the union party.
5. A mechanism to implement this proposal was included in subprinciples 6.3 to 6.6, but without effect until the issue was considered during State Wage Case 2025.[7] This was because it had not been the subject of careful consideration and submissions by the parties to State Wage Case 2024.[8] The Commission noted that the parties could make further submissions as to whether the mechanism in subprinciples 6.3 to 6.6 should in fact be implemented during State Wage Case 2025, and propose any consequential amendments to the Principles arising from that implementation.
6. The proposed mechanism came with limitations, including that such an increase would only be granted if the union parties gave an undertaking that would create industrial certainty for the life of the award by committing not to pursue further claims that would take effect during the nominal term of the award.

1. On 3 June 2025, the Fair Work Commission published its decision to increase the National Minimum Wage and all Federal modern award minimum rates by 3.5% effective from 1 July 2025 (the National Wage Review),[9] being a National decision for the purpose of s 48 of the Act.
2. Consequently, on 10 June 2025, the Commission acting on its own initiative issued a summons to interested parties to show cause why the Commission should not adopt the National Wage Review for the purpose of minimum rates awards listed in the summons and also to address the following questions:

"(2) Whether the Commission should vary any of the Award Making Principles made in the State Wage Case 2024 (No 4) [2024] NSWIRComm 25 including:

(a) Whether the Commission should amend the Paid Rates Adjustment mechanism at paragraphs 6.3 to 6.6 of the Award Making Principles; and

(b) Whether clause 9, Arbitrated Case, should be amended to confirm that minor changes that improve or modernise an award and which do not give rise to an increase in remuneration or involve a significant change to conditions of employment can be made without that change having to meet one of the criteria in clause 9.2.

(3) Whether the Commission ought to determine a Paid Rates Adjustment for 2025-2026 and if so what it should be."

1. Of the interested parties to whom the summons to show cause was issued, the Industrial Relations Secretary (the Secretary), Unions NSW, Local Government NSW (LGNSW), the Health Services Union NSW (the HSU), and the Australian Paramedic Association (the APA) filed notices of appearance.
2. On 29 August 2025, in State Wage Case 2025,[10] the Commission determined the first issue identified in the summons, by adopting the National Wage Review outcome in respect of the minimum rates awards and varying each award accordingly. Concurrently, the determination of the second and third issues identified in the summons was timetabled for the filing of evidence, submissions, and a hearing.
3. The Secretary, Unions NSW, LGNSW, and the HSU filed written submissions. The APA did not file written submissions. The APA appeared at the hearing of this matter but did not seek to make oral submissions.
4. In support of its submissions, the Secretary relied upon the following evidence:

(1) the affidavit of Elizabeth Anne Livingstone, Deputy Secretary for the Policy and Budget Group of NSW Treasury, sworn on 26 August 2025, which exhibited a fiscal report prepared by Ms Livingstone for this proceeding; and

(2) the statement of Jo Prados-Valerio, Director of Bargaining and Legal Strategy in the Premier's Department, signed on 26 August 2025.

1. Two matters arose from the evidence filed. First, no evidence was filed in respect of changes to the value of money since the last State Wage Case, notwithstanding that the Principles state that this is a relevant consideration to setting a paid rates adjustment.
2. Second, Ms Livingstone, on instructions, provided evidence as to the budget consequences of any paid rates adjustment to a list of 12 awards, stated to be the only awards for which a paid rates adjustment could be obtained in 2025-26. By the time of the hearing, however, it was apparent that a paid rates adjustment could not be obtained in respect of several of the 12 awards due to their status in proceedings before the Commission, including the Public Health System Nurses' and Midwives' (State) Award 2023.
3. To address these matters, prior to the hearing, the Commission provided to the parties:

(1) extracts from the Reserve Bank of Australia's August 2025 Statement on Monetary Policy and the Australia Bureau of Statistics' Consumer Price Index (CPI) data from the June 2025 Quarter which, at the commencement of the hearing, the parties confirmed the Commission should have regard to in making its decision, and which were made exhibits; and

(2) a table setting out the status of the 12 awards referred to in Ms Livingstone's fiscal report which, at the commencement of the hearing, the parties confirmed was accurate, subject to some qualifications which we set out below when dealing with Ms Livingstone's evidence.

1. The Secretary advanced three positions.
2. The first was that there should be no paid rates adjustment mechanism in the Principles (in other words, the mechanism proposed in 2024 should be removed). The Secretary contended that the mechanism would:

(1) detract from the Government's policy preference for mutual gains bargaining by allowing a union to deploy the paid rates adjustment as a "strategic floor" when bargaining for wage increases, undermining the efficacy of bargaining generally;

(2) waste resources in the bargaining process by permitting a union to continue to bargain following a State Wage Case, then at a late stage apply to vary an award to take up the paid rates adjustment;

(3) not operate harmoniously with other statutory mechanisms for the making and variation of awards;

(4) if it becomes the orthodox means by which paid rates awards are varied, result in awards with 12-month nominal term extensions, contrary to the Government's preference for the industrial certainty provided by, and the benefits to the Government's fiscal and budgetary position of, multi-year nominal terms;

(5) undermine the perceived benefit of avoiding the inefficiency of the Commission considering afresh all relevant evidence every time an application is made to increase wages due to cost of living changes because a union is free to choose if and when it applies for a paid rates adjustment to a specific award, and may pursue claims based on changes to the value of money without recourse to this mechanism; and

(6) not avoid the potential for inconsistencies because unions are at liberty to decide whether to apply for a variation of a paid rates award to give effect to a paid rates adjustment.

1. The second position was that if there is to be a paid rates adjustment mechanism it should be amended:

(1) to make clear that the no extra claims undertaking required by subprinciple 6.6(5) to be given by a union includes all claims under the Principles except for claims under the Gender Based Undervaluation Principle during the nominal term;

(2) to remove the Value of Money Principle to avoid the situation whereby a union can elect to pursue either the paid rates adjustment or, if it is not satisfied with the paid rates adjustment, an adjustment pursuant to the Value of Money Principle in separate proceedings involving substantially similar evidentiary issues; and

(3) to include two further mandatory considerations, namely the "likely effect of the award variation on the prospects of successful bargaining" and "the views of the bargaining parties".

1. The Secretary's third position was that if there is to be a paid rates adjustment, the paid rates adjustment should be no more than 3% because:

(1) the General Government Sector Budget forecasts for 2025-26 are based upon a 3% pay increase (plus superannuation) for paid rates awards outside their nominal term;

(2) the 2025-26 NSW Budget projects ongoing annual cash deficits in the General Government sector, such that an increase in expenses will require further borrowings, increasing the State's debt and interest burdens;

(3) an adjustment which exceeds the position in the NSW Government's Fair Pay and Bargaining Policy 2024-25 could adversely impact the NSW Government's ability to manage the State's fiscal position and outlook over the medium term;

(4) the State faces significant fiscal risks that could materialise over the next four years, and any marked increase to planned spending may hinder its ability to duly respond to these risks;

(5) an unexpected adjustment to employee expenses for 2025-26, and consequential increasing debt levels, will likely have adverse implications on the State's credit rating which is precariously poised;

(6) an increase to allowances in any given year results in higher base salaries in subsequent years, and therefore has an ongoing annual financial impact, such that an additional 1% increase in 2025-26 (over and above the 3% budgeted) is estimated to cost an additional $523.5 million in 2025-26, and an additional $2.2 billion over the four years to 2028-29; and

(7) the change in the value of money since State Wage Case 2024 is considerably below 3%.

1. As noted above, the Secretary relied on an expert report prepared by Ms Livingstone for this proceeding. Ms Livingstone's report can be summarised as follows.

(1) The fiscal position of the NSW Government is challenging, with its operating position under pressure. The Government projects a net operating deficit of $3.4 billion in 2025-26, and $1.1 billion in 2026-27, returning to a surplus of $1.1 billion in 2027-28 and 2028-29. Ms Livingstone opines that, notwithstanding the surpluses projected for 2027-28 and 2028-29, the fiscal position remains subject to multiple risks and pressures, and any additional expenses are likely to put pressure on the Government's return to surplus.

(2) The Government's debt position is projected to worsen, with gross debt projected to continue increasing over the four years to 2028-29 as the Government continues to borrow to fund a portion of its infrastructure program.

(3) A 3% increase for paid rates awards outside their nominal term has already been budgeted. Accordingly, a 3% increase would not impact the Government's fiscal outlook. However, an increase above 3%, applied to 12 awards Ms Livingstone was instructed could be affected by the paid rates adjustment, would have the following effect on the Government's fiscal outlook by increasing gross debt over the four-year period until 2028-29:

(a) $277.6 million for a 3.5% increase (0.5% above budget);

(b) $561.1 million for a 4% increase (1% above budget); and

(c) $838.7 million for a 4.5% increase (1.5% above budget).

1. As noted above, in reaching these conclusions, Ms Livingstone relies upon a list of 12 awards said to be eligible for a paid rates adjustment. At the commencement of the hearing, counsel appearing for the Secretary informed the Commission that:

(1) an in principle agreement had been reached in respect of the interim increases for two of these awards applying to the industry of nursing and midwifery;

(2) nurses and midwives constitute a "very significant cohort" of public sector workers; and

(3) accordingly, the Commission would have to be cautious in its evaluation of the budget consequences reported by Ms Livingstone, as these consequences would be significantly less given this cohort of workers would not be eligible for a paid rates adjustment.

1. Counsel for the Secretary also informed the Commission of further awards upon which Ms Livingstone relies that would not be eligible for a paid rates adjustment, but was unable to quantify the impact of these matters on Ms Livingstone's conclusions. Ultimately, it is not necessary to set these matters out in full because we have determined to set a paid rates adjustment of 3%, noting Ms Livingstone's opinion that such a rate would not impact the Government's fiscal outlook, even if all the awards that she was asked to consider obtained a paid rates adjustment.

1. LGNSW submitted that there is no reason to amend subprinciples 6.3 to 6.6 insofar as local government is excluded from their application.
2. In its submissions in chief, it submitted that there is no need to amend principle 9 to permit a minor change to an award without meeting the criteria within subprinciple 9.2 because the Commission can already make a minor change provided it is by consent, and that the absence of consent signals that a change is not genuinely minor. In reply, and at the hearing, LGNSW confirmed that it did not in principle oppose the amendment of principle 9, but wished to be heard on the drafting of the amendment.
3. LGNSW did not seek to make submissions in relation to whether the Commission ought to determine a paid rates adjustment or its quantum because any adjustment would not affect the local government sector.

1. Unions NSW submitted that subprinciples 6.3 to 6.6 should be retained in their current form for the reasons set out in State Wage Case 2024 (No 3).[11] In doing so, Unions NSW noted that there is a real question as to whether a no extra claims undertaking should be given at all, or in circumstances in which a wage increase does no more than maintain the real value of wages. However, Unions NSW has decided to take the pragmatic approach of not opposing the requirement to give a no extra claims undertaking, with the intention of interrogating the merits of such an undertaking at a future State Wage Case.
2. It contended that the paid rates adjustment for 2025-2026 should be set at 5%, including a 1.5% increase "above the increase that would otherwise have been awarded", as a first step to remedying the erosion of the real value of award wages in recent years, and to restore awards to a level that ensures that their real value has been preserved over the medium to long term. This figure was reached by Unions NSW by reference to the 2% increase awarded by the Commission as a one-off resetting of rates in Fire Brigade Employees' Union v Industrial Relations Secretary (on behalf of Fire and Rescue NSW) ("Firefighters' Awards Case 2025"),[12] but noting that result was particular to that cohort of employees. Unions NSW contended that this increase is justified because:

(1) the real value of wages has diminished and requires urgent correction;

(2) wage rates are significantly lower than the level at which they would have been fixed but for the constraints of the "wages cap" over the past decade;

(3) the proposed increase is appropriately conservative;

(4) the state of the economy is sound; and

(5) fair and reasonable conditions of employment require that wages not decrease in real terms.

1. Finally, Unions NSW submitted that principle 9 should be amended in the manner proposed in the Commission's summons.

1. The HSU advanced four positions.
2. First it contended that principles 9 to 14 ought to be abolished and replaced by a simplified "Principle 9 - Other increases to remuneration" appended to its submissions. The HSU contended that the historically driven hyper-prescriptiveness of these principles tends, in the contemporary era, to drive an artificial focus on pleading-like points rather than the genuine articulation of and engagement with the particular case being run by employees.
3. Second, and alternatively, it was contended that the Principles should be amended so that:

(1) the no extra claims undertaking in subprinciple 6.6(5) allows parties to pursue any claim, other than one based on changes to the value of money. The HSU contended that the current exception in the undertaking for claims based on gender undervaluation is too limited because gender is not the only basis upon which wage rates can and have been undervalued; and

(2) principles 9 to 14 are replaced by streamlined versions reflecting contemporary approaches to wage fixation.

1. Third, the HSU put forward a further alternative amendment to the Principles, namely to:

(1) modernise the historic language in principle 10 - the Work Value Change Principle - to remove artificial barriers to change, in particular to amend subprinciple 10.5 to address the reality of reactive work that nevertheless forms part of the core skill of a classification; and

(2) delete subprinciples 11.2 and 11.3 to better reflect the complexity involved in measuring public sector productivity and in particular the inadequacy of an input/output analysis.

1. Fourth, the HSU contended that the Commission should determine a paid rates adjustment for 2025-26 in line with the adjustment proposed by Unions NSW.

Whether the paid rates adjustment mechanism should be retained

1. The submissions advanced by the Secretary do not dissuade us from the position we reached in State Wage Case (No 3).[13] We confirm our view that the real value of award rates of pay should be maintained over time, not by way of an automatic increase, but rather, an efficient mechanism to increase rates in awards which are outside their nominal term and for which no increase has taken effect in the previous 12 months that will act as a safety net to ensure that award rates can be readily adjusted to broadly maintain their value in real terms. It is desirable that the Commission determine this increase once for all eligible public sector paid rates awards, rather than separately for each eligible award, given different evidence premised on different cohort sizes may lead to different outcomes for applications otherwise made on the same basis.
2. We are not persuaded by the concerns raised by the Secretary. The essence of the Secretary's concerns is that the paid rates adjustment mechanism would detract from bargaining. In our view, provided the quantum of any adjustment to rates is no higher than necessary to achieve its purpose, the mechanism provides an efficient and fair method to ensure awards are able to be adjusted in line with changes in the value of money, without discouraging parties from bargaining for multi-year awards.
3. It is not the paid rates adjustment mechanism itself that would deter parties from bargaining for multi-year awards, but rather the quantum of the particular paid rates adjustment in any year. The Secretary's submissions concerning the impact on bargaining have force in relation to a paid rates adjustment which is higher than union parties could reasonably expect to obtain through bargaining. Properly applied, the proposed paid rates adjustment mechanism will avoid this result.
4. The Secretary ultimately accepted that there are efficiencies that derive from determining the increase to the rates of remuneration for public sector workers arising from the change in the value of money by a single global hearing rather than a series of separate hearings.
5. We are accordingly minded to implement a straightforward process whereby, in each year, a Full Bench of the Commission receives evidence of changes to the value of money since the previous State Wage Case and the fiscal position and outlook of Government, and then determines a paid rates adjustment. The Commission can then separately and expeditiously consider applications to apply the adjustment to eligible awards having regard to its effect on bargaining for each award.
6. We acknowledge the potential, following the Full Bench setting a paid rates adjustment amount for a particular year, for a union to engage in negotiations in respect of a particular award outside its nominal term, only to later decide to apply to vary that award to increase rates in accordance with the paid rates adjustment, thereby wasting resources spent negotiating. Nevertheless, we do not see that as leading to a significant waste of resources as a union could do the same without the mechanism, but less efficiently, by engaging in bargaining and then seeking a substantial and full arbitration to increase rates in line with a change to the value of money, rather than making the expeditious application contemplated by subprinciple 6.7.
7. The Secretary raised a concern about the potential for a union to apply for an increase to rates in respect of a period for which a paid rates adjustment amount has been set, but seek a higher increase relying on subprinciple 9.2(5) and perhaps updated inflation data. We accept that could be done, but only by means of a contested Arbitrated Case in which sufficient evidence is led to satisfy the Commission to increase rates in the manner sought. The Commission would need to be satisfied that there was something special about the circumstances that justified departing from the paid rates adjustment amount. Such an application, requiring a full contested hearing, would take some time to determine. That stands in contrast to the relatively straightforward application to apply the predetermined paid rates adjustment that would be determined expeditiously.
8. We have updated the text of subprinciple 6.6(5) to confirm that the effective date of the increase determines whether an award is eligible for a paid rates adjustment and not, for example, the date on which the increase was determined or published. A change to similar effect should be made to subprinciple 9.3 to clarify that in considering changes in the value of money, the relevant period of change will ordinarily commence from the effective date of the last wage rate adjustment. We use the word 'ordinarily' noting that in extraordinary circumstances it may be appropriate to consider a change in the value of money over a longer period.[14]
9. We do not agree with the Secretary that further mandatory considerations should be inserted into subprinciple 6.6. Subprinciple 6.6 already requires the Commission to have regard to "the status of bargaining between the parties to the Award" and "the likelihood of that bargaining concluding in a timely fashion" when considering an application to apply a paid rates adjustment to an award. The ability to obtain an increase in rates of pay in line with changes to the value of money in many, if not most, instances is unlikely of itself to have a significant impact on the bargaining position of the parties. However, the fact that it comes with the necessary undertaking to prevent further increases occurring until the end of the 12-month period means that the Commission may determine, in light of the matters being discussed in the bargaining process, that the bargaining should proceed, rather than accede to the application to vary the specific award to apply the paid rates adjustment at that time. We reject the submission, if made, that requiring a union to bargain to obtain no more than an increase to reflect a change in the cost of living inappropriately discourages bargaining - employees should not have to give up conditions of employment or increase their productivity and efficiency, merely to maintain their existing rate of pay in real terms.

1. At a high level, the submission advanced by Unions NSW that public sector workers have had a diminution of the real value of their wages in recent years can be accepted. The Commission has begun to redress this diminution. For example, in the Firefighters' Awards Case 2025 the Commission awarded an additional increase as a one-off reset to remedy the below-trend increases that combined with significantly above-trend inflation in previous years to reduce the real value of wages.[15] Further, there have been consent increases obtained through bargaining in the last 12 months that have been above 3%, which will also address the diminution in the real value of wages in the period between 2020 and 2024.[16] This issue will continue to be addressed by parties in bargaining or by arbitration in the absence of conciliated outcomes, as occurred in the Firefighters' Awards Case 2025.
2. Unions NSW contended that the paid rates adjustment for 2025-26 should address this issue. While acknowledging that there is an issue to be addressed, in our view the paid rates adjustment mechanism is not the means by which to do so. It is intended to be a largely uncontroversial mechanism to maintain rates going forward. If there were to be a paid rates adjustment well above changes in CPI, such as 5%, it would serve as a significant disincentive to bargain. It would also produce the incongruous result whereby union parties that obtained a bargained outcome for their awards may achieve a worse result than union parties that did not achieve (or even seek) a bargained outcome. It would also produce the odd result this year that the paid rates adjustment is higher than the adjustment to minimum rates awards.
3. Notwithstanding the above, Unions NSW is correct to say that the Commission's determination of the fair and reasonable paid rates adjustment cannot be determined by Government policy. That we have determined a paid rates adjustment at 3% is not a simple application of the amount budgeted by Government, but rather an amount that addresses changes in the value of money over the last 12 months.
4. If a future Government policy were to seek increases to awards below the increase in the value of money in the preceding 12-months, it may well be necessary for the Commission to determine a paid rates adjustment that is higher than the Government's bargaining position. At that point, the Commission would have to consider the negative impact on bargaining and the impact on the fiscal position of the Government. Notwithstanding those matters, it may be appropriate for the Commission to determine a paid rates adjustment higher than Government policy to ensure that rates of pay remain fair and reasonable.
5. That is not the position presently confronting us. The position which emerges from the evidence before us is that in the period between June 2024 and June 2025:

(1) the CPI for Sydney increased by 1.9%;[17]

(2) the CPI for Australia increased by 2.1%;[18] and

(3) the Trimmed Mean Inflation for Australia measured at 2.7%.[19]

1. We are content to set the paid rates adjustment for 2025-26 at 3%, being a figure above each of those indices. We consider that 3% is appropriate, even though it is slightly higher than the change in the cost of living, given that:

(1) if a rate is to be set, the Secretary does not urge a lower rate;

(2) it should have no fiscal impact as the budget assumes such an increase for all public sector workers;

(3) it is not at a level which might be expected to impede bargaining;

(4) it reflects consent positions reached by the parties for interim variations to awards in recent times;[20] and

(5) the diminution in the real value of award rates in 2020-24 is such that it is not inappropriate to have a slightly higher than CPI increase.

1. In coming to the appropriate figure for this paid rates adjustment, we are concerned to ensure a clear and efficient method by which the paid rates adjustment may be determined in the future. By that, we mean that while proper consideration must be given to all of the mandatory criteria, including the fiscal impact of any decision, the starting point for the Commission's decision should be to identify changes in the value of money in the 12-month period ending in June in the year of the State Wage Case.

Whether the Value of Money Principle should be removed

1. We agree, in principle, with the HSU's submission that in any Arbitrated Case that relies on a range of the criteria in subprinciple 9.2, a union should also be permitted to rely on changes in the value of money. This position is maintained by retaining in subprinciple 9.2(5) the capacity for an Arbitrated Case to be established based on a change in the value of money. We note, however, that we would ordinarily expect that criterion to be relied upon in conjunction with other criteria. For the reasons explained above at [47], an applicant would need to point to some special circumstances to satisfy the Commission to increase rates based on a change in the value of money as the sole criterion in an Arbitrated Case. That is not to say that the Commission could not, in a case where multiple criteria are relied upon, ultimately decide that the only basis for an increase is a change in the value of money.
2. To this end, we have determined to remove principle 14, and to clarify the terms of principle 9 in respect of the value of money.

Whether the form of the undertaking required by subprinciple 6.5(5) should be amended

1. We are not minded to amend the form of the no extra claims undertaking required by subprinciple 6.5(5) which, as we explained in State Wage Case 2024 (No 3),[21] provides certainty and removes any disincentive to bargain that might arise if a union could obtain the paid rates adjustment and continue to press for higher rates of pay.
2. There is an exception to ensure that parties are not prevented from pursuing claims under the Gender Based Undervaluation Principle because of its prominence in the objects of our Act. We do not consider that it would be appropriate to expand the exception to include a wider range of discrimination-based undervaluation, as sought by the HSU.
3. We agree with the Secretary that the undertaking ought to exclude all claims under the Principles except for claims under the Gender Based Undervaluation Principle. Contrary to the submissions of the Secretary, we do not consider it necessary to add language to make that clearer, being satisfied that is the current effect of subprinciple 6.6(5).
4. In reconsidering the terms of the undertaking we did identify that arguably it would prevent applications to update or set new allowances to reimburse expenses under subprinciples 7.1 and 7.3 and also applications to ensure that the award does not contain rates below the minimum rate set by the National Minimum Wage Order made by the Fair Work Commission under subprinciple 8.1. There does not appear to be a good reason to prevent such applications during the term of an award, consistent with the fact that they do not give rise to an Arbitrated Case. We propose a minor change to the text of the undertaking to reflect that conclusion, as set out in the draft revised Principles published with this decision.

Whether the Principles should be amended to provide a broader discretion

1. As noted above, the HSU's primary position is that principles 9 to 14 ought to be abolished and replaced by a simplified "Principle 9 - Other increases to remuneration" which it appended to its submissions:

APPENDIX A

Principle 9 - Other increases to remuneration

9.1 Other than as allowed elsewhere in these Principles, an application for new awards or variations to existing awards providing for increases in remuneration, alterations to classification structures or other improvements to conditions will be arbitrated by a Full Bench of the Commission unless otherwise allocated by the President.

9.2 Such applications will be granted where an applicant demonstrates that:

(1) productivity or efficiency improvements have occurred which justify an increase in remuneration or other changes to conditions;

(2) the current rates of pay and/or conditions undervalue the work on the basis of gender in that they do not properly reflect the value of the work, skill or responsibility required;

(3) the current rates of pay and/or conditions undervalue the work on the basis of other discriminatory grounds in that they do not property reflect the value of the work, skill or responsibility required;

(4) the current rates of pay and/or conditions do not provide equal remuneration for work of equal or comparable value;

(5) there are work value reasons justifying the change, including but not limited to identifiable changes in the nature of the work, skill and responsibility required or the conditions under which work is performed since the award was last assessed on a work value basis;

(6) changes in the value of money, which have not been addressed by the application of the Paid Rates Adjustment, justify the change;

(7) some other special attribute or out-of-the-ordinary feature is present which warrants approval by the Commission.

9.3 For the avoidance of doubt, while the above matters are not exhaustive, they are intended to operate as restrictive considerations. The Commission ordinarily:

(1) will not entertain claims based wholly or substantially on comparative wage justice, outside the rectification of discriminatory undervaluation;

(2) will guard against contrived classifications and overclassification of jobs;

(3) will not address discriminatory undervaluation by reducing existing wage rates and conditions for other employees;

(4) will have regard to existing internal and external wage relativities, at least to the extent that the awards are directly related; and

(5) will not countenance double-counting, although a cumulation of factors may be relied on.

1. There is much force in the HSU's submissions that the restrictive tests in the Principles, in particular concerning the Work Value Principle, were developed during a time of stagflation when it was considered necessary to impose a degree of restriction on subordinate tribunal members to prevent them from making unprincipled increases to rates of pay for reasons other than indexation, and otherwise endanger the centralised system of wage fixing. That context no longer features in the industrial relations landscape of New South Wales. In addition, the HSU contended that these tests imposed a high level of restriction on the Commission's discretion in circumstances, which no longer pertain, where wages were automatically indexed in a manner not contemplated by the paid rates adjustment mechanism.
2. These restrictive tests were designed to constrain the discretion of individual members of the Commission in circumstances where claims to vary an award, including claims to increase wages on the basis of work value changes, were arbitrated by a single member of the Commission.[22] At that time, only special cases were required to proceed before "a Full Bench of the Commission, unless otherwise allocated by the President".[23] The Principles now require all arbitrated cases, including claims to increase wages on the basis of work value changes, to proceed before a Full Bench of the Commission, unless otherwise allocated by the President.[24]
3. The "strict" tests were not developed to restrict the discretion of a Full Bench of the Commission. The Full Bench's discretion was effectively set by the Special Case Principle which permitted it to allow a claim if it was justified on the merits, despite the claim not otherwise falling within a principle.[25]
4. In Re Social & Community Services Employees (State) Award ("Community Services Employees"),[26] the Full Bench referred to Re Crown Employees (Administrative and Clerical Officers) (State) Award and Other Awards (No 2),[27] in which the Commission held that:

"the special cases section of the principles provides a mechanism whereby a claim for enhanced wages or conditions beyond those normally allowed under the principles may be brought before the Commission. The hearing of such a claim is to be conducted by the Full Commission (formerly the Commission in Court Session) thus emphasising the special nature of the case. It will be a matter for the Full Commission, after hearing the evidence and submissions, particularly relating to the matters relied on to take the case 'out of the ordinary' and thus to make it 'special', to decide whether the claim, in part or in whole, should succeed. ... That, of course, is not the end of the matter. The Full Commission must decide whether, on the whole of the material before it, and bearing well in mind the respondents' opposition, the claim should in whole or in part succeed, and, if so, what increase should be awarded and what conditions, if any, should be prescribed. But we repeat our view that, in accordance with the principles, it is entirely appropriate for this claim to be heard and for the Commission to grant the claim in whole or in part if considered justified on the merits." (Emphasis added.)

1. At [312] in Community Services Employees, the Full Bench noted what had been observed by a Full Bench of the Australian Industrial Relations Commission as to what constituted a special case in Re Metal, Engineering & Associated Industries Award 1998 - Part 1:[28]

"In our view, 'special case', as used in Principle 10, is not a self-defining term. The identification of a special case is reserved to a Full Bench level of determination. It is not necessary or desirable to attempt to paraphrase that requirement to a set of principles, or a code of considerations for general application. A case by case approach is necessary. The circumstances of the Award and the industry in which it operates are of fundamental importance in determining whether the requirement is satisfied. In this matter, the special case requirement entails that the AMWU has the task of satisfying the Commission that there are sufficiently compelling reasons for awarding, as minimum rate conditions to apply across the industries covered by the Award, the substantive changes that it seeks." (Emphasis added.)

1. Earlier in Community Services Employees, the Full Bench at [23] referred to Re Transport Industry (State) Award,[29] where the Commission held that:

"[this] approach requires, in effect, that the Commission be satisfied that the case is not an ordinary one, but has special attributes which warrant its approval despite the restrictive considerations imposed generally by the principles of wage fixation."

1. The approach in Community Services was confirmed in Re Public Hospital Nurses (State) Award,[30] where the Commission emphasised the need to:

"establish an adequate evidentiary foundation for those factors which are relied upon as showing the special attributes of the case." (Emphasis added.)

1. The Full Bench in Re Public Hospital Nurses (State) Award[31] went on to note that other principles "may have relevance" to the exercise in which it was engaged, but did not need to be met in order for the case to succeed.
2. In other words, properly understood, the previous Wage Fixing Principles, now replicated in the Principles, imposed strict tests on single members, but did not restrict a Full Bench once satisfied there were "special circumstances" and the claim was otherwise "justified on the merits". That is consistent with the genesis of the Principles, which were developed, and indeed tightened, by full benches of the federal tribunal concerned to restrict wage increases determined by single members that were not properly justified.
3. It is worth noting at this point that the broad discretion exercised under the Special Case Principle has been recognised as able to be exercised by a single member of the Commission, if so allocated by the President of the Commission. This was previously permitted by the Special Case Principle (as it was then drafted). For example, in Employers First v NSW/ACT Independent Education Union[32] the Full Bench refused leave to appeal a decision of Schmidt J sitting alone, holding that it was open to Her Honour to make an award under the Special Case Principle, and that there was no requirement to make the award by reference to Wage Fixing Principles other than the Special Case Principle. The text permitting the allocation of special cases to single members is now picked up in subprinciple 9.1, applying to all arbitrated cases.
4. There have been cases where the Commission in determining a special case has found that the strict test of the Work Value Principle has been established.[33] However a characteristic of those cases is consideration of wide-ranging changes that established a "significant net addition" to the work requirements but without a careful examination as to whether the changes were sufficient to warrant the creation of a new classification. The Full Bench decisions determining these special cases seemed to find it sufficient that there was a significant net addition to work requirements to warrant an increase.
5. Prior to the Principles being amended in 2010 the Commission from time to time increased rates of pay to reflect changes in the value of the work, relying on the Special Case Principle, rather than the Work Value Principle.[34] The prohibition on considering work value change as a special case was removed last year. In the Firefighters' Awards Case 2025 the Commission considered that road crash rescue work performed by firefighters had evolved and required new skills, but that it did not meet the strict test of the Work Value Principle.[35] Notwithstanding this, by reference to the circumstances surrounding this evolution, the Commission held that a special case had been made out.[36]
6. In summary, noting the Principles require arbitrated cases to come before a Full Bench unless otherwise allocated by the President, most cases under the current Principles will be determined by the exercise of a broad discretion, regardless of the so-called restrictive principles. Provided that increases in the workload of the Commission are matched by increases in members of the Commission, it can be expected that this approach will not change. Further, unlike the position when the Wage Fixing Principles were being developed, there is no real risk that individual members sitting at first instance would increase rates without an adequate basis, and in any event such a decision could be the subject of an appeal.
7. In those circumstances a real question arises as to whether the Principles ought to be replaced with simpler principles that remove the historical, highly restrictive and somewhat antiquated language and instead provide guidance, in a manner akin to the proposal in Appendix A to the HSU's submissions.
8. We are not minded to do so this year. No party other than the HSU contended for the change. While the Secretary was on notice of the HSU's case, no other party gave it the level of consideration necessary to assist us to come to a firm conclusion about whether to make such a substantial change, nor if we were to do so, what ought to be the content of such a revised approach. However, we wish to indicate that this is a matter to which the Commission is likely to return in a future State Wage Case.
9. Presently, we consider that it is sufficient to address the particularly restrictive language of the Work Value Principle and to expand its text. We consider it would be appropriate to amend the Work Value Principle to broaden the Commission's discretion in a manner that, in practical terms, reflects the approach that the Commission has taken to determining work value cases, albeit in the context of determining a special case. In doing so, we do not think the change will have a practical effect on the Commission's determination of work value cases.
10. In particular, we embrace the HSU's view that we ought to amend the "strict test" concerning whether changes in work value will be recognised, and expand its text to address how changes in work value ought to be recognised for work that is not done by all employees in a classification or not done all the time by all employees in a classification. Specifically, we propose to replace the requirement to establish a change sufficient to warrant the creation of a new classification or an upgrade to a higher classification with a requirement to provide a sufficiently compelling reason to increase remuneration to reflect the changed value of the work.
11. We also propose to include a reworked version of one aspect of the HSU's proposal that assists to guide how change ought to be recognised for work that is not done by all employees in a classification or not done all the time by all employees in a classification. Our proposed changes are set out in the draft Principles annexed, in the form of a new subprinciple 10.5. It commences by providing that where the change in the nature of the work, skill and responsibility is one that applies to all employees in a classification this is to be reflected in the rate of pay for the classification, and goes on to address three circumstances where the change is to be reflected in a new or increased allowance rather than a general wage increase, being where:

(1) the nature of the change is one that gives rise to only particular employees within a classification holding and maintaining different skills; or

(2) employees are requested to do the changed work only from time to time; or

(3) the addition or alteration to the work is related to particular conditions under which the work is performed.

1. Subprinciple 10.5 does not prevent the award of an across-the-board increase that relies on a large number of different changes that have affected subsets of a classification in a manner that might justify a re-evaluation of the work value of that classification as a whole, as in Re Public Hospital Nurses (State) Award (No 4).[37] Nursing is a prime example, being a profession where within the single classification of Registered Nurse there are nurses who have obtained a wide variety of different additional training allowing them to work with an expanded scope of practice in an area of specialisation. In Re Public Hospital Nurses (State) Award (No 4), changes that included a variety of different specialised additional skills were addressed by whole-of-classification increases, rather than by the making of allowances. We also note that where an across-the-board increase has been granted in such circumstances, great care has to be taken, as required by subprinciple 10.7, to not double-count changes when considering any subsequent case seeking an allowance for a change that affects only a subset of a classification.
2. We wish to emphasise that the alterations to the Principles that we intend to make, and to the Work Value Principle in particular, do not remove the requirement to provide evidence that satisfies the Commission that the changes are of real significance in order to establish a case for changes to rates of pay; in other words, the case must be sufficiently compelling to justify an increase in remuneration to reflect the changed value of the work. Claimants for an increase in work value should not labour under the misapprehension that our intended amendment of the Work Value Principle would permit an increase for any minor change in work value. Something more than a continuum of previously recognised change or some minor change or updating of training or duties would be necessary. In that regard we are not overturning any long-standing principle.

Whether Principle 9 should be amended to permit minor changes

1. In any large arbitration there may be changes that parties seek to an award which are of a minor nature, and which do not affect rates of pay. The Commission may consider there to be a proper basis to allow the change to ensure that award conditions are fair and reasonable, even though the change does not meet an existing Arbitrated Case criterion (or even the Special Case Principle).
2. This was most recently apparent in the Firefighters' Awards Case 2025 where the parties sought a variety of changes without reference to an Arbitrated Case criterion, including changes to clauses requiring a particular form of consultation.[38]
3. In respect of this issue:

(1) Unions NSW and the HSU submitted that the amendment should be made;

(2) LGNSW initially opposed the amendment in its written submissions in chief, but changed its position in its written submissions in reply, to not opposing the amendment but wishing to be heard on the specific drafting of the amendment; and

(3) the Secretary made no submissions in chief on this issue. In his written submissions in reply he embraced the position taken by Local GNSW, which LGNSW ultimately changed in reply. During the hearing, we asked counsel appearing for the Secretary to confirm this position given the Secretary himself had benefited from minor changes for which he applied in Fire and Rescue. In response, counsel indicated that he had no instructions beyond what was put in writing.

1. We consider it appropriate that the Principles contain a clear statement that the Commission, when otherwise considering an award in arbitration, is not prevented from making minor changes that it is satisfied are appropriate to ensure the award remains fair and reasonable without having to be satisfied that one of the Arbitrated Case criteria has been met in respect of that minor change.
2. Accordingly, we propose to amend principle 9 to confirm that minor changes that improve or modernise an award and which do not give rise to an increase in remuneration or involve a significant change to conditions of employment can be made. We provide a draft amendment for submissions, with the balance of the proposed amendments.

Amendments to the list of minimum rates awards in Subprinciple 6.2

1. Since the summons to show cause in this proceeding was issued, the Commission handed down its decision in State Wage Case 2024 - Review of Minimum Rates Awards (No 2),[39] to implement various recommendations made by Commissioner McDonald, on report to the Full Bench, to rescind obsolete minimum rates awards, and to amend existing minimum rates awards to ensure each set fair and reasonable remuneration and conditions.
2. The consequence of that decision is that the list of minimum rates awards in subprinciple 6.2, to be dealt with in each State Wage Case, has changed. Accordingly, we have amended subprinciple 6.2 to reflect the current list of minimum rates awards.

Minimum wage for employees not governed by an industrial instrument

1. In State Wage Case 2024, we decided to remove (then) principle 7 concerning the minimum wage for employees within the Commission's jurisdiction whose employment was not governed by an industrial instrument, and instead publish at the end of the Principles a separate form of order to be made each time the Principles are published.[40] In accordance with that practice, the text of this order remains at the end of the draft Principles annexed to this decision, with the expectation that it will be made each time the Principles are published.

Applications to apply for a paid rates adjustment

1. We conclude by identifying our expectation for the process by which applications to apply for a paid rates adjustment are to be made. The application for a 3% uplift in rates of pay needs be accompanied by an affidavit which simply:

(1) sets out the date the rates of pay in the award were last increased;

(2) provides the necessary undertaking; and

(3) provides the status of bargaining between the parties to the award.

1. A respondent to the application would be given the opportunity to file evidence, and to indicate a desire to be heard on the application. In the absence of contested facts or a request for a hearing such applications will ordinarily be able to be determined on the papers.

(1) Pursuant to s 51 of the Industrial Relations Act 1996 (NSW), the paid rates adjustment for 2025-26 is 3%.

(2) By 4.00pm on 21 November 2025, the parties are to file any submissions they may wish to make as to the terms of the draft Award Making Principles annexed to this decision.

ANNEXURE - THE 2025-2026 AWARD MAKING PRINCIPLES

Draft provided for submissions, with emphasis added to indicate our amendments. Text that was inserted is underlined, and text that was removed is struck through.

1.1 These Principles guide the exercise of discretion when making or varying awards under Part 1 of Chapter 2 of the Industrial Relations Act 1996 (the Act).

2.1 When determining an application to make a new award or to vary an existing award, whether by consent or otherwise, the Commission must have regard to:

(1) whether the terms of the award as made or varied will set fair and reasonable conditions of employment for employees; and

(2) the public interest, and in that respect must have regard to:

(a) the objects of the Act, including the effect of the award as made or varied on:

(i) the promotion of productivity and efficiency;

(ii) the promotion of participation in industrial relations by employees and employers at an enterprise or workplace level;

(iii) the prevention and elimination of discrimination in the workplace, in particular ensuring equal remuneration for all persons doing work of equal or comparable value;

(iv) the encouragement of co-operative workplace reform and equitable, innovative and productive workplace relations; and

(v) strategies to attract and retain skilled staff where there are skill shortages so as to ensure effective and efficient delivery of services;

(b) the state of the economy of New South Wales and the likely effect of the decision on that economy; and

(c) in respect of an award that will apply to public sector employees, the fiscal position and outlook of the Government and the likely effect of the award as made or varied on the position and outlook.

3. When an award may be varied or another award made without the claim requiring consideration as an Arbitrated Case

3.1 Provided it otherwise complies with the requirements of the Act, an award may be made or varied without the application needing to be considered as an Arbitrated Case under Principle 9:

(1) in accordance with an express provision in an award that provides for its variation;

(2) to incorporate test case standards, in accordance with Principle 5;

(3) to adjust wages consistent with a State Wage Case decision, in accordance with Principle 6;

(4) to adjust allowances and service increments, in accordance with Principle 7;

(5) to adjust wages to ensure that they are not below the National Minimum Wage Order as made by the Fair Work Commission, in accordance with Principle 8; or

(6) where the application is consented to by the parties.

4.1 A consent application to make or vary an award may involve parties giving a no extra claims commitment in agreed terms. Such a commitment may take the form of an undertaking to the Commission not to pursue claims for extra or reduced terms and conditions that would take effect during the nominal term of the award, with or without identified exceptions.

4.2 Absent extraordinary circumstances, the Commission will not vary or make an award that is inconsistent with a no extra claims commitment unless otherwise expressly permitted by the award or by consent of the parties.

4.3 The Commission will not include in an award a clause that prohibits a party making an application under the Act or participating in proceedings under the Act.

5.1 There is a presumption that test case standards established and/or revised by a Full Bench of the Commission will be incorporated into an award on application.

6.1 Following the completion of an Annual Wage Review by the Fair Work Commission, the Commission will issue a notice to show cause why that National decision should not be adopted wholly or partly and with or without modification for certain minimum rates awards and for paid rates awards that apply to the public sector, which will be determined at a State Wage Case hearing.

6.2 In the State Wage Case hearing the Commission will determine a minimum rates adjustment for the following awards:

(1) Security Industry (State) Award ("Security Industry Award");

(21) Miscellaneous Workers - Kindergartens and Child Care Centres, &c. (State) Award;

(32) Health, Fitness and Indoor Sports Centres (State) Award;

(5) Clerical and Administrative Employees (State) Award;

(64) Local Government (Electricians) (State) Award;

(75) Entertainment and Broadcasting Industry - Live Theatre and Concert (State) Award;

(86) Local Government Aged Disability and Home Care (State) Award; and

(97) Nurses' (Local Government) Residential Aged Care Consolidated (State) Award 2021.

and vary them to give effect to that minimum rates adjustment, provided that each award contains the following clause:

"The rates of pay in this award include the adjustments payable under the State Wage Case for the relevant year. These adjustments may be offset against:

(i) any equivalent over award payments, and/or

(ii) award wage increases other than State Wage Case adjustments."

6.3 In the State Wage Case hearing the Commission may determine a paid rates adjustment for paid rates awards that apply to the public sector.

Note: As provided in Principle 17, Transitional Provisions, Paragraphs 6.3 to 6.6 have no application before the 2025 State Wage Case, which will consider whether to make a paid rates adjustment and will also determine whether there should be any alteration to those paragraphs.

6.4 A paid rates adjustment will be determined having due regard to all the circumstances including:

(3) the terms of the no extra claims undertaking required;

(4) changes in the value of money since the last State Wage Case; and

(5) the mandatory considerations in Principle 2, including the need to ensure that awards remain fair and reasonable, the likely effect of the decisions on the New South Wales economy, and the fiscal position and outlook of government.

6.5 For the avoidance of doubt, the paid rates adjustment need not be the same as the minimum rates adjustment and need not equate to the rate of inflation over the previous 12 months.

6.6 Following the making of a paid rates adjustment, a public sector award may, on application, be varied to apply that adjustment and extend its nominal term for 12 months from the date the adjustment takes effect, having regard to:

(6) the status of bargaining between the parties to the Award; and

(7) the likelihood of that bargaining concluding in a timely fashion;

(9) the award has not had anlast increase in rates for at leastof pay took effect more than 12 months earlier; and

(10) each union which is a party to the award gives to the Commission a no extra claims undertaking in the following terms or in such other terms as the parties agree:

[Name of union] undertakes not to pursue any further claims to amend the award in proceedings before the Industrial Relations Commission in respect of employees covered by the award that would take effect during its nominal term. Provided that thisThis undertaking does not prevent:

(i) participation in collaborative discussions to amend the award by means of mutual gains bargaining or otherwise;

(ii) making an application to vary the award by consent;

(iii) participation in a consent arbitration;

(iv) participation in a s 19 review or other proceedings initiated by the Commission or another party that affects the award; or

(v) pursuing and giving effect to claims under the Gender Based Undervaluation Principle during the nominal term; or

(vi) an application pursuant to 7.1, 7.3 or 8.1 below.

6.7 Applications to apply a paid rates adjustment will be dealt with expeditiously.

7.1 Existing allowances which constitute a reimbursement of expenses incurred may be adjusted from time to time where appropriate to reflect relevant changes in the level of such expenses.

7.2 If an order is made pursuant to Principle 6 for an adjustment to be made to the applicable award, that adjustment will also apply to existing allowances which relate to work or conditions which have not changed other than in line with whole of award salary adjustments, including shift allowances expressed as monetary amounts and service increments.

7.3 New allowances may be awarded to compensate for the reimbursement of expenses incurred where appropriate.

7.4 Otherwise, applications to increase existing allowances or create new allowances in the absence of consent will be determined in accordance with the Arbitrated Case Principle.

8.1 The Commission will vary an award on application or on its own motion to increase a rate of pay in an award which is below the minimum rate set by the National Minimum Wage Order as made by the Fair Work Commission from time to time.

9.1 Other than as allowed elsewhere in these Principles, an application for increases in remuneration (including for new service increments or superannuation contributions higher than those mandated by Commonwealth legislation) or changes in conditions in awards, will be determined as an Arbitrated Case and, unless otherwise allocated by the President, will be heard by a Full Bench of the Commission.

9.2 An Arbitrated Case may be granted if it meets one or more of the following criteria:

(1) there has been a change in work value that meets the requirements of the Work Value Changes Principle;

(2) there has been an increase in productivity or efficiency in respect of public sector awards that meets the requirements in the Productivity and Efficiency Principle;

(3) the application addresses undervaluation on a gender basis in accordance with the Gender Based Undervaluation Principle;

(4) a special case is established in accordance with the Special Case Principle; and

(5) there has been a change in the value of money justifying a change in rates of pay and conditions for public sector employees that meets the requirements of the Value of Money Principle.

9.3 When determining an Arbitrated Case, the Commission will have regard to changes in the value of money since wage rates were last adjustedwhich ordinarily will be since the effective date of the last wage rate adjustment.

9.3A When determining an Arbitrated Case the Commission may grant a minor claim that does not meet any of the criteria in Subprinciple 9.2 where satisfied it is appropriate to do so. A minor claim is a claim to modernise or improve an award in a manner that neither alters remuneration nor significantly alters conditions of employment.

9.4 Following determination of an Arbitrated Case the Commission will not include a no extra claims clause in the settled award, but may identify in the decision the extent to which it is open to parties to the award to make further claims that would take effect during the life of the resultant award.

9.5 Claims that are based substantially on comparative wage justice will not be countenanced other than to the extent contemplated by the Gender Based Undervaluation Principle.

9.6 There will be no double counting, provided however, that an Arbitrated Case may rely upon a cumulation of the factors referred to in these Principles.

9.7 In the following Principles the expression "the conditions under which the work is performed" relates to the environment in which the work is done.

10.1 Changes in work value may arise from changes in the nature of the work, skill and responsibility required or the conditions under which work is performed. Changes in work by themselves may not lead to a change in wage rates. The strict test for an alteration in wage rates is that the change in the nature of the work should constitute such a significant net addition to work requirements as to warrant the creation of a new classification or upgrading to a higher classification an increase in remuneration to reflect the changed value of the work.

10.2 In addition to meeting the test in 10.1, a party making a work value application will need to justify any change to wage relativities that might result not only within the relevant internal award structure but also against any external classification to which that structure is related. There must be no likelihood of wage leapfrogging arising out of changes in relative position.

10.3 The foregoing circumstances are the only ones in which rates may be altered on the ground of work value under this Principle and the altered rates may be applied only to employees whose work has changed.

10.4 In applying the Work Value Changes principle, the Commission will have regard to the need for any alterations to wage relativities between awards to be based on skill, responsibility and the conditions under which work is performed.

10.5 Where new or changed work justifying a higher rate is performed only from time to time by persons covered by a particular classification, or where it is performed only by some of the persons covered by the classification, such new or changed work should be compensated by a special allowance which is payable only when the new or changed work is performed by a particular employee and not by increasing the rate for the classification as a whole.

10.5 Changes in the nature of the work, skill and responsibility required or the conditions under which work is performed that are not recognised by an existing rate of pay or allowance that meet the test in 10.1 are to be compensated as follows:

(1) where all employees in a classification are required to hold and maintain the relevant skills and/or qualifications to perform particular or similar work, and are required to perform it from time to time, this is to be reflected in the rate of pay for the classification;

(2) where a particular employee or employees within a classification are required to hold and maintain particular skills and/or qualifications to perform the work that are in addition to those otherwise required by those employed in that classification, and can be required at any time to perform that work, this is appropriately compensated by an all-purpose allowance payable to that employee or employees instead of by increasing the rate for the classification as a whole;

(3) where new or changed work is work that can be requested of any employee in a classification from time to time, but only arises occasionally and does not form part of the core work for that classification, this is appropriately compensated for by an incident allowance; and

(4) where the addition or alteration to work is related to particular conditions under which the work is performed, and the conditions only arise from time to time, this is appropriately compensated for by a disability allowance.

10.6 The time from which work value changes in an award should be measured is the date of operation of any adjustment arising from the last work value inquiry or the date of a consent award where the parties agreed that the wage increases in the consent award reflect or include increases in work value, whichever is the later.

10.7 Care should be exercised to ensure that changes that were taken into account in any previous work value adjustments or in a structural efficiency exercise are not included in any work evaluation under this Principle.

10.8 Where the tests specified in 10.1 are met, an assessment will have to be made as to how that alteration should be measured in monetary terms. Such assessment will normally be based on the previous work requirements, the wage previously fixed for the work and the nature and extent of the change in work or the date of a consent award in which the parties have agreed that the wage increases reflect increases in work value.

10.9 The Commission will guard against contrived classifications and over-classification of jobs.

11.1 Productivity or efficiency measures that have delivered substantial cost savings and/or productivity or efficiency improvements or which have made a substantial contribution towards the attainment of the objectives of the employer (including departments and agencies of the Crown) to achieve an improved quality of service, and/or become more competitive and/or efficient, to which employees have made a significant contribution, may constitute the basis for increases to wages and salaries or improvements in employment conditions, provided that the time from which such measures, savings or improvements are measured is the later of:

(1) the date of the last adjustment awarded on account of productivity and efficiency; or

(2) the date of a consent award in which parties have agreed that the wage increases incorporate an adjustment made under this Principle.

11.2 Productivity or efficiency improvements in the public sector could arise from:

(1) delivering the same service (quality or quantity) with fewer inputs;

(2) delivering a better service (quality or quantity) with the same inputs;

(3) achieving a large reduction of inputs, with a relatively slight reduction in service quality/quantity; and/or

(4) achieving a large improvement in service quality/quantity, with a relatively small increase of inputs.

11.3 The following are not productivity or efficiency improvements in the public sector:

(1) gaining a small improvement in output with a proportionate or relatively large increase in inputs;

(2) achieving a small reduction in inputs with a proportionate or relatively larger reduction in service quality/quantity;

(3) gaining a small improvement in quality, with no extra inputs, but with a relatively large reduction in output;

(4) slightly boosting output, with no extra inputs, but with a relatively large reduction in quality.

11.4 For the avoidance of doubt, it is not necessary to identify cost savings before an increase can be awarded under this Principle.

11.5 This Principle does not apply to Local Government awards.

12.1 Claims may be made for an alteration in wage rates or other conditions of employment on the basis that the work, skill and responsibility required, or the conditions under which work is performed, have historically been, or are presently, undervalued on the basis of gender.

12.2 Where such a claim is established, the Commission will seek to ensure that wage rates and conditions of employment properly reflect the value of the work, skill and responsibility required and/or the conditions under which the work is performed.

12.3 Where the undervaluation is sought to be demonstrated by reference to any comparator awards or classifications, the assessment is not to have regard to factors incorporated in the rates of such other awards which do not reflect the value of work, such as labour market attraction or retention rates or productivity factors.

12.4 The application of any formula, which is inconsistent with proper consideration of the value of the work performed, including where such formulas may themselves have been the result or product of gendered conceptions of the value of the work the subject of the application, is inappropriate to the implementation of this Principle.

12.5 The assessment of wage rates and other conditions of employment under this Principle is to have regard to the history of the award concerned, including any historical gendered conceptions of the value of the work the subject of the application.

12.6 Where the requirements of this Principle have been satisfied, an assessment will be made as to how the undervaluation should be addressed in money terms or by other changes in conditions of employment, such as reclassification of the work, establishment of new career paths or changes in incremental scales. Such assessments will have regard to the wages and conditions of employment previously fixed for the work and the nature and extent of the undervaluation established.

12.7 In applying the previous paragraph, consideration is to be given to measures to address so far as possible, consistent with achieving the outcome in 12.2 above, a legitimate concern that changes in wage relativities, not only within the award in question but also against external classifications to which the award structure is related, will give to rise to claims that would cause wage leapfrogging.

12.8 Any changes made to the award as a result of this assessment may be phased in and consideration is to be given, where relevant, to whether any increase in award rates can be absorbed in individual employees' over-award payments.

12.9 The Commission will guard against contrived classifications and over-classification of jobs.

12.10 Equal remuneration will not be achieved by reducing any current wage rates or other conditions of employment.

13.1 A new award or a variation to an existing award can be granted otherwise than under one or more of the preceding Arbitrated Case principles where an applicant can demonstrate that the matter has special attributes or is out of the ordinary in a manner that warrants approval by the Commission despite the restrictive considerations imposed by these principles.

13.2 Care should be taken not to rely on factors already taken into account in establishing a predecessor award.

14.1 The Commission can make a new award or vary an award to address changes in the real value of money having regard to all the circumstances, including:

(1) the mandatory considerations in Principle 2 including the need to ensure that the award rates remain fair and reasonable, the state of the economy of New South Wales and the fiscal position and outlook of the Government;

(2) the status of bargaining between the parties to the Award;

(3) the likelihood of that bargaining concluding in a timely fashion; and

(4) the terms of any no extra claims undertaking that relevant unions provide to the Commission in order to obtain the increase;

(6) the nominal term of the existing award has expired;

(7) the employees covered by that award have not had an increase in rates for at least 12 months;

(8) no paid rates adjustment has been set pursuant to Principle 6; and

(9) each union party to the award gives a no extra claims undertaking in the following terms, or in such other terms as the parties agree or the Commission considers appropriate in the circumstances:

[Name of union] undertakes not to pursue any further claims to amend the award in proceedings before the Industrial Relations Commission in respect of employees covered by the award that would take effect during its nominal term. Provided that this undertaking does not prevent:

(i) participation in collaborative discussions to amend the award by means of mutual gains bargaining or otherwise;

(ii) making an application to vary the award by consent;

(iii) participation in a consent arbitration;

(iv) participation in a s 19 review or other proceedings initiated by the Commission or another party that affects the award; or

(v) pursuing and giving effect to claims under the Gender Based Undervaluation Principle during the nominal term.

14.2 This Principle does not apply to Local Government awards.

154.1 When considering an application for a new award or the variation of an award, including the timetabling of such an application, the Commission will have regard to whether the parties have complied with the following.

154.2 In respect of the commencement of negotiations for a new award:

(1) a party contemplating a major industrial case pursuant to Practice Direction 8A must notify the Commission and the other relevant parties at least three months before the nominal expiry date of the award that it is their intention to enter into negotiations for a new award in respect of claims justified under one or more of the Arbitrated Case criteria or otherwise;

(2) the parties to the award must begin negotiations as soon as is practicable after the notification has been given. In this regard, once a written claim has been made by one party on another party, then if negotiations have not already commenced they must begin within 28 days unless it is agreed by the parties to commence negotiations at a later time;

(3) prior to or at the outset of negotiations, a party can make a reasonable request to another party for relevant information to be used for the purpose of evaluating options or developing claims and that request will not be unreasonably refused;

(4) disputes about these procedures will be dealt with in accordance with the dispute resolution procedures in the relevant award applying to the parties to the dispute.

154.3 In respect of any claim to alter existing wages and conditions, including to modernise or consolidate awards, each party is to bargain in good faith prior to any arbitration commencing. In particular, parties are to:

(1) consider whether to enter into mutual gains bargaining under Chapter 2A of the Act;

(2) attend meetings they have agreed to attend and be represented at the negotiations by persons capable of giving genuine consideration and reasoned responses to the proposals of other parties;

(3) comply with agreed or reasonable negotiating or meeting procedures;

(4) disclose relevant information for the purposes of negotiation;

(5) respond to each other's claims and/or counter claims in a reasonable and timely manner; and

(6) to the extent that agreement is reached, apply by consent to the Commission to make a new award or vary an award to give effect to that agreement.

154.4 The good faith bargaining requirements do not require a party to:

(2) reach agreement on the terms that are to be included in the agreement.

165.1 Any employer or group of employers bound by an award may apply, temporarily or otherwise, to reduce, postpone and/or phase in the application of any increase in labour costs determined under the Principles on the ground of very serious or extreme economic adversity. The merit of such an application will be determined on a case by case basis and any relevant material shall be rigorously tested. Significant unemployment or other serious consequences for the employees and employers concerned are important factors to be taken into account in assessing the merit of any application.

165.2 Such an application will be processed according to the Special Case Principle.

165.3 Any decision to temporarily reduce or postpone an increase will be subject to a further review, the date of which will be determined by the Commission at the time it decides any application under this Principle.

176.1 Other than as provided at 17.2, tThese Principles apply to:

(1) any application to make or vary an award that is made on or after the date of commencement of these Principles; and

(2) any such application filed prior to that time where the hearing of the matter has not commenced as at the date of the commencement of these Principles (directions hearings will not count for this purpose).

17.2 Paragraphs 6.3 to 6.6 have no application prior to the 2025 State Wage Case, which will consider whether to make a paid rates adjustment and whether there should be any alteration to those paragraphs.

187.1 These Principles will operate on and from 20 December 2024[insert] 2025 until further order of the Commission.

The Commission makes the following order pursuant to s 51:

A. Minimum Wage for Award/Agreement Free Employees

A.1 Employees within the jurisdiction of the Act whose employment is not subject to the terms of an industrial instrument shall be paid not less than the rate prescribed by the National Minimum Wage Order as made by the Fair Work Commission from time to time.

[1] Industrial Relations Act 1996 (NSW), s 10.

[2] Industrial Relations Act 1996 (NSW), s 21(2)(b); State Wage Case 2024 (No 3) (2024) 337 IR 111; [2024] NSWIRComm 19 at [3].

[3] State Wage Case 1983 (1983) 5 IR 1; State Wage Case 2024 (No 3) (2024) 337 IR 111; [2024] NSWIRComm 19 at [3].

[4] (2024) 337 IR 182; [2024] NSWIRComm 25. See also State Wage Case (No 3) (2024) 337 IR 111; [2024] NSWIRComm 19 at [6].

[5] (2024) 337 IR 182; [2024] NSWIRComm 25. See also State Wage Case 2024 (No 3) (2024) 337 IR 111; [2024] NSWIRComm 19 at [111]-[117].

[6] State Wage Case 2024 (No 3) (2024) 337 IR 111; [2024] NSWIRComm 19 at [112].

[7] State Wage Case 2024 (No 3) (2024) 337 IR 111; [2024] NSWIRComm 19 at [115].

[8] State Wage Case 2024 (No 3) (2024) 337 IR 111; [2024] NSWIRComm 19 at [115].

[9] Annual Wage Review 2025 (2025) 341 IR 1; [2025] FWCFB 3500 at [6].

[10] [2025] NSWIRComm 22.

[11] (2024) 337 IR 111; [2024] NSWIRComm 19 at [110]-[118].

[12] [2025] NSWIRComm 1063.

[13] (2024) 337 IR 111; [2024] NSWIRComm 19.

[14] Fire Brigade Employees' Union v Industrial Relations Secretary [2025] NSWIRComm 1063 at [76], [95]-96].

[15] [2025] NSWIRComm 1063 at [96].

[16] See, eg, Industrial Relations Secretary v Unions NSW [2025] NSWIRComm 26 at [32]; Re Crown Employees (Public Sector - Salaries 2024) Award - Consent variation re Psychologist rates [2025] NSWIRComm 1045 at [6]; Crown Employees (NSW Police Force Special Constables) (Security) Award 2024 [2024] NSWIRComm 10 at [5]; Crown Employees (New South Wales Education Standards Authority - Education Officers) Salaries and Conditions Award 2024 [2025] NSWIRComm 1056 at [5]; Crown Employees (Australian Music Examinations Board (NSW) Examiners, Assessors and Chief Examiners) Award 2024 [2025] NSWIRComm 1055 at [5]; Higher School Certificate Marking and Related Casual Employees Rates of Pay and Conditions Award 2024 [2025] NSWIRComm 1054 at [5]; Crown Employees (Police Officers - 2024) Award [2024] NSWIRComm 24 at [6].

[17] Australia Bureau of Statistics, Consumer Price Index, Australia June Quarter 2025.

[18] Australia Bureau of Statistics, Consumer Price Index, Australia June Quarter 2025; Reserve Bank of Australia, Statement on Monetary Policy, (August 2025) at 58.

[19] Reserve Bank of Australia, Statement on Monetary Policy, (August 2025) at 58.

[20] See, eg, Crown Employees (NSW Police Force (Nurses')) Award 2022 [2024] NSWIRComm 20 at [1]; the Secretary's position concerning interim increases in Industrial Secretary & Ors v Public Service Association and Professional Officers' Association Amalgamated Union of New South Wales & Ors (No 2) [2024] NSWIRComm 21 at [4]; the 2024 interim increases made to the Public Health System Nurses' and Midwives (State) Award 2024 and the Crown Employees' Nurses (State) Award 2024 in Industrial Relations Commission Proceedings No. 2024/00242824 and No. 2024/00242813; and Public Health System Nurses' and Midwives' (State) Award 2023 [2025] NSWIRComm 30 at [3].

[21] State Wage Case 2024 (No 3) (2024) 337 IR 111; [2024] NSWIRComm 19 at [102]-[109].

[22] State Wage Case 2000 (2000) 97 IR 93; [2000] NSWIRComm 83 at Annexure B, subprinciple 2(d).

[23] State Wage Case 2000 (2000) 97 IR 93; [2000] NSWIRComm 83 at Annexure B, principle 10.

[24] Award Making Principles, subprinciple 9.1.

[25] Re Social & Community Services Employees (State) Award (2001) 113 IR 119; [2001] NSWIRComm 274 at [22]-[25], [312]-[313]; Re Operational Ambulance Officers (State) Award (2001) 113 IR 384; [2001] NSWIRComm 331 at [166]-[168].

[26] (2001) 113 IR 119; [2001] NSWIRComm 274 at [22].

[27] (1993) 52 IR 243 at 376-377; [1993] NSWIRComm 104.

[28] [2000] AIRC 722; (2000) 110 IR 247 at 266-267; [2000] AIRC 722.

[29] (1996) 95 IR 126 at 130-131.

[30] (2002) 115 IR 183; [2002] NSWIRComm 100 at [13], quoting Re Operational Ambulances Officers (State) Award (2001) 113 IR 384; [2001] NSWIRComm 331 at [168].

[31] (2002) 115 IR 183; [2002] NSWIRComm 100 at [13].

[32] (2002) 115 IR 8; [2002] NSWIRComm 13 at 11.

[33] Re Public Hospital Nurses (State) Award (No 4) (2003) 131 IR 17; [2003] NSWIRComm 442 at [237]-[241]; Re Staff Specialists (State) Award (2006) 152 IR 405; [2006] NSWIRComm 124 at [119]-[120]; Health Employees Pharmacists (State) Award (2003) 132 IR 244; [2003] NSWIRComm 453 at [116], [263], [338(d)]; Re Crown Employees (Teachers in Schools and TAFE and Related Employees) Salaries and Conditions Award (2004) 133 IR 254; [2004] NSWIRComm 114 at [499]; Re Teachers (Non Government Early Childhood Service Centres other than Preschools) (State) Award 2006 (2009) 191 IR 14; [2009] NSWIRComm 198 at [179]; Teachers (Non-government Preschools) (State) Award (2001) 120 IR 3; [2001] NSWIRComm 335 at [335].

[34] Re Crown Employees (Police Officers - 2009) Award (2012) 220 IR 1; [2012] NSWIRComm 23 at [85]; Re Crown Employees (Administrative and Clerical Officers) (State) Award (No 2) (1993) 52 IR 243 at 376; [1993] NSWIRComm 104; Re Social and Community Services Employees (State) Award (2006) 152 IR 149; [2006] NSWIRComm 87 at [9].

[35] Fire Brigade Employees' Union v Industrial Relations Secretary (on behalf of Fire and Rescue NSW) [2025] NSWIRComm 1063 at [119]-[121].

[36] Fire Brigade Employees' Union v Industrial Relations Secretary (on behalf of Fire and Rescue NSW) [2025] NSWIRComm 1063 at [119]-[121].

[37] (2003) 131 IR 17; [2003] NSWIRComm 442.

[38] For example, in respect of the consultation mechanism and the Country Relief model: Fire Brigade Employees' Union v Industrial Relations Secretary (on behalf of Fire and Rescue NSW) [2025] NSWIRComm 13 at [322], [403].

[39] [2025] NSWIRComm 1059 at [6], [8].

[40] State Wage Case 2024 (No 4) (2024) 337 IR 182; [2024] NSWIRComm 25 at Annexure A; State Wage Case (No 3) (2024) 337 IR 111; [2024] NSWIRComm 19 at [137]-[140].