the use of the Commission’s data in the Draft Report and specific responses to technical issues arising in chapters of the Draft Report. Chapter 3: Institutions Page Reference Section in Draft Report Fair Work Commission response/comment p. 151 The Draft Report states that certain findings are “… supported by earlier research finding that at ‘pinch points’ in decision making, the past professional history of decision makers can be a significant predictor of outcomes (Southey and Fry 2012).” The Southey and Fry 2012 research referred to does not find that member background “can be a ‘significant predictor of outcomes”. The research found: “A mild association exists between work history and arbitration decisions, on this analysis alone it would be imprudent to suggest that judicial bias featured in these decisions. The influence of an arbitrator’s work background on his or her decisions would be one among many potential variables influencing arbitration results.” (p. 118) The Southey and Fry 2012 research analyses cases heard under a previous legislative framework (the Workplace Relations Act 1996 (Cth) (pre-reform)). The analysis has little relevance to the way the system currently operates. See also the “Response to the Draft Report” by Prof. A Stewart et al of September 2015 (Submission DR271), discussing some of the limitations of the Southey and Fry and Booth and Freyens research (at pp. 5-6). p. 152 The Draft Report notes that “Data on existing members suggests that the average duration of current appointments is around 6 years, with some members having served for close to 15 years”. As at 1 August 2015, the average length of appointment for the Commission’s 41 primary appointments was 9.62 years and the mode was 13.76 years. p. 159 The Draft Report suggests that there should be an independent performance review of the Commission’s unfair dismissal conciliation operations along the lines of recent FWO evaluation. Citation references O’Neill 2012a. This citation appears to be incorrect (as it relates to the General Manager’s 2012 report into Individual Flexibility Arrangements). Chapter 5: Unfair dismissal Page Reference Section in Draft Report Fair Work Commission response/comment
(SEARS) data is 9.2 per cent.” p. 312 The Draft Report notes that “for comparison” the AWRS estimation of people on the NMW was 0.2 per cent which was lower than the Department of Employment’s estimate of persons “earning the minimum wage”. The AWRS’s finding of 0.2 per cent relates to persons covered by the National Minimum Wage (NMW) Order i.e. award/ agreement free employees. It does not relate to employees in receipt of wages that are at the rate of the national minimum wage under awards. The AWRS is the only survey which has data outlining the number of persons covered by the NMW Order. p. 333 Referring to the Expert Panel’s Annual Wage Review 2014-15 considerations, the Draft Report states: “It has indicated that it is ‘mindful of the possibility that higher rates of growth of minimum wages could diminish the number of entry level and lowskill jobs over the longer term’, and sets the minimum wage at a lower level as a result of that consideration.” This is not an accurate summation of the Expert Panel’s reasoning. In the Annual Wage Review 2014-15 decision ([2015] FWCFB 3500) the Expert Panel also notes that the consequences of larger minimum wage rises on profitability and the viability of small businesses are factors that have been given due weight in its decisions. (at para [433]) Chapter 9: Variations from uniform minimum wages Page Reference Section in Draft Report Fair Work Commission response/comment pp. 335, 343–344 Chapter 9 discusses variations from uniform minimum wages, which includes a discussion of the possibility of differences in wage rates. Section 154 of the Fair Work Act generally provides that modern awards must not include terms and conditions of employment that contain state-based differences. pp. 344, 442, 448 In a number of places, the report discusses the principle of “Equal Pay for Equal Work” in the context of the regulation of wages and the evaluation of work value across industries. The principle of equal remuneration for work of equal or comparable value forms part of the modern awards objective (s.134) and the minimum wages objective (s.284). The phrase is defined in s.12 of the Fair Work Act by reference to s.302(2), as meaning “equal remuneration for men and women workers for work of equal or comparable value”. This is the basis for
p. 396 The Draft Report suggests that employees not covered by an award have their wages and employment set by the NES. The National Minimum Wage Order sets minimum wages for award/agreement free national system employees (s.294(3)). The NES does not set wages. p. 416 The Draft Report notes that the Commission has expressed reluctance to revisit issues during the four yearly review which were decided in the award modernisation process or under the (two yearly) transitional review. The Commission’s approach and its reasons are explained in the Full Bench decision: 4 Yearly Review of Modern Awards: Preliminary Jurisdictional Issues [2014] FWCFB 1788 at paras [23]–[27] and [60]. Chapter 12: Repairing awards Page Reference Section in Draft Report Fair Work Commission response/comment p. 440 The Draft Report states: “The objective of these assessments would be to ensure that awards provide an adequate safety net for employees at least-cost to employers.” The current modern awards objective is to ensure that modern awards, together with the NES, provide a fair and relevant minimum safety net of terms and conditions of employment, not that the Commission must ensure that there is an adequate safety net at least-cost to employers. p. 448 The Draft Report states “… the Full Bench discussed the proposals put forward by a number of parties to justify different increases to wages in different awards. These proposals were rejected for two main reasons: - there was insufficient evidence of an incapacity to pay - any differential changes would alter the existing relativities, which would undermine the concept of ‘equal pay for work of equal value’… ” The Annual Wage Review 2013-14 [2014] FWCFB 3500 does not state that these were the two main reasons for which proposals for award-by-award adjustments were rejected. Relevantly, the Panel also states at para [517]: “The scheme of the Act is more consistent with establishing adjustments across the range of modern awards, and in the absence of exceptional circumstances, taking the sectoral variations into account when determining the level and nature of adjustments that will apply to the modern awards generally. Exceptional circumstances can and should be considered on their merits as required by the Act.” The Panel also provides reasons in response to the claims of parties in relation to particular industries or awards: see in particular paras [557] – [558].
Chapter 14: Regulated weekend penalty rates for selected consumer services Page Reference Section in Draft Report Fair Work Commission response/comment pp. 530-1 The Draft Report discusses the inclusion of preferred hours clauses in enterprise agreements. A preferred hours clause may be included in an enterprise agreement where the instrument overall would satisfy the BOOT (not only where there are exceptional circumstances). Chapter 16: Individual flexibility arrangements Page Reference Section in Draft Report Fair Work Commission response/comment p. 600 The Draft Report states that the 2012 General Manager’s report into individual flexibility arrangements (IFAs) found employees were more likely to initiate an IFA “(56 per cent compared to 44 per cent that were employer initiated).” The data presented in the Draft Report does not reflect the results for all IFAs made, it only reflects the results of those employers who had made a single IFA (p.43, Table 4.3). Where employers had entered into IFAs with more than one employee employers), a greater proportion were at the initiation of the employer: 74 per cent of these employers reported that all IFAs they had made were employer initiated; 11 per cent reported that some IFAs were employer initiated; and 15 per cent reported no IFAs were employer initiated (i.e. 15 per cent reported all IFAs were employee initiated) (p. 48, Table 4.6). p. 600 The Draft Report also states that the 2012 IFA report found: “Employers with multiple IFAs identify the main benefits as clarity about conditions, the capacity for staff to work hours as needed by the employer, and increased rostering flexibility (O’Neill 2012b). Employers with multiple IFAs also nominated formalisation of an existing arrangement as a benefit.” The formalisation of an existing arrangement was the most commonly reported benefit by multiple-IFA employees – 43 per cent (p.68, Table 5.10). p. 601 The Draft Report states: “The conditions most likely to be varied in an IFA are arrangements about when work is performed, increases in penalty rates and overtime rates (O’Neill 2012b).” Of the five matters contained in the IFA model flexibility term, arrangements for when work is performed was the most commonly varied matter among employers that reported having one IFA (45 per cent) and overtime was the most common among employers that reported having more than one IFA (36 per cent) during the reference period. The incidence