DECISION

Fair Work Act 2009
s.156 - 4 yearly review of modern awards

4 yearly review of modern awards—Training costs
(AM2016/14)

MANUFACTURING AND ASSOCIATED INDUSTRIES AND OCCUPATIONS AWARD 2010
GRAPHIC ARTS, PRINTING AND PUBLISHING AWARD 2010
FOOD, BEVERAGE AND TOBACCO MANUFACTURING AWARD 2010

4 yearly review of modern awards – training costs – Manufacturing and Associated Industries and Occupations Award 2010 – Graphic Arts, Printing and Publishing Award 2010 – Food, Beverage and Tobacco Manufacturing Award 2010 – training arrangements for trainees – training associated with training contract.

1. Introduction and Background

[1] This decision deals with what is in effect an application by the Australian Industry Group (Ai Group) to vary the Manufacturing and Associated Industries and Occupations Award 2010 (Manufacturing Award), the Graphic Arts, Printing and Publishing Award 2010 (Graphic Arts Award) and the Food, Beverage and Tobacco Manufacturing Award 2010 (FBTM Award) in relation to training costs.

[2] The Ai Group seeks to have provisions in these Modern Awards which currently provide for the reimbursement to certain employees for training costs, varied so that the reimbursement obligation would not apply to the costs associated with training in connection with a trainee’s training contract.

[3] The proposed subclauses which Ai Group seeks to include in the three Modern Awards to give effect to its primary claims are set out in [52] below.

[4] Section 156 of the Fair Work Act 2009 (Cth) (the Act) requires the Fair Work Commission (Commission) to conduct a 4 yearly review of modern awards (Review) as soon as practicable after 1 January 2014. As detailed in a statement issued on 6 February 2014, 1 the Review consists of an Initial stage, dealing with jurisdictional issues, a Common issues stage and an Award stage. The Manufacturing Award, the Graphic Arts Award and the FBTM Award were assigned to three different Groups of the Award stage; 1, 2 and 4.

[5] In October 2014, Ai Group proposed to insert a new paragraph in the Manufacturing Award concerning training costs, as follows:

“Clause 27.5 does not apply to costs associated with training that is in connection with a trainee’s training contact [sic].” 2

[6] Initially, this matter was discussed at conferences before Commissioner Bissett dealing with technical and drafting matters for the Manufacturing Award. In a Statement issued by Commissioner Bissett on 25 February 2016, 3 reference was made to the award variations sought by Ai Group relating to training costs.

[7] Ai Group was directed to identify the claims, the Modern Awards relevant to the claims and to submit draft determinations. Ai Group filed submissions 4 and a draft determination on 28 April 2016 for the Manufacturing Award and additionally, the Graphic Arts Award.

[8] In a subsequent mention before Justice Ross on 13 May 2016, Ai Group identified that the training costs issue also arose in the FBTM Award and that Ai Group intended to pursue a similar variation to that award. On 14 May 2016, Ai Group filed a draft determination proposing to vary the FBTM Award. 5

[9] Subsequently, Directions were issued calling for comprehensive submissions from interested parties and confirming that a Full Bench would be constituted to deal with the proposals to vary the Manufacturing Award, the Graphic Arts Award and the FBTM Award in relation to training costs. 6

[10] Submissions were received from Ai Group 7 and the Australian Manufacturing Workers’ Union (the AMWU) filed submissions opposing the variations.8 A hearing before this Full Bench was conducted on 30 August 2016. The Australian Workers’ Union (the AWU) wrote to the Commission noting that it has an interest in the training costs matter as it relates to the Manufacturing Award and the FBTM Award.9 The AWU expressed support for the AMWU’s submissions but did not file separate submissions or participate in the hearing.

[11] The Ai Group did not call any witnesses at the hearing, while the AMWU relied on a witness statement and oral evidence from Mr Ian Curry, 10 National Co-ordinator, Skills, Training & Apprenticeships.

[12] Further submissions were filed by both Ai Group 11 and the AMWU12 following the hearing.

2. The context

Legislative framework

[13] Relevantly, s.156(2) provides:

“(2) In a 4 yearly review of modern awards, the FWC:

(a) must review all modern awards; and

(b) may make:

(i) one or more determinations varying modern awards; and

(ii) one or more modern awards; and

(iii) one or more determinations revoking modern awards; and

(c) must not review, or make a determination to vary, a default fund term of a modern award.

Note 1: Special criteria apply to changing coverage of modern awards or revoking modern awards (see sections 163 and 164).

Note 2: For reviews of default fund terms of modern awards, see Division 4A.”

[14] Section 156(5) provides that in a Review each modern award must be reviewed in its own right, however, this does not prevent the Commission from reviewing two or more modern awards at the same time. In National Retail Association v Fair Work Commission 13 the Court noted the purpose of the ‘in its own right’ requirement is to ensure the review is ‘conducted by reference to the particular terms and the particular operation of each particular award rather than by a global assessment based upon generally applicable considerations.’14

[15] The ‘scope’ of the Review was considered in the Preliminary Jurisdictional Issues Decision. 15 There the Full Bench observed that “[T]he Commission is obliged to ensure that modern awards, together with the NES, provide a fair and relevant minimum safety net taking into account, among other things, the need to ensure a ‘stable’ modern award system (s.134(1)(g)). The need for a ‘stable’ modern award system suggests that a party seeking to vary a modern award in the context of the Review must advance a merit argument in support of the proposed variations.16

[16] The modern awards objective is set out in s.134 of the Act, as follows:

“134 The modern awards objective

What is the modern awards objective?

(1) The FWC must ensure that modern awards, together with the National Employment Standards, provide a fair and relevant minimum safety net of terms and conditions, taking into account:

(a) relative living standards and the needs of the low paid; and

(b) the need to encourage collective bargaining; and

(c) the need to promote social inclusion through increased workforce participation; and

(d) the need to promote flexible modern work practices and the efficient and productive performance of work; and

(da) the need to provide additional remuneration for:

(i) employees working overtime; or

(ii) employees working unsocial, irregular or unpredictable hours; or

(iii) employees working on weekends or public holidays; or

(iv) employees working shifts; and

(e) the principle of equal remuneration for work of equal or comparable value; and

(f) the likely impact of any exercise of modern award powers on business, including on productivity, employment costs and the regulatory burden; and

(g) the need to ensure a simple, easy to understand, stable and sustainable modern award system for Australia that avoids unnecessary overlap of modern awards; and

(h) the likely impact of any exercise of modern award powers on employment growth, inflation and the sustainability, performance and competitiveness of the national economy.

This is the modern awards objective.

When does the modern awards objective apply?

(2) The modern awards objective applies to the performance or exercise of the FWC’s modern award powers, which are:

(a) the FWC’s functions or powers under this Part; and

(b) the FWC’s functions or powers under Part 2–6, so far as they relate to modern award minimum wages.

Note: The FWC must also take into account the objects of this Act and any other applicable provisions. For example, if the FWC is setting, varying or revoking modern award minimum wages, the minimum wages objective also applies (see section 284).”

[17] The modern awards objective is directed at ensuring that modern awards, together with the NES, provide a “fair and relevant minimum safety net of terms and conditions” taking into account the particular considerations identified in paragraphs 134(1)(a) to (h). The objective is expressed very broadly. 17 The obligation to take into account the matters set out in paragraphs 134(1)(a) to (h) means that each of these matters must be treated as a matter of significance in the decision-making process.18

[18] No particular primacy is attached to any particular consideration and not all will necessarily be relevant in the context of a particular proposal to vary a modern award. 19

[19] Section 138 of the Act provides that terms included in modern awards must be “necessary to achieve the modern awards objective”. That which is ‘necessary’ will involve a value judgment based on the assessment of the considerations stated in s.134(1)(a) to (h), having regard to the submissions and evidence. 20

[20] The modern awards objective applies to the exercise of the Commission’s modern award powers including the Commission’s functions or powers under Part 2–3 of the Act. The Review function is set out in s.156, which is in Part 2-3.

[21] Section 139 of the Act provides that a modern award may include terms about any of the following matters:

“139 Terms that may be included in modern awards—general

(1) A modern award may include terms about any of the following matters:

(a) minimum wages (including wage rates for junior employees, employees with a disability and employees to whom training arrangements apply), and:

(i) skill-based classifications and career structures; and

(ii) incentive-based payments, piece rates and bonuses;

(b) type of employment, such as full-time employment, casual employment, regular part-time employment and shift work, and the facilitation of flexible working arrangements, particularly for employees with family responsibilities;

(c) arrangements for when work is performed, including hours of work, rostering, notice periods, rest breaks and variations to working hours;

(d) overtime rates;

(e) penalty rates, including for any of the following:

(i) employees working unsocial, irregular or unpredictable hours;

(ii) employees working on weekends or public holidays;

(iii) shift workers;

(f) annualised wage arrangements that:

(i) have regard to the patterns of work in an occupation, industry or enterprise; and

(ii) provide an alternative to the separate payment of wages and other monetary entitlements; and

(iii) include appropriate safeguards to ensure that individual employees are not disadvantaged;

(g) allowances, including for any of the following:

(i) expenses incurred in the course of employment;

(ii) responsibilities or skills that are not taken into account in rates of pay;

(iii) disabilities associated with the performance of particular tasks or work in particular conditions or locations;

(h) leave, leave loadings and arrangements for taking leave;

(i) superannuation;

(j) procedures for consultation, representation and dispute settlement.

(2) Any allowance included in a modern award must be separately and clearly identified in the award.” [Emphasis added]

[22] Section 12 of the Act defines training arrangement as meaning “a combination of work and training that is subject to a training agreement, or a training contract, that takes effect under a law of a State or Territory relating to the training of employees.”

[23] The Full Bench in the Transitional Review—Apprentices decision 21 accepted the submission of the AMWU that the Decision of Senior Deputy President Marsh in 1998 in Re Metal Industry Award 1984 - Part 122 supported its contention that training and apprenticeships are matters that fall within, or are incidental to, matters in s.139:

“[83] The AMWU next took us to a decision of Senior Deputy President Marsh in 1998 in Re Metal Industry Award 1984 - Part 1. It submitted that this decision supported its contention that “training and apprenticeships are matters that fall within or are incidental to matters in s.139”. We observe that this decision was also an award simplification decision. In it her Honour decided that clauses dealing with probationary employment (both generally and for apprentices), apprentices (including adult apprentices), the training contract and State laws relating to apprentices, the cancellation or suspension of the contract of apprenticeship, the reimbursement of training college fees, constraints on apprentices under 18 years old working overtime or shifts, the making up of lost time and the payment of training costs including travel costs associated with training were all allowable under s.89A of the WR Act. We accept the AMWU submission that the range of provisions there considered by her Honour raised considerations similar to those before this Full Bench. We note that in arriving at her decision heavy reliance was placed on the findings in the Hospitality Decision where comparable clauses had been found to be either allowable or incidental and necessary. An important exception however was to a claim made concerning training of apprentices. Senior Deputy President Marsh considered that claim in detail, noting that the Hospitality Decision had not exhaustively dealt with a comparable claim.

[84] We note that many of the provisions being considered in that case were supported by both the unions and the principal employer party to the award. Those which were opposed were generally challenged by the Commonwealth and ACCI. However the award made following her Honour’s decision, then called the Metal, Engineering and Associated Industries Award 1998, contained clauses dealing with apprentices and the training contract which today remain in the Manufacturing Award. That award was made by a Full Bench which was obliged to consider the terms of s.576J of the WR Act, which is the predecessor to s.139 of the Act and in the same terms.”

[24] Finally, a modern award may also include terms that are incidental or ancillary to the operation of NES entitlements and terms that supplement the NES, provided that the effect of those terms is not detrimental to an employee in any respect when compared to the NES (s.55(4)).

The arbitral history of training and training costs provisions

[25] In dealing with matters arising in the Review, the Commission will have regard to the relevant historical context and will take into account previous decisions relevant to any contested issue. The particular context in which those decisions were made will also be considered.

[26] Training provisions in awards have been the subject of consideration by the Commission and its predecessor bodies over many years. The training costs and travel costs provisions in the Metal, Engineering and Associated Industries Award 1998 (Metals Award 1998), the main predecessor award to the Manufacturing Award, were initially developed out of the structural efficiency process undertaken by the Australian Industrial Relations Commission (AIRC) in 1989-1990.

[27] The Metal Industry Award 1984 – Part 1 (Metals Award 1984) had set out the objective of the training clause as promoting structural efficiency by broad-banding and multiskilling employees. For this to be achieved, employers would need to consider the skills of their employees and whether additional training would be needed. The Award Restructuring Implementation Manual for the Metal and Engineering Industry 23 set out the underlying principles of the structural efficiency exercise. In June 1990, the Metal Trades Industry Association published further guidelines24 for employers, explaining their training obligations under the Metals Award 1984, including the provision of reimbursement for training fees and travel costs. This document provided an explanation of the intent of the clause. The award variation inserted in 1990 was intended to address the Structure Efficiency Principle as incorporated within the National Wage Case Decision in 1989:25

“STRUCTURAL EFFICIENCY

Structural efficiency adjustments allowable under the National Wage Case decision of 7 August 1989 will be justified in accordance with this principle if the Commission is satisfied that the parties to an award have co-operated positively in a fundamental review of that award and are implementing measures to improve the efficiency of industry and provide workers with access to more varied, fulfilling and better paid jobs. The measures to be considered should include but not be limited to:

•  establishing skill-related career paths which provide an incentive for workers to continue to participate in skill formation;

•  eliminating impediments to multi-skilling and broadening the range of tasks which a worker may be required to perform;

•  creating appropriate relativities between different categories of workers within the award and at enterprise level;

•  ensuring that working patterns and arrangements enhance flexibility and the efficiency of the industry;

•  including properly fixed minimum rates for classifications in awards, related appropriately to one another, with any amounts in excess of these properly fixed minimum rates being expressed as supplementary payments;

22 NATIONAL WAGE CASE AUGUST 1989

•  updating and/or rationalising the list of respondents to awards; and

•  addressing any cases where award provisions discriminate against sections of the workforce.

Structural efficiency exercises should incorporate all past work value considerations.”

[28] An Order made by Deputy President Keogh on 15 December 1989 inserted provisions into the Metals Award 1984 enabling employment of Australian Traineeship System (ATS) trainees (clause 13A) and adult apprentices (clause 14A). 26 Clause 13A set out a number of specific conditions of employment for trainees and, included subclause 13A(c)(vi), which stated:

“All other terms and conditions of the award shall apply unless specifically varied by this clause.”

[29] The ATS had been established in 1985 and further developed under the National Training Reform Agenda from 1986.

[30] By Order of Deputy President Keogh on 12 April 1990, 27 the Metals Award 1984 was varied to insert a new clause 6C for Training, which included new subparagraphs 6C(d)(ii) and 6C(d)(iii). These subparagraphs are similar to those now found in clause 32.5 of the Manufacturing Award.

“6C – TRAINING

. . .

(d) (i) Where, as a result of consultation in accordance with clause 6B or through a training committee and with the employee concerned, it is agreed that additional training in accordance with the programme developed pursuant the subclause (b) herein should be undertaken by an employee that training may be undertaken either on or off the job. Provided that if the training is undertaken during ordinary working hours the employee concerned shall not suffer any loss of pay. The employer shall not unreasonably withhold such paid training leave.

(ii) Any costs associated with standard fees for prescribed courses and prescribed textbooks (excluding those textbooks which are available in the employer's technical library) incurred in connection with the undertaking of training shall be reimbursed by the employer upon production of evidence of such expenditure. Provided that reimbursement shall also be on an annual basis subject to the presentation of reports of satisfactory progress.

(iii) Travel costs incurred by an employee undertaking training in accordance with this clause which exceed those normally incurred in travelling to and from work shall be reimbursed by the employer.” [Emphasis added]

[31] Clause 6C of the Metals Award 1984 was discussed in a Full Bench decision on 15 June 1990, 28 which considered union claims to include provisions concerning a training board for the Metal Industry:

“On 12 April 1990, Deputy President Keogh published an order which varied the Metal Industry Award 1984 - Part 1. The order was made by consent and the variations gave effect to changes which had been negotiated in accordance with the Commission's Structural Efficiency Principle. The principal theme of the changes was a commitment by the parties to co-operate in increasing the efficiency, productivity and international competitiveness of the metal and engineering industry and to enhance the career opportunities and job security of employees in the industry.

The training of employees was recognized by the parties as a key element in achieving these goals: a new provision titled clause 6C Training was introduced into the award. The opening words of this clause are as follows:

“6C - TRAINING

(a) The parties to this award recognise that in order to increase the efficiency, productivity and international competitiveness of industry, a greater commitment to training and skill development is required. Accordingly, the parties commit themselves to:

…

(i) developing a more highly skilled and flexible workforce; (ii) providing employees with career opportunities through appropriate training to acquire additional skills, and (iii) removing barriers to the utilisation of skills acquired."

There follows a comprehensive prescription of such matters as the development of training programmes by employers, the development of vocational skills by recourse to accredited educational institutions and the role and responsibilities of training committees.” [Emphasis added]

[32] By 1994, the National Training Wage Interim Award 1994 29 had been made. It reflected that the ATS traineeships were being phased out at the time:

“6 - SUPERSESSION

Any existing award provisions for the Australian Traineeship System (ATS) or the Career Start Traineeship (CST) shall not apply to any employer bound by this award, except in relation to ATS or CST trainees who commenced a traineeship with the employer before the employer was bound by this award.”

[33] The National Training Wage Interim Award 1994 also included a range of provisions relating to Trainees, including clauses 8 and 9, which respectively outlined “Training Conditions” and “Employment Conditions.” Similar to clause 13A of the Metals Award 1984, there were a number of specific employment conditions, including subclause 9(f):

“8(a) The Trainee shall attend an approved training course or training program prescribed in the Traineeship Agreement or as notified to the trainee by the relevant State or Territory Training Authority in accredited and relevant Traineeship Schemes; or NETTFORCE if the Traineeship Scheme remains subject to interim approval.

. . .

9(c) The Trainee shall be permitted to be absent from work without loss of continuity of employment and/or wages to attend the training in accordance with the Traineeship Agreement.

. . .

9(f) All other terms and conditions of the relevant award(s) that are applicable to the Trainee or would be applicable to the Trainee but for this Award shall apply unless specifically varied by this Award.” [Emphasis added]

[34] In 1995, 30 a new clause 13B was inserted into the Metals Award 1984 to clarify that clause 13A did not apply to trainees covered by the National Training Wage Interim Award 1994. Clauses 13A and 13B were replaced during the Award Simplification process31 with the following clause:

“4.2.7 Trainees

The parties to this Award shall observe the terms of the National Training Wage Interim Award 1994, as amended.”

[35] During the Award Simplification process, awards were varied to remove non allowable award matters. Clauses dealing with training were considered within this context. The Award Simplification Decision relating to the Hospitality Industry Award confirmed that allowances relating to training costs were allowable in this context: 32

“37. Training

The employers asked us to delete this clause on the basis that training is not an allowable award matter. The LTU consented to its deletion but on the basis that the provision is obsolete, dealing with a training program which no longer exists. We do not accept that training can never be the subject of award prescription. For example, clauses 37.4 and 37.5 are allowable because they make provision for rates of pay and other benefits which are clearly allowable matters. Nevertheless, we have decided to delete the whole of the clause because it is obsolete. In any case where training is said to be an allowable award matter, careful examination of all of the circumstances will be required.”

[36] In the Metal Industry Simplification Decision of 11 March 1998, 33 Senior Deputy President Marsh determined that clause 6C of the Metals Award 1984 was allowable because its purpose was to facilitate the implementation of the skills-based classification structure. The Senior Deputy President also reaffirmed the underlying purpose of the training provisions:

“5.2 Training

The Commonwealth supported the deletion of this provision with the exception of those subclauses which directly relate to entitlements which it agrees are allowable matters.

The parties support the inclusion of the clause which is identical to clause 6C in the current award. In doing so they rely upon a decision of Senior Deputy President Watson in the restructuring of the National Metal and Engineering On Site Construction Award 1989 (MECA Restructuring Print P4026) where he found that training clause, in similar terms to the clause now sought, was an allowable matter.

His Honour stated:

"I am satisfied, on the submissions put to me, that the order proposed in the exhibit MTIA 1 falls within the allowable matters prescribed in s.89A. The order seeks to give effect to a new skill based classification structure pursuant to the August 1989 Structural Efficiency Principle. Each of its provisions is directly associated with or is incidental to and necessary for the operation of provisions dealing with the awards before me of classification of employees and skills based career paths. Considered in the context of ordinary industrial usage, I am satisfied that the training provision proposed is incidental to and necessary for the operation of the provisions which give effect to skill based career paths as envisaged by the Structural Efficiency Principle.

I note that in Print N8926, Simmonds C approved supportive provisions, associated with the operation of a skills based classification structure, as allowable matters under the Act.

Whilst I am satisfied that the training provision is an allowable matter on the basis of the submission put to me in the current proceedings, the parties will have the opportunity to more closely examine the application of s.89A to the Award more generally in the context of a s.89A review of the award to be undertaken by a member of the building industry panel".

The clause now sought by the parties has been modified in light of the hospitality decision. Training provisions were inserted into the Metal Industry Award as part of the package of proposals identified as providing a basis for the proper operation of the skill based career path which was an objective of the structural efficiency principle. The identification of skills needed within an enterprise, ie., skills `acquired and used' is achieved in a non prescriptive manner through the operation of the provisions in clauses 5.2.1 and 5.2.2. As such it is argued clauses 5.2.1 and 5.2.2 provide mechanisms which "flow from and are incidental to an effective identification of skills needed within the enterprise which is a logical part of the implementation of a skill based classification structure".

Consistent with comments made in the hospitality decision on training I have adopted the approach outlined earlier in this decision namely, the particular context in which training provisions has been examined.” [Referencing omitted]

[37] The decision included a detailed analysis, clause by clause of what was allowable and/or incidental to the effective operation of the award and what was not an allowable matter, therefore, not to be included in the award. The outcome was a clause inserted in the Metals Award 1998 which, while similar in wording to clause 6C of the Metals Award 1984, addressed training in terms going to the establishment of skill based career paths at the enterprise level:

“5.2 TRAINING

5.2.1 Following proper consultation in accordance with clause 3.1, which may include the establishment of a training committee, an employer shall develop a training program consistent with:

•  the current and future skill needs of the enterprise;

•  the size, structure and nature of the operations of the enterprise;

•  the need to develop vocational skills relevant to the enterprise and the industry through courses conducted by accredited institutions and providers.

5.2.2 Where it is agreed that a training committee be established, the number of employee representatives on the committee should be no less than the number of employer representatives and the committee should have a charter which clearly states its role and responsibilities, for example:

•  formulating a training program including available training courses and career opportunities;

•  disseminating information on the training program and the availability of training courses and career opportunities for employees;

•  recommending individual employees for training and reclassification; and

•  monitoring and advising management and employees regarding the on-going effectiveness of the training.

5.2.3(a) Where as a result of such consultation, including with the employee concerned, it is agreed that additional training should be undertaken by an employee, that training may be undertaken either on or off the job. If the training is undertaken during ordinary working hours, the employee concerned shall not suffer any loss of pay. The employer shall not unreasonably withhold such paid training leave. This shall not prevent the employer and employee(s) agreeing to paid leave for other relevant training.

5.2.3(b) Any costs associated with standard fees for prescribed courses and prescribed textbooks (excluding those textbooks which are available in the employer's technical library) incurred in connection with the undertaking of training shall be reimbursed by the employer upon production of evidence of such expenditure. Provided that reimbursement may be on an annual basis subject to the presentation of reports of satisfactory progress.

5.2.3(c) Travel costs incurred by an employee undertaking training in accordance with this subclause which exceed those normally incurred in travelling to and from work shall be reimbursed by the employer.” [Emphasis added]

[38] The Metals Award 1998 retained clause 4.2.7, referred to above at [34] and also contained the following clause:

“5.6 TRAINEE RATES OF PAY

5.6.1 Trainees engaged under the terms of the National Training Wage Interim Award 1994 as amended, shall be paid the appropriate wage rate set out in that award.”

[39] Clause 5.6.1 of the Metals Award 1998 was subsequently varied on 17 January 2005, so that it referenced the new National Training Wages Award 2000. 34

[40] The National Training Wages Award 2000 35 also contained the following:

“9.1 The Trainee shall attend an approved training course or training program prescribed in the Training Agreement or as notified to the trainee by the relevant State or Territory Training Authority in accredited and relevant Traineeship Schemes;

. . .

10.4 The Trainee shall be permitted to be absent from work without loss of continuity of employment and/or wages to attend the approved training.

. . .

10.7 All other terms and conditions of the relevant award(s) that are applicable to the Trainee or would be applicable to the Trainee but for this Award shall apply unless specifically varied by this Award.” [Emphasis added]

[41] During the Award Modernisation process conducted by the Australian Industrial Relations Commission (AIRC) under Part 10A of the Workplace Relations Act 1996 (WR Act) apprentice and trainee wages and conditions were the subject of consideration, but there was no comprehensive review undertaken. In the Award Modernisation decision of 18 December 2008, 36 the Full Bench described the approach taken in relation to junior and apprentice rates as follows:

“[71] The federal awards and NAPSAs with which we are dealing contain a very wide range of rates for junior employees and apprentices. The relevant instruments fix percentages of the adult wage for juniors and apprentices based on a host of historical and industrial considerations, most of which can only be guessed at. It is not possible to standardise these provisions on an economy-wide basis, at least not at this stage. We have adopted the limited objective of developing new rates which constitute a fair safety net for each of the modern awards based on the terms of the relevant predecessor awards and NAPSAs. We have attempted to strike a balance as between, in some cases, wildly varying provisions. In the case of junior employees the rates will be expressed as a percentage of the rate for the relevant adult classification. In the case of apprentices the rates will generally be expressed as a percentage of the relevant trade rate.”

[42] In relation to the Hospitality Industry Awards, the Full Bench said:

“[134] The diversity in apprentice rates is indicative of broader issues which need to be addressed, in relation to apprentice and other training arrangements across the country. We do not think that the award modernisation process provides a proper opportunity to address those issues. In reaching that conclusion, we have had regard to submissions of training organisations which advocate a fuller review of apprentice wages.”

[43] The Award Modernisation Full Bench did not proceed to include in the Manufacturing Award all of the subclauses of the training clause that were previously contained in the Metals Award 1998, but did make provision for training costs in clause 32.5 as follows:

“32.5 Training costs

(a) Any costs associated with standard fees for prescribed courses and prescribed textbooks (excluding those textbooks which are available in the employer’s technical library) incurred by an employee in connection with training agreed to by the employer must be reimbursed by the employer on the production of evidence of such expenditure by the employee, provided that reimbursement may be on an annual basis subject to the presentation of reports of satisfactory progress.

(b) Travel costs incurred by an employee undertaking training agreed to by the employer, which exceed those normally incurred in travelling to and from work, must be reimbursed by the employer.”

[44] This provision resembles parts of Clause 5.2 of the Metals Award 1998: 37

“5.2.3(b) Any costs associated with standard fees for prescribed courses and prescribed textbooks (excluding those textbooks which are available in the employer's technical library) incurred in connection with the undertaking of training shall be reimbursed by the employer upon production of evidence of such expenditure. Provided that reimbursement may be on an annual basis subject to the presentation of reports of satisfactory progress.

5.2.3(c) Travel costs incurred by an employee undertaking training in accordance with this subclause which exceed those normally incurred in travelling to and from work shall be reimbursed by the employer.”

[45] In the later Award Modernisation decision of 2 September 2009, 38 the Full Bench stated “it would be desirable to develop a unified national system of training and employment conditions for apprentices” and noted, in that respect, that Fair Work Australia was required to set national minimum wages for award and agreement free employees to whom training arrangements applied in either its first or second annual wage reviews.

[46] A review of training conditions and other arrangements was conducted during the subsequent Transitional Review. Training costs were identified as one of the non-common matters relating to apprentices and were the subject of a separate decision for non-common matters.

[47] In the Transitional Review—Apprentices decision the Full Bench considered an application by Ai Group seeking to exclude clause 32.5 of the Manufacturing Award from applying to both apprentices and trainees. The Ai Group argued that the clause was never intended to have application to training by apprentices and trainees because the provisions associated with such training are governed by other award provisions.

[48] As part of the Transitional Review—Apprentices decision, the Full Bench determined 39 that clause 32.5 of the Manufacturing Award should be amended with the insertion of subclause (c), to make clear that the clause does not apply to costs associated with training that are in connection with an apprentice’s training contract:

“(c) Clause 32.5 does not apply to costs associated with training that are in connection with an apprentice’s training contract. Such costs are subject to clause 15 and not this clause.”

[49] A similar exclusionary provision was inserted in the FBTM Award. 40

[50] However, in its decision dated 28 November 2013, 41 the Transitional Review—Apprentices Full Bench declined to insert a similar provision in relation to trainees, stating:

“[31] In relation to trainees, the position is not as straight forward. An application by the Ai Group to vary the National Training Wage Schedule in awards was considered in the decision of 22 August 2013. 42

[32] The National Training Wage Schedule (NTWS) to the Manufacturing Award (Schedule D) provides in clause D.6.4 as follows:

“D.6.4 Subject to clause D.3.5 of this schedule, all other terms and conditions of this award apply to a trainee unless specifically varied by this schedule.”

[33] Clause D.3.5 provides:

“D.3.5 Where the terms and conditions of this schedule conflict with other terms and conditions of this award dealing with traineeships, the other terms and conditions of this award prevail.”

[34] In the decision of 22 August 2013 we noted that there is no specific provision about payment of course fees or travel costs in the NTWS and that the only provisions which could apply to trainees are those which would otherwise be applicable under the award. 43 In this regard we referred to a recent decision of the Federal Court.44

[35] In these circumstances, and without further material relating to the application of clause 32.5 to trainees and the practical implications of the variations proposed by the Ai Group for trainees, we are not persuaded that it would be consistent with the modern awards objective, including the need to ensure a stable and sustainable modern award system (s.134(1)(g)), to make the variations proposed. Moreover we are not satisfied that such variation in relation to trainees is necessary to ensure that the award is operating effectively without anomalies or technical problems arising from the award modernisation process. Accordingly we have decided not to make the variation sought by the Ai Group.”

[51] We conclude our analysis of the arbitral history by highlighting that the Preliminary Jurisdictional Issues decision in the Review established that while the Commission is not bound by principles of stare decisis it has generally followed previous Full Bench Decisions as a matter of policy and sound administration.

“[27] These policy considerations tell strongly against the proposition that the Review should proceed in isolation unencumbered by previous Commission decisions. In conducting the Review it is appropriate that the Commission take into account previous decisions relevant to any contested issue. The particular context in which those decisions were made will also need to be considered. Previous Full Bench decisions should generally be followed, in the absence of cogent reasons for not doing so.” 45

3. The Primary Claims

[52] The subclauses the Ai Group seeks to insert into the three Modern Awards are as follows:

•  Manufacturing and Associated Industries and Occupations Award 2010 at Clause 32.5

“(d) Clause 32.5 does not apply to costs associated with training that are in connection with a trainee’s training contract.”

•  Graphic Arts, Printing and Publishing Award 2010 at Clause 25.4

“(c) Clause 25.4 does not apply to costs associated with training that are in connection with an apprentice’s training contract or a trainee’s training contract.”

•  Food, Beverage and Tobacco Manufacturing Award 2010 at Clause 25.6

“(d) This clause 26.5 does not apply to costs associated with training that are in connection with a trainee’s training contract.”

4. Witness Evidence

[53] In support of its contention that it is industry practice to apply clause 32.5 of the Manufacturing Award to trainees, the AMWU called one witness, Mr Ian Curry, its National Coordinator - Skills Training & Apprenticeships. Mr Curry gave evidence that course fees, text book and travel expenses for training undertaken as part of a training contract are ‘overwhelmingly borne by employers.’ 46 Mr Curry provided in his evidence a letter from the South Australian Minister for Education, Training and Further Education dated 17 October 2006, which the AMWU submitted indicates the State Government’s intention is for employers to pay the costs associating with training fees and not the trainees.47

[54] Under cross-examination, Mr Curry confirmed he advises AMWU officials and individual trainees about disputes involving trainees. 48 He also stated employers would pay for travel in excess of what is normally incurred.49 However, Mr Curry was unable to provide details of how many trainees are covered by the three awards subject to Ai Group’s application.50

[55] Ai Group contended that at its highest, Mr Curry’s evidence was about his experience only and does not establish industry practice. 51 Ai Group also submitted the letter from the South Australian State Government does not carry any weight because it details the intentions of 10 years ago.52

[56] However, with the Ai Group itself not having called any witnesses, the AMWU submitted Ai Group’s assertion that it is industry practice for clause 32.5 not to apply to trainees was made without basis. 53 The AMWU further submitted it is open to the Commission to conclude Ai Group did not give evidence to support that assertion because any such evidence would be harmful to their case, as per Jones v Dunkel.54

[57] In response, Ai Group contended the Commission should not apply the rule established in Jones v Dunkel. Referring to Ziu Zhen Huang v Rheem Australia Pty Ltd, 55 Ai Group argued it is not open to the Commission to draw the inference that employers’ evidence would have been positively harmful to the case.

[58] Secondly, Ai Group stated the review is not a matter in the ordinary sense: instead it has involved parties assisting the Commission in the exercise of its statutory function. Ai Group submitted, the workload associated with the review means there is no capacity to advance detailed evidence in every matter and negative consequences may follow if an employer were to give evidence. 56

5. Ai Group Submissions

[59] The Ai Group submissions have advanced a number of arguments in support of their proposed variations to the three awards.

Manufacturing and Associated Industries and Occupations Award 2010

[60] Ai Group submitted that the awards must be interpreted within the industrial context in which they are made and with reference to the history and context of the relevant provisions. 57 Ai Group submitted that the history and industrial context of clause 32.5 indicates that training referred to in clause 32.5 is not training undertaken pursuant to a training contract58 and it was never intended to apply to apprentices and trainees undertaking training in connection with their training contracts.59 Instead, the Ai Group submitted that the provision originated from a clause inserted into the Metals Award 1984 and directed at establishing enterprise wide training programs which would enable employees to develop their skills to facilitate progression to higher classification levels. This was to promote structural efficiency by allowing employers to better utilise the skills of their employees. Ai Group submitted the originating clause, therefore, was associated with the implementation of this structural efficiency principle60 and was not intended to cover the costs associated with off-the-job training undertaken by apprentices and trainees as part of their contracts of training.61

[61] Ai Group submitted the originating clause, clause 6C inserted into the Metals Award 1984 in 1990, 62 had been linked to the 14 level skills based-classification structure inserted into the Metals Award 1984 in 1989, but this structure did not apply to apprentices until they had completed their apprenticeship.63 Ai Group submitted that training costs for apprentices in the Metals Award 1984 were in fact outlined in a separate clause (clause 14) and there were no provisions for trainees.

[62] Ai Group posits the effect of clause 32.5 of the Manufacturing Award applying to trainees is absurd because it could entitle trainees to payment for travel costs incurred while travelling to a registered training organisation (RTO) that they would not be entitled to if travelling to and from work and this is an entitlement that is not available to apprentices. 64

[63] Ai Group further submitted that while the Full Bench in the Transitional Review—Apprentices decision noted there is no specific provision about the payment of course fees or excess travel costs in the National Training Wage Schedule (NTWS), trainees can nonetheless qualify for government payments to assist with the costs when undertaking their training. 65 Ai Group submitted that the variation to clause 32.5 is necessary to avoid the cost impact of reimbursing trainees for training costs and excess travel costs.

[64] Ai Group submits the potential application of clause 32.5 to trainees is unfair on employers and impractical, particularly because the entitlements do not apply to apprentices. 66 Ai Group argued the historical context of the provision suggests it was never intended to apply to trainees and that its proposed variation would operate as an incentive to employees taking on trainees, consistent with the modern awards objective, including the impact of provision on productivity, business costs and the regulatory burden.67

[65] Ai Group also claimed it did not seek exclusion of trainees from provisions of clause 32.5 in the Transitional Review—Apprentices because it was not aware of any instances in which it was argued the clause applied to training undertaken by trainees in connection to their training contracts. 68 While Ai Group conceded the Full Bench declined to exclude trainees from an entitlement to costs in connection with their training costs, it submitted there was little focus on trainees in that case, with the evidence before the Commission focussed on apprentice training costs.69 Ai Group contended that decision did not contain a finding that training costs entitlements were extended to trainees by virtue of clause 32.5.70 It maintains industry practice that clause 32.5 does not apply to trainees.71

[66] Ai Group submitted the meaning of ‘travel costs’ is critical to considering the impact of extending the benefits of clause 32.5(c) to trainees. With reference to the Transitional Review—Apprentices decision, Ai Group submitted the Full Bench rejected the proposition that apprentice ‘travel costs’ should include travelling time. 72

[67] Ai Group contended that if clause 32.5 were to apply to trainees undertaking training in connection with their training contracts and if ‘travel costs’ include travelling time, a number of adverse consequences would arise, including:

•  varying entitlements between trainees depending on home location, travel route taken, and traffic delays;

•  problems for both employers and the Fair Work Ombudsman in calculating entitlements;

•  substantial cost increases for employers;

•  increase in youth unemployment and skill shortages; and

•  exacerbated impacts on employers and apprentices in rural and regional areas. 73

[68] Ai Group further contended that even if ‘travel costs’ for the purposes of clause 32.5 do not include travelling time but still include travel costs, the adverse consequences identified would still arise.

[69] Ai Group submitted these consequences are not fair to employers or trainees, and therefore clause 32.5, as currently drafted, is inconsistent with s.134(1) of the Act. Referring to a decision of the Full Bench of the Commission in the Review dealing with the Annual leave common issue, 74 Ai Group contended fairness of an award obligation to employers should also be considered.75 Further, Ai Group argued the identified consequences are directly inconsistent with ss.134(1)(c), (d), (f), (g) and (h) of the Act.

[70] At the hearing, Ai Group submitted that because clause 32.5 was not intended to and has never applied to trainees, clause D.6.4 of the NTWS has not created any entitlement to the benefit of it. 76 Ai Group submitted if we were not minded to vary clause 32.5, it would not change the position of trainees because they have no entitlement to training costs pursuant to that clause however, its position is that we should do so, having regard to s.134(1)(g) of the Act.77

[71] While acknowledging it has not advanced supporting evidence, Ai Group maintains that industry practice is not to apply clause 32.5 to training undertaken by trainees. 78

6. Ai Group Secondary position – Manufacturing Award

[72] Ai Group submitted that if the Commission was not prepared to accept its primary position, a specific provision should be inserted in clause 18 of the Manufacturing Award, modelled on provisions which related to apprentices:

“18.6 Training costs for trainees

(a) Payment of fees and textbooks

(i) Any costs associated with standard fees for prescribed courses and prescribed textbooks (excluding those textbooks which are available in the employer’s technical library) incurred by an employee in connection with training specified in, or associated with, the training contract must be reimbursed to the trainee within six months from the commencement of the traineeship or the relevant stage of the traineeship or within 3 months of the trainee commencing training with the Registered Training Organisation (RTO), whichever is the later, unless there is unsatisfactory progress;

(ii) Direct payment of the fees and textbooks, within 6 months from the commencement of the traineeship or the relevant stage of the apprenticeship, by an employer to the training provider satisfies the requirement for reimbursement in clause 18.6(a)(i) above.

(b) Travel payment for block release training

(i) Where a trainee is required to attend block release training for training identified in or associated with their training contract, and such training requires an overnight stay, the employer must pay for the excess reasonable travel costs incurred by the trainee in the course of travelling to and from such training Provided that this clause will not apply where the trainee could attend an alternate Registered Training Organisation (RTO) and the use of the more distant RTO is not agreed between the employer and the trainee.

(ii) For the purposes of this clause excess reasonable travel costs includes the total cost of reasonable transportation (including transportation of tools where required), accommodation costs incurred while travelling (where necessary) and reasonable expenses incurred while travelling, including meals, which exceed those incurred in travelling to and from work. For the purposes of this clause excess travel costs do not include payment for travelling time or expenses incurred while not travelling to and from block release training.

(iii) The amount payable by an employer under this clause may be reduced by an amount the trainee is eligible to receive for travel costs to attend block release training under a Government apprentice assistance scheme. This will only apply if a trainee has either received such assistance or their employer has advised them in writing of the availability of such assistance.” 79

[73] Ai Group further submits that if this secondary position is accepted, clause 32.5(d) should be:

“32.5(d) This subclause 32.5 does not apply to costs associated with training that are in connection with a trainee’s training contract. Such costs are subject to clause 18 and not this clause.” 80

[74] Ai Group contended that if this position is accepted, apprentice and trainee entitlements for training costs associated with training contracts would be aligned, promoting fairness and therefore consistency with s.143(1) of the Act. 81

[75] At the hearing, the Ai Group conceded that the reference to “a Government apprentice assistance scheme” in the proposed clause 18.6(b)(iii) could be drafted in broader terms, so as to refer to any Government assisted schemes for trainees operating from time to time. 82

7. Ai Group Submissions–Graphic Arts, Printing and Publishing Award 2010

[76] Ai Group submitted for the same reasons as those it advanced in respect of the Manufacturing Award, its proposed variation should be made to the Graphic Arts Award. 83

Secondary position

[77] Ai Group also advanced a secondary position, submitting that the same provision as detailed in paragraph [72] above should be added to clause 21 – National Training Wage and that clause 25.4(c) should be worded as follows, if its secondary position is accepted:

“25.4(c) This subclause 25.4 does not apply to costs associated with training that are in connection with a trainee’s training contract. Such costs are subject to clause 21 and not this clause.” 84

[78] Ai Group again contended that if this position is accepted, apprentice and trainee entitlements for training costs associated with training contracts would be aligned, promoting fairness and therefore consistency with s.143(1) of the Act. 85

8. Ai Group Submissions–Food, Beverage and Tobacco Manufacturing Award 2010

[79] Ai Group contended the current training costs provisions in the FBTM Award (clause 26.5) were adopted from the Manufacturing Award given the history of the FBTM Award being largely based on the Manufacturing Award. 86

[80] As such, and for the same reasons advanced in relation to the Manufacturing Award, Ai Group submitted its proposed variation should be made to the FBTM Award. 87

Secondary position

[81] Consistent with its position in relation to the other two awards, Ai Group submitted that should the Commission not accept its primary position, a specific provision as set out above at [72] should be included in clause 16 — Trainees. If the Commission accepted this secondary position, Ai Group submitted subclause 26.5(d) of the FBTM Award should be:

“26.5(d) This subclause 26.5 does not apply to costs associated with training that are in connection with a trainee’s training contract. Such costs are subject to clause 16 and not this clause.” 88

[82] Consistent with its position in relation to the other Modern Awards, Ai Group contended that if its secondary position was accepted, the training costs entitlements for apprentices and trainees would be aligned, promoting fairness and therefore consistency with s.143(1) of the Act. 89

9. AMWU Submissions

[83] The AMWU opposed the Ai Group’s proposed variations.

Jurisdictional issues

[84] The AMWU contended Ai Group’s proposal amounts to a significant change but Ai Group had not provided sufficient evidence in support to satisfy the threshold requirements established in the Preliminary Jurisdictional Issues decision. 90

[85] The AMWU submitted Ai Group had failed to show that clause 32.5 does not apply to trainees. 91 The AMWU’s position was that employers currently pay training costs for trainees covered by the Manufacturing, Graphic Arts and FBTM Awards and have always been required to do so by virtue of plain language reading of the Awards.92 The AMWU’s pathway of interpretation commences with clause 18.1 of the Manufacturing Award, which states “The terms of this award apply to trainees covered by the National Training Wage provisions, trainees in the technical field and trainee engineers and trainee scientists, except where otherwise stated in this award.” The AMWU submitted clause 18.1 is to be read with clause 32.5 and clause D.6.4 from Schedule D, thereby producing “a very simple conclusion” that clause 32.5 covers trainees “because clause 18.1 says so.”93

[86] The AMWU submitted the Commission should adopt a plain reading of the text of the Award as it was in 1990. This would establish trainees have had access to training costs since the clause was inserted and in the subsequent awards. 94 The AMWU argued the insertion of clause 6C in 1990 resulted in trainees having access to sections of the Metals Award 1984 that provided for payment of course fees, text books and travel costs and therefore all terms and conditions of that Award applied to trainees.95

[87] Referring to the Transitional Review—Apprentices decision, the AMWU submitted this matter had been considered and dismissed and contended that decision confirms clause 32.5 applies to trainees regardless of whether the training is subject to a training contract or not. 96

[88] The AMWU submitted that the Transitional Review—Apprentices decision, while excluding training undertaken by apprentices in relation to the training contract, is not conclusive to the terms and conditions of trainees’ employment. The AMWU highlighted that the Full Bench was not persuaded it would be consistent with the modern awards objective to exclude trainees from the operation of clause 32.5 without further material going to the practical implications of such an amendment. 97 The AMWU contrasted the broad application of the Metals Award 1984 to trainees with that of apprentices, noting the Metals Award 1984 does not contain any clause which states all terms and conditions of the award apply to apprentices unless otherwise stated.98

[89] The AMWU submitted that the existence of alternative and comparable entitlements for apprentices elsewhere in the Manufacturing Award was part of the basis of the Full Bench’s reasoning in removing application of the entitlement to apprentices. By way of contrast, it says trainees do not have a comparable entitlement in the NTWS (Schedule D in the Manufacturing Award). This being the case, it submits the only provisions which could apply are those in clause 32.5. The AMWU submitted the existence of a similar entitlement elsewhere in the Manufacturing Award or the NTWS would be a necessary precondition for excluding trainees from receiving the entitlements under clause 32.5. 99

[90] The AMWU acknowledged the standard Apprenticeship/Trainee Training Contract 100 does not require employers to pay course fees, text books and travel expenses for a trainee.101 However, it submitted the contract requires an employer to ‘[m]eet all legal requirements regarding the apprentice/trainee, including but not limited to … payment of wages and conditions under the relevant employment arrangements.’102 The AMWU submitted that where an employer enters into this form of contract they are agreeing to train the apprentice/trainee and release them from work to attend other training, therefore for the purpose of clause 32.5 of the Award, training under a training contract has been agreed.103

[91] The AMWU further contended that because the standard National Apprenticeship/Trainee Training Contract does not require an employer to pay a trainees course fees, text books and travel expenses, any payment arises from an award obligation. 104

[92] For its part, Ai Group had argued the contract does not require an employer to agree to all training being undertaken to obtain the qualification. 105 It had argued that in some circumstances, all the elements of all qualifications will not be relevant to the employer, therefore the Commission could not be satisfied that all training undertaken by an apprentice is agreed to by an employer.106

Effect of proposed variation

[93] Addressing the effect of Ai Group’s proposed variation, the AMWU submitted trainees would lose an existing award entitlement to be reimbursed for course fees, text books and travel expenses associated with their training contracts. 107 It also made submissions regarding the potential impact on trainees and the manufacturing industry.

[94] The AMWU submitted the removal of the existing award entitlement is not consistent with s.134(1)(a) of the Act because trainees would not have a relevant award safety net in relation to ‘… a very significant area of their employment.’ 108 Referring to its submission in the Transitional Review—Apprentices matter in 2012, the AMWU emphasised trainees and apprentices struggle to pay up front fees and do not receive full reimbursement when attending training.109 It relied on an unsworn witness statement from Ms Jane Timberall110 to illustrate the negative impacts of travel costs on trainees.111

[95] Referring to a survey of its apprenticeship members in 2015, the AMWU detailed 55.9% of survey respondents viewed travel expenses as ‘important’ or ‘very important’. 112 It further outlined there is a lack of appropriate reimbursement for apprentices, whose entitlement to reimbursement for travel expenses is lower than what trainees receive under clause 32.5.113 It submitted that given these facts, Ai Group’s proposal would leave many trainees significantly worse off.114 The AMWU submitted the Ai Group has presented no evidence of the practical implications of its claim, while the AMWU relied on the evidence of Mr Curry outlining the “near ubiquitous nature of employers paying the training costs of their trainees.”115

Impact on the manufacturing industry

[96] The AMWU submitted Ai Group’s proposal would undermine skills generation by discouraging employees from improving their skills and employers from developing flexible workforces. 116 It submitted the industry, employers and employees may be impacted.117 This would result, the AMWU submitted, in difficulties attracting and retaining trainees in the industry, a reduction in skills and lead to poorer economic outcomes.118

[97] Addressing the modern awards objectives, the AMWU submitted Ai Group’s proposal fails to meet ss.134(1)(d) and (h) of the Act. It argued workplace training leads to increased efficiency, productivity and flexibility and is necessary for sustainability, performance and competitiveness. 119

[98] The AMWU submitted the adverse consequences resulting from the operation of clause 32.5 outlined by Ai Group are ‘entirely unsubstantiated and without foundation in any facts presented.’ 120

Response to Ai Group’s secondary positions

[99] The AMWU contended the secondary positions advanced by Ai Group should be rejected as they would result in a significant reduction of trainees’ workplace entitlements. It argued Ai Group had not submitted any evidence or merit argument supporting its positions. 121 It was argued by the AMWU that through its secondary position, the Ai Group admits that a fair and relevant safety net for trainees should include the “provision of training costs by the employer.”122

[100] The AMWU submitted clause 32.5 has applied to trainees since its inception and that it continues today and should continue, based on a plain reading of the text of the Manufacturing Award and a reasonable interpretation of its history. The AMWU sought the opportunity to make further submissions if we were to decide that clauses 15.11(b) and (c) of the Manufacturing Award applying to apprentices, should apply to trainees.

Order of Deputy President Keogh dated 15 December 1989 varying the Metals Award 1984

[101] At the hearing, we directed Ai Group to file any further submissions in relation to the Order of Deputy President Keogh dated 15 December 1989 varying the Metals Award 1984 and gave the AMWU the opportunity to file submissions in reply.

[102] Ai Group subsequently submitted the history and background to clause 32.5 of the Manufacturing Award demonstrates that it was not intended to apply to trainees or apprentices undertaking training in connection with their training contracts. Ai Group does not argue that apprentices, adult apprentices and trainees did not have access to the clause from the time it was inserted into the Metals Award 1984 on 12 April 1990, but rather that it was not intended to apply to them in connection with their training contracts.

[103] Ai Group submits Clause 6C inserted in 1990 was directed at:

•  the establishment of enterprise-wide training programs, which reflected the needs of the enterprise;

•  enabling employees to develop their skills to facilitate progression to higher levels in the 14-level skills-based classification structure which had been inserted into the Award in September 1989; and

•  enabling employers to better utilise the skills of their employees.

[104] In submitting that clause 6C was directed at an enterprise-wide training program aimed at facilitating progression through the 14-level classification structure and facilitating the utilisation of a wider range of skills by employees, Ai Group submitted it did not logically include training carried out by apprentices, adult apprentices and trainees as part of their training contracts. This was because the classification structure in the Award did not apply to apprentices, adult apprentices and trainees and only applied when an apprenticeship or traineeship was completed, and only if the employer decided to continue to employ the employee on an ongoing basis at the expiry of the apprenticeship or traineeship.

[105] With the Full Bench in the Transitional Review—Apprentices deciding that clause 32.5 of the Manufacturing Award should not apply to apprentices, Ai Group submitted there is no logical reason why the clause should nonetheless apply to trainees.

[106] The AMWU submitted that clause 13A(c)(iv) inserted by Deputy President Keogh in December 1989, provided that “All other terms and conditions of the award shall apply unless specifically varied by this clause” and following the insertion of clause 6C on 12 April 1990, trainees had access to payment for course fees, text books and travel costs for all training undertaken by the trainee.

[107] It was further submitted by the AMWU that Ai Group has not presented a reasonable explanation as to why Deputy President Keogh did not exclude clause 6C from application to trainees, when it was inserted only months after he had inserted the traineeship clause which explicitly ensured that all other clauses of the award applied to trainees. As such, the Commission should rely upon the plain reading of the text of the award circa 1990.

[108] The AMWU submitted access to the training costs entitlement has since been unbroken for trainees in the manufacturing industry and through multiple industrial instruments, they have specifically been granted access to all the terms and conditions of the relevant award, except where explicitly excluded. It submitted Ai Group has presented no reasonable explanation as to why the training costs clause, once established as an entitlement, would not have continued to apply under the subsequent awards, given that at no time has it explicitly excluded trainees from its application for any reason.

[109] An additional submission made by the AMWU was that there were different conditions of employment between apprentices and trainees from the introduction of trainees into the Award in 1989.

[110] The AMWU concluded by submitting the removal or diminution of the current trainee entitlement should be rejected and given the evidence presented, the only course of action available to the Commission is to continue the status quo and ensure that trainees continue to enjoy access to the same, fair and reasonable training costs provision to which they have had access since 1990.

10. Consideration

[111] We have considered the arbitral history of training and training costs provisions. It is our view that by virtue of the Order of Deputy President Keogh dated 15 December 1989, insofar as trainees (at that time ATS trainees) were concerned, the particular provisions outlined in clause 13A of the Metals Award 1984 applied, together with all other terms and conditions of that award, unless they had been specifically varied by that clause 13A. This had the effect, once clause 6C was subsequently inserted by Deputy President Keogh on 12 April 1990, of extending the entitlements in clauses 6C(d)(ii) and 6C(d)(iii) to trainees, regardless of clause 6C having reflected the evolution of the training provisions from the structural efficiency process.

[112] We also consider the National Training Wage Interim Award 1994 came to operate in a similar way to clause 13A of the Metals Award 1984, so that as far as trainees were concerned, their terms and conditions were to be derived through the interaction of the National Training Wage Interim Award 1994 and the Manufacturing Award. The clause 5.2 inserted into the Metals Award 1998 broadened the focus of training, requiring employers to develop a training program consistent with, amongst other things, the need to develop vocational skills relevant to the enterprise and industry through courses conducted by accredited instructors and providers. Further, it continued to interact with the National Training Wage Interim Award 1994 and then the National Training Wage Award 2000. As such, terms and conditions for trainees continued to be derived from the two industrial instruments and the terms of the relevant award applied to trainees, unless specifically varied by the National Training Wage Award.

[113] The Award Modernisation process delivered clause 32.5. It is a clause pertaining to training costs of broad application, providing reimbursement of particular costs by the employer in relation to training to which it has agreed. Further, the interaction with the NTWS was maintained, with the terms of the Modern Award to prevail in relation to traineeships unless specifically varied by the NTWS and in the event of conflict between the two.

[114] Much like the approach to construing a statute, the construction of an industrial instrument such as an award begins with a consideration of the ordinary meaning of the words used, having regard to the context and evident purpose of the provision or expression being construed. Context may be found in the provisions of the award taken as a whole, or in their arrangement and place in the award being considered. The statutory framework under which the award is made may also provide context, as might an antecedent award or awards from which particular provisions might have been derived.

[115] Each Modern Award under consideration contains:

•  a provision which deals with the reimbursement of training costs incurred by employees in respect of identified expenditure; 123

•  a provision which excludes or has the effect of excluding employees engaged under an apprentice training contract from the entitlement to training cost reimbursement in respect of apprentice training; 124

•  a provision dealing with reimbursement of fees, textbook and expenses in connection with an apprentices training contract; 125 and

•  a provision to the effect that all other terms and conditions of the award will apply to a trainee unless otherwise specified applicable national training wage schedule. 126

[116] In each award there is no other provision of the applicable national training wage schedule that otherwise provides or specifies that trainees under a training contract are not entitled to the benefit of the training costs provisions of the relevant award.

[117] Taken together, the proper construction of these provisions read in the context of each relevant award as a whole leads invariably to the conclusion that employees employed under a training contract are entitled to reimbursement of identified training costs associated the training contract. The antecedent awards and the decisions relating to them which dealt with the subject of training costs and to which we have earlier referred merely reinforce that which the ordinary meaning of the words in the three awards discloses.

[118] The Ai Group’s assertion that such an outcome was not intended is not apparent from anything in the three existing Modern Awards nor from the antecedent instruments from which the current provisions are largely derived, nor is it apparent from the decisions discussed earlier in this decision. Indeed, the contrary is apparent.

[119] We have not been persuaded by Ai Group that the Full Bench’s conclusion in the Transitional Review—Apprentices decision to not exclude clause 32.5 from applying to trainees should be reversed. The Ai Group has not persuaded us in relation to its characterisation of the arbitral history. In particular, we do not accept its submission that the history and industrial context of clause 32.5 indicates that “training agreed to by the employer” referred to in clause 32.5, is not training undertaken pursuant to a training contract. We consider the training provisions have evolved beyond the Ai Group’s narrow conception of their application. Nor do we consider Ai Group has produced material that convinces us that it would be consistent with the modern awards objective to make the variation it seeks.

[120] The standard Apprenticeship/Trainee training contract 127 contemplates an employer and a trainee agreeing to the training a trainee is to complete both on-the-job and off-the-job as part of a Training Plan128 and requires the employer to agree to ‘[m]eet all legal requirements regarding the apprentice/trainee, including but not limited to … payment of wages and conditions under the relevant employment arrangements.’129 For the reasons already given, we are satisfied that clause 18.1 of the Manufacturing Award, read with clause 32.5 and clauses D.6.4 and D.3.5 of its Schedule D, establishes the entitlement of trainees to receive reimbursement of training costs falling within the circumstances outlined in subclauses 32.5(a) and 32.5(b). The same analysis pertains to the other modern awards under consideration.

[121] In advancing its secondary position, we consider it is open to conclude Ai Group acknowledges that a fair and relevant safety net for trainees should include an obligation on employers to meet training costs of trainees. This is certainly the view of the AMWU and it is our view. Ai Group has not however provided an evidentiary based merits case to support its submission that trainees should be reimbursed in the same fashion as apprentices, which might otherwise allow us to conclude that the entitlements of apprentices and trainees to training costs should be aligned. In the absence of specific provisions regulating the payment of training course fees and travel costs in the NTWS, we are satisfied the correct interpretation of the provisions of the Manufacturing Award and the NTWS is that clause 32.5 of the Manufacturing Award is applicable to trainees. We reach the same conclusion for the same reasons in respect of the two other awards.

[122] As outlined above, the need for a ‘stable’ modern award system suggests that a party seeking to vary a modern award in the context of the Review must advance a merit argument in support of proposed variations. We do not consider Ai Group has satisfied this requirement. The Ai Group submitted there was ‘little focus’ on trainees in the Transitional Review—Apprentices proceeding but it has not advanced the evidentiary picture relating to trainees in the case before us. Indeed, it has acknowledged it did not advance evidence in support of its assertion that industry practice is not to apply clause 32.5 to training undertaken by trainees. Similarly, there has not been evidence adduced to persuade us to accept the assertions of Ai Group in relation to the practical implications of clause 32.5 applying to trainees undertaking training in connection with their training contracts. In short, Ai Group did not produce material to further the argument in relation to trainees that was advanced before, but not accepted by the Transitional Review—Apprentices Full Bench.

[123] We consider the observation of the Transitional Review—Apprentices Full Bench that there is no specific provision about payment of course fees or travel costs in the NTWS, so that the only provisions which could apply to trainees are those which would otherwise be applicable under the Manufacturing Award, remains the position.

11. Conclusion

[124] We are not persuaded the proposed amendments attached to either the primary claims or the secondary positions advanced by Ai Group that would vary the Manufacturing and Associated Industries and Occupations Award 2010, the Graphic Arts, Printing and Publishing Award 2010 and the Food, Beverage and Tobacco Manufacturing Award 2010 in relation to training costs are necessary to achieve the modern awards objective. Consequently, the amendments sought are refused and the applications are dismissed.

DEPUTY PRESIDENT

Appearances:

B Ferguson for the Australian Industry Group.

W Tegg for the “Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers’ Union (AMWU).

Hearing details:

2016.

Sydney, Adelaide, Brisbane (video hearing):

August 30.

Final written submissions:

Ai Group submission, 27 September 2016

AMWU submission in reply, 9 October 2016

Printed by authority of the Commonwealth Government Printer

<PR711549>

 1   [2014] FWCFB 916

 2   Submission, Ai Group, 24 October 2014, at paras 79-106; Correspondence, Ai Group, 13 November 2015

 3   Statement, 25 February 2016, at paras [4]-[5]

 4   Submission and draft determinations, Ai Group, 28 April 2016

 5   Draft determination, Ai Group, 14 May 2016

 6   Directions, 18 May 2016

 7   Submission, Ai Group, 17 June 2016

 8   Submission in reply, AMWU, 1 August 2016

 9   Correspondence, AWU, 27 August 2016

 10   Exhibit 1

 11   Further submission, Ai Group, 27 September 2016

 12   Further submission in reply, AMWU, 9 October 2016

 13   [2014] FCAFC 118

 14   Ibid at [85]

 15   [2014] FWCFB 1788

 16   Ibid at [23]

 17   Shop, Distributive and Allied Employees Association v National Retail Association (No 2) (2012) 205 FCR 227 at [35] per Tracey J

 18   Friends of Hichinbrook Society Inc v Minister for Environment (No 3) (1997) 77 FCR 153; Australian Competition and Consumer Commission v Leelee Pty Ltd [1999] FCA 1121; Edwards v Giudice [1999] FCA 1836

 19   4 yearly review of modern awards – Penalty Rates [2017] FWCFB 1001 at [115]

 20   4 yearly review of modern awards – Preliminary Jurisdictional Issues [2014] FWCFB 1788 at [36]

 21   [2013] FWCFB 5411 at [83]

 22   M0039 Dec 286/98 S Print P9311, 11 March 1998

 23   Joint publication of the Metal Trades Industry Association the Australian Chamber of Manufactures and the Metal Trades Federation of Unions

 24   Award Restructuring Consultation, Training and Award Flexibility

 25   Dec 530/89 M Print H9100

 26   M039 V094 M Print J0730

 27   M039 V096 V Print J2043

 28   Dec 590/90 S Print J3026

 29   N0277 A M Print L5189

 30   M0039 V188 S Print N5611

 31   M0039 Dec 286/98 S Print P9311

 32   H0008 Dec 1533/97 M Print P7500

 33   M0039 Dec 286/98 S Print P9311

 34   PR955055

 35   AP790899CAN

 36   [2008] AIRCFB 1000

 37   M1913 Con S Print Q0444 [incorporating M1913 Con-a M Print Q2704]

 38   [2009] AIRCFB 800 at [51]

 39   PR545014

 40   PR559277

 41   [2013 ]FWCFB 9295

 42   [2013] FWCFB 5411 at [461]-[480]

 43   [2013] FWCFB 5411 at [476]

 44   [2013] FWCFB 5411 at [477]

 45   [2014] FWCFB 1788 at [27]

 46   Witness statement of Ian Curry, Exhibit 1, para 8

 47   Submission, AMWU, 1 August 2016, Attachment E and Submission, AMWU, 1 August 2016, at para 21

 48   Transcript – 30 August 2016 at PN39

 49   Transcript – 30 August 2016 at PN43

 50   Transcript – 30 August 2016 at PN44

 51   Transcript – 30 August 2016 at PN182

 52   Transcript – 30 August 2016 at PN184

 53   Submission, AMWU, 1 August 2016, at para 23

 54   Submission, AMWU, 1 August 2016, at para 25; (1959) 101 CLR 298

 55   PR954993

 56   Transcript – 30 August 2016 at PN170-179

 57   Transcript – 30 August 2016 at PN82

 58   Transcript – 30 August 2016 at PN89

 59   Submission, Ai Group, 24 October 2014, at para 87; Submission, Ai Group, 17 June 2016 at para 5

 60   Transcript – 30 August 2016, at PN79

 61   Submission, Ai Group, 17 June 2016 at paras 9-10

 62   Print J2043

 63   Submission, Ai Group, 17 June 2016 at paras 10-11

 64   Submission, Ai Group, 24 October 2014, at paras 83-85

 65   Submission, Ai Group, 24 October 2014, at para 86

 66   Submission, Ai Group, 24 October 2014, at para 102

 67   Submission, Ai Group, 24 October 2014, at para 106

 68   Submission, Ai Group, 17 June 2016, at para 36

 69   Submission, Ai Group, 24 October 2014, at paras 81-82

 70   Transcript – 30 August 2016 at PN143-159

 71   Submission, Ai Group, 17 June 2016, at para 43

 72   Submission, Ai Group, 17 June 2016, at para 57

 73   Submission, Ai Group, 17 June 2016, at para 58

 74   [2016] FWCFB 3177

 75   Submission, Ai Group, 17 June 2016, at para 62; Transcript – 30 August 2016 at PN141

 76   Transcript – 30 August 2016 at PN97

 77   Transcript – 30 August 2016 at PN165

 78   Transcript – 30 August 2016 at PN168

 79   Submission, Ai Group, 17 June 2016, at paras 64-65

 80   Submission, Ai Group, 17 June 2016, at para 66

 81   Submission, Ai Group, 17 June 2016, at paras 67-69

 82   Transcript – 30 August 2016 at PN201-PN206

 83   Submission, Ai Group, 17 June 2016, at para 74

 84   Submission, Ai Group, 17 June 2016, at para 77

 85   Submission, Ai Group, 17 June 2016, at paras 78-80

 86   Submission, Ai Group, 17 June 2016, at paras 81-89

 87   Submission, Ai Group, 17 June 2016, at para 91

 88   Submission, Ai Group, 17 June 2016, at para 94

 89   Submission, Ai Group, 17 June 2016, at para 97

 90   Submission, AMWU, 1 August 2016, at paras 5-7

 91   Submission, AMWU, 1 August 2016, at para 8

 92   Transcript – 30 August 2016 at PN228-PN229

 93   Transcript – 30 August 2016 at PN243-PN245

 94   Submission, AMWU, 7 October 216, at paras 9-10

 95   Submission, AMWU, 7 October 216, at paras 5-6

 96   Submission, AMWU, 1 August 2016, at para 15

 97   Submission, AMWU, 22 January 2016, at para 2.10

 98   Submission, AMWU, 7 October 2016, at paras 13-18

 99   Submission, AMWU, 22 January 2016, at paras 2.8, 2.9, 2.11

 100   Submission, AMWU, 1 August 2016, Attachment B

 101   Submission, AMWU, 1 August 2016, para 18

 102   Submission, AMWU, 1 August 2016, Attachment B, page 3

 103   Transcript – 30 August 2016 at PN325-PN330

 104   Submission, AMWU, 1 August 2016, at paras 18 and 22

 105   Transcript – 30 August 2016 at PN118

 106   Transcript – 30 August 2016 at PN137

 107   Submission, AMWU, 1 August 2016, at para 30

 108   Submission, AMWU, 1 August 2016, at paras 31 and 37

 109   Submission, AMWU, 1 August 2016, at para 32 and Attachment A at para 3.14

 110   Submission, AMWU, 1 August 2016, Attachment A, Statement of Ms Jane Timberall

 111   Transcript – 30 August 2016 at PN237

 112   Submission, AMWU, 1 August 2016, at para 34

 113   Submission, AMWU, 1 August 2016, at para 35

 114   Submission, AMWU, 1 August 2016, at para 36

 115   Transcript – 30 August 2016 at PN238-PN239

 116   Submission, AMWU, 1 August 2016, at para 42

 117   Submission, AMWU, 1 August 2016, at para 42

 118   Submission, AMWU, 1 August 2016, at para 44

 119   Submission, AMWU, 1 August 2016, at para 43

 120   Submission, AMWU, 1 August 2016, at para 45

 121   Submission, AMWU, 7 October 216, at para 21

 122   Transcript – 30 August 2016 at PN277

 123   Clause 32.5 of the Manufacturing and Associated Industries and Occupations Award 2010; clause 25.4 of the Graphic Arts, Printing and Publishing Award 2010; clause 26.5 of the Food, Beverage and Tobacco Manufacturing Award 2010

 124   Clause 32.5(c) of the Manufacturing and Associated Industries and Occupations Award 2010; clause 13.10(c) of the Graphic Arts, Printing and Publishing Award 2010; clause 26.5(c) of the Food, Beverage and Tobacco Manufacturing Award 2010

 125   Clause 15.11(b) and (c) of the Manufacturing and Associated Industries and Occupations Award 2010; clause 13.10 and 13.14 of the Graphic Arts, Printing and Publishing Award 2010; clause 13.10 and 13.14 of the Food, Beverage and Tobacco Manufacturing Award 2010

 126   Schedule D clause D.6.4 of the Manufacturing and Associated Industries and Occupations Award 2010 and see also clause 18.1; Schedule E clause E.6.4 of the Graphic Arts, Printing and Publishing Award 2010; Schedule D clause D.6.4 of the Food, Beverage and Tobacco Manufacturing Award 2010 and see also clause 16

 127   Submission, AMWU, 1 August 2016, Attachment B

 128   Ibid at Attachment B, page 6

 129   Ibid at Attachment B, page 3