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TRANSCRIPT OF PROCEEDINGS
Fair Work Act 2009 47499-1
VICE PRESIDENT WATSON
AM2010/226
s.158 - Application to vary or revoke a modern award
Application by National Retail Association Limited
(AM2010/226)
General Retail Industry Award 2010
(ODN AM2008/10)
[MA000004 Print PR985114]]
Melbourne
9.34AM, FRIDAY, 29 APRIL 2011
Continued from 28/04/2011
Reserved for Decision
PN741
THE VICE PRESIDENT: Ms Duff?
PN742
MS J DUFF: Thank you, your Honour. Your Honour, the Tribunal is presented with an application by the National Retail Association on behalf its members to vary the terms of the General Retail Award in one specific area, the minimum period of engagement of casual school students. Section 157 upon which the NRA's application is based is only one of many avenues that parliament has made available to the Tribunal to vary modern awards. Under this section the NRA must satisfy the Tribunal that the variation is necessary to achieve the modern award's objective.
PN743
The NRA relies on its written submission and I won't repeat the arguments contained in that document in any great detail here in closing. What I do wish to emphasise is a number of main points in reference to the whole of the evidence and the submissions before the Tribunal. The Tribunal has before it, both in this matter and in the previous proceeding, evidence of a number of employers and employees that demonstrates that the minimum engagement period in the General Retail Award is having a negative and prejudicial effect on casual school students. It is not a hypothetical or a potential impact. It is happening now, and has been occurring since the introduction of the modern award.
PN744
The NRA submits that the issue cannot and should not be put off until either the two year transitional provisions review or the general four year review of modern awards. In our submission the three hour minimum shift for casual school students has failed to achieve the modern award's objective because of one particular problem, namely that it is excluding a number of school students from participation in the workforce. The modern award's objective is to provide a fair and relevant minimum safety net of terms and conditions, taking into account a variety of factors. The NRA submits that the minimum safety net provided by the existing minimum engagement clause is neither fair nor relevant to the needs and interests of employers and school students, taking into account the need to promote social inclusion through increased workforce participation; the need to promote flexible work practices; and the likely impact of any exercise of modern award powers on business, including productivity, employment costs and regulatory burden.
PN745
As both the explanatory memorandum to the Fair Work Bill and various decisions of this Tribunal make clear, the Tribunal in this matter is required to balance the considerations contained in the modern award's objective in order to determine whether it is necessary to exercise the power conferred by section 157. The NRA submits that the SDA's main arguments only address one statutory objective, that is the net safety level. It fails to consider or engage with the other criteria set out in the modern award's objective, as the NRA, the ACCI, and the Minister for Employment and Industrial Relations of the State of Victoria have done.
PN746
In relation to the statutory objective of social inclusion, both the prefatory words to the objects of the Act set out in section 3 and the modern award's objective refer to promoting social inclusion through increased workforce participation. The Commonwealth Government is committed to promoting social inclusion, as evidenced by the objects set out in the Fair Work Act and various aspirational principles and policies that it has circulated. Specifically the National Strategy for Young Australia specifies that equipping young Australians with skills and personal networks they need to gain and be successful in employment is a government priority.
PN747
The SDA's witnesses differed on the concept of social inclusion and its relevance to the matter before the Tribunal. Dr Campbell was firmly of the view that workforce participation would not increase secondary school students' social inclusion, because they are already fully socially included by virtue of being engaged in full-time education. Dr Campbell did however acknowledge that increasing workforce participation is a worthwhile goal which afforded many benefits, both monetary and non monetary to secondary students. Dr Price on the other hand was prepared to acknowledge in her statement that allowing school students to work shorter shifts may increase their social inclusion through increased workforce participation. Dr Price also readily admitted the various monetary and other benefits arising from school students' increased participation.
PN748
The NRA believes that in addition to promoting social inclusion, facilitating student employment by granting the application will be advantageous to secondary school students by affording them a range of benefits. We would submit that the present issue before the Tribunal is not one that can be measured solely in terms of monetary impact or cost benefit analysis. Dr Price for the SDA at paragraph 15 of her written submission filed in the matter, and in her verbal evidence before the Tribunal, conceded that paid work has many benefits for young people including social opportunities, generic social skills, money which may not be available from parents, good quality work experience in some cases, and a sense of autonomy.
PN749
Throughout the evidence before the Tribunal provided by the SDA, particularly that of Dr Campbell and Dr Price, mention was made of the already high level of workforce participation by secondary school students, particularly in comparison to other OECD countries. Notwithstanding that Australia's incidence of secondary school students' employment may be comparably higher, there is no doubt that the nation's levels of youth unemployment and underemployment are undesirable and are markedly higher than the total unemployment and underemployment rates. In his statement filed in this proceeding Mr Gary Black explained that ABS data revealed that approximately 550,000 or 26 per cent of the youth labour market are unemployed or underemployed.
PN750
The ACCI's May 2010 issues paper entitled Youth Unemployment, which I understand is annexed to its submission to the Tribunal in this matter, provides a comprehensive overview of the detrimental position of youth in respect of underemployment and unemployment in Australia. However social inclusion is defined and measured, and notwithstanding the nation's comparably high levels of youth unemployment, we believe that all the parties involved in the present application would concede that social inclusion is a worthwhile goal and that school students derive many benefits from employment.
PN751
The NRA submits that the social inclusion of student casuals, whether it be at this point in time or some time in the future, the range of benefits they can derive by virtue of increased workforce participation and the ability of students to find sufficient employment will be greatly enhanced by the Tribunal granting the NRA's application in this matter, and thereby promoting opportunities for students to gain valuable work experience. The NRA's application is aimed at balancing the needs of both employers and employees. Prior to the award modernisation process the minimum engagement clauses contained in various industrial instruments varied from four hours to two hours to 1.5 hours for junior casuals in particular states for specific spans of hours.
PN752
The NRA is not arguing for the existing three hour minimum to be reduced to zero. What we seek is to make the clause more flexible having regard to the statutory objectives which guide the Tribunal. The current award provision prevents school students working hours particularly after school on week nights. With the variation those students are able to participate in the workforce. It is true that those students are able to participate in the workforce currently on weekends, but as the evidence demonstrates, where students prefer to work after school or the employer is unable to offer a shift of three hours because of the closing time of the store, the current award provision is limiting students' access to employment.
PN753
THE VICE PRESIDENT: It's not putting it too highly to say that the current restriction prevents school students working after school? There is evidence before me of some school students who do it or have done it.
PN754
MS DUFF: Certainly some students are able to do it, but that is where their employer has extended trading hours which allow them to actually work a three hour minimum between becoming available at the end of the school day and the closing time of the retailer concerned. But certainly in a large majority of independent retailers, small and medium enterprises, the current provision is limiting students' access to employment.
PN755
THE VICE PRESIDENT: Where is there evidence of these limitations? You say the vast majority. Is that established by the evidence?
PN756
MS DUFF: It is the opinion of the NRA and the opinion that was expressed by Gary Black.
PN757
THE VICE PRESIDENT: Where was that expressed in his statement?
PN758
MS DUFF: Your Honour at paragraph 3 Mr Black refers to the case of the Terang students, Miss Harrison and Mr Spencer, as being typical and reflecting the predicament of many school students across the country. The survey that was conducted by the NRA which Mr Black refers to from paragraphs 9 through 11 specifically elucidates the views of particularly smaller employers, of the difficulties that they are facing in regard to providing the minimum shift to school students.
PN759
THE VICE PRESIDENT: What conclusion should I draw from the survey material, noting that it's not direct evidence in a sense? But what conclusions do you say I should draw? It appears that many retailers support the reduction of the minimum engagement period, but what's the basis for saying that that would enable school children who can't currently be employed to be engaged? Is that link actually established by any of the evidence?
PN760
MS DUFF: Not that I'm aware of, your Honour, but it follows that if employers' evidence is currently, whether that be direct evidence before the Tribunal or anecdotally provided to employer associations like the NRA, that they cannot comply with the requirement to provide a three hour minimum, any reduction in that minimum is going to facilitate an increase in positions available to secondary school casuals.
PN761
THE VICE PRESIDENT: Yes. I'm not too sure that it's clear on that material whether a three hour engagement can't be utilised at this stage, or there might be a desire to use a shorter engagement if it became available. It would appear to be two different things.
PN762
MS DUFF: Certainly in some cases it might be two different things. It's not clear on the material in Mr Black's statement, but certainly from the survey that the ARA tendered in evidence in the previous proceeding my understanding of that evidence is that most of the businesses that they surveyed closed at or before 5.30 pm, and that most students were available for work of two hours or less; and the majority asserted that they would stop employing school students after school or stopping all - and 60 per cent indicated that they didn't employ school students because of the minimum shift requirements in the modern award.
PN763
THE VICE PRESIDENT: What was that percentage?
PN764
MS DUFF: 60 per cent.
PN765
THE VICE PRESIDENT: Where's that in the evidence?
PN766
MS DUFF: I can't point to the exact location in the evidence but those figures were in fact cited by your Honour in the decision at first instance, in the previous application by the NRA and the Master Grocers Association.
PN767
THE VICE PRESIDENT: Yes. Thank you.
PN768
MS DUFF: In relation to the previous application by the NRA and the Master Grocers to vary the General Retail Award, your Honour noted the real and significant impact of the current provision on Leticia Harrison, Matthew Spencer and the Terang Co-op as their employer. Your Honour further noted the strength of arguments that it is desirable to provide youth with employment opportunities and that award provisions which limit opportunities for youth employment should be avoided if possible. Mr Gary Black, executive director of the NRA, gave evidence of a number of issues pertinent to the statutory objectives and which, in the NRA's view, should encourage the Tribunal to exercise its discretion and grant the NRA's application.
PN769
Mr Black's evidence was that the Terang situation is typical and reflected the situation presently experienced by school students and employers across the country. The General Retail Award has significantly increased labour costs for many retailers, that approximately one in two young persons relies on retail for a job, that 26 per cent of the youth labour market are unable to find work or sufficient work, and that a survey conducted of members by NRA staff revealed that a very broad base of support exists for a reduction of the current minimum engagement period for casual school students, and the current minimum was seen as a significant impediment to the employment of casual students.
PN770
The results of the NRA survey are consistent with those of the ARA survey tendered in connection with that previous proceeding. As your Honour noted in the decision in that case the ARA survey supported the view that the current three hour minimum engagement was significantly impacting retailers, and the ARA established that over 50 per cent of respondents employed students on short shifts before the close of business, and that the majority of students were not available until 4 pm or later. Most businesses surveyed closed at or before 5.30 pm and most students were available for work for two hours or less. A majority of respondents asserted that they would stop employing school students after school, or stop employing students at all, and 60 per cent of respondents indicated that they did not employ school students because of the minimum shift requirements in the award.
PN771
In the NRA's submission the evidence led by the SDA in opposition to the application does not present any impediment to the Tribunal granting the application to vary the current minimum engagement period for casual school students. The SDA led evidence from four student casual witnesses. Each of those witnesses had had no dealings with shifts of less than three hours, and in each case the students concerned expressed a preference for longer shifts, and stated that a 1.5 hour shift would not have suited them. Importantly, each student witness admitted that a shift of less than three hours was not their preference because of their own particular circumstances. Each student readily admitted that students with different circumstances may prefer shorter shifts and that a 1.5 hour shift may be appropriate for others in different circumstances.
PN772
The issue of individual preference is, in the NRA's submission, a central feature of this matter. Both school students and retailers desire flexible award provisions that enable them to arrange their working hours to suit their particular circumstances. The evidence led by the SDA from Dr Campbell is not in our submission helpful to the Tribunal in the current matter. Dr Campbell's statement fails to take into account on his own admission numerous other factors relevant to the modern award's objectives. Throughout his evidence Dr Campbell has made assumptions with little basis. Dr Campbell has not conducted any specific research into the actual impact of the current minimum engagement period, and admits that there is no direct evidence on the length of shifts that school children prefer.
PN773
Dr Campbell believes that there is no reason to think that school students' preferences in terms of the length of shift would differ significantly from the preferences of other employees, yet concedes that there is no research to support this view. It is simply his personal opinion. Dr Campbell admitted his general belief that there is too high a proportion of casuals in the retail industry and that he was opposed to forms of individual agreement that didn't include adequate safeguards. He further admitted that the inclusion of further safeguards in the proposed amendments sought by the NRA would be unlikely to alter his opinion. These philosophical positions, in our view, taint his evidence with bias and suggest that he is not an entirely impartial witness.
PN774
The Tribunal heard the evidence of Dr Robin Price that despite conceding the various benefits to school students of engaging in paid employment she was opposed to a reduction of the current minimum period of engagement, and any conditions of employment that allowed an employer to adopt practices which in her view exploited casual employees. There are several limitations in the research conduced by Dr Price, and upon which her opinions are based, that in the NRA's submission minimise its relevance to the current proceeding. Much of Dr Price's research is not limited to student casuals but to the casual workforce generally. Her research centres around the employment practices and employees of major supermarket retailers and in particular the retailer known as the pseudonym Food Corp.
PN775
Whilst Dr Price was prevented from naming the specific retailer she could tell the Tribunal that it was a major national chain with over 700 stores operated 24 hours, and that the terms and conditions governing its employees were derived from an enterprise agreement. In connection with her observation that the employers she surveyed did not mention the current minimum engagement period as an impediment to youth employment, Dr Price admitted that most of the employers she'd surveyed had enterprise agreements in place and that the current award conditions did not apply to their businesses.
PN776
In relation to the potential detrimental effects of a reduction in a minimum casual engagement period Dr Price conceded that these effects are not necessarily specific to the amendments sought by the NRA in the present application, but are associated with excessive or unreasonable working hours of casual students generally. In these circumstances the NRA would submit that the evidence of Dr Price is of limited assistance in relation to the current application. It is the NRA's submission that the evidence of Ms Buesnell is largely unreliable and should be disregarded. Her experience is, on her own admission, limited to the employees of major retailers in Queensland who have their own enterprise agreements and are not bound by the provisions of the General Retail Industry Award, and whose trading hours are between 7 am and 10 pm.
PN777
It is also relevant to note that Ms Buesnell's experience is confined to a particular, limited area in Queensland. Fortunately for the student casuals of Orange and the surrounding area, major retailers such as Coles, Woolworths and Big W have extended trading hours and are able to offer employment to the (indistinct) student casuals, regardless of their preferences in terms of shifts. This situation must be contrasted to that of the Terang Co-op and other retailers around the nation who close between 5 pm and 6 pm. Ms Buesnell explained in her evidence that she had in fact conducted a written survey of members. Her statement did not accurately reflect that a written survey had been conducted, nor did it annex the results of that survey.
PN778
As with the other SDA witnesses we submit that Ms Buesnell's evidence should be approached cautiously because of her clear political view. Ms Buesnell admitted her objection to any reduction of the minimum period of engagement, not necessarily because of the views of the students she had surveyed but because it would set a precedent. We also submit that the evidence of Ms Carrington is of limited weight. Ms Carrington explained that the majority of SDA members with whom she interacts are employees of major retail chains who would have enterprise agreements in place. She further conceded that where transport issues like the ones mentioned in her statement are concerned, students may prefer to work a shift shorter than three hours if their transport issues are not similar.
PN779
The SDA has suggested in its evidence that the issue of closing time is a matter of individual preference of a retailer. Whilst it's true that trading hours in most states are largely deregulated, this doesn't mean that retailers are free to open whatever hours they choose. In its written submission the SDA states that it is largely a retailer's decision to close at 5 pm and not one that is imposed upon it. Similarly Dr Price was critical of retailers choosing to close when they could trade longer. However what the SDA and Dr Price have failed to take into account are the financial and operational considerations relevant to trading hours. Without sufficient customer income during a longer trading period an extension of trading hours would make it financially unviable for an employer to remain open past five or 6 pm.
PN780
So what we have in the NRA's submission is a necessary variation to allow a group of employees to participate in the workforce. Opposed to that we have the SDA's philosophical position that casual employment is undesirable and is to be reduced. That comes through in each of the witness statements provided by the SDA. The SDA has not, in our view, provided any evidence that would cause the Tribunal not to make the variation sought, when the evidence of NRA, the ACCI and the Victorian Government are considered. In our submission it is a clear decision for the Tribunal.
PN781
If this variation is not made school students will continue to be excluded from the workplace. Employers will continue to be prevented from offering employment opportunities to student casuals. This is not an insignificant issue. To characterise this as a small or an isolated incident is to misunderstand the situation. In our submission the Tribunal must make the variation sought. Unless the Tribunal has any questions further, they are the NRA's submissions. Your Honour had asked to be addressed on the potential additional conditions that might be considered in the variation sought.
PN782
THE VICE PRESIDENT: Yes.
PN783
MS DUFF: Would your Honour like to hear the NRA's position now?
PN784
THE VICE PRESIDENT: Yes, I would.
PN785
MS DUFF: Thank you, your Honour. The NRA's position is that the default provision is always going to be for a minimum engagement of three hours. The NRA's position is that the amendment sought is already sufficiently limited in its operation. It requires that the employee be a secondary student, that they're working between 3 pm and 6 pm on a school day, that the employee consents to a shorter shift than three hours, and that their parents also consent to that shorter shift. There is nothing in the NRA's proposal that stops an employer from offering a longer shift, or an employee from requesting a longer shift.
PN786
If the work is there and the store trades beyond 6 pm then we can't see any reason why an employer would restrict a student casual to a 1.5 hour engagement. If your Honour is concerned about the predicament of student casuals who are currently working a three hour shift and would like to maintain a shift of three hours or longer, the NRA would suggest that the Tribunal consider adding a provision to read something along the lines of:
PN787
If at the time of amendment of the modern award a casual student is regularly working a three hour shift commencing on or after 3 pm Monday to Friday and during a school week then the employer cannot reduce the duration of this shift in accordance with the new clause without the agreement of the student and the student's parent or guardian.
PN788
THE VICE PRESIDENT: Yes, thank you Ms Duff. Mr Mammone are you next?
PN789
MR D MAMMONE: Yes, your Honour. Very brief closing submissions, your Honour. The materials filed by ACCI have been marked in these proceedings. We rely on those written materials. We support the application by the NRA in this matter. We support the submissions made by the NRA. Very briefly, your Honour, the Australian Chamber of Commerce and Industry notes that this application flows immediately following the Tribunal's Full Bench decision in matter number C2010/4310 and C2010/4432. If your Honour hasn't a copy already I will also hand a copy to your Honour.
PN790
THE VICE PRESIDENT: Yes, I have a copy of that.
PN791
MR MAMMONE: ACCI believes that this application is specifically directed to varying the award for a very limited purpose only and not more broadly. We believe that they address the concerns addressed by the Tribunal in that Full Bench proceeding of the composite nature of the variation sought in the original proceedings. ACCI supports the applications to vary the General Retail Industry Award and believes that the variation, which would only apply to secondary school casual employees, is necessary to achieve the modern award's objective pursuant to section 157 of the Act.
PN792
In relation to the words in section 157, "fair and relevant safety net" ACCI submits that the Tribunal should set minimum standards at an appropriate level that acts as a safety net; but does not do so at the cost of other statutory objectives such as employment, increased workforce participation, promotion of flexible modern work practices, and efficient and productive performance of work. Set minimum standards at a level that encourages or enhances job creation and the promotion of employment opportunities for employees; set minimum standards at a level that does not threaten the capacity for junior employees to obtain or remain in employment; set minimum standards at a level that should encourage persons to gain a foothold in employment for the first time, and set minimum standards at a level that does not threaten skill formation by limiting the employment opportunities for junior employees.
PN793
Both expert witnesses for the union, more particularly Dr Campbell, agreed that work has both monetary and non monetary benefits. The non monetary benefits do have value. Dr Campbell made specific reference in his evidence to the House of Representatives' report and the numerous benefits and positive features of combining school and work. In relation to the statutory construction it's clear that a Full Bench has considered your Honour's earlier decision in terms of the correct manner to interpret section 157. In paragraph 23 of the Full Bench's decision they state that:
PN794
In our view synonyms such as exceptional, indispensable and requisite the compound phrase “exceptional circumstances” are of limited value and their use is likely to lead to confusion. While synonyms might in some circumstances assist in the construction of statutes, they ought not to be substituted for the words that the legislature has used.
PN795
It goes on to say that your Honour did not do so and nor was there any indication that Your Honour misapplied the correct test. The Full Bench then at paragraph 27 considered the circumstances which led to the three hour minimum engagement provision in the context of applications to vary the modern award. At paragraph 27 the Full Bench said that while the ultimate question was whether your Honour:
PN796
…was satisfied that the variation was necessary to achieve the modern awards objective, the positions taken by the parties and the Full Bench in the making of the award were not irrelevant to that question.
PN797
It's clear that firstly the ultimate question in section 157 is the satisfaction of the Tribunal that the variation is necessary to achieve the modern award's objective. When one considers the words in section 134 of the Act, the modern award's objective, subsection (1) states that:
PN798
FWA 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 -
PN799
And then enumerated factors (a) through (h). The word "ensure" must have some work to do in our submission. There must be some force and some necessary requirement on the Tribunal that the modern awards that were created in the Part 10A process continue or provide a fair and relevant minimum safety net. In our view not granting the application in this matter would be contrary to the modern award's objective in that it would not ensure a fair and relevant minimum safety net in so far as it applies to secondary school casual students.
PN800
This is the ultimate question, as the Full Bench has alluded to in paragraph 27 of their decision, in terms of exercising the discretion of the Tribunal. Not whether there's a manifest error in the Part 10A process or a change in circumstances. Whilst that can be considered, we say that the focus should be on whether the application is necessary to meet the objective in section 134 and we say in this case the evidence of both the applicant and the expert witnesses to a limited degree, in terms of the benefits of work for young people, goes to those issues. Having regard to section 3 of the Act, of section 134 and section 157, as a whole we say that in these circumstances it is necessary to achieve the modern award's objective. Those are the submissions of ACCI.
PN801
THE VICE PRESIDENT: Thank you Mr Mammone. Mr O'Grady?
PN802
MR O'GRADY: Yes, thank you, your Honour. The minister of course relies upon the written submission which is exhibit O1 in its entirety. Your Honour will, having read it, see that the emphasis really is on two issues. The modern award objectives of social inclusion through increased participation of school aged young people in the workforce whilst they're still at school, and the need to promote flexibility in the award system so as to enhance the efficient and productive performance of work and reduce unnecessary regulation on business. Those are the two underlying themes that are adopted in the minister's submission.
PN803
The clause that is sought to be inserted, looked at in context, creates options rather than imposes obligations. In terms of the submission that Mr Mammone has just been making about the statutory test the descriptor, if you like, of exceptional circumstances that your Honour identified in a previous application which was given some approval by the Full Bench, I'm sure was not intended to impose any higher burden than the words of the legislation itself, and that is that it's something that's necessary to achieve the modern award's objective. The SDA submission to the effect that really what is being sought here is a review of a decision of a Full Bench, and that the principles that apply in those circumstances ought to be applied, is not right because if that was the test then there would be no need for a section 157 and there would be no opportunity to review awards during the four year term.
PN804
In essence if, despite the very best efforts of all of those associated with the making of a modern award, the award in its operation fails to achieve one of the modern award objectives then in those circumstances it speaks of a need for variation. So if your Honour comes to the view on the evidence that students are losing opportunities to work or that opportunities for students to perform part-time work after school on weekdays are being limited, or those opportunities are not being made available, and your Honour comes to the view that that is contrary to the concept of increased participation in the workforce thus limiting the social inclusion of those people, then it is submitted that it is open to your Honour to, and in fact your Honour ought to, grant the application.
PN805
Much of the evidence of both the expert witnesses and the organisers went to the issue of social inclusion, and at the end of the day all of the evidence about times other than the hours of three till 6.30 on weekdays is not really helpful to your Honour in deciding this application. That really was where much of the evidence of the individuals, if you like, was focussed, and also the evidence of the organisers. In summary the evidence on the circumstances of students is that it really depends upon the individual circumstances of each student in each situation, and it's very difficult to distil from the evidence before you a common theme, if you like.
PN806
On the other hand you have the evidence before you of the survey material. I don't propose to deal with that. It's in the submission of the NRA. I think it's summarised at paragraph 51 or thereabouts. It's really for your Honour to weigh all of that up and, as I said, if you come to the view that there are limitations on the opportunities for school students to engage in part-time work after school on weekdays, then it's not far from that position to the position of, "This is inconsistent with social inclusion through increased participation in the workforce".
PN807
The social inclusion aspect is one that was the focus of some evidence, both of Dr Price and Dr Campbell. It's also the subject of some material which I understand Mr Friend and Mr Dowling give to your Honour in their submission, and they've provided a copy just now before your Honour came in. I'm not sure what submission they propose to make in relation to that, but if there is a submission which in any way seeks to constrain or confine the meaning of social inclusion then it's submitted that your Honour ought consider very carefully whether that is the appropriate approach. Because in essence what you have here is beneficial legislation, and with an objective relevantly in the application before you of promoting social inclusion, and so the concept ought be looked at generously.
PN808
The material in so far as I've been able to discern, looking through it whilst other submissions were being made, seems to suggest that there's no single definition of social inclusion, and that's not surprising. But what the Fair Work Act does of course is it focuses on one particular aspect of social inclusion, and that is social inclusion through increased participation in the workforce. Now your Honour will recall that in cross-examining Dr Campbell I tested with him his proposition that students get sufficient social inclusion from school and they don't need it from the workforce. I think at the end of the day his intransigence left him in a position where all he was relying upon was the lack of definition of social inclusion, to satisfy himself that students participating in the workforce might benefit or might gain in their social inclusion from work.
PN809
On the other hand you have Dr Price's views, and you'll recall the passages that I took Dr Campbell to from the House of Representatives Standing Committee Report. It's submitted that the concept of social inclusion through increased participation in the workforce is one that is entirely appropriate to apply to the circumstances of students who are attending secondary school, who are looking for work after school between the hours of three to 6.30 on weekdays. Other aspects of Dr Campbell's own evidence seem, whilst not in terms, to acknowledge that there are some benefits or greater social inclusion available from participation in the workforce by school students. His own evidence at paragraph 39, his own evidence at paragraph 41, where he refers to the House of Representatives Standing Committee Report at 3.12.
PN810
What was interesting was at the tail end of his evidence in an exchange with your Honour he spoke about his and his wife's sponsorship of a Sudanese student. One distils from that, whilst not stated in terms, that the purpose of getting the Sudanese student into the workforce was for social inclusion. I did want to say briefly something about the Child Employment Act provisions, at least in Victoria, your Honour. We've addressed that in our submission but there are a couple of other sections which I did want to at least draw to your Honour's attention. Subsection (2) of section 11 of the Child Employment Act imposes a duty upon every parent and guardian not to allow a child - and child is defined as someone, I think, up to the age of 15 - to engage in employment if the nature and extent of the employment is such as to prejudice the child's attendance at school, or their capacity to benefit from instruction.
PN811
So there's really a statutory duty on parents and guardians to protect against students working too much so that it interferes with their schooling. There is a correlative obligation on an employer in section 20 of the Child Employment Act, and it says that a child may only be employed to perform light work. The concept of light work is defined in section 5, and that includes a qualification in paragraph B of subsection (1) of section 5 that it not be such as to prejudice the child's attendance at school or the child's capacity to benefit from instruction. So that goes to two things, your Honour. Both the length of shifts and also this concept of spreading the hours over the week that both Dr Campbell and Dr Price seem to have a concern with; as to whether or not performing work over a number of shifts over the course of the week might interfere with their education.
PN812
The fact is there are statutory protections in place - and they can't be ignored - so as to prevent that situation arising. The evidence in relation to that issue of the prospect that there would be a larger number of shorter shifts and that would impact on students' ability to excel at school et cetera is one that requires some consideration, because that seemed to be one of the main areas of attack on the minister's submission by Drs Price and Campbell. In essence in order for that contention to be made out it really requires three propositions to be made good. One is that the availability of shorter shifts will be taken advantage of by employers so as to force students to work a larger number of shorter shifts. That's the first proposition.
PN813
The second proposition is that students will work more shifts to make up the hours. The third proposition that needs to be made good in order for the contention to be made out is that the consequences that it would absorb more time of each week due to the additional number of engagements, if you like. Turning to the first of those propositions, forced shorter shifts, the clause protects against forced reduction in shifts. In its terms it does not provide for reduced minimum shifts. It allows flexibility for agreement by students and their parents to shorter shifts in certain limited circumstances.
PN814
Despite the efforts of Drs Price and Campbell it's submitted that the evidence does not make out the reality of students being forced to work shorter shifts. You'll recall one of the central pins to Dr Price's contention in that regard was the superannuation issue which just is not made out. I should mention while I just note that, your Honour, the relevant sections in the Superannuation Guarantee Act, if your Honour needs to go to them, are not in my notes but I will give them to you. I think it was section 28. Yes, section 28, and the relevant aspect of that is the reference to part-time employee, and part-time employee is defined in section 6 to mean a person who is employed to work not more than 30 hours per week.
PN815
Dr Campbell expressed some concern about the lack of protections in the clause, if you like. I think in essence what he was saying is that it still leaves vulnerable students open to be pushed around by big mean employers, and have their shifts reduced. The extent to which Dr Campbell has concerns about that as a concept is revealed by his lack of belief in the veracity of the protections available from the making of individual flexibility agreements. That's something that the parliament has decided is appropriate, but it's not enough for Dr Campbell. So in that regard you need to look at his views in context. The fact is what the clause does is it requires not just the approval of the student but of course the student's parents or guardian, who are subject to the duties - at least in Victoria - of those that I mentioned in the Child Employment Act.
PN816
The other is this. Dr Campbell did not really address the issue from the point of view of the employer's considerations. There seemed to be an assumption on the part of both Dr Campbell and Dr Price that employer's would take every opportunity to drive things down, if you like. But one needs also of course to consider the reality of the situation. If an employer has an arrangement in place that is working and the student is one that is suitable for the job and the shifts that are in place, it's suitable for everyone, where is the need for change? The transaction costs of bringing about change, introducing others into the workforce to drive down the shifts to an hour and a half or whatever is something that needs to be taken into account. Costs of searching, hiring, training and the like.
PN817
But at the end of the day what the clause does is it provides opportunities for employers to make decisions about the right mix, and for student employees also to request shorter shifts if it suits them, and that's a point that was acknowledged by Dr Price. One of the attractions of casual employment of course for students is that they also can say no, or they also can seek changes to the arrangements. Particularly - I think the example was in the evidence of Dr Price - where it comes to exam time and the like, and what this clause does is it makes available more flexible arrangements so that the circumstances of each individual engagement can be given effect to.
PN818
I come back to what I said earlier, that at the end of the day it's very difficult to distil any one model relationship from the material, and the reason for that is because circumstances depend on the circumstances of each individual student; what their needs; where they live; what travel requirements they have; whether the workplace is near school; whether the workplace is near home; what sporting commitments they have et cetera. The other aspect to the, if you like, forced reduction of hours was the contention that students really have little awareness of their rights and were therefore vulnerable.
PN819
One matter that needs to be taken into account in relation to that of course is the obligation upon employers now to ensure that everyone has a Fair Work Information Statement when engaged, and the other matters that are addressed in the House of Representatives Standing Committee Report at both paragraphs 5.29 and 5.40. Just finally on this forced reduction of hours, the evidence of young Georgia Munro on that aspect was interesting. She said that, "At some stage you have to decide if you're going to go backwards. You've got to know where to draw the line". In essence what she was saying is if the shift was so short that it wasn't worth doing then you need to look at other options. The reality is the economics speak for themselves on that.
PN820
The other aspect of Ms Munro's evidence of course was the opposite end of the spectrum, the long shifts where kids come into school the next morning wrecked. So again it comes down to the proposition that the clause makes available options, flexibility. The second proposition that goes to make up the contention attacking the minister's submission that a reduction in daily minimum hours helps avoid the impact of work on educational outcomes is that it will lead to students working more shifts to make up hours. Mr Mammone addressed this. Ms Duff addressed this. There is ample evidence to say that students are not simply driven by the dollar in securing part-time work after school.
PN821
Your Honour has already been taken to the range of other considerations that drive students to engage in work. It's identified in paragraphs 2.7 and 3.12 of the House of Representatives Standing Committee Report, Dr Campbell's evidence at paragraph 39 of his statement and paragraph 15 of Dr Price's statement where she surveys the literature. The other thing for Dr Price is the flexibility of casual engagement, the importance of the right of refusal for the student, which she addresses at paragraph 22. There is no evidence of specific lengths of shifts which are to be preferred. At the end of the day it will depend upon the individual circumstances and the needs of both the student and the employer.
PN822
The consequence of what I've just said is that it's speculative to say, as Dr Campbell does at paragraph 40, that there is no reason to think that students would bring any different set of considerations to the hours of engagement than those of other (indistinct). Students do have different factors influencing their availability, their needs and the like. Just whilst I'm having a crack at Dr Campbell, if you like, at paragraph 50 his proposition that one and a half hours is not long enough for any employee, the reality is that's for the student and the employer to decide, depending upon the circumstances of their relationship.
PN823
There was some evidence about travel time and the like. The reality is there's no doubt there will be some situations where travel arrangements are such that it will make it uneconomical, and undesirable for whatever other reasons, for a student to perform work at a particular place for a particular shift. There's no reason to suggest that that situation is exacerbated by the availability of an option of shorter shifts. There are a range of circumstances - and it doesn't require the evidence of experts or anyone else for one to come to this view - there are a range of other situations where of course shorter shifts will be more desirable due to other commitments; whether they be study related, sport related, charity related, or home related.
PN824
The example that Dr Campbell gives can in no way be said to be representative of the majority of situations of students. In fact even on his own evidence it's a little unrealistic. What he does is he gives evidence about travel times of employees generally, and then gives an example of a position a particular person might be in. The example that he uses is one where the travel time exceeds the average travel time of employees generally. There's no material about average travel times of casual employees engaged in work after school, being casual employees who are school students.
PN825
So at the end of the day the attack on the minister's proposition that a reduction in daily minimum hours would help to avoid the impact of work on educational outcomes, it's submitted, is one that hasn't been made good. There are a couple of other minor criticisms of the minister's submission in the SDA's submission. At paragraph 43, I think, the SDA have a crack at the minister for not looking at people other than school students. Well that's unwarranted, given that this application of course focuses on the needs of school students. The criticism at paragraph 44 that the minister's material is of tangential benefit at most is inconsistent with Dr Campbell's acknowledgement that he found the minister's material somewhat helpful.
PN826
The comparison with other nations in the OECD really has its limits in that there's nothing before your Honour to indicate what constraints there are on students working in those other countries. Absent any material that enables your Honour to compare like with like, or be comfortable that you are comparing like with like, it renders that material of little value. The other comment I just wanted to make briefly about the evidence of Dr Campbell was his preparedness to draw down conclusions from a border group, if you like, a broader category of people such as casual employees generally or workers generally, and to apply those same considerations to the position of students in secondary school engaging in casual employment after school. He does tend to take that position in a number of regards.
PN827
The material that is before you that relates to casual employees generally, as opposed to that which relates to student casuals working after school between the hours of three and 6.30 pm is of limited value because it fails to have regard to the needs of the school students as such. The fact that income is not the sole driver; the fact that the number of hours that casuals can work is more likely to be a constraint than modesty in income levels; how much work can they fit in? The attraction of casual loadings rather than standing entitlements is something that Dr Price acknowledged as an attraction for students. The attraction of flexibility of casual employment I've mentioned in paragraph 22.
PN828
The availability of increased employment over non school days, public holidays and school holidays, and irregular shift arrangements is something that Mr Caranza and Ms Munro identified. The other factor of course is that for many of the students this is likely to be their first step into the workforce, and it provides them with all the very opportunities that are emphasised in the House of Representatives Standing Committee Report. To gain confidence, to gain exposure to a broader section of the community, to be conferred with responsibility, and those are all matters which it's submitted go to make up the concept of social inclusion; concepts which are enhanced by the participation of the student in the workforce.
PN829
As I said earlier, at the end of the day if your Honour comes to the view that, despite the very best efforts of those who have come together to make this award, in the circumstances of secondary school students attending school and wanting to work after school hours on weekdays between 3 pm and 6.30 pm are being in some way inhibited or prevented from doing that, then it is contrary to the modern award objective of promoting social inclusion through the increased participation of school aged students. And also contrary to the need to promote flexibility in the award system so as to enhance the efficient and productive performance of work, and reduce the unnecessary regulation on business. Those are the submissions of the minister.
PN830
THE VICE PRESIDENT: Thank you Mr O'Grady.
PN831
MR O'GRADY: Thank you, your Honour.
PN832
THE VICE PRESIDENT: Mr Friend?
PN833
MR FRIEND: Thank you, your Honour. Your Honour what I propose to do is just go through in reasonably short scope, I hope, the outline of submissions that were filed a couple of weeks ago, and then we've prepared another short document dealing with some matters which seem to have risen as points of focus during the course of the last two days' evidence. Your Honour, there have been a number of applications like the present one in recent times, as your Honour is no doubt too painfully aware. But a number of them have also been withdrawn. The ARA has given up. They gave up the application in support of the NRA, and a large group of applications by VECCI, one of which you (indistinct) with the Retail Award, has also been withdrawn.
PN834
We deal with the description of the application in part A of the outline. Ms Duff, just looking at paragraph 5 when she described the clause, said it only operated between three and 6 pm. Our reading of it is three and 6.30. I think that's what it said. That's what Mr O'Grady said. Can I touch briefly on the principles which we say should be applied. There hasn't been any direct engagement in relation to this but in my submission what Mr O'Grady put to your Honour was not the correct approach. The correct approach is the one that has been established in the cases that we've referred to here. So looking at paragraph 12:
PN835
The Commission would be unlikely to alter substantive award terms so recently made after a comprehensive review. Normally a significant change in circumstances would be required before the Commission would embark upon a reconsideration.
PN836
That's from the June 2009 Full Bench of the AIRC, and in the Pharmacy Guild there's a look at change as being necessary.
PN837
THE VICE PRESIDENT: That was in a different time, was it not? That was at a time when the Commission was undertaking the task of establishing modern awards.
PN838
MR FRIEND: Yes.
PN839
THE VICE PRESIDENT: And there could be applications to vary those awards at that time. But now with the Fair Work Act in place, which contemplated modern awards having been made, then with the ability to review the provisions of awards, the first of which being next year - - -
PN840
MR FRIEND: Yes, well in fact it established not just the ability but it creates the requirement, as I understand it - - -
PN841
THE VICE PRESIDENT: Yes, a requirement to review the terms of awards.
PN842
MR FRIEND: Yes.
PN843
THE VICE PRESIDENT: With an ability to make applications subject to a statutory test.
PN844
MR FRIEND: Yes.
PN845
THE VICE PRESIDENT: Which is really established by the Full Bench material.
PN846
MR FRIEND: That's right, your Honour, and a change will be more likely as time progresses obviously in any event, and what the Full Bench said about "so recently made" disappears into the past, again as time progresses.
PN847
THE VICE PRESIDENT: Yes.
PN848
MR FRIEND: But in the circumstances where what we're having is an extraordinary review, so to speak, an application outside the framework established by parliament, you would think that one of the things you would look for - and the Full Bench only said normally - is a change to justify it, a problem having arisen. Then if you look at the explanatory memorandum, which we've set out in paragraph 15 and 16 - I mean, this has all been gone over before, your Honour, and then there's your Honour's own assessment of what's required, set from the earlier NRA case at paragraph 18. That of course was accepted on appeal. It seems to have been accepted by the parties at that time, "157 is a significant hurdle". Your Honour refers to the explanatory memorandum, "Variation that is outside the four-yearly reviews will be permitted in exceptional circumstances".
PN849
Now the Full Bench said, "Well, synonyms don't necessarily help", but they didn't indicate that there was any error in your Honour's approach, and we'd respectfully submit that that's correct. So the position is that the applicant and those supporting it has to show that the modern award's objective is not being met and that this change, this particular change, is necessary for it to be met. We've described the applicant's case in part C. You will note in particular, your Honour, the concessions given by Mr Black in evidence referred to at paragraph 30, that there was no debate about the three hour minimum in Queensland. Bear in mind that the NRA is a Queensland based organisation and in fact ironically only has standing in this Tribunal to represent Queensland employers as a transitionally recognised organisation.
PN850
But be that as it may there's no debate about it. It has been like that for many years. This issue has arisen following the events in Terang of 2009, I think it was. As was noted by the Full Bench in the appeal decision in the last NRA case, there was a political flavour to the agitation of those matters. I put to Mr Black that he was here engaged in a political campaign and he said in cross-examination that his members or his organisation felt that the agreements and promises had been broken in relation to increased costs in other areas, and that that was part of the justification for seeking a decreased cost in relation to the engagement of student casuals. We've summarised what we say about those cases or about the NRA case there. I'll come back in more detail to some of the specific issues when I come to the other document later in these submissions.
PN851
Your Honour, the minister's submission, which is the first part of section D, in terms of the evidence in respect of the need for change as opposed to what the minister submits is a desirability for change, relies entirely upon the surveys of the ARA and the NRA referred to in the NRA's submissions. In that regard, your Honour, I simply direct your attention to Dr Campbell's analysis of those surveys and their utility, and he goes to it in some detail in his statement, and your Honour will have seen it. Not one question in cross-examination was directed to him in regard to his criticism of those surveys, and it is pretty severe criticism, your Honour.
PN852
If you look at it in effect he says because of the way they're structured, the way the questions are framed, they're virtually useless. They're not going to get you anything except the answer that you were looking for when you started. But not one question is raised in cross-examination with him to challenge that. Does your Honour want me to take you to that part of his statement? 67 is the NRA survey and it's almost a lesson in how to conduct a survey. At 68 he says, "You're trying to produce results that can be generalised to the population" and "You've got to eliminate sample bias and ensure that it's conducted in a neutral way". And he gives there a citation for information on survey design.
PN853
He says, "There's no information about the quality of the sample or the respondents". "But the major problem is the quality of the questions". "We're not told how they're introduced", and he gives some examples of what the questions might have been. At 70 he says what he can discern from the survey, "NRA members approved the application but why they do so remains unclear". There's a much more detailed discussion in relation to the ARA survey at 64 and following, and at 65 after a very detailed discussion what Dr Campbell says is, "The overall result that the NRA seeks to extract from the ARA surveys is completely unjustified. The survey offers no credible evidence that the three hour minimum engagement period for casual workers was significantly impacting retailers".
PN854
When your Honour asked Ms Duff for evidence, this was all she could point to, but again Dr Campbell wasn't cross-examined on this. Even if the survey could be seen as representative it's clear that the NRA's version of the findings don't stand up, and your Honour will see the rest. Mr Dowling reminds me that in relation to the NRA survey we sought further information about how it was conducted and that just wasn't available. They didn't keep it we assume. So the minister relies on the surveys. The survey is fatally flawed. There is a real difficulty - and we'll come back to this - for the applicant and the interveners establishing any - - -
PN855
THE VICE PRESIDENT: Isn't Dr Campbell's criticism of some of the questions somewhat harsh? For example at the end of paragraph 69 he says that question 5 is more or less another version of question 1, "a leading question whether in effect the employer approves the current application".
PN856
MR FRIEND: Yes.
PN857
THE VICE PRESIDENT: But the question is, "Would you employ more school aged children after school if a minimum 1.5 hour shift was implemented?" In so far as that question has elicited a yes, doesn't it indicate something about future employment practices that might bear upon issues of employment opportunities?
PN858
MR FRIEND: I think the point - and unfortunately Dr Campbell wasn't asked about this, but I think the point is that as you go through the survey, looking at the questions in order you've got question 1, "Would it make it easier for you?" and he says:
PN859
This is a strange question to lead off with, pegged as it is to a wrong version of the current NRA application. It's a leading question which does little more than in effect ask members whether they approve of the NRA case.
PN860
One has to assume that they were tough if they were being asked about these things because it's a case before the Tribunal, and even if they weren't it's reasonably common knowledge that these issues are alive in relation to a reduction of minimum hours and that the NRA has been active in supporting that. Now you are then asked, "Well, would it make it easier?" which is as Dr Campbell says the same as, "Do you support the application?" and then, "Would you do it?" might give a little more information, your Honour, but it is in the context of a series of questions providing support for the application. I think that's the point that he makes.
PN861
Mr O'Grady has written to the minister's submissions also, to a number of factors about choice and convenience for employees in working a shorter shift. We say - and we were criticised by him this morning - at paragraph 43 of our initial submissions that the flexibility should be imported. We say there's no identification of why that would be the case just for secondary students as opposed to everyone else, and all of those submissions about those things would apply to everyone. Many people have obligations and duties and commitments that mean that on certain days and at certain times they can't work three hours. The argument that's put would equally apply to a general application to reduce the minimum engagement.
PN862
But the minimum engagement is there and has been there through most of Australia as three hours at least for a very long time, and for good reason. To say that for some people it might be convenient for them to work shorter hours is not really an argument in favour of reducing it for one subsection of that group. We've said what we want to say about the ACCI's submissions at paragraphs 45 to 48. We've summarised our evidence and the evidence of the experts. I don't apprehend that there has been much of an attack on Dr Price's evidence. There have been assertions that it's not relevant, but not really any sort of an attack on it.
PN863
There have been some comments about Dr Campbell's evidence, one of which was Mr O'Grady saying that he tended to take a representative sample of data in relation to some people and draw down from that in relation - and draw conclusions about a smaller group. He wasn't asked about that, but that's what he does. That's the sort of expertise that Dr Campbell has. He manipulates data. He tries to work out how you can draw reliable conclusions, or conclusions of greater or lesser reliability, from the data that's available. You'll see that throughout his statement there are areas where he says, "Look, this is not necessarily particularly accurate" or some figures he describes as guesstimates.
PN864
But he's doing his best from the available information, using his expertise to draw conclusions about what the situation is, and we can never know the absolute truth because we have to rely on surveys and data collected in a range of ways. But that's the manner in which these questions are brought out into the light as best we were able with the information that was available. The other real criticisms of Dr Campbell I think related to the question of social inclusion and I want to say a good deal about that in a minute, and so I might deal with that at that time. We've summarised the evidence of the organisers and the students and I don't need to establish that. There's a section on no changed circumstances and your Honour will read that subject to the submissions that I made earlier in response to your Honour's questions.
PN865
Flexible work arrangements are dealt with at section G and it's probably unnecessary, your Honour, for me to go any further in relation to that. The social inclusion and discrimination I want to deal with in a minute. At section H we've set out a number of problems that we see with the clause as drafted. We'd rather apprehended that your Honour in asking the question on the first day, whether the parties would address in respect to parameters that can be put on the clause, saw that there might be some additional parameters. We, as part of our supplementary written submissions, have something to say about that, but as it stands now the first point you can see at 94. The window in which there can be one and a half hours' employment is three and a half hours long.
PN866
There may be many employees, many student employees who are now working three hours within that period. Ms Duff recognised that in the only potential change to the clause that she suggested, probably inaptly named in the case of school students but it was a grandfather clause; that those who were now working three hours in that period could keep their hours. But it's a pretty big concession to acknowledge that there will potentially be people who can work three hours within that time who could have their hours reduced with the clause as it stands. It is just as big a concession in relation to people who are not working three hours now but who next week, or next year, or the year after, will be able to work three hours, notwithstanding their school commitments, between 3 o'clock and 6.30.
PN867
THE VICE PRESIDENT: And those people affected could be disenfranchised from those work opportunities because of their individual circumstances.
PN868
MR FRIEND: Yes. Or they could be offered one and a half hours when they might have been offered three, and there's a whole group of people like that. This is going to be a very important group, people who could work three hours, and what I'll seek to demonstrate to your Honour is that once you start to play around with the clause and try and deal with these problems it actually is impossible to come up with an answer. It perhaps speaks volumes that neither Mr Mammone nor Mr O'Grady took up your Honour's invitation to try and delineate the various parameters.
PN869
There are questions of consent. your Honour, we've set out a passage of the cross-examination of Mr Black who at the end agreed that a student would go home - maybe one of their students who is able to work three hours - to Mum and Dad and say, "Look, I've got a job. It's only an hour and a half but it's the only one I can get. Will you sign here?" Mr Black agreed that that might very well be what would happen. By reducing it to one and a half hours you do away with the three hour minimum. You can't expect that people are necessarily going to continue offering three-hour jobs, even though three hours are there. If it's more convenient to the employer to offer an hour and a half or they want to save the hour and a half's work then they can do that.
PN870
Now it's no criticism of employers to say that they will seek to operate their businesses in the most efficient way possible. Of course they will. That's what they're there for, to run a business and to make money. But one of the efficient ways to do it may well be to employ students for an hour and a half even though three hours' work is potentially available. So how do you stop that, and we'll come to that. Can you focus it on this hypothetical group, if there is indeed anyone in this group? There's nothing in the proposed clause for recording these agreements. It's related to school days so of course you've got to ascertain on a particular day whether it's a school day. That's okay most of the time but many schools have curriculum days where students aren't required to attend. Is that or is that not included? That's a moot question.
PN871
Public holidays, obviously there's no one and a half hour minimum; school holidays there's no one and a half hour minimum. So what's going to happen, your Honour, when the employer who's used to having someone for an hour and a half, and that's all they want, and the child says, "Well I want to keep working because I want to keep earning my money" and the employer says, "Well, I don't want you for three hours. See you when school starts again". That might work well for some people. They might want to go away. But it's not a very good lesson about workforce participation, to want to work and to be laid off in that way. But that's the effect of the clause, that they have to be employed for three hours on those days, when the employer has only employed them for an hour and a half presumably because that's all they need. But that's the effect of the clause.
PN872
Then of course there's the point we make in 101, and if we talk about social inclusion - and we will a great deal in a minute - people who are socially excluded to a higher degree are young people who have no employment. Now they will be at a disadvantage over persons in school. Where the employer wants someone for one and a half hours he or she won't be able to employ an unemployed person for that shift because they have to be offered three. In other circumstances if it's the school student or the unemployed person they're on an equal footing. But if there's special treatment for school students in that regard they will be at an advantage for employers who want to employ people for short shifts. We'll come back to the clause in a minute.
PN873
Your Honour, at 102 we set out a number of other matters. Before I move to that, your Honour, on the question of the agreement not being in writing there was on other criticism of Dr Campbell, which was that he had said he reserved judgment over the requirements for individual flexibility agreements. I think that's as far as he went. He reserved judgment over whether they worked, and that's a perfectly reasonable position to take. It may be what parliament has prescribed, but that doesn't mean it necessarily works. Dr Campbell's profession is understanding how these things work in operation. But it doesn't in any way, in my submission, affect the usefulness of his evidence in general.
PN874
Turning back to 102, A and B deal with travel. Now your Honour raised with some of the witnesses I think the position, "Well, what if the student works across the road from school?" and obviously there will be cases where that occurs. But sometimes there will be travel difficulties as well. Sometimes, as Ms Carrington I think it was said, it's the school bus so there will be additional costs. There are a range of circumstances and again we'll come back to this; is there's a range of different factors that have to be taken into account in assessing what this group might be.
PN875
In 102F, just touching on some of them, your Honour, that one and a half hours for students creates a strong incentive to replace adult workers with students; the adult worker who might otherwise have been doing five or six hours might find themselves reduced to four and a half because a student could come in and do the last part of the shift. No one is suggesting that more work will be created by this amendment or variation. No one is saying more people will be employed. That has not been any part of the case from the applicant or the interveners. So the existing amount of work might be redistributed, and one of the ways, if it is redistributed, will be that the student will replace the casual worker. The casual worker who's doing a shift longer than the minimum may find it reduced.
PN876
Mr O'Grady's point about superannuation from Dr Price's evidence, I think he misstated the point that she was trying to make. But his point is well made; we accept that under 18 there's no superannuation except in very limited circumstances. But that really makes the situation worse because you'll be replacing an employee on 100 per cent plus 25 per cent loading, or perhaps a part-timer without the loading, with a student on a minimum rate, a student rate, a young person's rate plus the loading and no superannuation, which is another 9 per cent difference and going up.
PN877
THE VICE PRESIDENT: I think Dr Price put it in terms of an effect of a reduction in the length of the shift for the school student from three hours to one and a half hours would involve the saving.
PN878
MR FRIEND: Yes.
PN879
THE VICE PRESIDENT: That proposition appears to be problematical.
PN880
MR FRIEND: It only applies to 18 year olds, your Honour.
PN881
THE VICE PRESIDENT: Yes.
PN882
MR FRIEND: Of whom there would be a large number, at least in Victoria, finishing school. But it's a much - not much less, but it's a less significant point than Dr Price put in her statement. It wasn't a particularly important part of the statement. We accept that she was mistaken, as she did in the witness box, and your Honour saw the way that she dealt with the cross-examination on that. She was completely open about how that had arisen.
PN883
THE VICE PRESIDENT: Yes.
PN884
MR FRIEND: Now can I hand up the additional outline.
PN885
THE VICE PRESIDENT: I'll mark this exhibit F11.
PN886
EXHIBIT #F11 ADDITIONAL OUTLINE OF SUBMISSIONS
MR FRIEND: I missed the number, I'm sorry, your Honour.
PN888
THE VICE PRESIDENT: I think we're up to 11.
PN889
MR FRIEND: Eleven. Your Honour, one of the early questions that has to be really answered in considering this case is whether there is a group of people who are being prevented from being employed by this minimum, and whether there's any evidence before the Tribunal to that effect? We say that the highest you can get from the evidence - and this arises from some of the questions, or some of the answers perhaps from the questions your Honour asked of the witnesses - is that theoretically some students may not be able to obtain employment on some school days because they can't attend work for at least three hours before it must finish.
PN890
There's no evidence that the students can't work other days, and we have to bear in mind that not only are trading hours unrestricted, but in most places supermarkets are open late, even in the country, and certainly beyond five, 5.30. In most places there's one or more late - in the cities, but one or two late night trading days, and there's the weekend. So it's probably three or four days of the week that students may not be able to work. The other days there's an ability to work. There's no potential limitation on their ability to work arising out of the three hour minimum. But the applicant has to establish that there's an identifiable group, and there is really nothing before the Tribunal to identify that group.
PN891
When your Honour asked Ms Duff for the evidence she couldn't really point you to anything. You have to identify the group with some particularity if you're going to fix the perceived problem, because the only way to fix the perceived problem on the basis of the application that's made is to excise out that group. If you're to excise them out you have to know who they are and how it arises. You'll see what we say in paragraphs 8 and 9 and we'll come back to this point again later in the submissions; the excision and how you can do it, if you wanted to try, in relation to the clause. I promised your Honour I'd come back to social inclusion. We have some documents that really arise out of - one of the documents that was put by Mr O'Grady in cross-examination of Dr Campbell. Can I hand those up, your Honour.
PN892
Mr O'Grady's right that the words in the statute are the words in the statue, social inclusion. Inclusion in society. It's not a very descriptive phrase. One is really left to speculate a little bit about how that really arises or what it really means, and in that sense it's very useful to look at the background and to understand how the phrase is generally used. Your Honour will probably be aware - I certainly wasn't - that we have a Minister for Social Inclusion in the Federal Government. The first document at the top of those documents that your Honour has is the one that was shown to Dr Campbell, and that's from the Australian Government's website, Social Inclusion.
PN893
That's the strategy for young Australians and that talks about the eight priority areas for government action to help young Australians. To improve health and wellbeing, shape their own futures through education, rapport with their families, empower them to take part and be active in their communities, equip them with skills and personal networks they need to get work, enable them to participate online confidently and safely. But it is about inclusion in society in a more general sense, and that's the high point of the sort of argument about social inclusion that was coming from the other end of the bar table. The second document which is called Social Inclusion Priorities takes us closer to understanding what social inclusion is, and it's the opposite obviously of what social exclusion. The second paragraph:
PN894
Disadvantage and social exclusion tends to be higher amongst certain groups of people and the Australian Government has identified priorities in which to start the work of addressing social exclusion and increasing social inclusion.
PN895
So social inclusion is something you promote for people who are socially excluded, and these are the sorts of priorities that the government has addressed or identified. Children are at greatest risk, jobless families, locations of disadvantage, assisting the employment of people with disability or mental illness, addressing the incidence of homelessness and closing the gap for Indigenous Australians. The third document comes from the same website.
PN896
It's entitled The Origins, Meaning, Definition and Economic Implications of the Concept Social Inclusion / Exclusion. I'm not going to read this all to your Honour. If we turn to page 1 it deals with background and talks about the derivation of the concept, "Before the 1990s it was infrequently used. Instead social disadvantage" - that's social exclusion so it's the opposite of social inclusion - "social disadvantage, poverty" et cetera. And the second paragraph:
PN897
In the UK the new Labour administration in 1997 related its goals to the reduction of social exclusion. A greater emphasis was placed on the social consequences of being in a deprived situation, especially the alienation or disenfranchisement of people caught in poor circumstances. Social exclusion focuses more on social relations and the extent to which people are able to participate in social affairs and attain power to influence decisions that affect them.
PN898
So social inclusion - and there are other passages in the document, your Honour. If you look at foundations, the definition is at page 3, and then a distillation, a practical definition of key drivers at page 5, 6 and 7, and I won't take your Honour to that. To similar effect, just for completeness, another document from the website is Social Inclusion Origins, Concepts and Key Themes. Now these documents are late 2008, early 2009. But the concept of social inclusion is about not being excluded from society. One effort of social inclusion is workforce participation obviously. Would your Honour mark those documents?
PN899
THE VICE PRESIDENT: Yes. I'll mark that bundle of documents exhibit F12.
PN900
EXHIBIT #F12 BUNDLE OF DOCUMENTS FROM AUSTRALIAN GOVERNMENT WEBSITE, SOCIAL INCLUSION
MR FRIEND: Thank you, your Honour. It's not just a question of saying, "Well, any work for any person promotes social inclusion". The promotion or the actual objective of 134(c) is that the Tribunal must take into account the need to promote social inclusion through increased workforce participation. What is really meant by that is a requirement to take into account, in respect of the employees who may or may not work under the award, their need for social inclusion because they are socially excluded. Now to some extent obviously a principle that will always be there is not to put barriers in front of employment.
PN902
But social inclusion is something additional, something about if necessary assisting those who are excluded from society to become included through employment, and your Honour it's really for that reason, when one understands the use of the term more generally. Dr Campbell was somewhat bemused, we would say, by the idea that school students needed additional social inclusion. He didn't take the position that work wasn't good for them. Obviously it is good for them, and that's something that the Tribunal can take into account. We don't dispute that. But the extent of the relevance of this modern award objective is something that's important in this case, because almost the whole case of the applicant relies upon this objective.
PN903
There's flexibility, but really that could be argued in respect of any change. A reduction of wages to $100 a week would increase flexibility, and there's no demonstrated need. But in terms of these employees, these potential employees, they are already socially included and so the need to promote additional social inclusion through workforce participation is less, and we give the example here of the Medical Practitioners Award. One would imagine that it wouldn't be a consideration that was very high in the Tribunal's mind, promoting social inclusion for persons who are qualified medical practitioners.
PN904
THE VICE PRESIDENT: Well it might be quite relevant for a Sudanese student looking for employment.
PN905
MR FRIEND: It might be, your Honour, but where's the evidence that they can't get it because of the three hours?
PN906
THE VICE PRESIDENT: Well Dr Campbell said that he's having great difficulty finding employment - - -
PN907
MR FRIEND: Your Honour, I doubt that that's the three hours. I think there are other possible explanations for that, and much more likely ones.
PN908
THE VICE PRESIDENT: But if there are greater opportunities created then it might be that end of the labour market that it's an attractive opportunity.
PN909
MR FRIEND: Your Honour, that's an argument for lowering wages further. That's an argument for reducing hours to half an hour. You have to see a problem before you've got to fix it, and there's no evidence of a problem apart from this notional possibility that there might be some people who aren't getting work; when we know that we have one of the highest levels of workforce participation in the OECD for students. That's a very significant factor in this case.
PN910
THE VICE PRESIDENT: But it's suggested that the spread of those opportunities is limited. Dr Campbell said that it appeared to be amongst school students in more well off areas.
PN911
MR FRIEND: And that ties very much in with Dr Price's evidence, that those are the students who are motivated to, and who present well enough to get employment. You're not going to fix that by reducing minimum engagements. You're just going to drive down the hours for those who are getting work. It's not an instrument. This change is not directed at assisting those people. There might be other things that can be done, probably not through a modern award. But it's not even a blunt instrument. It's just a reduction. It's not in any way directed at the group that your Honour has identified, and the evidence before your Honour doesn't support the proposition that it would have any effect. At the end we are required to have some evidence to act on.
PN912
Now can I make some submissions, your Honour - I think I've said and summarised what I wanted to say in the rest of that section. The potential redraft; now I've already made the point that no one has really taken up the opposition, the invitation. At 17 I've made that point again, already, that the three hours can be worked between three and 16. To draft a clause that meets the case that's posited for this hypothetical employee who can't get a job, because perhaps they can only work on school days and what have you, but isn't it also going to affect other employees? You have to identify the parameters, which is the time the employee is available for work.
PN913
Schools finish at different times so just saying school day doesn't help. Students have different travel times to work and it's a significant point. For someone who can walk across the road, it may be much easier for them to get the three hours. Someone who can't might be in a position where they can't attend work early enough on some occasions. But you need to identify - given that we're talking about individual arrangements, and on any view that's what we're talking about - you need to identify the earliest time at which the individual student can attend for work on a school day. It might differ on different days of the week so I assume you have to take account of that as well, and then you have to identify the latest time the student can finish.
PN914
Now your Honour talked about external factors which create a cut off, and that's obviously not trading hours because there isn't in any real sense - I'm sorry, I mean legally mandated trading hours. It's the time perhaps that the employer has decided to close the business for whatever reason, but then often there will be work available after that time. But then again it's Dr Price's evidence on the basis of her experience in the retail trade. So you need to identify what's the latest time the individual can finish. Now it would seem that the only way that you're going to effectively be able to do that, if at all, is just to leave it up to the parties to identify it and to agree on it, because there's no way you can objectively identify that case in each instance.
PN915
Once you do that you've really got a situation where the parties are left to agree on a minimum time, and there's no safety net there unless it's the one and a half hours that's contended for. But certainly the clause, if one attempted to draft one - and I must say Mr Dowling and I spent some time playing around with this concept trying to come up with something, and we attempted to draft one - it would be complex and difficult to apply. You would need to have similar protections as to those that are there for individual flexibility agreements and there would clearly have to be a regulatory burden. There would have to be something in writing. Just consent in the air as it is in the proposal is hopeless, in my submission.
PN916
Individual flexibility agreements are there anyway, but we understand the position is that they can't be used because such an agreement wouldn't pass the better off overall test. But maybe that's a reason why the change shouldn't be made. We then deal, your Honour, with the question of discrimination. That's raised in the submissions of both the NRA and ACCI. The clause as it stands doesn't discriminate against anyone. It's the same clause for every person. The clause that's proposed has a different provision in relation to school students. It therefore discriminates between school students and other persons. That discrimination is on the grounds of age because school students are young persons. It's just another way of identifying young persons.
PN917
THE VICE PRESIDENT: In whose favour?
PN918
MR FRIEND: Pardon, your Honour?
PN919
THE VICE PRESIDENT: In whose favour?
PN920
MR FRIEND: Well, it's against the young person because the young person can be employed for an hour and a half. They have a minimum engagement of an hour and a half instead of three hours. If one assumes that the minimum engagement is there to protect the employee, and I don't know what other assumption one could make, then a lower minimum engagement is less protection.
PN921
THE VICE PRESIDENT: But the case against you is it's providing them with an opportunity that they would not otherwise get. You say that the clause proposed is not confined to that situation?
PN922
MR FRIEND: No. No.
PN923
THE VICE PRESIDENT: But if it was confined?
PN924
MR FRIEND: If you could somehow confine it to the situation that only - and it never had any other operation and frankly, your Honour, I can't see how it can be done - then it would not be discrimination against them. It would be discrimination but it wouldn't be discrimination against them. But otherwise the group who can work three hours but who can be engaged for an hour and a half, they're discriminated against.
PN925
THE VICE PRESIDENT: On the grounds of age?
PN926
MR FRIEND: On the grounds of age because they're - - -
PN927
THE VICE PRESIDENT: Compared to the other school aged children?
PN928
MR FRIEND: No, as compared to everyone else. It's not compared to other school aged children. It's compared to other persons in the market looking for employment. Now you can have discrimination in wage rates. The Act says that, but it doesn't say you could have discrimination in hours, and that's another reason why you can't do it. Because one would assume that if parliament had intended that you could discrimination in hours as well as wage rates for young persons it would have said so, and we've referred to 153. It's actually a significant point, your Honour.
PN929
Then there's the question we come back to of whether it's necessary. The applicant and the others need to show that the objective is not being achieved. They've got to satisfy your Honour that there's a recognisable group of persons who are being prevented from obtaining employment by the three hour minimum. The minimum's fair and reasonable and based on a long history, and your Honour will see attachment SDA1 to F1 - and it was before your Honour in the last matter - which sets out all the minimum engagement periods in all of the instruments throughout Australia. There's no evidence, we submit, upon which a state of satisfaction could be reached that the objective is not being met. What you have is speculation and hypothesis.
PN930
There was reference to - and I should say something about this - the evidence in the other case and that's not before your Honour. Your Honour has got to make the decision on the basis of the evidence that has been placed before you here. Even if you find this group of people, none of which have been produced, even if you find this hypothetical group then you still have to balance up is it better to make this variation to deal with that group and affect all these other people? What's the correct balance? This is the argument you have about three hour minimums anyway.
PN931
Should it be three, four or two? There's always going to be these circumstances and it's not confined to school students. Three has been thought of as a good minimum and a Full Bench has determined that in relation to this industry. It's what applies and without, we would say, compelling evidence your Honour can't be satisfied that it's necessary to achieve the modern award's objective to make this change. Unless there's anything else I can say to assist your Honour, those are the submissions of the SDA.
PN932
THE VICE PRESIDENT: Thank you Mr Friend. Ms Duff?
PN933
MS DUFF: Thank you, your Honour. There are just a couple of points that I wish to make on behalf of the NRA in response to Mr Friend's submissions. Mr Friend mentioned at the outset that there was - and I'm not sure whether this was made as a passing comment or whether it was taking issue with the NRA's standing to bring this application. The NRA is taken somewhat by surprise to that comment, given that it's certainly the first time that the issue has been raised in the context of the current - - -
PN934
MR FRIEND: Sorry, your Honour, there's no question as to standing. We accept it's standing. I thought I'd make that clear.
PN935
MS DUFF: Thank you. In relation to these surveys conducted by the NRA and the ARA Mr Friend drew your Honour's attention to Dr Campbell's criticisms of those surveys. In relation to those criticisms I'd just like to make two very brief points. Many of those same criticisms apply equally to the surveys conducted by the SDA organisers, Miss Carrington and Miss Buesnell. Their survey suffered from precisely the same flaws that Dr Campbell is at pains to point out are inherent in the surveys that don't support the SDA's position. The second point is that my reading of Dr Campbell's statement - Mr Friend referred your Honour to three precise paragraphs.
PN936
My reading of those paragraphs is that in terms of the criticisms directed at the ARA survey, Dr Campbell is actually more - it's the NRA's interpretation of those results rather than the results themselves and the construction of the survey that are the subject of his criticisms. The results of the ARA survey are set out and apparently accepted by your Honour in the previous application by the NRA and Master Grocers. In relation to the difficulties that Mr Friend has identified in the formulation of the form of variation sought the NRA rejects that it has made any concession that there was a risk that those who are currently able to work more than three hours will have their hours reduced.
PN937
What the NRA put to your Honour in terms of the grandfather clause was simply at the request of your Honour to be addressed on potential alternatives. The NRA also considers that many of the criticisms of the content of the proposed variation are somewhat hollow, for want of a better word. Many enterprise agreements to which the SDA is named as a party provide for minimum shifts of less than three hours, and those clauses commonly have less protections than the clause that is sought to be included by the NRA; namely that they don't require any form of parental consent.
PN938
Lastly, in relation to discrimination it would be the NRA's submission that that argument cuts both ways. The current clause can also be viewed as discriminatory against school students on the basis of their age, and again I come back to the similar provisions that are contained in various enterprise agreements that the SDA has negotiated and is party to. There is equally a prohibition in the Act on discriminatory terms in enterprise agreements. We would submit that given the prevalence of such provisions in enterprise agreements, that if such terms were discriminatory the Tribunal certainly would have identified them as such during the approval process.
PN939
THE VICE PRESIDENT: Are any of those clauses in the evidence before me?
PN940
MS DUFF: Not that I'm aware of. I have various complete copies of the agreements if your Honour wishes me to hand them up.
PN941
THE VICE PRESIDENT: Well it's up to you to put the case you wish to, that you refer to those matters. But there's no evidence of them it appears.
PN942
MS DUFF: In the absence of any further questions we don't have any further submissions, your Honour.
PN943
THE VICE PRESIDENT: There was some new material in Mr Friend's submissions. Do any of the other parties wish to comment or respond to that, given it was raised at the point of those submissions? Mr Mammone?
PN944
MR MAMMONE: Just two brief points, your Honour. Those materials - and I haven't had an opportunity to read each document in detail, but just a brief perusal of them - appear to be based on the EU concept of social exclusion and inclusion, and also exclusion by the looks of one of the documents. It's quite clear that parliament has consciously defined social inclusion within the context of the Fair Work Act, and qualified that concept in the Act by the words that appear after it, "through increased workforce participation".
PN945
So it clearly has a meaning within the Fair Work Act. To the extent that these materials do anything other than state what the EU -which is where we understand the concept may have derived from - has considered that and various indicators for monitoring or identifying social exclusion in Australia, I'm not sure much turns on that your Honour. I may have misheard, but I recall a submission made at the outset that an application has been withdrawn in this matter and an application has been withdrawn by VECCI in relation to another matter. I'm not sure what the submission was exactly.
PN946
THE VICE PRESIDENT: Well as I recall it, it was that applications made by VECCI in relation to a number of awards have been withdrawn. I think Mr Friend said including in relation to the General Retail Award.
PN947
MR MAMMONE: If that's the extent of that submission it's a matter of fact that a number of applications have been made in relation to a number of other modern awards, including this award, and some have been withdrawn, some have been progressed and determined accordingly. I'm not sure what weight turns on - what exactly is relevant in that submission. But that's all the submissions of ACCI, your Honour.
PN948
THE VICE PRESIDENT: Yes. Mr O'Grady?
PN949
MR O'GRADY: If I may take up your Honour's invitation on one point. Being the intervener we don't normally get the right to say something else. I did fail to head off Mr Friend's submission about students being over 18 years of age on the superannuation point, which I could have done. That is that of course Dr Price said people come out of school a year younger in Queensland so it puts them out. In relation to people in other states of course the usual time at which a person turns 18 is in their final year of school, Year 12, where one would expect a natural disinclination to take on additional work with the increased focus on more important study.
PN950
In relation to the discrimination point, the argument that Mr Friend puts in his written outline of submissions, I just offer this observation for your Honour hoping that it assists you. The attribute, if there is such discrimination, is attendance at school. It is not age because there are others of the same age who have the benefit of the three hour minimum because they're not at school. On a simple application of the High Court test in Purvis v The State of New South Wales the relevant attribute is not the reason for the discrimination, it's the attendance at school. Those were the only points that I needed to make, taking up your Honour's invitation. I'm satisfied with what I said about the social inclusion clause. Thank you.
PN951
THE VICE PRESIDENT: Yes, thank you Mr O'Grady.
PN952
MS DUFF: Your Honour may I take one final point?
PN953
THE VICE PRESIDENT: Yes you can - - -
PN954
MS DUFF: In relation to the issue of whether the enterprise agreements that contain the clauses that I have referred to in submissions and in cross-examining the student witnesses, I'm happy to tender those documents if your Honour would like me to; but I understood that given that all the agreements are a matter of public record that wasn't necessary. If you would prefer I could provide you with a list of the specific agreements that have formed part of our cross-examination and submissions.
PN955
THE VICE PRESIDENT: Well, I don't regard any agreements that aren't tendered in the proceedings as formally before me that I can have regard to.
PN956
MS DUFF: In which case may I tender the Swan View IGA and SDA Agreement 2010.
PN957
MR FRIEND: That wasn't even referred to in the case, your Honour. It might be that it's in the same terms as the ones that were read, and I don't have a difficulty with that. It's a third one, and I would like to say one thing if it gets into evidence.
PN958
THE VICE PRESIDENT: Yes.
PN959
MS DUFF: I believe I did refer to it in the cross-examination of the student witnesses, but if Mr Friend is correct, it is in identical terms to the four or five other agreements that I've also referred to.
PN960
MR FRIEND: Two others. Can I see it?
PN961
MS DUFF: Yes.
PN962
MR FRIEND: Thank you. Well as I understand it this is the only one being tendered, your Honour. Others have been - I think the clauses were read into transcript so to that extent the first two of them I think Ms Duff asked the witness to read the clause into transcript. Your Honour the only point that we'd say in relation to that is those agreements to be certified had to pass the better off overall test. It's not a matter for your Honour to do an analysis to determine whether or not that's right. You ought to assume on the presumption of regularity that those agreements do pass the better off overall test, including in respect of those students, otherwise they would not have been formalised. So to that extent it doesn't answer the case for the applicant at all.
PN963
THE VICE PRESIDENT: Yes, I will mark that agreement, the Swan View IGA and SDA Agreement 2010 exhibit D3.
PN964
EXHIBIT #D3 SWAN VIEW IGA AND SDA AGREEMENT 2010
THE VICE PRESIDENT: There being nothing further I simply thank the parties for their submissions in this matter. I will reserve my decision. The proceedings are now adjourned.
<ADJOURNED ACCORDINGLY [11.59AM]
LIST OF WITNESSES, EXHIBITS AND MFIs
EXHIBIT #F11 ADDITIONAL OUTLINE OF SUBMISSIONS PN147
EXHIBIT #F12 BUNDLE OF DOCUMENTS FROM AUSTRALIAN GOVERNMENT WEBSITE, SOCIAL INCLUSION PN161
EXHIBIT #D3 SWAN VIEW IGA AND SDA AGREEMENT 2010 PN225