Application by Shop Distributive and Allied Employees Association (SDA) - [2014] FWCFB 1846

1

[Note: refer to the Federal Court decision dated 11 September 2014 [2014] 
FCAFC 118 for result of appeal.]

Fair Work 
(Transitional Provisions and Consequential Amendments) Act 2009 
Sch. 5, Item 6 - Review of all modern awards (other than modern enterprise and State PS 
awards) after first 2 years

Modern Awards Review 2012 - General Retail Industry Award 2010 -

Junior Rates
(AM2012/196)

JUSTICE BOULTON, SENIOR DEPUTY PRESIDENT
SENIOR DEPUTY PRESIDENT HARRISON 
COMMISSIONER ROE SYDNEY, 21 MARCH 2014

Modern Awards Review 2012 - Junior rates - Application by the SDA to vary the General 
Retail Industry Award 2010 to provide for adult rates to be paid to 20 year old employees.

Introduction

[1] This decision concerns an application made by the Shop, Distributive and Allied 

Employees Association (SDA) to vary the General Retail Industry Award 2010 (the Award).1

The application is made in the context of the review of all modern awards as required by Item 

6, Schedule 5 of the Fair Work (Transitional Provisions and Consequential Amendments) Act 

2009 (the Transitional Provisions Act). The SDA seeks to vary clause 18 of the Award, the 

junior rates clause, to provide that “employees 20 years of age will receive 100% (adult rate)”. 

Put another way, the variation seeks to provide that 20 year old employees are to be paid the 

same minimum award rate for the classification in which they are engaged as 21 year old 

employees are paid. The Award currently provides that 20 year old employees are to receive 

90% of the relevant adult rate.

[2] Pursuant to s.615A of the Fair Work Act 2009 (the Act) the President decided that it 

was in the public interest for this application to be dealt with by a Full Bench.

                                               

1 MA000004.

[2014] FWCFB 1846

DECISION


E AUSTRALIA FairWork Commission




 

http://www.judgments.fedcourt.gov.au/judgments/Judgments/fca/full/2014/2014fcafc0118
http://www.judgments.fedcourt.gov.au/judgments/Judgments/fca/full/2014/2014fcafc0118


[2014] FWCFB 1846

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[3] In the hearings before us Mr S Moore, of counsel, appeared on behalf of the SDA, Ms 

J Dolan for the Australian Council of Trade Unions (ACTU), Mr M Tehan and Mr T Pick for 

the Commonwealth of Australia (Commonwealth), Mr N Tindley for the Australian Retailers 

Association (ARA), Mr S Elliffe and Ms D Allison for the National Retail Association 

(NRA), Mr D Sztrajt for Master Grocers Australia Limited (MGA), Mr B Ferguson for the 

Australian Industry Group (Ai Group), Ms S Haynes for Australian Business Industrial (ABI) 

and the Australian Chamber of Commerce and Industry (ACCI) and Mr J O’Dwyer for the 

Electrical Contractors Association (ECA). All of these parties tendered written submissions,

and, in some cases which we later refer to, witness statements were also tendered. Written 

submissions were also filed by the Australian Federation of Employers and Industries (AFEI), 

the National Electrical and Communications Association (NECA) and the Master Plumbers 

and Mechanical Services Association of Australia (MPA).

Legislative provisions applicable to the review

[4] The review of the Award is being conducted under Item 6, Schedule 5 of the 

Transitional Provisions Act. Item 6 provides: 

“6 Review of all modern awards (other than modern enterprise awards and State 
reference public sector modern awards) after first 2 years

(1) As soon as practicable after the second anniversary of the FW (safety net 
provisions) commencement day, FWA must conduct a review of all modern awards, 
other than modern enterprise awards and State reference public sector modern awards.

Note: The review required by this item is in addition to the annual wage reviews and 4 
yearly reviews of modern awards that FWA is required to conduct under the FW Act.

(2) In the review, FWA must consider whether the modern awards:

(a) achieve the modern awards objective; and

(b) are operating effectively, without anomalies or technical problems arising 
from the Part 10A award modernisation process.

(2A) The review must be such that each modern award is reviewed in its own right. 
However, this does not prevent FWA from reviewing 2 or more modern awards at the 
same time.








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(3) FWA may make a determination varying any of the modern awards in any way 
that FWA considers appropriate to remedy any issues identified in the review.
Note: Any variation of a modern award must comply with the requirements of the FW 
Act relating to the content of modern awards (see Subdivision A of Division 3 of Part 
2-3 of the FW Act).

(4) The modern awards objective applies to FWA making a variation under this item, 
and the minimum wages objective also applies if the variation relates to modern award 
minimum wages.

(5) FWA may advise persons or bodies about the review in any way FWA considers 
appropriate.

(6) Section 625 of the FW Act (which deals with delegation by the President of 
functions and powers of FWA) has effect as if subsection (2) of that section included a 
reference to FWA’s powers under subitem (5).”

[5] The approach to be adopted in a review under the Transitional Provisions Act was 

considered in the Modern Awards Review 2012 Full Bench decision in June 2012.2 We adopt 

the approach there discussed. The following extracts from that decision are relevant to the 

application we are here dealing with: 

“[82] The starting point in our consideration of this issue is to construe Item 6 according 
to the language of the provisions, having regard to their context and legislative 
purpose. The context includes the legislative history. 

[83] As to the historical context the award modernisation process was conducted by 
the AIRC under Part 10A of the former WR Act. The process took place in the period 
from April 2008 to December 2009 and was conducted in accordance with a written 
request (the award modernisation request) made by the Minister for Employment and 
Workplace Relations to the President of the AIRC. The award modernisation process 
was completed in four stages, each stage focussing on different industries and 
occupations. All stakeholders and interested parties were invited to make submissions 
on what should be included in modern awards for a particular industry or occupation. 
Separate processes, including variously, the provision of submissions, hearings and 
release of draft awards, were undertaken in respect of the creation of each modern 
award to ensure parties were able to make submissions and raise matters of concern 
relevant to particular awards. By the end of 2009 the AIRC had reviewed more than 
1500 state and federal awards and created 122 industry and occupation based modern 
awards. 

[84] The award modernisation request and variations were issued in accordance with 
s.576C of Part 10A of the WR Act. Part 10A was repealed on 1 July 2009 (Item 2 of 
Schedule 1 to the Transitional Provisions Act). Despite that repeal, Part 10A was 

                                               

2 [2012] FWAFB 5600.








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preserved by Item 2 of Schedule 5 to the Transitional Provisions Act in order to allow 
the award modernisation process to be completed. The award modernisation process 
required by Part 10A of the WR Act has been completed.

[85] Two points about the historical context are particularly relevant. The first is that 
awards made as a result of the award modernisation process are now deemed to be 
modern awards for the purposes of the FW Act (see Item 4 of Schedule 5 of the 
Transitional Provisions Act). Implicit in this is a legislative acceptance that the terms 
of the existing modern awards are consistent with the modern awards objective. The 
second point to observe is that the considerations specified in the legislative test 
applied by the Tribunal in the Part 10A process is, in a number of important respects, 
identical or similar to the modern awards objective which now appears in s.136...

[88] These policy considerations tell strongly against the proposition that the Review 
constitutes a “fresh assessment” unencumbered by previous Tribunal authority. 

[89] In circumstances where a party seeks a variation to a modern award in the Review 
and the substance of the variation sought has already been dealt with by the Tribunal 
in the Part 10A process, the applicant will have to show that there are cogent reasons 
for departing from the previous Full Bench decision, such as a significant change in 
circumstances, which warrant a different outcome.

...

[99] To summarise, we reject the proposition that the Review involves a fresh 
assessment of modern awards unencumbered by previous Tribunal authority. It seems 
to us that the Review is intended to be narrower in scope than the 4 yearly reviews 
provided in s.156 of the FW Act. In the context of this Review the Tribunal is unlikely 
to revisit issues considered as part of the Part 10A award modernisation process unless 
there are cogent reasons for doing so, such as a significant change in circumstances 
which warrants a different outcome. Having said that we do not propose to adopt a 
“high threshold” for the making of variation determinations in the Review, as 
proposed by the Australian Government and others.

[100] The adoption of expressions such as a “high threshold” or “a heavy onus” do not 
assist to illuminate the Review process. In the Review we must review each modern 
award in its own right and give consideration to the matters set out in subitem 6(2). In 
considering those matters we will deal with the submissions and evidence on their 
merits, subject to the constraints identified in paragraph [99] above.”

[6] The modern awards objective is set out in s.134 of the Act3 as follows: 

“134 The modern awards objective

What is the modern awards objective?

                                               

3 Note that s.134 has been amended since this matter was heard. 








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

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

(b) the need to encourage collective bargaining; and

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

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

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

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

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

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

This is the modern awards objective.

When does the modern awards objective apply?

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

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

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

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

[7] The minimum wages objective is set out in s.284(1) of the Act as follows: 

“284 The minimum wages objective

What is the minimum wages objective? 








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(1) The FWC must establish and maintain a safety net of fair minimum wages, taking 
into account: 

(a) the performance and competitiveness of the national economy, including 
productivity, business competitiveness and viability, inflation and employment 
growth; and 

(b) promoting social inclusion through increased workforce participation; and 
(c) relative living standards and the needs of the low paid; and 

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

(e) providing a comprehensive range of fair minimum wages to junior 
employees, employees to whom training arrangements apply and employees 
with a disability. 

This is the minimum wages objective.”

Summary of the parties’ contentions

[8] The SDA submitted that it was appropriate we consider its application, as part of this 

review of the Award, to vary the wage rate for a 20 year old employee. It submitted the rates 

for employees of that age had not been given any particular consideration such that it could be 

asserted that the substance of the application had been dealt with when the Award was made 

under Part 10A of the Workplace Relations Act 1996 (the WR Act). Further, it submitted that 

even if we were to find that the substance of its current application was considered in the 

making of the Award, there are cogent reasons to now, in this review, consider whether a 20 

year old should be paid the adult rate. It submitted the Award is not achieving the modern 

awards objective. A variation to the Award in the terms sought was said to be necessary to 

remedy this. Further, as the variation sought relates to the Award’s minimum wages, it was

also submitted that the variation sought would be consistent with the minimum wages 

objective. The Commonwealth and the ACTU supported the SDA’s application.

[9] The employer associations (which we will refer to as “the employers”) made 

submissions to the contrary. They submitted that when the Award was made, the Australian 

Industrial Relations Commission (AIRC) considered the rates to be paid to junior employees 

and, clearly, employees aged 20 were within that group. They submitted there are no cogent 

reasons to warrant our reconsidering the rate that should be paid to a 20 year old employee. In 








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the event we were persuaded to adopt the SDA’s submission that the substance of those rates 

had not been considered in the course of making the Award, then there is no basis to find that 

the Award is not achieving the modern awards objective. They also submitted the Award is

operating effectively without anomalies or technical problems arising from the Part 10A 

process. No need was made out for any variation to remedy any issues in accordance with 

subitem (3) of Item 6 of Schedule 5.

(a) The Part 10A award modernisation process

[10] The first matter we will deal with is the Part 10A process during which the Award was 

made.

[11] The Award was made in the award modernisation process which was undertaken by 

the AIRC pursuant to a written request from the Minister for Employment and Workplace 

Relations (award modernisation request) under Part 10A of the WR Act. 

[12] The WR Act made clear that modern awards could deal with the rates of pay for junior 

employees. Section 576J of the WR Act provided that a modern award could deal with terms 

about a number of matters which were listed in that section. One was “minimum wages 

(including wage rates for junior employees, employees with a disability and employees to 

whom training arrangements apply)”.4 Section 576J(3) provided that “junior employee means 

an employee who is under the age of 21”. We note that the current definition of junior 

employee, contained in s.12 of the Act, is that such a person is “a national system employee 

who is under 21”.

[13] In its decision of 20 June 2008 the AIRC Full Bench identified a list of priority

industries and occupations that would be first dealt with and the retail industry was in this 

list.5 Interested parties filed submissions regarding the terms of an award for the retail 

industry in July and August 2008. The SDA’s submissions made the following points: 6

                                               

4 See s.576J(1)(a).
5 [2008] AIRCFB 550. 
6 Exhibit SDA24, tab 1.








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 In its draft award and submissions it used the term “age based discounted rates of 

pay” for the title of the clause that identified the percentage of the relevant adult 

rate which employees, aged between 16 and 20, were to be paid.

 Neither the WR Act nor the award modernisation request made it mandatory to 

include discounted rates of pay for junior employees and consideration needed to 

be given to whether a modern award should include such rates. The AIRC was 

required to do more than merely replicate pre-existing rates. Nonetheless, the SDA 

had approached junior rates of pay in a pragmatic way, acknowledging that 

employers had built cost structures around the significant use of existing junior 

rates.

 The SDA had chosen to put rates for juniors in its draft award which reflected the

percentages in Shop, Distributive and Allied Employees Association - Victorian 

Shops Interim Award 20007 (Victorian Shops Award). Employees at age 20 were to 

be paid 90% of the relevant adult rate. It submitted there was no justification for 

employees at 16 years of age being paid less than 50% of the relevant adult rate.

 The SDA addressed the specific classifications to which the age based discounted 

rates would apply. It addressed employees under 21 performing higher grade work 

in hairdressing and beauty, community pharmacy and clerical administrative 

streams (which streams it had proposed should all be in the modern retail industry 

award) and that junior rates should have limited application to employees in those 

streams.

 In the case of the retail stream it submitted that employees under 21 years of age 

should be paid discounted rates only if engaged under the classifications of Retail 

Worker Levels 1 and 2. It said that the skill and responsibility required of a Retail 

Worker Level 3 or a higher classification could not justify an age based discount. 

The reality was that an employee would not be engaged by an employer at this 

level unless that employee was as competent to perform at the same level as an 

adult worker. The rationale employers had used for age based discounted rates was 

that it provided an incentive for employers to employ juniors and reflected their 

lack of experience or proper work ethic, and consequently their work value to the 

employer. This rationale disappeared when a junior is promoted to a higher level 

classification or given higher duties. 
                                               

7 AP796250CRV. 








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[14] The SDA filed a draft award and clause 19 of that draft, titled “Age Based Discounted 

Rates”, was in these terms:8

“19.1 Age Based Discounted Rates for Employees under 21 Years of Age apply to the 

following classifications only 

 Retail Worker Level 1 and Level 2

 Salon Assistant

 Pharmacy Assistant Levels 1 and 2

 Clerical and Administrative Levels 1, 2 and 3

The following percentages of the appropriate classification will apply:

Age % of adult rate

16 years and under 50

17 years 55

18 years 67.5

19 years 80

20 years 90

...”

[15] The ARA submitted9 that the classification structures in the existing retail instruments 

were vastly different and there were few points of commonality. Accordingly, it submitted 

that the Commission should adopt the junior rates of pay in the Shop Employees (State) 

Award10 (NSW NAPSA) as they reflected the most common structure and an appropriate 

balance of the rates in pre-existing awards. Under the NSW NAPSA, a 20 year old employee 

was entitled to 90% of the adult rate of pay.

                                               

8 Exhibit SDA24, tab 2.
9 Exhibit SDA24, tab 3.
10 AN120499. 








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[16] MGA filed submissions and a draft award.11 The award contained a junior rates clause 

which had a rate of pay for a 20 year old at 90% of the adult rate for the applicable 

classification. We were not taken to any submission it had made about junior rates.

[17] The NRA and the Australian National Retailers Association (ANRA) filed joint 

submissions12 which supported the maintenance of current junior rates as they appeared in 

pre-reform awards. They also submitted that State based differentials in junior percentages 

should be retained.

[18] There were consultations with interested parties in the industry before Vice President 

Watson in August 2008. During these consultations, the SDA responded to the ARA’s 

proposal and discussed the method that should be employed in determining which existing 

junior rates structure was the most common. In doing so, the SDA stated that in the majority 

of awards 20 year old employees were to be paid 90% or more of the adult rate of pay.13

[19] The SDA said that it would be content if the Commission adopted the differentials in 

rates as they appeared in the NAPSAs as the NRA and ANRA had submitted. If that was to 

occur those State differentials would be removed from the award after five years and the SDA 

would be “quite happy to accept that proposition.”14

[20] Some further submissions were made subsequent to the public consultations. The 

NRA and ANRA clarified their position about State based differentials. They supported the 

maintenance of those differentials in junior rates of pay for the first five years after which 

they sought the implementation of the structure in the NSW NAPSA.15 The SDA filed 

submissions in response which highlighted that although the NRA and ANRA had adopted 

the provisions in enterprise agreements for some matters such as casual loadings or span of 

hours, they had not adopted the junior rates percentages in enterprise agreements.16 They 

                                               

11 Exhibit SDA24, tab 4.
12 Exhibit SDA24, tab 5.
13 Exhibit SDA24, tab 6. Transcript of proceedings on 8 August 2008, PN847. 
14 Exhibit SDA24, tab 6. Transcript of proceedings on 8 August 2008, PN851.
15 Exhibit SDA24, tab 8. 
16 Exhibit SDA24, tab 9. 








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submitted that the majority of enterprise agreements gave 20 year old employees the adult rate 

of pay. 

[21] The AIRC issued a Statement17 and an exposure draft of the Award18 in September 

2008. The draft contained a rate of pay of 90% of the appropriate adult wage rate for all 20 

year old employees. In the Statement the Full Bench said: 

“[89] The terms and conditions in the draft award have been set having regard to the 
disparate terms and conditions currently in awards and NAPSAs. Those instruments 
contain a variety of different obligations and entitlements. Differences exist between 
the rates and conditions in different States, different parts of the industry and even 
between different groups of employers within the same part of the industry.”

[22] Submissions about the terms of the exposure draft were filed in October 2008. The 

SDA submitted that the exposure draft “allows every employee under the age of 21 to be paid 

a reduced rate. This could not possibly have been the intention.” The SDA restated its earlier 

position, that junior rates should not apply to employees who are engaged as a Retail Worker 

Level 3 or higher classification. It submitted that no job at Retail Worker Level 3 was 

introductory work or work requiring close and personal supervision or constant on-the-job 

training, which employers argue justified payment of lower rates to junior employees.19 The 

NRA and ANRA submitted that the percentages adopted for junior employees in the exposure 

draft had “gone a step further than an appropriate swings and roundabouts approach” to the 

NSW NAPSA junior rates they had proposed.20

[23] The exposure draft was the subject of public consultation before the Full Bench in 

November 2008. The SDA commented on the rate of pay for employees under 16 years and 

said it was of the view that no employee should be paid less than 50% of the adult rate. It 

went on to submit that this was not the forum in which to address the issue of where junior 

rates should apply and the ages at which they should apply. It accepted that “in the scheme of 

things” it could accept the junior rates in the exposure draft.21

                                               

17 [2008] AIRCFB 717.
18 Exhibit SDA24, tab 10.
19 Exhibit SDA24, tab 11.
20 Exhibit SDA24, tab 12.
21 Exhibit SDA24, tab 13. Transcript of proceedings on 5 November 2008, PN3648.








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[24] The ARA submitted that the SDA’s argument that junior rates should be limited to the 

two lower classifications under the award should “be ignored” as this was not a feature of the 

pre-reform awards.22

[25] In December 2008 the Full Bench published its decision relating to the priority

industries and also addressed a number of general issues and standard clauses that would be 

placed in modern awards (the December 2008 decision).23 One general issue concerned junior 

and apprentices rates. In dealing with the context in which the award modernisation process 

was taking place, the Full Bench said: 

“[10] The process leading to the making of the priority modern awards has involved 
pre-drafting consultation, the preparation and publication of exposure drafts, further 
consultation on the drafts and finally the preparation and publication of the awards. 
Every written submission and suggestion of any significance has been published on the 
AIRC website. That site also contains the transcript of the public consultations as well 
as exhibits and other relevant material. Because of the vast amount of material it has 
not been possible to refer to all of it. We have attempted, however, to refer to the 
significant areas of difference in the course of deciding various matters and to indicate 
the basis upon which we have formulated the terms of the awards. It is apparent that 
interested parties have adapted well to this process and that there has been adequate 
opportunity for comment on the exposure drafts and on the various proposals which 
have been made in relation to them.”

[26] In that part of its decision titled “General Issues and Standard Clauses” it addressed 

the topic of junior and apprentices rates. It said:

“Junior and apprentice rates

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

                                               

22 Exhibit SDA24, tab 13. Transcript of proceedings on 5 November 2008, PN3376.
23 [2008] AIRCFB 1000. 








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be expressed as a percentage of the rate for the relevant adult classification. In the case 
of apprentices the rates will generally be expressed as a percentage of the relevant 
trade rate.”

[27] Later in its decision each of the priority industry and occupational awards was 

addressed. In the case of the retail industry the Full Bench decided to make separate awards 

for general retailing, fast food, hair and beauty and community pharmacies. It said:

“[286] The contents of the four awards we publish with this decision are derived from 
the existing awards and NAPSAs applying to the different sectors. Although the scope 
of the awards is obviously reduced, this did not eliminate the variations in terms and 
conditions within each part of the industry. We have generally followed the main 
federal industry awards where possible and had regard to all other applicable 
instruments. In this regard we note in particular the significant differences in awards 
and NAPSAs applying to the fast food and pharmacy parts of the industry. 

[287] Many of the submissions made to us from employers expressed concern at 
additional costs arising from provisions of the Retail industry exposure draft regarding 
hours of work, overtime, penalty rates, annual leave and allowances. We have revised 
these provisions having regard to the terms, incidence and application of relevant 
instruments for each sector. The result is provisions which more closely approximate 
to existing instruments for the relevant parts of the industry but which adopt different 
standards from one part to another. We have addressed submissions concerning the 
application of allowances and hours provisions and made other changes consistent 
with the approach to such matters in the main part of this decision.”

[28] No specific reference was made by the Full Bench to the junior rates provisions in the 

award made for the retail industry.

Submissions regarding the Part 10A process

[29] The SDA submitted that the substance of the application before us was not considered 

by the Full Bench during the award modernisation process. Although the issue of junior rates 

for employees under the proposed retail industry award was agitated by the SDA, the issues 

were limited in scope to two matters: that employees under the age of 16 years be paid at least 

50% of the adult rate of pay and that the applicability of junior rates be limited to employees 

engaged under the classifications of Retail Worker Level 1 and Level 2. Mr Moore submitted 

that the present controversy, that 20 year olds be paid the adult rate of pay, was not put to or 

considered by the Full Bench during the award modernisation process.








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[30] The SDA pointed to its submissions of July 2008 which identified that the rate of pay 

sought by the SDA for 20 year old employees was 90% and to the submissions of the relevant 

employer parties which sought the same. The SDA described the comment made by the SDA

about junior rates and State differentials in the August 2008 consultations as an aside, in the 

context of a question from Vice President Watson, and it did not amount to a claim that junior 

rates under the proposed retail award should be abolished. 

[31] The SDA submitted that the comments about junior and apprentice rates made by the 

Full Bench in the December 2008 decision were about the general approach it had taken to 

those rates,24 and that it had pursued the “limited objective” of setting junior rates based on 

pre-reform instruments rather than determining any controversies about the level of junior 

rates in each industry. It contrasted these general comments with those the Full Bench made 

about the catering, liquor and accommodation and restaurant industries where the Full Bench 

explicitly dealt with junior rates of pay.25 On this basis, the SDA submitted that the award 

modernisation process poses no impediment to our consideration of its application as part of 

this review. 

[32] The SDA also made an alternative submission. It said that should we find that the 

matter of rates to be paid to junior employees of 20 years of age was considered as part of the 

award modernisation process, any such consideration was merely incidental to the matters 

before the AIRC. Further, the limited objective of standardising the relevant predecessor 

instruments, the broad scope of the exercise undertaken by the AIRC which prevented it from 

considering the merit of relevant provisions, and the failure of current junior rates to provide a 

fair and relevant minimum safety net for 20 year olds are all cogent reasons for revisiting the 

rates in this review. 

[33] The ACTU and Commonwealth also submitted that the substance of this application 

was not canvassed during the award modernisation process. They argued that the AIRC 

sought merely to derive a safety net from pre-reform instruments that contained a wide range 

of junior rates of pay and that this did not involve a consideration of the merits of the matter. 

The Commonwealth submitted that this is a cogent reason why we should revisit junior rates 

                                               

24 [2008] AIRCFB 1000 at [71].
25 [2008] AIRCFB 1000 at [135]. See also [287]. 








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in the Award. The ACTU submitted that the Full Bench in its December 2008 decision had 

implicitly recognised the need to revisit the issue in the future.

[34] The ARA submitted that the present application agitates matters that were dealt with 

during the award modernisation process and that the SDA has failed to establish any cogent 

reasons to revisit those matters. Specifically, the ARA identified submissions made by the 

SDA to the AIRC relating to the need to prevent and eliminate age discrimination, the 

promotion of equal remuneration for work of equal value and the rationale upon which rates 

for junior employees are discounted. The ARA submitted that these are the very arguments 

that have also been put to us. 

[35] The ARA submitted that the union has mischaracterised the December 2008 decision 

which reflected the AIRC’s reluctance to develop standard rates of pay for apprentices and 

juniors that would apply in all industries. The Bench did, however, explicitly state that it had 

determined new rates which constituted a fair safety net and this indicates that the merits of 

the junior rates clause were considered. The ARA argued that although a submission made by 

a party may not have been referred to in the decision, we should assume that all of the 

material was considered. The SDA’s submission, that the AIRC’s “limited objective” of 

standardising rates provides a cogent reason, must fail.

[36] The ARA noted that subsequent to the making of the Award, the SDA applied to vary 

it under s.576H of the WR Act such that the junior rates clause would not apply to trades 

classifications. That application was dismissed on the basis that what was sought was not a 

feature of the underpinning instruments.26 It submitted that in that matter, the SDA also 

sought to rely on the argument that aged based discounted rates are not appropriate for highly 

qualified junior employees. 

[37] The MGA supported the submissions made by the ARA with respect to the award 

modernisation process and the SDA’s failure to establish cogent reasons. 

[38] The NRA submitted that the issue of junior rates was considered during the award 

modernisation process and the SDA had sought 90% of the adult rate of pay for 20 year old 
                                               

26 [2010] FWAFB 305 at [25]. 








[2014] FWCFB 1846

16

junior employees. It was submitted that the AIRC had considered the need to create a fair 

minimum safety net and that the SDA had failed to establish any cogent reasons for revisiting 

that determination. 

[39] Ai Group submitted that the SDA’s submissions to the AIRC ventilated similar 

concerns to those raised in these proceedings. When regard is had to those submissions, the 

award modernisation request which required the AIRC to consider protecting young people in 

the labour market and the December 2008 decision, it is clear that junior rates in the retail 

industry were squarely dealt with during the award modernisation process.

[40] Ai Group submitted that the AIRC expressly stated that it had developed a fair and

relevant minimum safety net for junior employees and thus, the substance of the application 

made by the SDA in this review has been dealt with. No cogent reasons have been established 

by the SDA.

[41] ACCI and Business SA made similar submissions to Ai Group. They said the SDA 

had not established any significant change in circumstances which would warrant a variation 

to junior rates in the Award. The matter of appropriate junior rates had been determined by 

the Full Bench in the December 2008 decision. The fact that the Full Bench had found it had 

not been possible to standardise rates across the States and Territories did not of itself enliven 

the jurisdiction of the Commission in this review, or provide cogent reasons to here revisit 

junior rates. 

Conclusions about the Part 10A award modernisation process

[42] We agree with the SDA’s submission that the issues raised in the award making 

process which concerned junior rates were confined and specific. They related to the 

percentage of the adult rate below which no employee should be paid and to the rates for

employees who worked in higher classifications and those with trade skills.

[43] There was no specific consideration given to the percentage of the adult rate which 

should be paid to a 20 year old. From its first draft, the SDA had proposed that retail workers 

at the first two classification levels should be paid 90% of the relevant adult rate. In those 

circumstances, and given the employers also proposed that same percentage for these 








[2014] FWCFB 1846

17

workers, there was no need for the Full Bench in the Statement accompanying the exposure 

draft (or at any later time) to comment about appropriate percentages for these workers. It was 

not in contest.

[44] By the time of the Full Bench public consultations it did not seem there was any 

controversy about the scale of rates for any juniors which was contained in the exposure draft. 

In that case it is not surprising the Full Bench said little about the rates and the percentages 

aligned with each of the junior ages in its December 2008 decision. This is consistent with the 

comment made by the Full Bench in paragraph [10] of the December 2008 decision. It was 

not considered a significant area of difference and, it follows, there was no controversy of 

substance which the Full Bench needed to address in respect of any of the awards it made in 

the retail industry. 

[45] In reaching our conclusion we have closely considered all the materials referred to us 

about the various stages in the making of the Award. We are not persuaded that the 

considerations which are raised by the variation now sought by the SDA were in issue. In our 

opinion, a fair reading of all the relevant documents reveals that no need arose for 

consideration to be given to the appropriate rates for 20 year old employees. Nor is it correct 

to describe the comment made by the advocate for the SDA, during the August 2008 

consultations, as an indication that the SDA was seriously advocating for the abolition of all 

junior rates. It was an observation that, if the employers were insisting on the retention of 

State differentials, then in 5 years time the practical effect of that may be that the junior rates 

clause would cease to operate.

[46] For all these reasons, we are not persuaded by the employers’ submissions that the 

substance of the claim before this Full Bench was considered during the Part 10A process. We 

do not therefore need to consider whether there are cogent reasons to revisit it in the sense in 

which that “test” is referred to in the Modern Awards Review 2012 decision.27 It is necessary 

however for the SDA to establish a case on merit that the Award is not meeting the modern 

awards and minimum wages objectives. It seeks to do so by relying heavily on the written and 

oral evidence of the numerous witnesses it called. Before we turn to consider that evidence we 

should indicate that the SDA did not rely on the considerations in subitem 2(b) of Item 6 of 
                                               

27 [2012] FWAFB 5600.








[2014] FWCFB 1846

18

Schedule 5 of the Transitional Provisions Act to support the variation sought. That provision 

is set out earlier in this decision. It requires the Commission in this review to consider if the 

Award is operating effectively without anomalies or technical problems arising from the Part 

10A process.

(b) The evidence 

[47] We turn now to consider the evidence presented by the SDA and the employers in the 

proceedings.

SDA witness evidence 

[48] The SDA relied on the evidence of 20 witnesses all of whom were employed in the 

general retail industry. A witness statement of each was tendered. All except one of these 

witnesses gave oral evidence and was cross examined. We should here note that both the SDA 

and the employer witness evidence was primarily about employees classified at Retail 

Employee Level 1. We will now provide a summary of the evidence of those witnesses.

[49] Mr Sebastian Fernandez,28 who is 22 years old, is a casual retail assistant at Kmart and 

engaged under an enterprise agreement. He had worked there since the age of 18. Upon 

commencement he was provided with the same training as all other employees when they first 

joined the store. There was no specific training given to him as a junior employee. The only

training he received was in lay-by. From the age of 18 he regularly worked without 

supervision and from 19 years of age he often supervised other staff who were older and less 

experienced than him. From that time onwards he had performed a wide range of duties and 

this had remained unchanged when he turned 20 and then 21. Mr Fernandez accepted that he 

had matured since he commenced employment with Kmart and his performance had 

improved with age and experience.

[50] Ms Vania Chrisopolous,29 aged 19, works as a courtesy desk associate at Big W. She 

was engaged to replace an adult employee who had gone on maternity leave and she 

                                               

28 Exhibit SDA1. 
29 Exhibit SDA2. 








[2014] FWCFB 1846

19

performed the same duties as that employee had. She said the majority of employees in her 

area were adult employees and she did the same duties as them but was paid less. Ms 

Chrisopolous works 15 - 20 hours a week but would prefer to work 35 hours a week. She had 

not received any training in rostering or budgeting. The concept of shrinkage was understood 

by Ms Chrisopolous and she accepted that the risk of shrinkage is greater where employees 

are careless.

[51] Ms Dela Allen30 is a 22 year old sales assistant and has been employed by Sanity for 

around three years. She was provided with basic training about customer service and store 

procedures when she started. In 2012 she was appointed as a manager and she then received 

some further training. She had recently stepped down from the managerial role and it had

been filled by a 19 year old. Since stepping down from her managerial role, Ms Allen’s 

responsibilities have been the same as they were when she first commenced work. She said 

that she felt she was able to perform confidently in her role two months after commencing 

employment with Sanity but acknowledged that with experience an employee improves in 

their ability to manage customers. Ms Allen gave evidence that in her store, all employees are 

expected to know the work performed in any role and that there was little difference between 

the work she performed as a manager and that which she performs as a sales assistant. During 

her time as manager, she was not responsible for rostering staff or budgeting for the store. 

[52] Mr Brendan Evans,31 who is 26 years old, has been employed by Woolworths as a 

long life retail assistant since the age of 20. He is engaged under an enterprise agreement as a 

part-time employee and intends to commence study. Mr Evans was provided with one-off 

training when he commenced and regularly worked without direct supervision. He had 

received no further training. He said that the responsibilities he undertook were the same at 

the age of 20 as they were when he turned 21. Mr Evans had received training in shrinkage 

however he had not been trained in rostering or budgeting.

[53] Mr Emmanuel Giakoumakis,32 who is 20 years old, is employed as a retail assistant by 

Dick Smith Electronics. He has been working in the industry from the age of 15. Mr 

                                               

30 Exhibit SDA3. 
31 Exhibit SDA4. 
32 Exhibit SDA5. 








[2014] FWCFB 1846

20

Giakoumakis said that the work he performs is the same as that performed by employees who 

are older than him. He has worked without supervision since 17 years of age and has been 

responsible for training other staff including employees older than him. His evidence was that 

the employees that he trains are able to perform their roles to the same level as himself. At age 

18 he assisted with recruitment processes. He was provided with a six hour induction program 

prior to commencing work and had received subsequent on-the-job training. He accepted he 

had matured since he was 15 years old, when he first entered the industry. He is paid award 

rates but also receives a 3% commission of the gross profit on every sale he makes. Mr 

Giakoumakis is paid higher duties for training staff and for opening or closing the store when 

his store manager is not present. He has not been trained in budgeting or rostering for the 

store as this role is performed by the store manager. 

[54] Ms Nikita Griffin33 has been employed at a Bi-Lo Supermarket since the age of 14. 

From the age of 18 she worked as a checkout operator and supervisor and her duties included 

customer service and supervising the checkouts. Ms Griffin is aged 22 and is now a customer 

service manager. In that role she is required to supervise register staff, close the store, ensure 

that all cash takings are accounted for and secure the cigarettes by unpacking the service 

kiosk. She said that she faced some resistance from senior employees she supervised. There 

are seven supervisors who report to her, of whom at least three are under the age of 21. Ms 

Griffin is responsible for rostering staff in her store and understood that for each roster, labour 

costs are required to be within a certain percentage of sales, however she bases her rostering 

primarily on the availability and skills of the staff. Ms Griffin said that instructions would be 

provided to managers as to how to drive efficiencies if labour costs increased. She was 

provided with some training in budgeting however could not provide evidence as to the 

highest cost incurred by the store.

[55] Ms Jessica Ryan34 is 24 years old and has worked for Woolworths for four years. First 

she was a checkout operator and then was appointed as a part-time service supervisor. She is 

engaged under an enterprise agreement. As a supervisor Ms Ryan is responsible for control 

over cash, customer service, supervising staff, rostering breaks and handling customer 

complaints. There are employees aged 18 and 20 who perform in the same role and they 

                                               

33 Exhibit SDA6. 
34 Exhibit SDA7. 








[2014] FWCFB 1846

21

supervise employees who are older than them. Of the 15 checkout operators she supervises in 

one shift, approximately seven are under 21 years of age. Ms Ryan accepts that greater 

maturity over time assisted her in securing her current role. Although she is not trained in 

rostering or budgeting, Ms Ryan understands that the store is often understaffed due to budget 

constraints. Ms Ryan had not received any training in loss prevention and shrinkage.

[56] Ms Kirsty Gould35 is 22 years old and works as a full-time sales assistant under an 

enterprise agreement for Kmart and has been engaged by Kmart since she was 15. She was 

initially employed as a casual, working roughly 20 hours a week however she sought to work 

more hours. Ms Gould received training in using the cash register, lay-bys, OH&S, company 

policies and product knowledge however this training was offered to all employees, 

irrespective of their age. At the age of 19 she was offered a position in the “Manager in 

Training” program. Ms Gould said that since the age of 18 she has been confident in her 

position and since turning 20, there has been no change in her duties or responsibilities but 

her productivity has improved. She also accepted that she had matured since she was first 

employed and this had improved her customer service skills and the care she took when doing 

her job. Ms Gould has not been trained in rostering, budgeting or shrinkage.

[57] Mr Bradley Cartledge36 is aged 25 years and has been working for Bunnings for the 

last nine years. Mr Cartledge was trained in his position when he first commenced 

employment. To his knowledge, such training was given to all new employees regardless of 

their age. He has subsequently been provided with training in driving a forklift. He has not 

been trained in budgeting or rostering however he had undertaken an online course 

concerning shrinkage from which he understood that an employee’s attentiveness affected the 

store’s ability to prevent loss. He was appointed to a supervisory role as a result of his strong 

performance. He has supervised other staff since the age of 18 and was fully competent in his 

role within six months after he commenced. Mr Cartledge saw no change in his 

responsibilities or work duties since the age of 20 however he accepts that with greater 

experience and maturity he is better able to perform his role. Mr Cartledge is employed on a 

part-time basis and his hours depend, in part, on his university timetable. 

                                               

35 Exhibit SDA8. 
36 Exhibit SDA9. 








[2014] FWCFB 1846

22

[58] Ms Hayley Haigh37 is 19 years old and was employed by Beer Wine Spirits. She 

commenced working in retail four years ago for Woolworths. Her responsibilities are the 

same as those older than her and include customer service, restocking the fridges and shelves, 

dealing with difficult customers and shoplifters. Ms Haigh says she feels “disrespected” as 

she is not paid the same rate as adult employees who do the same work. She worked 20 hours 

a week whilst studying and stated that this was sufficient to support herself. Ms Haigh accepts 

that she has become more mature over time and that the experience gained in her current 

position has contributed to her future employability. Ms Haigh has not been provided with 

training in budgeting but had received some on-the-job training in the prevention of 

shoplifting.

[59] Mr Julian Richards,38 aged 29, started working for Bunnings at the age of 18. This was 

his first paid job in the retail industry. He received some basic training which was not age 

specific. He has not been trained in budgeting or rostering but is aware that shrinkage is 

minimised by greater attentiveness. He is covered by an enterprise agreement. Mr Richards 

worked as a casual and his hours depended upon his university timetable and business 

requirements. When he was not studying he would work 38 hour weeks. From the age of 18 

he has worked without direct supervision and from 20 was responsible for supervising other 

staff, often older than him. Within 3 - 6 months of commencing, Mr Richards felt fully 

competent in his role and nothing has changed regarding his responsibilities since the age of 

20 although he accepts that with experience and maturity he is better able to perform his role. 

[60] Ms Renee Antill39 is 28 years old and has worked at Woolworths since the age of 16. 

Ms Antill received training when she first commenced employment but this was not age 

specific. Within six months she felt fully competent in her role. When she turned 18 she 

received further training as a systems operator and in cash control and payroll. From the age 

of 20, Ms Antill’s work involved cash register operation, customer service, supervising other 

checkout operators, pricing and ticketing integrity. Ms Antill stated in her evidence that the 

work she performed did not change when she turned 21 and she was given no indication that 

her performance had improved since the age of 20. During cross examination Ms Antill 

                                               

37 Exhibit SDA10. 
38 Exhibit SDA11. 
39 Exhibit SDA12. 








[2014] FWCFB 1846

23

accepted that in her time at Woolworths her efficiency, confidence, maturity and ability to 

deal with customers had improved with experience. She is engaged under an enterprise 

agreement. Ms Antill has not received training in budgeting however she understands that her 

employer aims to minimise costs in determining its rosters and has been trained in paying 

attention to detail in order to minimise shrinkage. 

[61] Ms Kerrie Pugh40 is 28 years old and has been employed by Bunnings for 11 years. 

Prior to that, she worked for WA Salvage which is also in the retail industry. She had started 

working in retail when she was 16 years old. Ms Pugh is covered by an enterprise agreement. 

When she commenced employment with Bunnings, Ms Pugh was provided with two weeks of 

training which was not age specific. Any training that she has received since then has been 

provided to all employees. Ms Pugh has not been trained in budgeting or shrinkage. She has

been trained in rostering and accepted that the store’s budget is a relevant consideration in 

determining the roster. At the age of 18 she worked as a front end controller which involved 

instructing and supervising other employees who worked at the registers. She was not paid a 

higher amount for this. Some of the employees she supervised were older than her. Nothing 

has changed in the nature of the work performed by her since the age of 20. She accepted that 

with experience and maturity she was better able to perform her role.

[62] Mr Benjamin Knight41 is a 20 year old retail assistant employed by Typo. He has 

worked for three employers in the retail industry over the past six years. His role involves 

providing customer service, opening and closing the store, cleaning, inventory handling and 

administrative tasks. This work is the same as that performed by older employees. During the 

Christmas period, Mr Knight was informally asked to supervise junior staff but was not paid a 

higher duties allowance for this. Mr Knight maintained that if his wage were to increase to the 

adult rate, this would not necessarily mean a reduction in his hours as he is considered a 

valuable member of his team. He has not been trained in budgeting. He currently works 8 - 12 

hours a week to accommodate for his university timetable but may do additional hours during

the holidays. He considered himself to be as mature at 18 as he is now. 

                                               

40 Exhibit SDA13. 
41 Exhibit SDA14. 








[2014] FWCFB 1846

24

[63] Mr Matthew James42 is a 20 year old casual employee of The Reject Shop and is 

currently covered by an enterprise agreement. His regular duties are the same as employees 

older than him and include customer service, handling cash, store opening and closing, and 

replenishing stock. Mr James works 20 - 38 hours per week and explained that his hours were 

largely dependent on the store’s budget. He expressed concern that his hours may be reduced 

further if his wage increased. Mr James accepted that he has matured over time and this 

maturity has improved his performance at work. 

[64] Mr Dyllon Paynter43 is 20 years old and has worked at Woolworths as a part-time 

night fill employee for over four years. Mr Paynter is covered by an enterprise agreement and 

his wages increased from 80% to 100% of the adult rate when he turned 20, however his 

duties or responsibilities had not changed. He had performed the same duties for a number of 

years. He works around 15 - 20 hours a week and is content with the hours of work he is 

offered. Mr Paynter accepted he has developed greater confidence and maturity in his time at 

Woolworths and this has made him a better employee. 

[65] Ms Laura Davis44 is 21 years old and works as a part-time shop assistant at 

Woolworths. Prior to that she was employed by Dan Murphy’s for approximately one year. 

When she commenced at Woolworths she was provided with induction training, which was 

not age specific. No further training was subsequently provided to her. She works around 17 

hours a week. During her time at Woolworths, she has regularly worked without direct 

supervision and has covered for the duty manager in his absence. She supervises other 

employees in the Deli and a number of them were older than her. Ms Davis said that there was 

no difference in her duties or responsibilities after she turned 21. Ms Davis is currently 

studying however when she has sought to work more hours during her holidays, she has been 

not been offered those hours and was told by management that this is due to budget 

constraints. Ms Davis has been trained in shrinkage and loss prevention. 

                                               

42 Exhibit SDA15. 
43 Exhibit SDA16. 
44 Exhibit SDA17. 








[2014] FWCFB 1846

25

[66] Mr Clinton Redhouse45 is 21 years old and works as a part-time shop assistant and 

night filler at Woolworths. Prior to this he worked for Woolworths Liquor and Dan Murphy’s. 

Mr Redhouse works around 17 hours a week and is studying information technology. He was 

provided with training when he commenced with Woolworths at the age of 17 however this 

was not age specific. No further formal training was provided other than on-the-job training in 

stock taking and adjusting counts. Mr Redhouse said that the youngest night fill employees 

were 17 - 19 years old. He said that as his role required the use of a knife, employees had to 

be at least 16 years old. He acknowledged that carelessness in using a knife could lead to 

stock damage which is an additional expense to his employer. Mr Redhouse said there was no 

change to his responsibilities after turning 20. He had undertaken the supervision of other 

employees without being formally required to do so by his employer and there was also a 

more senior supervisor rostered at the same time. Mr Redhouse stated that in his time in the 

retail industry the work he did was “basically the same”, there has been no difference in the 

standard of work he has produced and within a year of commencing he felt that he was fully 

competent in his role. 

[67] Mr Jack Vince,46 aged 20, has been employed as a casual shop assistant at Dick Smith 

for the last four years. He works approximately eight hours a week to accommodate for his 

university timetable. His role requires product knowledge which he says comes with 

experience in the job rather than age. In some cases the employer provides information 

regarding a new product on the intranet site but in many cases product knowledge is 

developed as the employee is asked questions by customers. Mr Vince accepted that 

employees who work a greater number of hours per week are exposed to greater customer 

interaction and thus develop product knowledge faster. 

[68] Mr Daniel Newman47 is 20 years old and works full-time as a night fill employee for 

Woolworths. One to two nights per week he is the most senior employee on the shift and is 

responsible for the night fill team. Of the employees he supervises, five or six are older than 

him. His responsibilities, when he is in charge, include finding replacement staff when 

                                               

45 Exhibit SDA18. 
46 Exhibit SDA19. 
47 Exhibit SDA20. 








[2014] FWCFB 1846

26

someone is unwell, allocating work, ensuring the work is completed and closing the store. Mr 

Newman was not available for cross examination. 

Witnesses called by the employers 

[69] The ARA, MGA and Ai Group called seven witnesses all of whom had prepared a 

written statement. They gave oral evidence and were cross examined. We now summarise 

their evidence.

[70] The ARA called Ms Kirralee Read, who owns a Bakers Delight store in Victoria.48 Ms 

Read stated that her business generally recruits 15 year olds who then work in the business 

while going through high school and university. She hires junior employees because it 

reduces the overall cost of wages and provides the business with sufficient flexibility as they 

are often available to work in the evenings, on weekends or on public holidays. The business 

has 25 employees and 14 of them are under the age of 21. One is 20 years old. The junior 

employees are enrolled in Certificate III training in retail, for which the Commonwealth 

Government pays a completion incentive to the employer of $1500 per enrolment. Ms Read 

gave evidence about the cost to her business if she had to pay all her 18, 19 and 20 year olds 

the adult rate of pay. She identified the skills acquired by an employee engaged by Bakers 

Delight. In her business, an employee would be considered competent in their duties and the 

work expected of them within six months of commencement and an 18 year old worker, who 

would typically have three years experience, is considered a senior employee. She maintained, 

however, that in some aspects of the role of a Retail Employee Level 1 there is an identifiable 

difference between the performance of an 18 - 20 year old to that of a 21 year old. She said an 

employee with greater work and life experience is better able to deal with challenging 

circumstances. If the rate of her two 19 year olds and her 20 year old was increased to 100% 

of the adult rate, this would increase the annual wages bill by 1.9%. Although this increase 

would not cause the business to become unviable, she stated that she may not continue to 

employ 20 year old workers. It is not her current practice to terminate the employment of 

employees when they turn 21 as so much time and money has been spent training them. If 

they wanted work, she would find hours that suited.

                                               

48 Exhibit ARA1.








[2014] FWCFB 1846

27

[71] The ARA also called Ms Julie Tariel,49 a human resource business partner of LS 

Travel Retail Pacific. She described the company as one of the world’s largest travel retailers 

having stores at airports and railway stations. The company has 1000 employees in Australia,

most employed under the Award. Nationally, 60 of its employees are under the age of 21 and 

58 of them are aged 18 - 20 years. Junior employees are offered a position in a Certificate III 

or IV course and are also provided with on-the-job training in customer service. Ms Tariel 

said the majority of employees are casuals and trading hours include early mornings, nights 

and weekends. Being able to engage juniors lowers the business’ costs. She addressed the cost 

and other consequences for the business if junior rates were abolished for 18 - 20 year olds. 

She accepted that most employees are competent within six months of engagement. Although 

she stated that employees generally become increasingly productive as they become older and 

more mature, she accepted that in her experience there was no clear difference in the 

performance, capacity or skill of a 20 year old employee and a 21 year old employee. It 

depended also on them having had some experience.

[72] The MGA called Mr John Cummings50 who is responsible for the operation of an 

independent supermarket in Western Australia which operates under the banner of 

Independent Grocers of Australia (IGA). He had been an owner of independent supermarkets 

for 23 years. Employees at his store are engaged under the Award. He had around 19 

employees under 18 years of age, two employees aged 18 and no 20 years olds. Most junior 

employees commence when they are between the ages of 15 and 16, and thus have 2 - 3 years 

of experience by the time they turn 18. Mr Cummings said there was a great demand by 

young people in the local community for casual employment opportunities at his store.

[73] Mr Cummings understood the SDA’s claim to be initially for 20 year olds to receive 

the adult rate and that if successful, to then phase in adult rates for 18 and 19 year olds. He 

addressed the consequences for his store if employees of 18 years and older were to be paid 

the adult rate. He would not employ them because an adult could do the job better, quicker 

and more reliably. He addressed what he saw as the differences in skills between 18 - 20 year 

olds and an adult.

                                               

49 Exhibit ARA2. 
50 Exhibit MGA1.








[2014] FWCFB 1846

28

[74] Mr Cummings stated that most junior employees work approximately eight hours a 

week due to other commitments such as study and sport, and are reluctant to take on more 

work. As a result, they are unable to fall into a routine at work and require ongoing 

supervision by an adult employee. He accepted that they are able to complete basic tasks such 

as operating the checkout or “filling the milk”. In his experience, adult employees produce a 

higher level of output, display greater commitment and provide greater value to the employer. 

He agreed that there was no identifiable difference between the performance of a 20 year old 

and a 21 year old that is based entirely on the age of the employee, but that experience was 

the primary factor. He said that the hours worked by the employee, their commitment and 

intellectual capability were also relevant to the performance of an employee. 

[75] Mr Cummings made the observation that, although the output of a 20 year old is not 

significantly different to a 21 year old employee, the 20 year old employee will be less 

dedicated. He noted however, that this would depend on the individual. Supervision at his 

stores does not necessarily entail a senior employee working side-by-side with a junior 

employee, but it includes the need to check the work done to ensure it was completed 

correctly. He accepted there was no identifiable difference in the work standard or capacity of 

a 20 year old to a 21 year old but indicated there are some tasks which cannot lawfully be 

assigned to a 20 year old employee due to occupational health and safety considerations. 

[76] The MGA next called Ms Deborah Smith51 who is the owner of four independent 

supermarkets operating in Queensland under the name of FoodWorks. These stores currently 

employ 13 junior employees aged 18 - 20 out of a total 60 employees, all of whom are 

engaged under an enterprise agreement. Half of these employees commenced employment 

with FoodWorks when they were 15 or 16 years old, the other half commenced when they 

were 17 or 18. Most junior employees engaged by the business are employed on a casual 

basis which allows the employee and the business to accommodate for commitments such as 

study. Ms Smith accepted that most employees would be able to competently perform their 

role within six months from commencement, however this depends on the hours they work.

[77] Ms Smith said her company has a rotational on-the-job training program which all 

new employees undergo, irrespective of their age. The cost of this training is equivalent to an 
                                               

51 Exhibit MGA2.








[2014] FWCFB 1846

29

extra staff member who is rostered to train a new employee. Generally, adult employees are 

cheaper to train as they require less time in training.

[78] Ms Smith maintained throughout her evidence that junior employees are less accurate 

than adult employees, they are disinterested, they cause higher rates of shrinkage and more 

errors. Consequently, Ms Smith moderates the duties assigned to young workers and provides 

them with specific time frames and instructions which she does not deem necessary in 

supervising adult employees. She gave her opinion about the differences in maturity between 

employees at the ages of 17, 18, 19 and 20 and also that of male and female junior employees. 

In her experience, a 20 year old has never been given the responsibility of supervising other 

staff.

[79] Ms Smith gave various examples of the difficulties that have arisen as a result of work 

performed by employees aged 20 or under. She referred to errors in correctly identifying fruits 

and vegetables at the point of sale, opening boxes in a way that caused the wastage of fresh 

stock due the immature and rushed approach of young employees, incorrect scanning and 

ticketing, and a failure to prevent incidences of shoplifting due to a lack of “emotional 

intelligence”. 

[80] Ms Smith said she understood the SDA’s application to be in respect to 20 year olds 

and if successful it would be phased in for 18 and 19 year olds. Her evidence was directed to 

that possibility. 

[81] The MGA next called Mr Andrew Williamson52 who owns three independent 

supermarkets in South Australia operating under the banners of FoodWorks and IGA. 

Approximately 70% of junior employees at these stores are engaged when they are 15 or 16 

years old most being at Retail Employee Level 1 under the Award. His evidence was that 

employees at his stores are generally competent within six months of commencement. 

[82] Mr Williamson gave evidence about the skills gained by junior workers from 

employment in the retail industry such as punctuality, reliability, accepting responsibility, 

confidence and problem solving. He said that employing junior workers results in additional 
                                               

52 Exhibit MGA3.








[2014] FWCFB 1846

30

expenses to employers such as training, counselling, correcting errors, damaged stock and the 

costs that result from lower productivity. Junior employees lack the skills acquired by more 

experienced employees, such as how to deal with busy periods or difficult customers. 

[83] Mr Williamson stated that a junior employee may be involved in supervising another 

employee who would typically be of the same age or younger, in the form of a “buddy 

system”. Training is provided to all new employees and largely takes place on-the-job. 

Employees are also offered an enrolment in Certificate II or III training as it is appropriate to 

the work they perform. An incentive payment from the Commonwealth Government is passed 

on to the employee when they successfully complete the course. Mr Williamson has 

previously employed a 20 year old employee as a department manager and paid her 90% of 

the relevant higher classification rate.

[84] Mr Williamson’s opinion was that compared to 21 year olds, 20 year olds exhibit less 

productivity, greater recklessness, immaturity, a higher error rate, and unreliability. That was 

also his impression about 18 and 19 year olds. Young workers also let social problems affect 

them at work to a greater degree than older workers. Mr Williamson said that at the current 

rate payable to 20 year olds, he was not dissatisfied with the value that they provide, however 

if they were to be paid the adult rate he would choose to employ an adult worker instead.

[85] The MGA also relied on the evidence of Mr Frederick Harrison,53 Chief Executive 

Officer of Ritchies Stores Pty Ltd (Ritchies) the owner of 70 independent supermarkets and 

liquor stores operating under the IGA banner. The stores are in Victoria, New South Wales 

and Queensland. Fifteen of those stores operate under enterprise agreements which entitle 20 

year old employees to 95% or 100% of the adult rate of pay. 80% of the 6250 employees 

engaged by Ritchies are employed on a casual basis, of which half are under the age of 21. He 

gave evidence about the cost to his business if 18, 19 and 20 year olds were to be paid the 

adult rate. 

[86] Mr Harrison stated that generally a 20 year old employee in his stores would have had 

between 2 - 5 years experience in their position and would be generally competent in 

performing their role within 6 - 12 months from their commencement. However, employees 
                                               

53 Exhibit MGA4. 








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31

do improve with age and maturity, particularly after they complete higher school education or 

other studies. In his stores, junior employees are given only specific tasks which they are 

capable of completing. They start young and develop from 15 years up to 21. They have 

employees at 20 years of age who are department managers and store managers. Duty 

managers or store supervisors are generally 21 years of age or older.

[87] With respect to training, Mr Harrison gave evidence of sessions run by senior staff or 

external trainers in addition to on-the-job training which is provided to all employees. The 

company is required to roster additional staff for training, pay the external trainers, and incur 

administrative costs. A small percentage of staff is also enrolled in Certificate II, III or IV 

training in retail. He gave evidence regarding the constant supervision that night fill 

employees require and the specific training provided to those employed in liquor stores.

[88] He said that approximately 65% of the total expenses incurred by Ritchies are 

attributable to wages. He accepted that his stores could absorb the cost increase that they 

would incur if the SDA’s application were successful, however he would consequently prefer 

to employ juniors aged 15-16 years and adult employees. He said that although larger retail 

chains may be able to wear the increased cost, independent grocers do not operate on the same 

model and therefore face greater difficulties.

[89] Ai Group called Ms Julie Toth, its Chief Economist.54 She is also a member of the Fair 

Work Commission’s Minimum Wage Research Group. Ai Group relied on a report prepared 

by Ms Toth in May 2013 which was based on data from the Australian Bureau of Statistics 

(ABS). 

[90] When looking at employment rates in the various industries, the largest proportion of 

20 - 24 year old employees are employed in the retail industry (17.3%). Ms Toth’s evidence 

was that the main source of non-managerial and part-time labour in the retail industry is 

students aged 15 - 24 years. In June 2011, 1.3 million Australians in this age bracket were 

studying full-time and living with their parents. These individuals typically move into a 

skilled occupation when they complete their studies, they are not the primary income earners 

in their households, and they are only available for work outside of their university class 
                                               

54 Exhibit AIG1. 








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32

timetable or on weekends. There are also another 840,000 Australians aged between 15 and 

24 who are not financially dependent on their parents and 79% of them are employed. The 

majority of this group is aged 20 - 24 years. 

[91] Ms Toth drew two conclusions based on data regarding the participation rates of 20 

and 21 year olds in the workforce. Participation rates for 20 year olds are generally two 

percentage points lower than for 21 year olds which suggests that 20 year olds are less 

available as potential employees. Further, unemployment rates decrease with each year 

attained from 20 to 24 years and thus 20 year olds are less attractive to employers as potential 

employees than slightly older employees, despite the discounted hourly rate that is paid to 

them. Ms Toth accepted during cross examination, that these figures in fact reflect the market 

balance for a particular age group based on the interaction between the supply of labour and 

employer demand for the same labour. The data does not give any insight into the factors that 

bear upon where this intersection occurs, such as the attainment of many university degrees at 

the age of 20 or 21 after the completion of a three year course.

[92] Ms Toth gave evidence about the unemployment rates of persons aged 20 - 24 years as 

at March 2013, based on data reflecting the moving average over the previous 12 months. The 

data shows that the unemployment rate in that period for 23 - 24 year olds was consistently 

lower than the unemployment rate of 20 and 21 year old employees. Ms Toth stated that based 

on this chart the average unemployment rate of 20 year olds was higher during this period by 

approximately 0.5%. In cross examination she accepted that this was not reflected in the ABS 

Labour Force data presented in her report which, in March 2013, shows that the average 

unemployment rate over the previous 12 months of 21 year olds was higher than 20 year olds,

whether they were studying full-time or not studying full-time.

Other evidence

[93] In addition to the witness evidence the employer associations also tendered a range of 

documents. Some of these documents were also relied upon by the SDA and the 

Commonwealth. A number of these documents are referred to by us later in this decision. It is 

adequate at this stage that we identify those documents. They included a report of the Low 








[2014] FWCFB 1846

33

Pay Commission of the United Kingdom titled “Protecting Young Workers: The National 

Minimum Wage”;55 Australian Government publications titled “State of Australia’s Young 

People”;56 “Australian Small Business Key Statistics and Analysis”57 and “Economic 

Structure and Performance of the Australian Retail Industry”;58 extracts from the New 

Zealand Office of the Minister of Labour concerning the establishment of a starting out 

wage,59 and two New Zealand Department of Labour papers, one titled “Youth Minimum 

Wage Reform and the Labour Market”60 and the other titled “The Impact of the 2008 Youth 

Minimum Wage Reform”.61

[94] Submissions were made by the Commonwealth and the ACTU which relied upon 

statistical information about the retail industry, research about the wages prescribed for 20 

year old employees in the 122 modern awards and enterprise agreements and assessments of 

the cost of the SDA claim. We refer to these matters in the context of our considering the 

modern awards and minimum wages objectives. 

Conclusions on the witness evidence

[95] The SDA submitted that there were ten principal conclusions which had been 

established by the evidence of the witnesses. We set them out below together with our 

comments about them.

1. At the age of 20, a significant number of employees in the retail industry have 

at least three years of experience in the industry. 

                                               

55 Exhibit ARA3, annexure C. United Kingdom, Low Pay Commission, Protecting Young People: The National Minimum 
Wage (March 2004).

56 Exhibit AIG2, attachment 1. Kristy Muir, Killian Mullan, Abigail Powell, Saul Flaxman, Denise Thompson and Megan 

Griffiths, State of Australia’s Young People: A Report on the social, economic, health and family lives of young people, 

Office for Youth (October 2009).
57 Exhibit ECA1, attachment 3. Megan Clark, Melissa Eaton, David Meek, Emily Pye and Razib Tuhin, Australian Small 

Business: Key Statistics and Analysis, Department of Industry, Innovation, Science, Research and Tertiary Education 

(December 2012).
58 Productivity Commission, Economic Structure and Performance of the Australian Retail Industry, Report no. 56 (4 

November 2011). The Commonwealth also tendered extracts from this report (exhibit Commonwealth2).
59 Exhibit ECA1, attachment 2. Office of the Minister of Labour, Cabinet Paper: Starting Out Wage Policy (27 July 2012).
60 Dean Hyslop and Steven Stillman, Youth Minimum Wage Reform and the Labour Market, New Zealand Treasury Working 

Paper 04/03 (March 2004). 
61 Dean Hyslop and Steven Stillman, The Impact of the 2008 Youth Minimum Wage Reform, Department of Labour (August 

2011).








[2014] FWCFB 1846

34

We agree that this conclusion is consistent with the SDA’s witnesses’ evidence. It is 

also consistent with that of the employers. Many of their employees, who had reached 

the age of 20, had commenced working for them years earlier when they were 15 or 16 

years of age. 

2. Most people mature as they get older. 

This conclusion, described by Mr Moore as trite and obvious, was one that could be 

reached based upon the cross examination of the SDA’s witnesses. The majority of 

them were asked in cross examination if they believed they had matured since they 

had commenced employment. Most agreed they had. 

Although we accept the evidence supports this conclusion we are uncertain about the 

relevance or utility of it. Unless a definition was given to what the employers intended 

by their use of the word maturity, it is difficult to comment much further on this 

conclusion. That a person matures as they age, in the sense of developing mentally and 

bodily, is accepted. We agree with the SDA’s submission that the cross examination of 

witnesses merged the questioning about maturity with the evidence about experience. 

The latter was something more concrete and about which employees could give or 

concede examples of what they believed they were able to better do after they had 

worked for a time in the industry. A concession that an employee had matured from 

age 15 or 16 to age 20 is in itself of little weight. We accept however, as a general 

proposition, the longer employees work in the industry they will perform their job 

better and learn more about the store, its products and customers.

3. Maturity is not to be equated with work experience.

The SDA submitted this conclusion comes out of the previous conclusion. We accept 

the SDA’s submission that what is more important is the experience gained by 

employees in this industry, particularly in light of the fact that many commence 

employment at 15, 16 or 17 years of age.








[2014] FWCFB 1846

35

4. There is no difference in the work and duties performed by a 20 year old Retail 

Employee Level 1 as compared to a 21 year old Retail Employee Level 1.

We accept that the evidence supports a general conclusion to this effect. The evidence 

relied upon consistently stated that the nature of the work performed by a 20 year old 

and a 21 year old employee in the retail industry is the same. The duties and 

responsibilities assigned to and undertaken by 20 year olds did not change after the 

employee turned 21. The evidence did not establish any discernible improvement in 

the performance of duties between the ages of 20 and 21 years. There was also 

evidence before us of junior employees supervising their colleagues who were often 

older than them. 

Much of the employer evidence was also supportive of this conclusion. Some 

employers, however, said that there was a difference. Of those who insisted there was 

a difference, little detail or actual examples were given; it was their impression that 

there was a difference. No attempt was made by the employers to lead any evidence of 

comparisons made between the work done by these two groups of employees. There 

was no identification of any material difference in the tasks they undertook, the 

manner in which they completed them or the standard to which they were done. 

There was no persuasive evidence to establish that it is more likely that a 20 year old 

will need to be supervised than a 21 year old. Many of the witnesses gave evidence 

that they had worked as junior employees without direct supervision. There is no 

evidence of any difference between a 20 year old employee’s understanding of such 

topics as shrinkage, rostering and budgeting to that of a 21 year old. 

5. Most retail employees achieve a satisfactory level of proficiency in respect of 

Retail Employee Level 1 duties and responsibilities after about six months of 

employment.

We accept that this conclusion is established by the evidence of both the employees 

and the employers. After 6 months in their position, the evidence suggests that most 

employees are both competent and proficient in their role. 








[2014] FWCFB 1846

36

6. Most witnesses called by the SDA were covered by an enterprise agreement, 

not the Award.

Although not strictly expressed in accordance with the relevant terms of the Act, we 

accept this conclusion. In fact the Award does cover all of the employees but in the 

case of the majority, where an enterprise agreement applied to them, it was that 

instrument which regulated their wage rates.62 The SDA relied on a comparison of the 

Retail Employee Level 1 classification criteria in the Award with that for a base or 

entry level employee in nine relevant enterprise agreements and submitted they clearly 

align.63 The job functions are comparable. Although the employers did not contest this 

conclusion they did note that the enterprise agreements were ones predominantly

applying to large employers.

7. The employer witnesses have misunderstood or deliberately ignored the SDA’s 

application. A number of the employer witnesses had addressed the consequences 

for their business if junior rates for 18, 19 and 20 year olds were abolished. They 

had not addressed the claim, confined as it was, to 20 year olds being paid the 

adult rate.

We acknowledge that a significant amount of the employers’ evidence referred to all 

employees who are in the junior employee age ranges which encompass employees of 

15 - 20 years. On numerous occasions, when employers gave evidence about juniors, it 

was not clear which age groups they were addressing. To that end, we agree with the 

SDA that there is little employer evidence that concentrates on 20 year old employees 

who are the focus of this matter. We also accept that some of the employers gave 

evidence which seemed to relate to an application that was in fact seeking adult rates 

for 18, 19 and 20 year olds, or at the least, was the first of a number of increases that 

would phase in the adult rate for these employees starting with 20 year olds.

Having made the above observations we are not, however, prepared to go further as 

the SDA encourages us to and make any finding that the employers have deliberately 

                                               

62 See ss.48 and 57 of the Act. 
63 Exhibit SDA22.








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37

ignored the scope of the application. We note that although the originating application 

to vary the Award and the grounds in support refer only to 20 year olds being paid the 

adult rate, a document titled “Outline of submission” which accompanied the 

application addressed the view the SDA held about the “inequity” of the rates paid to 

18, 19 and 20 year olds. It described the application as a first step in the process to 

move the Award’s junior rates to a fairer level. The SDA’s first written submission 

was replete with references to the long held complaint of the SDA that the retention of 

junior rates for 18, 19 and 20 year olds is inequitable, discriminatory and a relic of the 

past. We note however, that in the hearing before us, the SDA made clear that its 

application related solely to 20 year old employees.

Although we are not persuaded to reach the adverse conclusion sought by the SDA,

the fact that much of the employer evidence addressed either all junior employees or 

those aged 18, 19 and 20 does have some ramifications to our later consideration of 

whether the Award is meeting the modern awards and minimum wages objectives. 

8. There is no additional training or supervision required or provided to 20 year 

old employees and the training that is provided is not age related.

We accept that the evidence establishes that most employees receive training at the 

commencement of employment and that it was on-the-job training. Some employers 

rotated their new starters around the different areas of their business and some 

assigned supervisors or managers to oversee a new employee. None of this training 

was related to an employee’s age. It was usual for a new starter to be provided with 

induction training when they commenced employment and this applied to all new 

employees, irrespective of their age. On-the-job training is provided by some 

employers, particularly where it is necessary to maintain up-to-date product 

knowledge. There was evidence that a small number of employees had undertaken 

certificate levels II, III and IV traineeships but again there was no suggestion this was 

age specific. The only evidence of training that was related to the employee’s age was 

where an employee turned 18 and may then be trained in driving a forklift. 

Most of the SDA witnesses had received some training about shrinkage and generally 

had some understanding of the topic. The evidence did not suggest that the time when 








[2014] FWCFB 1846

38

training is given is in any way age related. In this respect we also note that loss 

prevention is a function listed as one that a Retail Employee Level 1 may perform.

The SDA witnesses were asked in cross examination if they had received any training 

in rostering or budgeting. Most had not. However, it appears to us, that training for 

rostering or budgeting has no relationship to age. The training in these aspects 

generally came with an employee assuming some managerial tasks or being given 

responsibility for these aspects of the operation of a store. For this reason, we have 

found it difficult to understand the relevance of the employers’ cross examination of 

employees as to whether they had been trained in these functions. There was no 

suggestion any of the employers who gave evidence, or indeed in the industry 

generally, would give this training to their employees upon reaching 21 years of age 

(or older). There is no suggestion that 21 year old employees undertake these duties 

and 20 year olds do not.

There was little evidence to suggest a 20 year old, with some experience, required any 

supervision; certainly not close supervision such that may suggest an additional cost

would be incurred by employers to engage persons to provide such supervision. In 

fact, as we have earlier noted, there was evidence that employees at 20 years of age or 

younger had supervised other employees. 

9. There is no probative evidence that paying the full adult rate to 20 year old 

employees will have any material or significant adverse impact on the viability of 

retail businesses.

We agree that this conclusion is open on the evidence. We refer later in this decision 

to the evidence and submissions about the cost of the SDA’s application when we 

refer to the modern awards and minimum wages objectives which we are required to 

take into account. For present purposes, we accept the SDA’s submission that there 

was little evidence given by the employer witnesses about the cost to their business if 

the variation to the Award was granted. The employers’ evidence concentrated more 

on the financial impact as a consequence of introducing the adult rate for all 

employees aged 18 - 20 years of age. Those employers who had undertaken some 

calculation of the cost impact to them, accepted it was not such as to impact the 








[2014] FWCFB 1846

39

viability of their business. One employer who had done specific calculations of the 

cost to her business was Ms Read and she had made one of her calculations on the 

basis that she may have to pay 18, 19 and 20 year olds the adult rate. She had also 

made calculations on the basis that she was required to pay her 19 and 20 year olds the 

adult rate. About this she said it would increase her wages bill by 1.9%. The other 

employer who had done some calculations was Mr Harrison and he had done so on the 

assumption that, for the financial year of 2011 - 2012, his business had been required 

to pay 18, 19 and 20 year olds the adult rate.

10. There is no probative evidence that employers prefer 21 year old employees 

rather than 20 year old employees.

We agree that this conclusion is open on the evidence. The evidence did not provide 

any reliable basis to make any finding about the attractiveness or otherwise to 

employers of 20 year old employees. 

(c) General considerations

[96] Before turning to the specific issues relating to the modern awards and minimum 

wages objectives, there are several matters raised in the proceedings which we need to refer 

to. These include the Junior Rates Inquiry (the Inquiry), relevant legislative provisions 

relating to junior employees and the position of junior employees under other modern awards.

The Junior Rates Inquiry 

[97] Under s.120B of the WR Act, the AIRC conducted an inquiry into junior rates of pay 

in 1998 - 1999. The Inquiry was conducted by a Full Bench which reported its findings to the 

Minister for Employment, Workplace Relations and Small Business in June 1999.64 The 

report was tabled in Federal Parliament on 24 June 1999. The purpose of the Inquiry was to 

assist the debate regarding the content of junior pay legislation and, in particular, to report on 

the feasibility of replacing junior rates with non-discriminatory alternatives.

                                               

64 Junior Rates Inquiry, Report of the Full Bench Inquiring Under Section 120B of the Workplace Relations Act 1996, Print 
R5300 (4 June 1999). 








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[98] The Inquiry examined the utility of junior rates, the consequences for youth 

employment of abolishing junior rates and the desirability and feasibility of replacing junior 

rates with non-discriminatory alternatives. The Full Bench referred to the history regarding 

junior rates of pay as follows:

“ ... Age has been a wage reference for young people since before the advent of formal 
processes of conciliation and arbitration. From the 1960s to the present, the basis of the 
Commission’s approach to the fixing of junior rates has been that of case by case. 
Inherent in that approach are the concepts of needs, work value and allocation of 
employment. The levels of youth employment have become a recurring factor. In 
keeping with social changes, needs, a concept influential at the beginning of the era, 
has come to be overshadowed by considerations of internal award relativity between 
entry level and training contract classifications and application of the work value 
concept. Since 1985, national wage benches have generally confirmed the case by case 
approach as a form of response to general issues about junior rates raised by the 
parties. An exception to that approach in 1994 resulted in the adoption of the National 
Training Wage.”65

[99] Whilst the Full Bench was not required to make specific conclusions or 

recommendations, it supported the use of junior rates of pay saying that such rates were 

simple to understand and administer and played a useful role in the youth labour market.66

The Full Bench noted that employment for youth is relatively scarce, increasingly casual and 

part-time, fragmented and dependent upon retail and service industries67 and commented that:

“ ... Well designed junior rate classifications, framed to reduce capacity to exploit the 
use of them, may justifiably be used for creating or protecting employment 
opportunities for young employees.”68

[100] In relation to junior rates of pay, the Full Bench said:

“ ... It is almost common ground, and it is also our assessment, that some degree of 
discounted pay rate for entry level work continues to be necessary. It seems needed, at 
least as an equal opportunity measure, in the areas in which employment under junior 

                                               

65 Junior Rates Inquiry at p.x, para [5](ii).
66 See generally Junior Rates Inquiry, section 4.3 dealing with “Considerations Reducing the Desirability of Replacing Junior 

Rates”. 
67 Junior Rates Inquiry at p.xii, para [8](i). 
68 Junior Rates Inquiry at p.xvi, para [9](v).








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41

rate classifications is most concentrated. It is probably necessary also as a reflection of 
the ‘true value’ of the work to the employer, taking account of maturation factors.”69

[101] The Full Bench referred to the challenge in finding an appropriate balance in the 

determination of junior rates between the objectives of equal opportunity (i.e. taking account 

of the competitive disadvantage in employment of school leavers, teenagers and young 

employees) and equality of treatment in employment of all employees (i.e. taking account of 

skills, responsibilities, experience and performance).70

[102] Following the Inquiry, the WR Act was amended to include the following as part of 

the principal objects of the legislation, namely “(aa) protecting the competitive position of 

young people in the labour market, promoting youth employment, youth skills and 

community standards and assisting in reducing youth unemployment”.71 The amendments 

sought to support youth employment through the inclusion in awards, where appropriate, and 

on a case-by-case basis, of junior rates of pay72 and specifically provided that junior wage 

provisions are not to be treated as constituting discrimination by reason of age.73

[103] It is noted that the Act presently provides for the making of special national minimum 

wage orders for junior employees74 and that a term of a modern award or an enterprise 

agreement will not be taken to discriminate against an employee merely because it provides 

wages for junior employees or a class of junior employees.75 A “junior employee” is defined 

to be a national system employee who is under 21.76

[104] We consider that the rationale for junior rates of pay remains relevant and that 

discounted rates continue to be justified. This is particularly so in the retail industry given the 

large number of juniors who are employed in it. 

                                               

69 Junior Rates Inquiry at p.140, [4.4.4].
70 Junior Rates Inquiry at p.141, [4.4.5].
71 See s.3 of the WR Act.
72 See s.143(1C)(ea) of the WR Act.
73 See s.88B(4) of the WR Act.
74 See s.294(1) of the Act.
75 See ss.153(3) and 195(3) of the Act.
76 See s.12 of the Act.








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[105] The productivity of young workers and value to employers being less than that of adult 

employees has been long accepted by Federal and State industrial tribunals. Junior rates 

reflect the general lack of experience of young employees and can act as an incentive or 

encouragement to employers to engage young persons, thereby allowing young persons to get 

a start or foothold in employment when they might otherwise struggle to compete against 

older applicants. Further, it is generally the case that the engagement of young persons will be 

associated with additional costs to the employer because of training and supervision needs.

[106] It seems to us that the SDA, the Commonwealth and the ACTU all accept these 

principles as valid. For example, the ACTU accepted the historic rationale for junior rates 

however argued that it is inapplicable to 20 year old employees in circumstances where there 

is no evidence that 20 year olds are less productive or impose additional costs on employers 

than older workers.77 The employers supported the use of junior rates within the industrial 

relations framework. No suggestion was made in the proceedings that there should be changes 

in rates of pay for junior employees under 18 years of age. The position of the various parties 

is not as clear cut in the case of employees of 18 and 19 years of age. We should not be taken 

to have made any ruling in this matter in respect to employees at these ages. We have 

concentrated in this matter on 20 year old employees in the retail industry.

Definition of junior employee in the Act

[107] The SDA and employers referred to the definition of junior employee in the Act78 and 

to other provisions which refer to junior employees. The employers submitted there is no 

legal basis for the SDA’s characterisation of junior rates as discriminatory. They emphasised 

that the use of the term “all junior employees” in s.153(3)(a) clearly allows for awards to set 

junior rates for all junior employees as defined by the Act. This must necessarily include 20 

year olds. They submitted that the section expressly allows and envisages the discriminatory 

treatment of workers on the basis of age. They also referred to s.284(1)(e) of the Act, which 

requires the Commission to establish and maintain a safety net of minimum wages, taking 

into account the provision of a comprehensive range of such wages for junior employees and 

                                               

77 Transcript of proceedings on 16 July 2013, PN4708 - PN4710 and Exhibit ACTU2 at 19 - 21.
78 See s.12.








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others. The SDA submitted that although the effect of s.153(3) is that a modern award term 

does not discriminate against an employee merely because it provides for junior rates of pay, 

the Act does not require the inclusion of such terms and thus does not preclude the variation 

sought.

[108] It does not seem to us that there is any real contest between the parties about the 

manner in which the relevant sections of the Act, dealing with junior rates, impact on this 

matter. It is also clear from the terms of s.153(3)(a) that if rates for junior employees are to be 

contained in a modern award, there is no necessity that it provides a rate for all of the 

employees within the definition. It expressly envisages that a class of junior employees (i.e.

not all of those in that definition) may be provided for in a modern award. In our opinion, 

there is no constraint within the Act on a modern award prescribing specific wage rates for a 

subset only of workers within the junior employee category. In respect to the description of 

the discounted wage being discriminatory, we should indicate that we have not used that term 

(nor, in our opinion, did the SDA) to suggest the clause was discriminatory in the sense of 

being unlawful.

18 year olds are adults

[109] The SDA highlighted aspects of the law which treat 20 year olds as adults including 

the right to vote, marry, serve in the armed forces and obtain a licence to drive a vehicle. It 

said that it is unfair that 20 year old employees are not treated as adults despite being 

recognised by society, and the law, as adults from the age of 18. On this basis, the provision is 

not one that can be described as being relevant for the purposes of s.134(1). The ACTU also 

contended that for the Award safety net to remain fair and relevant, the discounted wage for 

20 year olds should be removed so as to appropriately reflect community expectations and 

standards. 

[110] The employers submitted that the mere fact that society recognises an individual as an 

adult for purposes unrelated to industrial regulation is not a valid consideration in assessing 

whether the Award is meeting the modern awards objective.

[111] In our opinion, although the factors the SDA relies upon may be taken into account in 

considering whether a modern award is relevant, in the context of this case we do not place 








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much weight on the submission. The employers are correct to submit that in other legally 

regulated matters there are some specific restrictions or conditions placed on persons of 18 

years of age.79 More importantly however, as we have addressed in the previous paragraphs, 

the Act expressly defines those persons who are junior employees for its purposes and 

accordingly, allows for a modern award to provide wage rates for those juniors which differ to 

those for adults. The SDA application requires us to consider whether, in the case of a 20 year 

old in the retail industry, that should continue to be the case.

Rates in other modern awards

[112] The SDA relied on the Commonwealth’s analysis of the incidence of junior rates 

clauses in other modern awards.80 It submitted that of the five industries that employ the 

greatest number of 20 year old employees, the Award and the Manufacturing and Associated 

Industries and Occupations Award 2010 (MAIO Award)81 are the only ones that contain rates 

of pay specific to junior employees. And, in the MAIO Award, 20 year old juniors are paid 

97.7%. However, if they work in a foundry then 100% of the adult wage is to be paid. 

[113] The Commonwealth also referred to industries that engage a high proportion of young 

workers and pay 20 year old employees the adult rate, including hospitality, building and 

construction, and health care and social assistance.82 Its analysis also shows that of all 122 

modern awards, 72 provide for junior rates. Of these awards 47 provide that adult rates are to 

be paid to 20 year olds. Accordingly, 20 year old employees, covered by 97 of the modern 

awards, are paid at the adult rate.

[114] The employers argue that a comparison between the Award and other awards which 

do not contain junior rates is of little utility as it does not include an analysis of the difference 

in the numbers of employees engaged in those industries or the unique opportunity provided 

to young people in the retail industry to gain training in transferrable skills, mentoring and an 

income. Although we have some doubt that gaining transferrable skills, mentoring and an 

                                               

79  For example, drivers licence restrictions. 
80 Exhibit Commonwealth1. 
81 MA000010.
82 Exhibit Commonwealth1. 








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45

income is unique to the retail industry, we do accept that the absence of junior rates in certain 

other modern awards is not of itself a reason to grant the SDA’s claim.

[115] Notwithstanding the observation we have made in the previous paragraph, we think it 

appropriate that some weight be given to the fact that 20 year olds are paid the adult rate or 

close to the adult rate in industries which employ a large number of 20 year olds being the 

hospitality, building and construction, manufacturing, health care and social assistance 

industries. The material provided by the Commonwealth suggests that paying 20 year olds the 

adult rate in these industries has not significantly harmed their position in the labour market. 

Although we cannot directly draw the conclusion that likewise, in the retail industry, 

requiring 20 year olds to be paid the adult rate would have no negative impact on their 

position in the labour market, the Commonwealth’s analysis does suggest that the impact 

would not be significant. We return to this consideration again when dealing specifically with 

the retail industry and in the context of our consideration of ss.134(1)(c) and 284(1)(b) of the 

Act. Before we leave this consideration we wish to make it clear that the comments we have 

made relate specifically to 20 year olds and not juniors of any other age. The comparable 

statistics, analysis and conclusions about other junior employees may be significantly 

different.

(d) Is the Award achieving the modern awards and minimum wages objectives?

[116] Earlier in this decision we reproduced ss.134 and 284 of the Act which set out the 

modern awards and minimum wages objectives. As a general observation we note that the 

parties in their submissions concentrated primarily on the modern awards objective and little 

was said about the minimum wages objective. Although there is no proposal to adjust the 

minimum weekly wage for any classification level as contained in clause 17 of the Award, the 

effect of the SDA’s claim is to increase the minimum rate that would be payable to a 20 year 

old. Such a claim, in our opinion, is one which meets the description of a variation which 

“relates” to the Award’s minimum wages. Accordingly, subitem (4) of Item 6 of Schedule 5 

requires us to consider the minimum wages objective. We note that a number of the 

considerations in each of the objectives are in the same or very similar terms. 

[117] The parties made both general submissions about whether the Award is achieving the 

modern awards objective and specific submissions by reference to the factors listed in 








[2014] FWCFB 1846

46

s.134(1) which we must take into account. We have considered all of the submissions of the 

parties and the numerous reports and papers we were taken to concerning junior rates. Many 

of the matters which the employers submitted should weigh against the SDA’s claim were 

relied upon by each of the employer associations. We have generally dealt with those 

submissions without attributing them to any particular association.

[118] The SDA, supported by the Commonwealth and the ACTU, submitted that clause 18, 

the junior rates clause, providing as it does for a 20 year old to be paid 90% of the relevant 

adult rate does not constitute a fair and relevant minimum safety net. It submitted that the 

provision is unfair because it discriminates against 20 year olds solely on the basis of their 

age. It summarised the matters established by the evidence of retail workers and employers 

being that there is no material difference between the work and duties performed by a 20 year 

old and a 21 year old Retail Employee Level 1, they perform work to the same standard, that 

most employees achieve a satisfactory level of proficiency in the performance of their duties 

after about six months of employment and that at the age of 20 employees typically have at 

least three years of experience in the industry. 

[119] Subject to the comments we have made about the description of the discounted rate 

being discriminatory, these submissions are consistent with the conclusions we have earlier 

found are open on the evidence. They are all matters which, in our opinion, are appropriate for 

us to take into account. 

Sections 134(1)(a) and 284(1)(c): Relative living standards and the needs of the low paid

[120] We agree with the SDA’s submission that a high proportion of employees in the retail 

industry are low paid. This categorisation of these employees is consistent with decisions 

made by the Minimum Wage Panel in Annual Wage Reviews. Persons on award rates, 

particularly those below the C10 trades rate are considered to be low paid in the sense in 

which that term is used in ss.134(1)(a) and 284(1)(c).83 It is also consistent with the recent 

finding made by a Full Bench in the Modern Awards Review 2012 - Penalty Rates decision

                                               

83 For example see [2010] FWAFB 4000 at [237] and [2013] FWCFB 4000 at [367].








[2014] FWCFB 1846

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(Penalty Rates Decision).84 It is also accurate to describe 20 year olds, who do not receive the 

adult rate of pay, as being amongst the lowest paid. 

[121] The SDA also relied on the evidence of the desire of junior employees to work a 

greater number of hours than they are offered, the finding in the Penalty Rates Decision, 

which in turn relied on evidence there given by Ms Toth, that the majority of working 15 - 24 

year olds are not financially dependent on their parents,85 and the increasing incidence of 

caring responsibilities undertaken by young workers. It also noted the needs of those young 

workers who are undertaking higher education and those with consumer debt who face 

additional costs.

[122] The ACTU submitted that retail workers are amongst the lowest paid workers in 

Australia. It referred to ABS data regarding underemployment, submitting that 27% of 15 - 24 

year olds would like to work more hours than they are currently offered and said this suggests 

that these employees are finding it difficult to meet the rising costs of living.86 It noted ABS 

weekly earnings data for the November 2012 quarter indicates that the average weekly 

earnings for full-time adults are $1396 per week, and for a full-time 20 year old employee in 

the retail industry are $907.47.87

[123] In our opinion each of the considerations in the above paragraphs weighs in favour of 

the variation sought by the SDA.

[124] The parties took us to data which identifies a number of other attributes of the retail 

industry. It is suitable for us to refer to this here but in doing so we should note this has been 

considered by us both in the context of the factor we are currently addressing and generally, in 

our consideration of whether the Award provides a fair and relevant minimum safety net. We 

note that the industry is the second largest employer overall88 and a major employer of young 

persons. It has one of the highest proportions of award reliant employees who, by definition, 

                                               

84 [2013] FWCFB 1635 at [212].
85 See also a finding made by in the Penalty Rates Decision at [214].
86 Exhibit ACTU1, para 19. ABS, Underemployed Workers, Australia, Catalogue no. 6265.0 (September 2012). 
87 Exhibit ACTU2, paras 9 and 10. ABS, Average Weekly Earnings, Australia, Catalogue no. 6302.0 (November 2012).
88 ABS, Labour Force, Detailed, Quarterly, Catalogue no. 6291.0.55.003 (November 2012). 








[2014] FWCFB 1846

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receive the lowest wage that they can legally be paid. ABS data indicates that 25.6% of retail 

sector employees are award dependent.89

[125] The employers submitted that a significant proportion of 20 year old employees are 

contributory earners, are paid penalty rates with respect to a large number of the hours worked 

and their availability is often limited due to other commitments. They submitted that the SDA 

should not be able to make general submissions about employees’ financial circumstances 

when it had called no specific evidence about that topic from its witnesses.

[126] The employers noted that many of the SDA’s witnesses were students and submitted 

that consideration should be given to the financial assistance available to young people such 

as Youth Allowance, Austudy and HECS. It relied on the finding of the report titled “State of 

Australia’s Young People”,90 that most young people do not have significant costs of living 

because they remain in their parents’ home until they are 24 years of age. 

[127] We have given consideration to the submissions made by the parties. It is not possible 

in this matter for us to determine minimum wages for 20 year old employees by reference to 

the variety of circumstances in which such employees are found. Such circumstances include 

the family or household income and the assistance that an individual may receive in respect of 

study they are undertaking. We simply do not have adequate evidence or submissions about 

these considerations tailored to the circumstances of 20 year old employees in the retail 

industry. We have concentrated on the fairness of the minimum rate for any 20 year old in a 

classification in the Award. In that context we accept the employers’ submission that the SDA 

had not called evidence about the particular financial and household circumstances of its 

witnesses. 

[128] The ARA submitted that the grant of the application would adversely affect the living 

standards of retailers particularly small business retailers.91 As this submission was not 

                                               

89  Exhibit Commonwealth1; ABS, Employee Earnings and Hours, Australia, Catalogue no.6306.0 (May 2012); and Fair 

Work Commission, Research Report 4/2013: Retail Trade Industry Profile (February 2013). 
90 Exhibit AIG2, attachment 1. Kristy Muir, Killian Mullan, Abigail Powell, Saul Flaxman, Denise Thompson and Megan 

Griffiths, State of Australia’s Young People: A Report on the social, economic, health and family lives of young people, 

Office for Youth (October 2009). 
91 Exhibit ARA3, para 46.








[2014] FWCFB 1846

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developed it is adequate for us to indicate that we do not readily see that it is a consideration 

which ss.134(1)(a) or 284(1)(c) require us to take into account. The potential impact on 

business costs and viability are appropriate to take into account under other provisions of 

these sections of the Act.

Section 134(1)(b): Need to encourage collective bargaining 

[129] The SDA submitted that this consideration had no particular bearing on its application 

and it described it as a “neutral consideration”. The employers submitted the variation sought 

may discourage collective bargaining. They said the existing wages and conditions encourage 

collective bargaining because they are set at an appropriate level to allow room for 

bargaining. To increase the minimum wage rate under the Award to enterprise agreement 

rates would act as a disincentive to bargaining.92 They submit that the rate of pay that 20 year 

olds are entitled to under enterprise agreements should not determine the minimum safety net 

under the Award. 

[130] This is a factor to which we have given much consideration. We agree with the 

employers that the existence of enterprise agreements in which 20 year olds are paid the adult 

rate is not a justification for us to find that the corresponding Award rate is not fair or 

relevant. The existence of these rates in the enterprise agreements is however relevant to 

whether the variation sought would encourage or discourage enterprise bargaining. We note 

the incidence of enterprise agreements covering large employers which provide for the adult 

rate to be paid to a 20 year old and, in the majority of the enterprises, that higher rate has been 

paid now for many years. There was no evidence or submissions made that the existence of 

these agreements has had any adverse impact on the business and the renegotiation of 

subsequent agreements. We accept that we have very little information about the range of 

benefits in these agreements which would allow for an assessment of the extent to which the 

payment of the adult rate to a 20 year was “offset” as part of the bargain between the parties. 

However, we think it unlikely any such benefits or offsets the employers may have sought 

would be peculiar to 20 year olds. 

                                               

92 Exhibit ABI2, para 20. 








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[131] As for enterprise agreements covering small and medium businesses, the proportion in 

which a 20 year old is paid the adult rate is smaller than in the case of larger business, but 

nonetheless is still significant.93 Again, however we do not know what the bargain may have 

been in these agreements and the significance of that element of the agreement to pay the 

adult rate to 20 year olds. We are unable to make an assessment whether it is more or less 

likely that increasing the minimum rate for a 20 year old in the Award will encourage 

collective bargaining in these sectors of the industry. 

[132] Although not directly on the point of whether the variation sought would encourage 

collective bargaining, we should here refer to a submission made by the Commonwealth. It 

referred to the Department of Education, Employment and Workplace Relations (DEEWR)

analysis of 42 retail industry enterprise agreements (out of 1259 current agreements) and its 

finding that 25 enterprise agreements (which cover a significant majority of the total 

employees covered by the 42 agreements) paid adult rates to 20 year old workers before 2008 

and continued to do so after a new enterprise agreement was negotiated. Of the 17 agreements 

that did not provide adult rates for 20 year olds before 2008, almost half did so after 

renegotiation. The Commonwealth submitted that this data indicates a trend towards the 

payment of adult rates to 20 year olds in the retail industry. The limited number of enterprise 

agreements analysed in this exercise and the lack of detail about the content of those 

agreements (other than the wage rate for a 20 year old) was highlighted by the employers. 

They submitted the analysis should be given no weight. We accept that this analysis, which is 

consistent with the existence of a significant number of agreements providing adult rates for 

20 year olds, suggests a trend as submitted by the Commonwealth. However, we are unable to 

draw an inference from this analysis as to whether the Award variation sought by the SDA 

will be likely to encourage this trend to continue. 

[133] In our opinion, the variation sought by the SDA will not be likely to have a significant 

effect, one way or the other, on the incidence of collective bargaining. 

Section 134(1)(c) and s.284(1)(b): Promote social inclusion through increased workforce 

participation

                                               

93 Exhibit Commonwealth1, para 5.4.








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[134] The SDA submitted that the grant of its application will promote social inclusion by 

eliminating the discriminatory treatment of 20 year old employees and that there was little 

probative evidence that would permit the Commission to find otherwise. It referred to the 

Annual Wage Review 2009 - 2010 decision in which it was accepted that “social inclusion 

encompasses both the obtaining of employment and the pay and conditions attaching to the 

job concerned”.94 The ACTU also referred to this proposition and noted it had been again 

confirmed in the Annual Wage Review 2011 - 2012 decision.95

[135] The SDA submitted that an increase in the rate of pay would incentivise 20 year olds 

to seek employment in the retail industry. It rejected the employers’ submission that there 

would be a reduction in the hours of work offered to 20 year olds if the application were 

granted. It noted the evidence of the employers that it was not their current practice to cease 

engaging employees once they reached 21 years of age and to prefer younger employees in 

their place. The SDA referred to the evidence of Ms Reid who said her business had spent 

time and money training and educating these employees so if they wanted to stay they would 

continue to be engaged.

[136] The employers submitted that the application, if granted, would further reduce 

employer demand for young workers which would offend this provision of the Act. They 

submitted that junior rates of pay give young workers a cost advantage in the labour market, 

the removal of which will disadvantage 20 year old employees and reduce the incentive to 

engage such employees. They submitted that budgetary constraints, particularly those faced 

by the independent retail sector, would mean opportunities available to 20 year old employees 

will become limited or they would be offered less hours. They may favour either younger or 

more mature workers. 

[137] The employers referred to the unemployment rate for all 15 - 24 year olds as of April 

2013, noting that it was 10.8% and that for 15 - 19 year olds it was even higher at 16.1%. It 

was submitted that the rate for these two groups had been slowly declining since the Global 

                                               

94 [2010] FWAFB 4000 at [275]. 
95 [2012] FWAFB 5000 at [210]. 








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Financial crisis.96 The evidence of Ms Toth was highlighted to support the submission that 20 

year olds experience higher unemployment rates than 21 – 24 year olds.

[138] The Commonwealth submitted that employment of youth remained steady in the 

industry. The 2006 Census recorded that 41,400 20 year old workers were employed in the 

industry as compared to 41,100 in 2011.97 The SDA calculated this decline as a 0.75% 

decrease in the number of 20 year old workers between those years. Both the SDA and the 

Commonwealth described this decline as only a small decrease particularly in the context of 

Ms Toth’s evidence regarding the higher economy-wide fall in participation rates during the 

same period. It was the Commonwealth’s submission that considerations pertaining to social 

inclusion and increased workforce participation should be considered to be neutral in this 

matter.

[139] We should here refer to a submission made by the ARA which relied on the result of a 

survey it had undertaken.98 It argued that the variation sought would result in a reduction in

the number of 20 year old employees engaged in the industry and the number of hours offered 

to 20 year olds as employers are constrained by labour cost budgets. 

[140] There are 155 retailers who participated in the survey. Little was said about how the 

ARA had gone about conducting this survey. The methodology is unexplained. We have 

found it to be of limited assistance. We do not know from which group the participants were 

selected or sourced. Many of the criticisms which were made in the Annual Wage Review 

2012 - 2013 decision about an employer survey there relied upon can also made about the 

ARA survey.99 The overwhelming majority of the questions in the survey were about junior 

employees generally, which group the questionnaire described as being under 21 years of age. 

Two questions only were about 20 year old employees. We observe that the survey did not 

give any indication whether the participants currently employed 20 years olds and, if so, how 

many. One question was whether the participant agreed or disagreed that their 20 year olds 

were more productive than younger employees but not as productive as their adult employees. 

                                               

96 Exhibit AIG2, paragraphs 99 - 102. ABS, Labour Force, Australia, Catalogue no. 6202 (April 2013). 
97 Exhibit Commonwealth1. 
98 Exhibit ARA3, annexure A. 
99 [2013] FWCFB 4000 at [438] - [442].








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The majority either “somewhat agreed, neither agreed nor disagreed or disagreed.” The other 

question asked if the participant was required to pay their 20 year olds the adult rate, then 

what impact this would have on the way they would employ 20 year olds. 47% selected the 

answer “no change” and the remaining selected either that they “would employ fewer 20 year 

olds” or that they “would offer fewer hours to 20 year olds”. Even if the survey was otherwise 

shown to be conducted in a valid and reliable manner, these answers do not provide the ARA 

with particularly persuasive evidence to support its submission about the weight which we 

should put on the findings of this survey. 

[141] Having considered all of the evidence and submissions we are not persuaded the 

variation will be likely to have a negative impact on workforce participation. In those 

businesses with a collective or other employment arrangement whereby 20 year olds are 

already being paid the adult rate, it is unlikely to have any impact on the continuing workforce 

participation of these workers. We later refer to the assessment of the number of 20 year old 

employees who are currently being paid as an adult. There was no evidence that had led to 

employers choosing to either not engage employees of that age or to give them fewer hours. 

Nor was there any evidence from employers with a mix of both collective agreements with 20 

year olds being paid as adults and the Award discounted rate, as to any relevant changes they 

had made to their hiring or rostering practices.

[142] In the case of businesses where the award rate only is paid, we accept employers may 

consider whether to hire either a younger employee or an adult instead of a 20 year old. The 

evidence did not suggest it is a strong possibility they will decide to do so. Their current 

practice was not to prefer these other employees to an employee about to turn 21 years of age. 

That is understandable as they would be unlikely to do so particularly in the case of an 

employee with experience who understands the business and its customers.

The reports about the impact of paying adult rates to juniors 

[143] The parties referred to analyses of the effect of reforms in New Zealand in 2001 which 

lowered the eligibility for the adult minimum wage in all industries from 20 years of age to 18 

and, in two instalments, increased the wage for 16 and 17 year olds to 80% of the adult 

minimum wage. Subsequently, in 2008, the youth minimum wage for 16 and 17 year olds was 

replaced with a new entrant’s minimum wage which would apply for 3 months, or a minimum 








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period of hours worked, after which the adult minimum wage would apply. The SDA relied 

on a report published in 2004 which considered the impact of the 2001 reforms and the 

employers relied on a report, by the same authors as the earlier report, about the impact of the 

2008 reforms. 

[144] The SDA noted the 2004 study found “no consistent and robust evidence of any 

adverse effects of the changes on teenage employment. In fact, in contrast to simple 

competitive model predictions of the effect of minimum wage increases, the only statistically 

significant point estimates imply possible positive employment responses to the changes”. 100

[145] The report regarding the 2008 reforms was relied on to highlight the finding that the 

combination of the increase to the rate for employees of 16 and 17 years of age together with 

an increase at the same time to the adult minimum wage resulted in a 28.2% increase to the 

minimum wage for those workers. This in turn had resulted in a 20 - 40% fall in the 

proportion of 16 and 17 year olds in employment by 2010. There had been no significant 

impact on unemployment of 16 and 17 year olds as the employment losses had occurred 

entirely among students who had been combining study with part-time employment.101

[146] Reference was also made to extracts from a March 2004 United Kingdom Low Pay 

Commission Report; “Protecting Young Workers: The National Minimum Wage”.102 We note 

that the report contained two recommendations - an increase to the existing minimum wage 

for adults (i.e. employees 18 years of age and over) and the introduction of a minimum wage 

for 16 and 17 year olds.

[147] We have considered the reports and the emphasis both the SDA and the employers 

give to the extracts from them that we were taken to. As is apparent from our description of 

the nature of the subject matter of each report, they are not readily applicable to this review. 

The conclusions reached or the recommendations made do not readily assist us in the context 

                                               

100 Exhibit SDA27. Dean Hyslop and Steven Stillman, Youth Minimum Wage Reform and the Labour Market, Institute for the 

Study of Labour, Discussion paper no. 1091 (March 2004) at p.16. See also transcript of proceedings on 16 July 2013, 

PN4644 - PN4645. 
101 Dean Hyslop and Steven Stillman, The Impact of the 2008 Youth Minimum Wage Reform, Department of Labour (August 

2011).
102 Exhibit ARA3, annexure C. United Kingdom, Low Pay Commission, Protecting Young People: The National Minimum 

Wage (March 2004).








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of the statutory considerations we are here required to apply and the particular age groups we 

are focussing upon. 

Section 134(1)(d): Promote flexible modern work practices and the efficient and productive 

performance of work

[148] Very little was said about this consideration. The SDA, in its written submissions, 

highlighted the skills of young persons with new and emerging technology and contended that 

those skills contributed to more flexible and modern work practices and are critical to 

effective and productive performance. These considerations were not further addressed in 

their final oral submissions, with the SDA then indicating that this is not a relevant 

consideration as its variation would not impact on work practices, nor have any direct bearing 

on the way work was performed. The employers said there was no reason to doubt that 

employees of 21 years and over also had comparable technological skills that could enhance 

their work performance. We think these matters to be of minor weight in the overall balance 

of the various considerations we have addressed in this decision.

Sections 134(1)(e) and 284(1)(d): Equal remuneration for work of equal or comparable value 

[149] The SDA did not seek to support its variation by reference to this objective. It 

submitted that this is not a relevant consideration in this matter as no part of its claim 

concerned gender based differences.103 In view of the submissions of the parties in these 

proceedings, this is not a consideration which supports the granting of the SDA’s claim. 

Section 134(1)(g): Simple, easy to understand, stable and sustainable modern award system 

etc

[150] The SDA submitted that this consideration had no applicability to its claim. The 

employers said little about this consideration; only that they had a concern about the potential 

of adding to the existing transitional provisions in the Award and the complexity in applying 

them. 

                                               

103 Transcript of proceedings on 2 July 2013, PN795 - PN796 and transcript of proceedings on 16 July 2013, PN4613. 








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Sections 134(1)(f) and (h) and 284(1)(a): Impact on business, productivity, employment costs, 

employment growth, inflation etc

[151] Sections 134(1)(f) and (h) and 284(1)(a) of the Act require the Commission to take 

into account a number of factors. Those of particular relevance to this matter, which the 

parties addressed, include the likely impact of the SDA’s claim on employment costs, 

employment growth and business viability. 

[152] The SDA submitted that there is no probative evidence before the Commission of any 

significant adverse impact the variation would have on the viability of business in the retail 

industry. It noted that none of the witnesses called by employer organisations suggested the 

variation would have any significant adverse effect. It also noted that Ms Toth, despite her 

expertise in the field of economics, did not suggest this would be the outcome of the variation 

being allowed. The SDA also submitted that it was relevant to note that despite the absence of 

junior rates in other modern awards, there was no suggestion their absence had negatively 

impacted on growth in employment and profitability in the industries covered by those 

awards. 

[153] The SDA noted that 20 year olds constitute a relatively small proportion of the total 

number of employees in the retail industry. Referring to DEEWR estimates, it asserted that 

any increase in the industry’s total wage bill would be offset by the productivity of 20 year 

old employees who generally have three or more years of experience. It also relied on the 

increasing incidence of 20 year old employees being paid the adult rate under enterprise 

agreements. A compendium of nine enterprise agreements covering large retail businesses 

was provided to us.104 Of those agreements, all but three currently entitle 20 year old workers 

to the adult rate of pay. 

[154] The SDA took us to findings made by the Full Bench in the Penalty Rates Decision 

regarding the circumstances of the retail industry. The Full Bench said:

“[147] The retail industry remains broadly robust and generally profitable. There have 
been some changes in the retail industry generally, including as a result of some 

                                               

104 Exhibit SDA21.








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incremental increase in online sales and more recent economic challenges facing the 
Australian economy more generally. This has led to pressure on prices and overall 
sales volumes (with the exception of food retailers whose volumes have generally 
increased) and upon employment growth when compared to previous trends. 

[148] Although trading conditions have tightened for many retailers in recent years, 
there has not been any severe deterioration in overall economic conditions in the retail 
industry since the General Retail Award commenced operation in 2010.” 105

[155] We also note in the Annual Wage Review 2012 - 2013 decision, the Minimum Wage 

Panel, in its conclusions on “The Economy” said:

“[20] The most award-reliant sectors of the economy continued to have a mixed 
experience over the past year. Most have had a fall in hours worked and in 
employment, although rises in profitability and output have been stronger. The Retail 
trade industry in particular has improved both sales and profitability, while wages 
growth and employment in this sector has been below the average for all industries. 
The diversity in outcomes in respect of output, profits, employment, and wages 
between and within the award-reliant industries suggests that factors other than recent 
minimum wage increases have driven outcomes within those industries.”106

[156] The Commonwealth noted that 25.6% of retail employees were award reliant and 54% 

of them are employed as casuals. It also noted that ABS data indicates that 3.9% of all retail 

employees are 20 years old.107 In assessing the cost of the claim to the industry, the 

Commonwealth relied on analysis it had undertaken about the scope of enterprise agreement 

coverage of 20 year olds in the industry and the potential cost to the industry if the SDA claim 

was granted. In respect to the incidence of enterprise agreement coverage, it submitted that a 

significant proportion of retail enterprise agreements and individual arrangements, covering 

some 56% of 20 year olds in the industry, already provide for the payment of adult rates to 20 

year olds.108 It also submitted that its analysis shows that almost 93% of 20 year old retail 

workers who are covered by enterprise agreements are entitled to the adult rate of pay. It 

acknowledged the high incidence of enterprise agreements for large employers within its 

sampled group (i.e. those with 100 or more employees) and that these employers 

overwhelmingly paid 20 year olds the adult rate.109 It noted that the disproportionate number 

                                               

105 [2013] FWCFB 1635.
106 [2013] FWCFB 4000.
107 Exhibit Commonwealth1, attachment C.
108 Exhibit Commonwealth1, para 2.1(c).
109 Exhibit Commonwealth1, para 5.1 - 5.4.








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of agreements covering these large employers could impact the extrapolation of the results to 

the whole industry. The DEEWR estimated that if the claim was granted, retail industry 

employers would face an increase in labour costs of 0.06%, or 0.07% if the level of award 

reliance of 20 year olds was increased to 30%. The Commonwealth also estimated that small 

business, which it described as being typically more award reliant, would face an increase of 

0.1%.110 The Commonwealth submitted that any cost increases faced by business were limited 

and affordable. 

[157] The Commonwealth referred to a Government publication titled “Australian Jobs 

2013”,111 which projects retail trade employment to grow by 8.9% over the period of 

November 2012 to November 2017.

[158] The ACTU made submissions in support of the SDA’s position. It submitted that any 

cost increase to employers would be minimal and affordable. It relied on the trend towards 20 

year old employees being paid the adult rate of pay under enterprise agreements as an 

indication that there is no potential negative impact on business, productivity or 

competitiveness. It also pointed to the 97 modern awards that do not contain junior rates of 

pay, including some industries that engage a significant number of junior employees. The 

ACTU submitted that the claim is affordable to the industry, which experienced 3.1% growth 

and a 3% rise in turnover in 2012.

[159] The ACTU placed weight on the absence of any evidence called by the employer 

parties regarding the potential cost impact of the claim.112

[160] The employers submitted that the DEEWR’s estimates regarding the potential impact 

of the claim are flawed as they assume that all 20 year old employees engaged under the 

Award are classified at Retail Employee Level 1. Further, the calculations do not contemplate 

the payment of penalty rates and the increase in the industry’s wage bill is understated by 

expressing it as a percentage of the total industry wage bill, which would take into account 

wages paid to employees not covered by the Award.

                                               

110 Exhibit Commonwealth1 and transcript of proceedings on 16 July 2013, PN4821. 
111 DEEWR, Australian Jobs 2013 (2013). 
112 Exhibit ACTU2. 








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[161] The employers did not agree with the SDA’s submission about the claim not 

impacting the viability of retail businesses and they referred to the evidence of Mr Harrison 

and Ms Read regarding the financial strain that their respective enterprises are under, and the 

increased pressure they would face as a result of wage increases. The employers emphasised 

the adverse impact of the claim on independent retailers who are largely award reliant and the 

absence of any trade-off for employers.

[162] The employers submitted that while the variation sought may not be relevant to large 

retailers that currently pay the adult rate to 20 year olds, it was of great significance to small 

and medium-sized employers as well as those based in rural and regional areas as they are, to 

a greater extent, award reliant. They submitted that the impact that the claim may have on 

small and medium-scale businesses had been inadequately addressed by the SDA. In this 

context reference was made to the objects of the Act which include provision for “a balanced 

framework for cooperative and productive workplace relations that promotes national 

economic prosperity and social inclusion for all Australians by ... acknowledging the special 

circumstances of small and medium sized businesses”.113 They noted that 38.5% of 

employees in the retail sector are engaged by small businesses (i.e. those with fewer than 20 

employees). If medium sized employers (i.e. with 20 - 199 employees) are added, they would 

make up 56.6% of all retail employers.114 Given the dependence of small and medium 

retailers on the Award, and the large proportion of employees aged between 15 - 24 years 

engaged in the industry, they submitted that the claim would result in a significant cost impact 

on small and medium businesses.

[163] The employers referred to various survey outcomes regarding business conditions in 

the retail industry. The National Australia Bank Monthly Business Survey (March 2013) and 

the National Australia Bank Quarterly Business Survey (March quarter 2013) reported a 

deterioration in activity in the retail industry. ABS Business Indicators also showed negative 

growth from the sale of goods and services in NSW. They submitted that it is important to 

have regard to current economic and business conditions when considering implementation of 

                                               

113 Exhibit AIG1. See s.3(g) of the Act,. 
114 Exhibit AIG1, attachment 2. Megan Clark, Melissa Eaton, William Lind, Emily Pye and Laura Bateman, Key Statistics: 

Australian Small Business, Department of Innovation, Industry, Science and Research (2011)  at p.7.








[2014] FWCFB 1846

60

a wage increase. Current business conditions suggest that the variation sought could result in 

unfavourable outcomes for the industry. They also noted that since the Award had come into 

operation, businesses in some States had incurred additional labour costs, especially higher 

penalty rates. To add further costs would only serve to undermine the modern awards 

objective.

[164] Another consideration which arose in the parties’ submission related to a contest about 

whether additional training costs were associated with 20 year old employees. It was 

suggested by employers that these additional costs partly justified a discounted rate being paid 

to these employees, a proposition the SDA and the Commonwealth challenged. The SDA 

submitted that retail workers are not provided with age-specific training, skills, and young 

workers commonly work without direct supervision and often supervise other employees. 

Relying on a Productivity Commission Report of November 2011, the Commonwealth 

submitted that there is little difference in the formal qualifications of workers aged above and 

below 20 years and that employers in this industry are less likely than in other industries to 

provide any formal training. It also noted that they spend considerably less on training than 

that invested by employers in all industries.115 The employers made general submissions 

about the costs of training young employees, however it was not clear what is said to be the 

cost of training for 20 year olds and how that may be relevant to the cost of allowing the 

variation sought by the SDA. In our opinion the evidence does not provide any basis for a 

discount on the wage for a 20 year old employee which may be justified by there being any 

additional training and consequential costs to an employer with respect to these employees.

[165] We have considered all of the submissions, the estimations made by the 

Commonwealth and the reports the parties took us to. We accept we should apply 

considerable caution to the estimates made by the Commonwealth and have done so. On the 

other hand, we were not provided with much evidence as to estimates the employers had 

undertaken about the cost of the claim. That which we were given was specific to a small 

number of businesses and not confined to their 20 year old employees. Having considered the 

submissions, we assess the likely cost impact of the claim to be moderate. Further, that impact 

will be reduced as a consequence of the period of service requirement we have decided to 

                                               

115 Exhibit Commonwealth2. Productivity Commission, Economic Structure and Performance of the Australian Retail 
Industry, Report no. 56 (4 November 2011).








[2014] FWCFB 1846

61

introduce. We are not persuaded that the provision of adult rates to 20 year old retail 

employees will have a significant negative impact on business costs, nor on the viability of 

retail businesses. We are not persuaded it will have a discernible impact on employment 

growth.

[166] Before we leave our consideration of these provisions of the modern awards and 

minimum wages objectives, we should refer to the potential for a flow on of this claim to 

other awards. Little was said about this consideration. The SDA submitted that the 

consequential cost impact for other industries is limited. Industries covered by modern awards 

that do not contain junior rates do not face any possible flow on effects. It acknowledged that 

some impact may be felt by the fast food industry, however it noted that the scheme of the Act 

does not readily allow for a similar variation, if sought, to be made to other modern awards in 

the event its application was granted. We note the employers also identified the fast food 

industry as being exposed to a possible comparable claim. 

[167] The employers submitted that there was also the potential that the SDA would seek to 

eliminate junior rates in the Award for those aged 18 and 19. They referred to the policy 

position of the SDA that discounted rates for 18, 19 and 20 year olds were not justified. 

[168] We have taken these considerations into account. We agree with the SDA that it is not 

readily apparent that a claim similar to this can be made in respect of any of the other 

employees to whom a junior rate is paid. This claim is made in the context of the two year 

review of awards and in accordance with the Transitional Provisions Act. No further claim 

can be made under that Act. The considerations in this case are specific to the claim for 20 

year olds in the retail industry to be paid the adult rate. We do not consider it to be a precedent 

for any other claim which may be made either in respect to the Award or any other modern 

award. 

Conclusions

[169] We have carefully considered all the evidence and submissions presented in the 

proceedings together with the relevant legislative provisions relating to the transitional review 

of the Award and the determination of the application before us. We have reached the 

following conclusions in relation to the issues raised relating to junior rates of pay and 








[2014] FWCFB 1846

62

whether it is necessary and appropriate at this time to vary the Award so as to provide adult 

rates for 20 year old retail employees.

[170] We have decided that the Award is not achieving the modern awards and minimum 

wages objectives. We consider that the discounted rate for all 20 year old retail employees is 

not a fair and relevant minimum safety net. In reaching this conclusion the witness and 

documentary evidence specific to the retail industry has been of primary importance. 

[171] The SDA submitted that we should draw various conclusions based on the evidence

presented in this case. Our comments and findings on the evidence are set out earlier in this 

decision. In general we are of the view that the evidence, considered in the context of the 

modern awards and minimum wages objectives, predominantly weighs in favour of adjusting 

the rates of pay for 20 year old retail employees. In particular we have decided that the 

adjustment is appropriate and is necessary for those objectives to be achieved.

[172] The evidence presented by both the SDA and the employers generally supports a 

conclusion that most junior retail employees achieve a satisfactory level of proficiency in their 

roles after about six months in employment. Further, much of the evidence suggests that there 

is little difference in the duties and responsibilities assigned to 20 and 21 year old retail 

employees or in the level of supervision required in relation to those employees.

[173] Having regard to the evidence before us, we have decided that it is appropriate that 20 

year old retail employees should be entitled to adult rates of pay provided that they have 

worked for the employer for more than six months. This would recognise the work performed 

by experienced 20 year old employees in the retail classifications and would provide an 

appropriate balance between the various considerations relevant in the setting of junior rates 

generally and in the context of the retail industry. Although such a service requirement is not 

a feature of enterprise agreements in the retail industry which provide adult rates for 20 year

old employees or in other awards which so provide, we consider that the requirement is 

appropriate in the circumstances of the retail industry generally and having regard to the 

evidence presented in this case. It will ensure that 20 year old employees receiving adult rates 

under the Award will have the knowledge and experience which comes from having worked 

for their employer for at least six months.








[2014] FWCFB 1846

63

[174] Given the nature of employment in the retail industry, we have not sought to specify 

the number of hours or the range of work or training that must be worked or undertaken 

during the six month qualifying period. We would expect that many employees will continue 

to be engaged in their twentieth year on a similar basis and with similar hours of work as 

previously. However, we accept that some employees might be engaged on a different basis. 

We have sought to provide both a fair and easy to administer basis for recognising the work 

performed by employees of 20 years of age in the retail industry who have had more than six 

months experience in the employer’s workplace. 

[175] In varying the Award to give effect to this decision, we are mindful of the cost 

implications for some employers and the transitional arrangements that are still applicable 

under the Award. We have therefore decided that the Award should be varied so that the new 

rates for 20 year old employees in retail classifications will be phased in as follows: 95% of 

the adult rate to apply from the first pay period commencing on or after 1 July 2014; and 

100% of the adult rate to apply from the first pay period commencing on or after 1 July 2015. 

[176] The SDA should prepare a draft order to vary the Award to give effect to this decision 

and provide the draft order to the Full Bench within 7 days.

SENIOR DEPUTY PRESIDENT

Appearances:

S Moore of counsel, J Willey and J Fox for the SDA

J Dolan for the ACTU

M Tehan and T Pick, solicitors, for the Commonwealth 

N Tindley, solicitor, for the ARA

S Elliffe and D Allison for the NRA

D Sztraijt for the MGA








[2014] FWCFB 1846

64

B Ferguson for Ai Group 

S Haynes for ABI and the ACCI

J O’Dwyer for the ECA

K McCosh for the NECA

Hearing details:

Sydney, and Melbourne (mentions by video link): 

April 23 and June 6.

2013.

Melbourne:

July 2 - 4.

2013.

Sydney: 

July 15 - 17.

2013.

Printed by authority of the Commonwealth Government Printer

Price code J, PR548773

Cases cited by this decision: