DECISION

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

4 yearly review of modern awards – Payment of wages
(AM2016/8)

4 yearly review of modern awards – payment of wages common issue – finalisation of payments on termination model term.

1. Background

[1] The ‘payment of wages’ terms in modern awards are being dealt with as a common issue in the 4 yearly review (the Review). A common issue is a proposal for significant variation or change across the award system, such as an application or proposal seeking to change a common or core provision in most, if not all, modern awards. 1

[2] On 1 December 2016 we issued a decision dealing with various ‘payment of wages’ issues in modern awards (the December 2016 decision). The main issues dealt with in the December 2016 decision were the:

•  timing of payment of wages;

•  timing of payment on termination of employment; and

•  accrual of wages and other amounts.

[3] The December 2016 decision also dealt with penalties for late payment of wages and annual leave loading. Those issues have been determined and variation determinations issued.

[4] A claim was also made by Restaurant and Catering Industrial (RCI) to remove a restriction on the days for payment of wages in respect of the Restaurant Industry Award 2010. This was referred to the Award stage of the review and will be the subject of a hearing in October 2018. 2

[5] In respect of the issues outlined at paragraph [2] above, we provided provisional views and provisional model terms in our December 2016 decision. Further submissions were sought in relation to the finalisation and determination of these issues.

[6] A number of submissions were received from parties and the Commission published a summary of these submissions on 22 March 2017. A further hearing was held on 23 March 2017 before the Full Bench.

[7] At the 23 March 2017 hearing we noted that there appeared to be a measure of agreement between the parties about some important matters of principle. We also noted that there is a degree of complexity in these matters which reinforces the need for this to be an iterative process. 3 A Statement issued on 26 April 2017 (the April 2017 Statement) identified those areas of agreement and highlighted what appeared to be the areas of disagreement. Potential areas of agreement were identified in relation to the following matters:

‘(i) Clarity is important, so that those covered by an award clearly understand their obligations. Parties also generally acknowledged that there are benefits of uniformity, but the circumstances of particular awards may mean that not all elements of common approach are appropriate in that particular award.

(ii) As noted in (i) above, while it is generally acknowledged that consistency is desirable, there is also broad support for the proposition that an award by award approach is warranted and that regard should be had to the existing terms of the award, their historical context and the circumstances pertaining to the relevant industry.

(iii) There is broad support for the concepts identified in the two provisional model terms. But there also appears to be some matters of detail about which there is a clear disagreement. These are set out below. Further, as the Full Bench advised at the 23 March hearing, there are a number of issues requiring input from parties who were not present at the hearing; for example, on the question of whether casuals should be dealt with differently there was limited input from hospitality and retail employers and unions (other than the SDA).’ 4 (Citations omitted)

[8] A conference was held on 4 May 2017 at which the parties confirmed that there was general agreement in respect of the matters noted above and that a further update on the outstanding issues would be provided at a mention on 22 August 2017. At that mention, the parties requested additional time for discussion of the outstanding issues. A further mention was held on 11 September 2017, at which the Australian Council of Trade Unions (ACTU) and Australian Industry Group (Ai Group) agreed to file draft directions in relation to the proposed programming of the determination of the outstanding issues. It was noted that parties would be invited to make submissions in relation to three issues:

(i) the payment of wages and other amounts model term;

(ii) the payment on termination of employment model term; and

(iii) the accrual point.

[9] It was also generally agreed that the outstanding issues would be determined on the papers, in the absence of any party seeking an oral hearing for a particular reason. No party sought an oral hearing.

[10] A Statement and Directions were published on 19 September 2017. In response to those directions, submissions were received from the following parties:

(i) Australian Business Industrial and the New South Wales Business Chamber (ABI) dated 13 November 2017;

(ii) ACTU dated 30 October 2017;

(ii) Australian Hotels Association (AHA) dated 30 October 2017;

(iii) Ai Group dated 7 November 2017;

(iv) Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union (AMWU) dated 31 October 2017;

(v) CFMEU–Forestry, Furnishing, Building Products and Manufacturing Division (as it then was) (CFMEU-Forestry) dated 31 October 2017;

(vi) CFMEU–Mining and Energy Division (as it then was) (CFMEU-M&E) dated 31 October 2017;

(vii) Housing Industry Association (HIA) dated 30 October 2017;

(viii) Master Builders Australia (MBA) dated 6 November 2017;

(ix) National Retail Association (NRA) dated 6 October 2017;

(x) National Road Transport Association (NatRoad) dated 30 October 2017;

(xi) Real Estate Employers’ Federation (REEF) dated 30 October 2017;

(xii) the former Textile, Clothing and Footwear Union of Australia (TCFUA) dated 31 October 2017; and

(xiii) United Voice (UV) dated 31 October 2017.

[11] A revised summary of submissions was published on 30 November 2017.

[12] Submissions in reply were received from:

(i) ABI dated 6 December 2017;

(ii) ACTU dated 4 December 2017;

(iii) Ai Group dated 6 December 2017;

(iv) Australian Workers’ Union (AWU) dated 4 December 2017; and

(v) MBA dated 4 December 2017.

[13] This decision deals with one aspect of the ‘payment of wages’ common issue – the finalisation of the ‘Payment on termination of employment’ model term.

2. Payment on termination of employment model term

[14] Only 36 of the 122 modern awards contain terms which provide for the payment of wages and other amounts owing to an employee on the termination of their employment. 5 There is also considerable variation in the manner in which these 36 modern awards deal with payments on termination. For example, the time period within which termination payments are to be made varies from the day of termination to 3 days after termination; 10 of the 36 modern awards provide for termination payments to be sent by post or registered post; 6 of the awards provide for termination payments to be ‘forwarded’ to the former employee, but do not specify the means by which such payments are to be made. The terms of these 36 modern awards also vary in the manner in which they refer to the amounts owing to an employee whose employment has been terminated, including making reference to ‘all money due’,6 ‘monies’,7 ‘all wages and other monies’8 and ‘all wages and holiday pay’.9

[15] In addition to the lack of uniformity in the existing terms dealing with termination payments, some 86 modern awards make no provision at all in respect of the time period within which termination payments are to be made.

[16] In a Statement 10 issued on 14 October 2016 (the October 2016 Statement) we expressed some provisional views in respect of this issue, which may be summarised as follows:

1. Each modern award should provide for the payment of wages and other amounts owing to an employee on termination of employment, to ensure that employers and employees are aware of their obligations and entitlements.

2. There is some utility in a common ‘payment on termination’ provision across all modern awards.

3. The default term for the payment of wages and other amounts due on termination of employment should be:

Payment on termination of employment

The employer must pay all amounts that are due to an employee under this award and the NES when the employee’s employment ends:

(a) within 7 days after the employee’s last day of employment; or

(b) on the next normal pay day.

4. There does not appear to be a sound rationale for retaining the current provisions that require payment of wages on termination within a short period after termination (such as one or two days, or ‘forthwith’) and the existing provisions in respect of payments on termination should be replaced by the default term.

[17] In the December 2016 decision, we confirmed our provisional view that each modern award should provide for the payment of wages and other amounts owing to an employee on termination of employment and that such a term should prescribe the timeframe within which such termination payments are to be made. 11

[18] As to the proposition that there be a common ‘payment on termination’ provision across all modern awards, we said:

‘We also confirm our provisional view that there is utility in common ‘payment on termination’ provision across all 122 modern awards. But we accept that each modern award is to be reviewed in its own right and there may be sound reasons for departing from a model term in a particular modern award. A case by case assessment is required.’ 12

[19] In the December 2016 decision we gave further consideration to the time period within which termination payments should be made and proposed that such payments should be made ‘within 7 days after the employee’s last day of employment’. We also noted two potential qualifications to the requirement to make payment within that 7 day period.

[20] First, s.120 of the Act provides that in some circumstances an employer can apply to the Commission for a determination that the amount of redundancy pay to which an employee is entitled under the National Employment Standards (NES) is reduced to a specified amount (which may be nil). The relevant circumstances are that an employee is entitled to be paid an amount of redundancy pay by virtue of s.119 of the Act and either the employer obtains ‘other acceptable employment’ for the employee, or the employer is unable to pay that amount of redundancy pay.

[21] To address the interaction between the model term and s.120 we proposed that:

‘The provisional default term will be qualified so that, where an employer has made an application under s.120, the Commission will be able to make an order delaying the requirement to pay redundancy pay to which the employee is entitled under … s.119, until a specified day after the Commission has determined the application. It is envisaged that, consistent with the usual payment requirement under the default term, such orders would generally require payment of the amount (if any) to which the employee is entitled in accordance with the Commission’s decision on the application no later than seven days after the date of that decision.’ 13

[22] The second proposed qualification related to the interaction between the proposed model term and s.117(2)(b) of the Act. Section 117(2) states:

‘(2) The employer must not terminate the employee's employment unless:

(a) the time between giving the notice and the day of the termination is at least the period (the minimum period of notice) worked out under subsection (3); or

(b) the employer has paid to the employee (or to another person on the employee's behalf) payment in lieu of notice of at least the amount the employer would have been liable to pay to the employee (or to another person on the employee's behalf) at the full rate of pay for the hours the employee would have worked had the employment continued until the end of the minimum period of notice.’

[23] To address this issue we proposed that:

‘the provisional default term should be amended to make clear that it is subject to s.117(2)(b) and to include a note drawing attention to that statutory provision. The note will be phrased so as to avoid the need to form a concluded view about the proper construction of s.117(2)(b).’ 14

[24] Finally, we also proposed that the provisional model term be amended to make it clear that employees are entitled to be paid wages in respect of any incomplete pay period worked up until the end of the employee’s employment. 15

[25] The revised provisional model term was as follows:

Payment on termination of employment

(a) Subject to paragraph (b), the employer must pay an employee no later than 7 days after the employee’s last day of employment:

(i) the employee’s wages for any complete or incomplete pay period up to the end of the employee’s last day of employment; and

(ii) all other amounts that are due to the employee under this award and the NES.

(b) The requirement to pay an employee no later than 7 days after the employee’s last day of employment is subject to s.117(2) of the Act and to any order of the Commission in relation to an application under s.120 of the Act.

Note 1: Section 117(2) of the Act provides that an employer must not terminate an employee’s employment unless the employer has given the employee the required minimum period of notice or “has paid” to the employee payment instead of giving notice.

Note 2: Section 120 of the Act provides that in some circumstances an employer can apply to the Commission to reduce the amount of redundancy pay an employee is entitled to under the NES. In dealing with an application, the Commission could make an order delaying the requirement to make payment until after the Commission makes a decision on the application.

[26] The wording of paragraph (a)(i) of the revised provisional model term was intended to ensure that wages accrue under the award in respect of any incomplete pay period worked by the employee (for example, if the employee’s employment ends after the employee has worked only two days of a one week pay period).

[27] As mentioned earlier, we established a timeframe within which interested parties could make submissions in respect of the revised provisional model term. A revised summary of submissions was published on 30 November 2017. We briefly summarise the submissions before turning to specific issues raised.

[28] The ACTU supports the development of a model term dealing with:

•  the timing of termination payments; and

•  the amounts to be paid both under the award and the NES when employment is terminated.

[29] The ACTU also supports such a model term being considered for insertion into the 86 modern awards that are currently silent in respect of these issues. As to the 36 modern awards which do deal with these issues (albeit to vary extents) the ACTU supports those clauses being varied for clarity and to correct any errors or uncertainty; but notes that a case by case assessment is required.

[30] In its submission of 30 October 2017 the ACTU proposed an alternate model term, as set out below:

‘Y Payment on termination of employment

Y.1 Where the termination is at the initiative of the employer, the employer must pay the employee:

(a) the employee’s accrued wages for any complete or incomplete pay period up to the day on which the employee’s employment terminates; and

(b) all other amounts that are due to the employee under the award and the NES

No later than 3 days after the day on which the employee’s employment terminates, unless earlier payment is required by law.

Note 1: Section 117(2) of the Act deals with payment in lieu of Notice and requires earlier payment.

Note 2: Laws other than the Act, for example some laws governing long service leave entitlements, may require earlier payment.

Note 3: If the Commission grants an application under section 120 of the Act, it may determine a different date for payment of any redundancy entitlement. A dispute about how section 120 might apply to a particular redundancy situation may be dealt with under clause [Z] of this award.

Y.2 Where the termination is at the initiative of the employee, and the employee has given notice in accordance with this Award, the employer must pay the employee:

(a) the employee’s accrued wages for any complete or incomplete pay period up to

the day on which the employee’s employment terminates; and

(b) all other amounts that are due to the employee under the award and the NES

No later than 3 days after the day on which the employee’s employment terminates, unless earlier payment is required by law.

Note: Laws other than the Act, for example some laws governing long service leave entitlements, may require earlier payment.

Y.3 Where the termination is at the initiative of the employee, and the employee has not given notice in accordance with this Award, the employer must pay the employee:

(a) the employee’s accrued wages for any complete or incomplete pay period up to

the day on which the employee’s employment terminates; and

(b) all other amounts that are due to the employee under the award and the NES

No later than 7 days after the day on which the employee’s employment terminates, unless earlier payment is required by law.

Note: Laws other than the Act, for example some laws governing long service leave entitlements, may require earlier payment.’

[31] The submissions put by individual unions generally supported the position advanced by the ACTU; and the ACTU supported the reasons advanced by various unions as to why a default 7 day waiting period would occasion hardship and represent a derogation of entitlements for many workers.

[32] The various employer parties broadly supported the inclusion of the Commission’s revised provisional model term in all modern awards, subject to appropriate award-specific modifications. Some employer parties proposed certain amendments to the content of the model term.

[33] It is convenient to deal with the various proposals to vary the revised provisional model term, thematically.

(i) Time period within which termination payments are to be made

[34] The revised provisional model term provides that termination payments are to be paid to the employee ‘no later than 7 days after the employee’s last day of employment’. We deal later with the expression ‘after the employee’s last day of employment’ (see [58]-[61]); we deal first with the period within which such payments are to be made.

[35] ABI seeks a variation to the time period within which termination payments are to be made; it contends that such payments should be made in accordance with each employee’s pay cycle. The AHA 16 and NatRoad17 advance a submission in similar terms. In support of its proposal ABI submits that:

‘employees subject to monthly or fortnightly payment arrangements are aware of, and accustomed to, when they are going to be paid. In these circumstances there is no prejudice caused to the employee, nor any additional ‘wait’ associated with this process compared to any other pay cycle.’ 18

[36] We are not prepared to adopt the position advanced by ABI and others. If termination payments were to be made in accordance with each employee’s pay cycle then it is conceivable that some employees may have to wait for up to a month before they receive their termination entitlements. As we observed in our December 2016 decision:

‘Such a delay may impact on the capacity for employees whose employment has been terminated to access Newstart or other social security benefits.’ 19

[37] As noted above, the ACTU’s alternate model term provides that, except in circumstances where a termination is at the initiative of the employee and the employee does not give the prescribed notice, termination payments are to be made no later than 3 days after the day on which the employee’s employment terminates, unless earlier payment is required by law.

[38] The SDA supports the ACTU’s position and submits:

‘that its members are typically low paid and largely part time and casual. Workers in such circumstances are often in a position where they do not have financial reserves. In other words such workers often rely on prompt payment to meet their financial obligations.

Where notice of termination is given, an employer has the opportunity to plan for payment of outstanding entitlements. In these circumstances 7 days is excessive. In addition the SDA emphasises the point made by the ACTU, that any termination under s.117(2) is unlawful unless the employer has paid notice before the termination.’ 20

[39] The CFMEU-M&E submits that ‘with respect to payment upon termination of employment … where payment is not made upon the actual termination of employment it should be made within 72 hours of the actual termination.’ 21 The CFMEU-M&E submits that the views expressed in the December 2016 decision should be given further consideration:

‘In that regard the Full Bench noted that the administrative “costs are not likely to be substantial”. We agree. It is also our submission that the “impracticality” issues are mitigated by the operation of modern technology. As has been observed in earlier submissions, the implementation of modern computer based payroll systems, together with the availability of fast, efficient and cheap communication means such as mobile phones, internet, emails and text messaging have circumvented the problem of any difficulty or delay in obtaining the requisite information. Accordingly, we submit that the practicality and administrative costs are insufficient to warrant a delay in termination payment beyond 72 hours. For this reason, we seek that the Full Bench give further consideration to this term of the payment of wages upon termination of employment clause.’ 22 (Citations omitted)

[40] The TCFUA supports the position advanced by the ACTU and CFMEU-M&E that the model term provide an outer limit of 3 days and also opposes the adoption of a ‘blanket 7 day period’, on the basis that such a provision:

‘has capacity to cause financial hardship to employees in context where they are no longer employed with that employer. These detrimental impacts can include, for example, complications for an employee in accessing Centrelink benefits.’ 23

[41] United Voice advances a different proposition; it submits:

‘It would be problematic to give employers specific timeframes within which to delay the payment of termination entitlements after termination. The apparent accepted practise is that termination entitlements are paid at the time of termination or (reasonably) after. There will be occasions when the money is paid a few days late and in this respect the English formulation of the time being ‘before or after the termination’ provides a sensible and practical statement of an employer’s obligation to pay promptly. Employees are very reasonable people and there is no evidence that the courts are being inundated by civil proceedings alleging an employer has for some reason paid termination entitlements outside the strict letter of an award provision.

An unsubstantiated inconvenience alleged by the employer parties occasioned by having to make out of cycle payments is not a reason to alter the status quo.

Further, the requirement of paragraph 117(2)(b) of the Fair Work Act 2009 provides for a further difficulty for any award term that departs from what could be characterised as demanding the prompt payment of all termination entitlements.’ 24

[42] In its subsequent submission United Voice submits:

‘In relation to the provisional payment on termination model term we query the utility of such a term. Particularly with longstanding employees where state and territory based long service leave entitlements and payments in lieu of notice will have to be paid, there will be limited possibility of the term creating a single pay day for termination entitlements. There is significant benefit in having a well signposted single cut-off point where an employer should pay to an employee what is owed. We maintain our position that prompt payment after termination should be the modern award standard.

In relation to termination entitlements, working out what precisely has been paid is often difficult and made more difficult when termination entitlements are made in a serious [sic] of separate payments sometimes significantly after the end of employment. In terms of providing a useful standard setting provision, the model term will have some difficulty doing this. Conscientious employers will be aware that they can legally make at least 2 payments in relation to many termination [sic] and those that pay in dribs and drabs will no doubt continue to do so as there is no clear provision mandating one payment at any particular time before or after the end of the employment relationship.’ 25

[43] It is convenient to deal first with the proposals advanced by United Voice. As noted above, United Voice contends that ‘prompt payment after termination should be the modern award standard’ and, based on various English authorities, submits that the formulation ‘before or after termination’ provides ‘a sensible and practical statement of an employer’s obligation to pay promptly.’

[44] We reject the proposals advanced by United Voice.

[45] Contrary to the submission put, a requirement to pay termination payments ‘before or after termination’ is neither sensible nor practical. Indeed such an obligation is so vague and uncertain as to be meaningless; it places no temporal limit on when such payments are to be made. An employer could pay an employee’s termination payments one year ‘after termination’ and still comply with United Voice’s proposed formulation. Such an outcome is plainly inconsistent with the provision of ‘a fair and relevant minimum safety net’, as required by the modern awards objective. United Voice’s other proposed formulation, ‘prompt payment after termination’, suffers from a similar vice — it lacks certainty.

[46] As to the proposition advanced by the ACTU (and others) that termination payments be made ‘no later than 3 days’ after termination, we are not persuaded to depart from the 7 day period specified in the revised provisional model term. As we observed in the December 2016 decision:

‘We think an appropriate balance between the various considerations is for the model term to provide that all unpaid wages and all other amounts due to an employee under the modern award and the NES are to be paid ‘no later than 7 days after the employee’s last day of employment’.

Such a provision ensures that employees receive their termination payments in a timely way while providing employers with sufficient time to calculate and pay the sums due. Such a term would address the ‘impracticability’ arguments advanced on behalf of the employers. We accept that we may impose some ‘time costs’ associated with obtaining information about the hours worked in the prior pay period and may require ‘out of cycle’ EFT transactions in some instances, but the costs involved are unlikely to be substantial.’ 26

[47] Nothing advanced in the subsequent submissions has persuaded us to depart from the position set out above.

[48] We particularly wish to comment on the ACTU’s contention that a 7 day default period would represent a derogation of entitlements for many workers. In considering the position put it needs to be born in mind that we are presently only considering the content of a model term. Further, as will become apparent, at this stage we are only proposing to insert the finalised model term into the 86 modern awards which currently make no provision at all in respect of the time period within which termination payments are to be made. We deal later with the review of the other 36 modern awards which currently contain terms that deal with termination payments. In respect of those 86 modern awards with no relevant provision at present, we reject the proposition that requiring termination payments to be made within 7 days of termination constitutes a derogation of the entitlements of the workers covered by those awards. Contrary to the submission put, the insertion of the model term into these 86 modern awards will enhance employee entitlements.

(ii) Scope of termination payments

[49] Ai Group contends that the model term should be amended to clarify that it only regulates the payment of amounts payable under the award or the NES. In other words the model term should not apply to over award arrangements. In support of this contention Ai Group submits:

‘Employers and employees should be free to determine arrangements governing the payment for any element of an individual’s wages that exceeds entitlements, set by the award. There are many legitimate reasons why over-award payments may not be provided until a point in time beyond 7 days from the date of termination. It is not necessary for a minimum safety net of terms and conditions to regulate such matters.’ 27

[50] ABI makes a similar point and submits:

‘Given that the modern awards objective is focused upon the creation of a ‘fair and relevant minimum safety net of terms and conditions’, it is respectfully submitted that modern awards should only regulate the frequency of payments arising from the minimum safety net itself.

That is, over-award payments need not (and should not) be subject to the model term regarding payment of wages. This is because over-award payments do not form part of the minimum safety net.’ 28

[51] Consistent with the views expressed in the Plain language re-drafting – Standard clauses decision 29 we will amend paragraph (a)(i) of the revised model term to insert the words ‘under this award’ after ‘wages’.

(iii) Interaction with other award terms

[52] Ai Group drew attention to the potential tension between the provisional model term and some existing award terms which enable an employer to withhold certain termination payments owed to an employee in circumstances where the employee initiates the termination of their employment, but fails to provide the requested period of notice; or where the employee has been granted leave in advance. 30

[53] A model term dealing with annual leave in advance was finalised in the May 2016 4 yearly review of modern awards – Annual leave decision. 31 The model term provides that if, on the termination of employment, an employee has still not accrued an entitlement to the period of paid annual leave which has been taken in advance, then:

‘the employer may deduct from any money due to the employee on termination an amount equal to the amount already paid to the employee in respect of that annual leave taken.’ 32

[54] Some 122 modern awards have been varied to insert the annual leave in advance model term.

[55] We also note that a number of modern awards currently contain a termination of employment term which sets out the period of notice of termination required to be given by an employee. The relevant term also provides that if an employee fails to give the requisite notice then the employer may deduct from any money due to the employee on termination an amount not exceeding the amount that the employee would have been paid in respect of the period of notice not given. These terms are currently being reviewed and were the subject of consideration in the 4 yearly review of modern awards – Plain language redrafting – Standard clauses decision 33 issued on 13 June 2018.

[56] In addition to the provision for deductions under such award terms, s.324 of the Act permits certain deductions to be made from an amount payable to an employee in relation to the performance of work in accordance with s.323(1).

[57] The model term we are finalising in this decision is not intended to override existing award terms or provisions of the Act that permit employers to make deductions from termination payments in certain circumstances. Accordingly, we will add a new paragraph to the model term to make it clear that the requirement to pay wages and other amounts under paragraph (a) of the model term is subject to the employer making deductions authorised by the award or the Act.

(iv) The seven day period

[58] We now turn to the ‘event’ from which the 7 day period commences. The revised provisional model term provides that termination payments are to be paid no later than 7 days ‘after the employee’s last day of employment’.

[59] In a joint submission Mark Irving 34 and Andrew Stewart35 (Irving and Stewart) comment on the use of the expression ‘the employee’s last day of employment’ in the revised provisional model term and submit:

‘The context suggests that it is meant to signify the date on which the relevant employment terminates, in a legal sense. But we think that some readers might also take it to mean the last day the employee is at work, even though for a further period they still (for example) have leave to take, or are not required to attend work. We suggest that it would be safer to refer instead to ‘the day on which the employee’s employment is terminated’ (first instance) or ‘the day of the termination’ (second and third instances). This has the virtue of aligning the clause with the language used by s 117 of the Fair Work Act.’ 36

[60] Referring to the amendment suggest by Irving and Stewart, the ACTU submits:

‘We also consider that the references to “the employee’s last day of employment” could lead to errors and that an expression such as “the day on which the employee’s employment terminates” is less likely to.’ 37

[61] We note that the present wording was intended to avoid the possibility of a phrase like ‘the day on which the employee’s employment is terminated’ being misunderstood as meaning the day on which an employee is given notice of termination of employment. However, we accept that the risk of misunderstanding may be minimised if the wording is more closely aligned with that in the Act. We will amend the model term accordingly.

[62] The CFMEU-FFPD submits that, for clarity, any model term referring to a timeframe ought to refer to calendar days. 38

[63] We are not persuaded that it is necessary to amend the revised provisional model term in the manner proposed. The reference to 7 days in the model term is plainly a reference to 7 calendar days. While the Acts Interpretation Act 1901 (Cth) does not define a ‘day’, it does define a ‘business day’, as ‘a day that is not a Saturday, a Sunday or a public holiday in the place concerned’ (at s.2B). Further, at common law a reference to a day is understood to refer to a calendar day. 39

[64] When used in the Act a ‘day’ means a calendar day 40 and where a day is intended to be a business day the expression ‘business day’ is used.41 We also observe that using the expression ‘calendar days’ in the model term may have unintended consequences. Modern awards frequently refer to a specified time period, for example the period of notice required for a roster change. Such terms often refer to the time period in terms of a period of ‘days’. Using the expressions ‘calendar days’ and ‘days’ in the same instrument may give rise to confusion, as it may be thought that they refer to different concepts – ie that a reference to a ‘day’ means something different from a ‘calendar day’.

(v) Accrual of wages

[65] Irving and Stewart propose a ‘default clause’ to be included in modern awards that specifies the basis on which wages accrue. In that context they also propose that paragraph (a)(i) of the model term be amended to refer ‘accrued wages’ and that clause x.1(a)(i) of the provisional ‘Payment of wages and other amounts’ model term (see the December 2016 decision at [34]) be amended similarly. 42

[66] We propose to deal with the issue of accrual of wages in the course of finalising the provisional ‘Payment of wages and other amounts’ model term. We will consider whether to insert ‘accrued’ into paragraph (a)(i) of the model term at that time.

[67] As related in the December 2016 decision:

‘the wording of paragraph [(a)(i)] of the provisional model ‘payment on termination of employment’ model term … is intended to ensure that wages accrue under the award in respect of any incomplete pay period worked by the employee prior to the employee’s employment ending. Again, whether provision to this effect is necessary, may depend upon the wording of the minimum wage provisions of the particular award concerned. This wording does not seek to clarify whether an employee is to be paid wages for a part of a day or a part of an hour worked in an incomplete pay period.’ 43

[68] The HIA raised a concern that the expression ‘complete or incomplete pay period’ in paragraph (a)(i) of the model term ‘may cause confusion’, 44 but offered no alternative wording because the awards in which it has an interest generally calculate wages on an hourly basis and hence the issue is not a matter of significant concern. In all other respects the HIA supports the revised provisional model term.45

[69] No other party raised the issue identified by the HIA and we propose to retain the expression ‘complete or incomplete pay period’ for the time being. This will be revisited when we deal with the issue of accrual of wages.

(vi) Inclusion of Notes

[70] The revised provisional model term incorporates two ‘Notes’.

[71] The MBA submits that the inclusion of the proposed notes is unnecessary and proposes an alternate model term, as follows:

‘Payment on termination of employment

(a) Subject to notice being provided, the employer must pay an employee no later than 7 days after the employee’s last day of employment:

(i) The employee’s wages for any complete or incomplete pay period up to the end of the employee’s last day of employment; and

(ii) All other amounts that are due to the employee under this award and the NES’. 46

[72] No other party supported the proposition that the inclusion of notes in the model term was unnecessary. As discussed below, the present notes will be amended and added to in light of various issues raised by the parties. We are satisfied that the inclusion of these notes in the model term is necessary to achieve the modern awards objective.

[73] Further, we do not support the inclusion of the words ‘subject to notice being provided’ at the commencement of paragraph (a) of the MBA’s proposed model term. The intention of this proviso is not immediately apparent. However, we think it likely that the intent of the MBA’s proviso is to relieve an employer of the requirement to pay termination payments within the specified period in the event that the employee resigns their employment and does not give the requisite notice of termination.

[74] As noted earlier, the ‘Plain language redrafting’ Full Bench is currently considering award terms providing for deductions from termination payments where employees fail to give the requisite notice. 47 As also related earlier, in our December 2016 decision we confirmed our provisional view that to require unpaid wages and other amounts due to an employee to be paid no later than 7 days after termination of employment, struck an appropriate balance between the issues that had been raised on behalf of employees and those raised on behalf of employers. Those issues included the prospect of the 7 day payment period applying to cases of summary dismissal and where an employee resigns their employment without giving notice.48 Again, we are not persuaded to depart from the 7 day period specified in the revised provisional model term.

(vii) Interaction with s.117(2) of the Act

[75] Paragraph (b) of the revised provisional model term qualifies the requirement under paragraph (a) to pay ‘no later than 7 days after the employee’s last day of employment’, by reference to s.117(2) of the Act:

(b) The requirement to pay an employee no later than 7 days after the employee’s last day of employment is subject to s.117(2) of the Act …

[76] In addition Note 1 provides:

Note 1: Section 117(2) of the Act provides that an employer must not terminate an employee’s employment unless the employer has given the employee the required minimum period of notice or “has paid” to the employee payment instead of giving notice.

[77] On a literal reading, s.117(2)(b) prohibits an employer terminating the employment of an employee with payment in lieu of notice, without making the payment in lieu, before, or at the time of, termination of employment. The background to the reference to s.117(2) in paragraph (b) of the model term and Note 1 was set out at paragraphs [105] to [115] of our December 2016 decision. This included:

‘[111] Ai Group and ABI support the inclusion of a note to ensure that employers are not inadvertently misled into a contravention of s.117(2)(b). ABI proposed a note in the following terms:

‘Note: Employers who do not provide written notice of termination but instead provide a payment in lieu of notice must comply with s.117(2)(b) of the Fair Work Act, which requires payments in lieu of notice to be made at or before the time of termination.’

[112] ABI submits that such a note will serve as an important contextual guide which confirms that the provisional default term is not intended to operate in a manner inconsistent with s.117(2)(b) and will ensure no person is misled as to their payment obligations in respect of the termination of an employee’s employment.

[113] Ai Group expressed some reservations about the breadth of the note proposed by ABI. Others expressed reservations about the inclusion of a note, in whatever form.

[114] Of course, s.117(2)(b) only applies to payments in lieu of notice and hence it regulates a narrower range of entitlements than those covered by the default term. A model term would also cover, for example, payments for accrued leave, wages for time actually worked and redundancy pay.

[115] We think the provisional default term should be amended to make clear that it is subject to s.117(2)(b) and to include a note drawing attention to that statutory provision. The note will be phrased so as to avoid the need to form a concluded view about the proper construction of s.117(2)(b).’ 49

[78] MBA submits that there should be no reference to ss.117(2)(b) and 120 either in notes or within the substantive wording of the model term. Amongst others reasons, MBA suggests that the benefit derived from drawing attention to these provisions is outweighed by the complexity this adds to the model term. 50 We have earlier rejected the MBA’s view that it is unnecessary to include notes in relation to ss.117(2)(b) and 120 in the model term.

[79] In respect of the wording of Note 1, NRA submits that the quotation marks encompassing the words ‘has paid’ can be deleted, for the following reasons:

‘This apparent emphasis on the expression “has paid” would tend towards giving these words greater emphasis in the model provision than is given to them under the Fair Work Act 2009…

The additional emphasis placed on the past-tense expression “has paid” would seem to indicate that notwithstanding a dismissal ‘taking effect’ within the meaning of the authorities, the employment relationship is in fact ongoing until the employee has received their final pay in lieu of notice. This therefore raises the question whether a dismissal has ‘taken effect’ if those entitlements are not yet “paid”.’ 51

[80] The quotation marks around ‘has paid’ in Note 1 are intended to signify that this expression comes from s.117(2). We do not propose to make the change sought by the NRA.

[81] The ACTU’s proposed alternate model term includes a different formulation of Note 1, in the following terms:

‘Note 1: Section 117(2) of the Act deals with payment in lieu of Notice and requires earlier payment.’ (Emphasis added)

[82] The formulation proposed expresses a definitive view as to the proper construction of the obligation in s.117(2)(b).

[83] The proper construction of s.117(2)(b) is yet to be conclusively determined by a court and accordingly in the December 2016 decision we indicated that the note would be phrased so as to avoid the need to express a concluded view about this issue. We see no need to alter the wording of Note 1 in light of the submissions made.

[84] However on further consideration we have come to the view that the benefit in including reference to s.117(2) in paragraph (b) of the revised provisional model term, is outweighed by the complexity it adds to the model term. The requirement under paragraph (a) of the model term to pay ‘no later than 7 days after’ termination does not conflict with any requirement under s.117(2) to make payment in lieu of notice before or at the time of termination. Accordingly, it is not necessary to express the payment requirement in paragraph (a) as being ‘subject to’ s.117(2). The concern that employers may inadvertently be misled into a contravention of s.117(2)(b) is adequately addressed by the inclusion of Note 1 in the model term.

(vii) Interaction with s.119 and s.120 of the Act

[85] Paragraph (b) of the revised provisional model term also qualifies the requirement under paragraph (a) to pay ‘no later than 7 days after the employee’s last day of employment’, by reference to orders that may be made ‘in relation to’ an application under s.120 of the Act:

(b) The requirement to pay an employee no later than 7 days after the employee’s last day of employment is subject to … any order of the Commission in relation to an application under s.120 of the Act.

[86] Further, Note 2 provides:

Note 2: Section 120 of the Act provides that in some circumstances an employer can apply to the Commission to reduce the amount of redundancy pay an employee is entitled to under the NES. In dealing with an application, the Commission could make an order delaying the requirement to make payment until after the Commission makes a decision on the application.

[87] The background to the reference to s.120 in paragraph (b) and Note 2 is set out at paragraphs [102] to [104] of our December 2016 decision:

‘[102] Section 120 of the [Act] provides that in some circumstances an employer can apply to the Commission for a determination that the amount of redundancy pay to which an employee is entitled under the NES is reduced to a specified amount (which may be nil). The relevant circumstances are that an employee is entitled to be paid an amount of redundancy pay by the employer because of s.119 and either the employer obtains ‘other acceptable employment’ for the employee or the employer is unable to pay that amount of redundancy pay.

[103] Absent a qualification to the proposed requirement to make payment ‘no later than 7 days after the employee’s last day of employment’, if an application is made under s.120 and the application is not determined by the Commission and any reduced amount of redundancy pay paid by the employer by the end of that time period, the employer will breach the award.

[104] The provisional default term will be qualified so that, where an employer has made an application under s.120, the Commission will be able to make an order delaying the requirement to pay redundancy pay to which the employee is entitled under … s.119, until a specified day after the Commission has determined the application. It is envisaged that, consistent with the usual payment requirement under the default term, such orders would generally require payment of the amount (if any) to which the employee is entitled in accordance with the Commission’s decision on the application no later than seven days after the date of that decision.’

[88] Section 119 of the Act relevantly provides:

‘119 Redundancy pay

Entitlement to redundancy pay

(1) An employee is entitled to be paid redundancy pay by the employer if the employee’s employment is terminated:

(a) at the employer’s initiative because the employer no longer requires the job done by the employee to be done by anyone, except where this is due to the ordinary and customary turnover of labour; or

(b) because of the insolvency or bankruptcy of the employer.

Note: Sections 121, 122 and 123 describe situations in which the employee does not have this entitlement.

Amount of redundancy pay

(2) The amount of the redundancy pay equals the total amount payable to the employee for the redundancy pay period worked out using the following table at the employee’s base rate of pay for his or her ordinary hours of work …’

[89] Section 120 of the Act relevantly provides:

‘120 Variation of redundancy pay for other employment or incapacity to pay

(1) This section applies if:

(a) an employee is entitled to be paid an amount of redundancy pay by the employer because of section 119; and

(b) the employer:

(i) obtains other acceptable employment for the employee; or

(ii) cannot pay the amount.

(2) On application by the employer, the FWC may determine that the amount of redundancy pay is reduced to a specified amount (which may be nil) that the FWC considers appropriate.

(3) The amount of redundancy pay to which the employee is entitled under section 119 is the reduced amount specified in the determination.’

[90] Section 119(1) provides that an ‘employee is entitled to be paid redundancy pay by the employer’ (emphasis added) in the circumstances provided for in s.119(1). The ACTU contends that s.119 requires payment for redundancy pay to be made at or before the time an employee’s employment is terminated in the circumstances provided for. 52 Ai Group disagrees and submits that s.119(1) provides for the accrual of an entitlement to redundancy pay upon termination, but does not impose any requirement upon an employer as to when payment is to be made.53

[91] Further to its reading of s.119, the ACTU contends that the Commission may include a date for later payment in an order it makes under s.120, on the basis that the conferral of statutory power carries with it such powers that are necessary for, or incidental to or consequential upon, the exercise of the power granted. 54 However, the ACTU submits that such incidental powers do not extend to a power to delay the requirement to make payment until after the Commission makes a decision on the application, as the ACTU understands Note 2 of the revised provisional model term to suggest. The ACTU allows for one exception to this general proposition — if such a delay was effected by an interim order that reduced the redundancy payment to nil subject to further order of the Commission.55

[92] The ACTU also contends that an application can only be made under s.120 if an employee is already ‘entitled to be paid an amount of redundancy pay by the employer because of s.119’ (s.120(1)(a)). 56 Section 119(1) provides that such an entitlement only arises ‘if the employee’s employment is terminated’ (emphasis added). It follows on the ACTU’s reading that an application can only be made to the Commission under s.120 after termination of employment and so after a requirement to make immediate payment of redundancy pay has arisen under s.119. The ACTU suggests that such a construction does not visit any particular hardship on an employer, as the timing of the redundancy ‘decision’ is a matter within the employer’s control and is typically carefully considered.57

[93] In light of its reading of ss.119 and 120, the ACTU submits that if there is to be a note in the model term addressing the prospect of an employer seeking a reduction in redundancy pay under s.120, then:

‘it may be of greater utility to draw attention to the capacity to have the Commission deal with a dispute about the NES – and to do so pre-emptively, in circumstances where the employer is considering making a section 120 application. Alternately, this option might be discussed in annotated explanatory documents of the type contemplated by the Full Bench at [25] – [36] of [2014] FWCFB 9412.’ 58

[94] The ACTU proposes a note in the following terms:

‘Note 3: If the Commission grants an application under section 120 of the Act, it may determine a different date for payment of any redundancy entitlement. A dispute about how section 120 might apply to a particular redundancy situation may be dealt with under clause [Z] of this award.’ 59

[95] In its submissions of 23 December 2016, Ai Group submits that it is not clear whether the Commission has the power under s.120 to make an order of the type contemplated by the provisional model term. Further, even if the Commission has the requisite power, Ai Group submits that the granting of such an order should not be a matter at the discretion of an individual member of the Commission. 60

[96] Ai Group further submits in respect of applications under s.120:

‘There is no limitation on the timeframe for making such an application and awards should not operate to effectively create one. Although we appreciate the imperative for employees to receive redundancy pay in a timely manner, this must be weighed against the need not to undermine the policy objective of s.120.’ 61

[97] Ai Group proposes that relief from the requirement to make termination payments within 7 days should be automatic in the event that a s.120 application is made. Ai Group proposes the following alternate clause:

‘The requirement to pay an employee no later than 7 days after the employee’s last day of employment will not apply, and will be deemed to have never applied, if an employer makes an application under s.120 of the Act to have the amount of redundancy payable to the employee reduced. In such circumstances any redundancy pay will be payable from a date determined by the Commission, provided that this date is not less than 7 days from the date of the Commission’s decision in relation to the employer’s application.’ 62

[98] The NFF ‘broadly supports’ Ai Group’s submissions. 63

[99] In its submissions of 9 February 2017, Ai Group further submits that if its interpretation of s.119 is wrong, then the Commission could nevertheless include an award term pursuant to s.121(2) which would alter the application of s.119 to ensure consistency with the model term. 64 Section 121(2) provides that a ‘modern award may include a term specifying … situations in which section 119 does not apply to the termination of an employee’s employment.’ In light of these further considerations Ai Group also suggests that its proposed alternate clause (reproduced above) may require slight amendment to align with the requirements of s.120.65

[100] At the very least, Ai Group submits, any new award provision ought not impose an obligation (as to the timing of redundancy payments) that would be breached in circumstances where an employer had made an application under s.120. 66 We concur with that submission. As discussed below, we will amend the model term to make it clearer that the Commission can grant relief from the requirement under the model term to make payment not later than 7 days after termination, in the event that an employer makes an application under s.120.

[101] The CFMEU-FFPD objects to the inclusion of any reference to s.120 in the model term and submits:

‘We are concerned that explicit reference to s 120 may incentivize s 120 applications and provide rogue employer [sic] with a clear path to delay or avoid their NES obligations. Even if an employer makes a section 120 application, there is no guarantee that the FWC will make any order delaying the requirement to make payment. There is also a question of what remaining entitlements would still be payable within the relevant (7 days) timeframe if the employer made a section 120 application. It is not clear whether the FWC could make orders effectively staying the payment of all outstanding NES/Award entitlements on the basis that one NES entitlement may not ultimately be payable in full or at all.’ 67

[102] The TCFUA advances a similar point:

‘The TCFUA is generally concerned that the inclusion of Note 2 in the provisional model term may act to encourage or incentivise non-genuine, s.120 applications by employers in order to delay the required payment of redundancy pay to terminated employees. An application under s.120 may not be heard and determined by the Commission for many months, leaving the affected employee no access to the redundancy entitlement for a significant period of time. In circumstances where the Commission found against an applicant employer in an s.120 application, an employer retains the obligation to pay the redundancy pay under s119 but has effectively subverted the beneficial obligation regarding timely payment. There are few negative scenarios for an employer in such a scenario. The AI Group’s proposal would exacerbate this risk even further and should be rejected on that basis.’ 68

[103] In our December 2016 decision we suggested that s.119(1) is one of a number of provisions that specify when entitlements to payment under the NES accrue:

‘[124] The [Act] does specify when various payments under the NES accrue. For example, the entitlement under the NES to payment in lieu of untaken paid annual leave and to redundancy pay is expressed to arise upon termination of employment (see ss.90(2) and 119(1)). As discussed … above, it seems that the [Act] requires payment in lieu of notice under the NES to be made before or at the time of termination of employment (s.117(2)) … Entitlement under the NES to payment for paid annual leave or for paid personal/carer’s leave, is expressed to arise when an employee takes a period of such leave (ss.90(1) and 99) and similarly with compassionate leave (s.106), absence on jury service (s.111(2)) and absence on a public holiday (s.116).’ 69

[104] As with s.117(2)(b), the proper construction of s.119(1) is yet to be conclusively determined by a court and it is not necessary for us to express a concluded view on its operation for present purposes. However, we are not persuaded by the ACTU’s submissions that s.119(1) of the Act requires payment for redundancy pay to be made at or before the time an employee’s employment is terminated. Section 119(1) provides that an ‘employee is entitled to be paid redundancy pay by the employer if the employee’s employment is terminated’ in the prescribed circumstances (emphasis added). On an ordinary reading this wording seems to denote an entitlement to payment arising if the specified events occur, but not when that payment is to be made. This can be contrasted with s.117(2) which requires, if an employer has not given an employee notice of termination, that ‘the employer has paid to the employee … payment in lieu of notice’ (emphasis added). As discussed earlier, on a literal reading that wording requires payment in lieu to be made at or before the time of termination of employment.

[105] The wording of s.119(1) can also be compared to the wording ‘the employer must pay the employee’ (emphasis added) which is used in the various provisions dealing with payment for leave that are referred to at paragraph [124] of the December 2016 decision (above). If, contrary to our view, that wording was read as requiring payment to be made when the specified events occur, then the NES would require an employer to pay an employee for annual leave, paid personal/carer’s leave and compassionate leave at the time the leave is taken, and to pay an employee in respect of an absence on jury service or a public holiday at the time of the absence. The context in which the phrase ‘entitled to be paid’ in s.119(1) is used in various other provisions of the Act and the Fair Work Regulations 2009 also does not provide support for the ACTU’s reading. 70

[106] Further, we consider that the statutory purpose would be better served if s.119(1) is read so as to provide an employer with an opportunity, after accrual of an entitlement to redundancy pay and before the time when payment must be made, to make an application under s.120.

[107] We reject Ai Group’s proposal that relief from the requirement to make termination payments within 7 days, should be automatic in the event that an employer makes an application under s.120. Ai Group’s alternative clause could be used to effectively remove any limit under the model term on the period for which an employer could withhold payment of redundancy entitlements. Under the proposed clause an employer could simply refuse to pay any redundancy entitlements and, if pressed to do so, then make a s.120 application, at which point the 7 day payment requirement in the model term is ‘deemed to have never applied’. As discussed in the December 2016 decision, if s.323 of the Act does not encompass all termination payments, there would seem to be a legislative gap — that is, there is no specified period within which certain termination payments are to be made. 71 Further, even if s.323 does regulate the period within which redundancy payments must be made, that period may be up to a month after an employee’s employment is terminated. As we have previously stated, we think an appropriate balance between the various considerations is for the model term to provide that all amounts due to an employee under the modern award and the NES are to be paid no later than 7 days after termination.72

[108] We fail to see how Ai Group’s proposal is consistent with its stated appreciation of ‘the imperative for employees to receive redundancy pay in a timely manner’. 73

[109] As related in the December 2016 decision, Note 2 was intended only to alert employers and employees that an employer could make an application under s.120, and if an employer did so, that the Commission could make an order delaying the requirement under paragraph (a) of the revised provisional model term to make payment of redundancy pay within 7 days after termination. Contrary to Ai Group’s submissions, such an order would not involve any exercise of powers under s.120 and nor would it involve any variation of the model term. 74 Paragraph (b) of the model term (at [85] above) provides for such an order to be made.

[110] Contrary to the submissions of the CFMEU-FFPD and TCFUA, we continue to be of the view that it is necessary for the model term to alert employers and employees to the possibility of applications under s.120, and for the model term to provide for relief from the requirement it imposes to pay redundancy pay accrued under s.119(1) ‘no later than 7 days after’ termination of employment in the event that an application is made under s.120.

[111] At present, the requirement under paragraph (a) of the model term to make payment no later than 7 days after termination is qualified by providing in paragraph (b) that it is subject to ‘any order of the Commission in relation to an application under s.120’. Instead of that approach, the present paragraph (b) will be omitted 75 and a new paragraph (b) will provide that the requirement to pay wages and other amounts under paragraph (a) is ‘subject to further order of the Commission’. We consider that this will reduce the complexity of the model term and also provide some capacity for the Commission to provide relief from unintended consequences of the model term. New text will be added to Note 2 of the model term to draw attention to the capacity of the Commission to make an order relieving an employer of the payment requirement under the model term and the reference to s.120 in the note will be adjusted accordingly.

[112] The new provision for ‘further order of the Commission’ could be utilised to provide relief from the requirement to pay redundancy payments no later than 7 days after termination if an employer makes an application under s.120 of the Act, but it will not be confined to that circumstance. The new provision will enable the Commission to provide relief from the requirement under the model term to make particular payments within the 7 day period if this is warranted in the circumstances concerned. That said, we emphasise our intention that such relief will only be granted where there are compelling reasons to do so. We also note that the Commission has no capacity to provide relief from the requirement under s.323 of the Act to pay accrued amounts ‘at least monthly’.

(viii) Interaction with long service leave payment requirements

[113] Finally, the ACTU’s alternate model term incorporates an additional note, in the following terms:

‘Note 2: Laws other than the Act, for example, some laws governing long service leave entitlements, may require earlier payment.’

[114] The CFMEU-FFPD refers in its submissions to State legislation that requires payment of long service leave balances upon termination. 76

[115] The Long Service Leave Act 1992 (Vic) provides that if the employment of an employee ends then the employer must pay the employee ‘the full amount of the employee’s long service leave entitlement’ ‘on that day’ (s.72(2)), and similarly the Long Service Leave Act 1987 (SA) provides that a payment in lieu of long service leave on the termination of a worker’s service ‘must be made to the worker immediately on the termination’ (s.8(4)(b)). The Long Service Leave Act 1955 (NSW) provides that where ‘the services of a worker are terminated’ the employer ‘shall forthwith pay to the worker in full’ an amount referable to the employee’s accrued long service leave entitlement (s.4(5)), and similarly the Long Service Leave Act 1976 (ACT) requires payment in lieu of long service leave to be made to an employee ‘as soon as practicable after termination of his or her employment’ (s.8(4)).

[116] The provisional model term is confined to payment of wages and otheramounts accrued under the award and the NES, and so does not apply to payments required under State long service leave legislation. Ai Group observes that pursuant to s.155, awards cannot include ‘terms dealing with long service leave.’ 77 However, conceivably, some employees may have long service leave entitlements under the long service leave NES (s.113 of the Act) that require payment to be made earlier than the maximum 7 days after termination of employment permitted by the provisional model term. Given that possibility and the earlier payment requirements under some State and Territory long service leave legislation, it is appropriate that the attention of employers be drawn to this potential liability by a note in the model term. We do not consider that such a note is prohibited by s.155.

[117] In our view the more specific such notes are, the more helpful they will be to the users of modern awards. As long service leave is the only example that has been raised of earlier payment requirements under other legislation, the new Note 3 in the model term will be confined to long service leave. If further examples are subsequently identified, including earlier payment requirements in particular modern awards, these can be picked-up in settling the award variation determinations dealing with the model term.

[118] We set out below (in mark-up) the various changes we have made to the revised provisional model term.

X Payment on termination of employment

(a) Subject to paragraph (b), Tthe employer must pay an employee no later than 7 days after the day on which the employee’s employment terminates employee’s last day of employment:

(i) the employee’s wages under this award for any complete or incomplete pay period up to the end of the day of the termination employee’s last day of employment; and

(ii) all other amounts that are due to the employee under this award and the NES.

(b) The requirement to pay an employee no later than 7 days after the employee’s last day of employment is subject to s.117(2) of the Act and to any order of the Commission in relation to an application under s.120 of the Act.

(b) The requirement to pay wages and other amounts under paragraph (a) is subject to further order of the Commission and the employer making deductions authorised by this award or the Act.

Note 1: Section 117(2) of the Act provides that an employer must not terminate an employee’s employment unless the employer has given the employee the required minimum period of notice or “has paid” to the employee payment instead of giving notice.

Note 2: Paragraph (b) allows the Commission to make an order delaying the requirement to make a payment under clause X. For example, the Commission could make an order delaying the requirement to pay redundancy pay if an employer makes an application under section 120 of the Act for the Commission to reduce the amount of redundancy pay an employee is entitled to under the NES. Section 120 of the Act provides that in some circumstances an employer can apply to the Commission to reduce the amount of redundancy pay an employee is entitled to under the NES. In dealing with an application, the Commission could make an order delaying the requirement to make payment until after the Commission makes a decision on the application.

Note 3: State and Territory long service leave laws or long service leave entitlements under s.113 of the Act, may require an employer to pay an employee for accrued long service leave on the day on which the employee’s employment terminates or shortly after.

[119] The final version of the model term is set out below.

X. Payment on termination of employment

(a) The employer must pay an employee no later than 7 days after the day on which the employee’s employment terminates:

(i) the employee’s wages under this award for any complete or incomplete pay period up to the end of the day of termination; and

(ii) all other amounts that are due to the employee under this award and the NES.

(b) The requirement to pay wages and other amounts under paragraph (a) is subject to further order of the Commission and the employer making deductions authorised by this award or the Act.

Note 1: Section 117(2) of the Act provides that an employer must not terminate an employee’s employment unless the employer has given the employee the required minimum period of notice or “has paid” to the employee payment instead of giving notice.

Note 2: Paragraph (b) allows the Commission to make an order delaying the requirement to make a payment under clause X. For example, the Commission could make an order delaying the requirement to pay redundancy pay if an employer makes an application under section 120 of the Act for the Commission to reduce the amount of redundancy pay an employee is entitled to under the NES.

Note 3: State and Territory long service leave laws or long service leave entitlements under s.113 of the Act, may require an employer to pay an employee for accrued long service leave on the day on which the employee’s employment terminates or shortly after.

3. Varying modern awards

3.1 General

[120] In this section we deal with the variation of modern awards consequent upon our finalisation of the model term in respect of ‘Payment on termination of employment’. It is necessary to first say something about the Commission’s task in the Review.

[121] Section 156 deals with the conduct of the Review and s.156(2) provides that the Commission must review all modern awards and may, among other things, make determinations varying modern awards. In this context ‘review’ has its ordinary and natural meaning of ‘survey, inspect, re-examine or look back upon’. 78 The discretion in s.156(2)(b)(i) to make determinations varying modern awards in a Review, is expressed in general, unqualified, terms.

[122] If a power to decide is conferred by a statute and the context (including the subject-matter to be decided) provides no positive indication of the considerations by reference to which a decision is to be made, a general discretion confined only by the scope and purposes of the legislation will ordinarily be implied. 79 However, a number of provisions of the Act which are relevant to the Review operate to constrain the breadth of the discretion in s.156(2)(b)(i). In particular, the Review function is in Part 2-3 of the Act and hence involves the performance or exercise of the Commission’s ‘modern award powers’ (see s.134(2)(a)). It follows that the ‘modern awards objective’ in s.134 applies to the Review.

[123] A range of other provisions of the Act and s.138 (achieving the modern awards objective) are also relevant to the Review: s.3 (object of the Act); s.55 (interaction with the National Employment Standards (NES)); Part 2-2 (the NES); s.135 (special provisions relating to modern award minimum wages); Division 3 (terms of modern awards) and Division 6 (general provisions relating to modern award powers) of Part 2-3; s.284 (the minimum wages objective); s.577 (performance of functions etc by the Commission); s.578 (matters the Commission must take into account in performing functions etc), and Division 3 of Part 5-1 (conduct of matters before the Commission).

[124] The modern awards objective is to ‘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 the particular considerations identified in ss.134(1)(a)–(h) (the s.134 considerations). The obligation to take into account the s.134 considerations means that each of these matters, insofar as they are relevant, must be treated as a matter of significance in the decision-making process. 80 No particular primacy is attached to any of the s.134 considerations81 and not all of the matters identified will necessarily be relevant in the context of a particular proposal to vary a modern award.

[125] Section 138 of the Act emphasises the importance of the modern awards objective:

‘138 Achieving the modern awards objective

A modern award may include terms that it is permitted to include, and must include terms that it is required to include, only to the extent necessary to achieve the modern awards objective and (to the extent applicable) the minimum wages objective.’

[126] To comply with s.138, the terms included in modern awards must be ‘necessary to achieve the modern awards objective.

[127] What is ‘necessary’ to achieve the modern awards objective in a particular case is a value judgment, taking into account the s.134 considerations to the extent that they are relevant having regard to the context, including the circumstances pertaining to the particular modern award, the terms of any proposed variation and the submissions and evidence. 82

[128] The modern awards objective is very broadly expressed. 83 It is a composite expression which requires that modern awards, together with the NES, provide ‘a fair and relevant minimum safety net of terms and conditions’, taking into account the matters in ss.134(1)(a)–(h).84 

[129] It is not necessary to make a finding that the award fails to satisfy one or more of the s.134 considerations. 85 Generally speaking, the s.134 considerations do not set a particular standard against which a modern award can be evaluated; many of them may be characterised as broad social objectives.86 In giving effect to the modern awards objective the Commission is performing an evaluative function taking into account the matters in s.134(1)(a)–(h) and assessing the qualities of the safety net by reference to the statutory criteria of fairness and relevance.

[130] Further, the matters which may be taken into account are not confined to the s.134 considerations. As the Full Court observed in Shop, Distributive and Allied Employees Association v The Australian Industry Group 87 (Penalty Rates Review):

‘What must be recognised, however, is that the duty of ensuring that modern awards, together with the National Employment Standards, provide a fair and relevant minimum safety net of terms and conditions itself involves an evaluative exercise. While the considerations in s 134(a)-(h) inform the evaluation of what might constitute a “fair and relevant minimum safety net of terms and conditions”, they do not necessarily exhaust the matters which the FWC might properly consider to be relevant to that standard, of a fair and relevant minimum safety net of terms and conditions, in the particular circumstances of a review. The range of such matters “must be determined by implication from the subject matter, scope and purpose of the” Fair Work Act (Minister for Aboriginal Affairs v Peko-Wallsend Ltd [1986] HCA 40; (1986) 162 CLR 24 at 39-40).’ 88 

[131] Fairness in this context is to be assessed from the perspective of the employees and employers covered by the modern award in question. 89

[132] It is not necessary for the Commission to conclude that the award, or a term of it as it currently stands, does not meet the modern awards objective. Rather, it is necessary for the Commission to review a particular modern award and, by reference to the s.134 considerations and any other consideration consistent with the purpose of the objective, come to an evaluative judgment about the objective and what terms should be included only to the extent necessary to achieve the objective of a fair and relevant minimum safety net.’ 90 

[133] In the context of the Review, variation of a modern award may be warranted if it is established that there has been a material change in circumstances since the making of the award, but the Commission’s power to vary the award is not conditional on it being satisfied that there has been such a change in circumstances. 91 For example, a modern award might be found not to comply with the modern awards objective ‘where considerations, which were extant but unappreciated or not fully appreciated on a prior review, are properly brought to account.’92

[134] In 4 Yearly Review of Modern Awards - Penalty Rates (Hospitality and Retail Sectors) 93 the Full Bench summarised the general propositions applying to the Commission’s task in the Review, as follows:

‘1. The Commission’s task in the Review is to determine whether a particular modern award achieves the modern awards objective. If a modern award is not achieving the modern awards objective then it is to be varied such that it only includes terms that are ‘necessary to achieve the modern awards objective’ (s.138). In such circumstances regard may be had to the terms of any proposed variation, but the focal point of the Commission’s consideration is upon the terms of the modern award, as varied.

2. Variations to modern awards must be justified on their merits. The extent of the merit argument required will depend on the circumstances. Some proposed changes are obvious as a matter of industrial merit and in such circumstances it is unnecessary to advance probative evidence in support of the proposed variation. Significant changes where merit is reasonably contestable should be supported by an analysis of the relevant legislative provisions and, where feasible, probative evidence.

3. In conducting the Review it is appropriate that the Commission take into account previous decisions relevant to any contested issue. For example, the Commission will proceed on the basis that prima facie the modern award being reviewed achieved the modern awards objective at the time it was made. The particular context in which those decisions were made will also need to be considered.

4. The particular context may be a cogent reason for not following a previous Full Bench decision, for example:

•  the legislative context which pertained at that time may be materially different from the [Act];

•  the extent to which the relevant issue was contested and, in particular, the extent of the evidence and submissions put in the previous proceeding will bear on the weight to be accorded to the previous decision; or

•  the extent of the previous Full Bench’s consideration of the contested issue. The absence of detailed reasons in a previous decision may be a factor in considering the weight to be accorded to the decision.’ 94

[135] We now turn to the particular modern awards we propose to vary arising from this decision.

3.2 Varying the 86 modern awards listed in Attachment B

[136] In this section we are dealing with the 86 modern awards which currently make no provision at all regarding the time period within which termination payments are to be made. As mentioned earlier, in the December 2016 decision we confirmed our provisional view that each modern award should provide for the payment of wages and other amounts owing to an employee on termination of employment and that such a term should prescribe the timeframe within which such termination payments are to be made. 95

[137] We have reached the provisional view that in order to achieve the modern awards objective, it is necessary to vary the 86 modern awards which are currently silent in respect of the time period within which termination payments are to be made, to insert the model ‘Payment on termination of employment’ term. In reaching that provisional view we have taken into account the s.134 considerations and we now turn to express our provisional views in respect of those matters.

3.2.1 Provisional views on the s.134 considerations

[138] The variation of these 86 modern awards to insert the model term will be of benefit to the employees covered by these awards and is likely to affect low paid employees in particular. Section 134(1)(a) requires that we take into account, relevantly, ‘the needs of the low paid’. This consideration is a factor in favour of varying modern awards to include the model term.

[139] Section 134(1)(b) requires that we take into account ‘the need to encourage enterprise bargaining’. There is no evidence before us which would lead us to conclude that inserting a term providing for the payment of termination entitlements would have an adverse impact on the incentive to bargain in respect of this matter. But, nor is there anything before us to suggest that such a term would necessarily encourage enterprise bargaining.

[140] We are not persuaded that the matters set out at s.134(1)(c), (da) and (e) are relevant in the present context.

[141] It is convenient to deal with ss.134(1)(d) and (f) together.

[142] Section 134(1)(d) requires that we take into account ‘the need to promote flexible modern work practices and the efficient and productive performance of work’ and s.134(1)(f) requires that we take into account ‘the likely impact of any exercise of modern award powers on business, including on productivity, employment costs and the regulatory burden’.

[143] The word ‘productivity’ in s.134 has the conventional meaning it is given in economics of the number of units of output per unit of input. Productivity is a measure of the volumes or quantities of inputs and outputs, not the cost of purchasing those inputs or the value of outputs generated. The price of inputs, including the cost of labour, raises separate considerations relating to business competitiveness and employment costs. 96 

[144] Section 134(1)(f) is expressed in very broad terms; it refers to the likely impact of any exercise of modern award powers ‘on business, including’ (but not confined to) the specific matters mentioned, that is, ‘productivity, employment costs and the regulatory burden’.

[145] We accept that the insertion of the model term into these awards will have some adverse impact on business. It may increase employment costs in some businesses, albeit not significantly, and may have some, albeit limited, adverse impact on the efficient and productive performance of work. But we doubt that the model term will have any impact on productivity.

[146] The variation of modern awards to insert the model term will also give rise to some, albeit not significant, increase in the regulatory burden upon business particularly in the administration of their payroll arrangements.

[147] The considerations in ss.134(1)(d) and (f) tell against varying modern awards to include the model term.

[148] Section 134(1)(g) requires that we take into account ‘the need to ensure a simple, easy to understand, stable and sustainable modern award system for Australia that avoids unnecessary overlap of modern awards’.

[149] The variation of these 86 modern awards to insert the model term will give rise to an additional employer obligation, but the decisions we have made in relation to the content of the model term are intended to make the provision simple and easy to understand.

[150] Section 134(1)(h) requires that we take into account ‘the likely impact of any exercise of modern award powers on employment growth, inflation and the sustainability, performance and competitiveness of the national economy’. The matters mentioned in s.134(1)(h) focus on the aggregate (as opposed to sectorial) impact of an exercise of modern award powers.

[151] The variation of these modern awards to insert the model term will not give rise to any significant measurable impact on the national economy.

[152] We deal with the next stage in our consideration of these 86 modern awards in Chapter 4 of this Decision.

[153] We now turn to the review of the remaining 36 modern awards.

3.3 Reviewing the 36 modern awards set out in Attachment A

[154] As mentioned earlier, 36 modern awards contain terms which provide for the payment of wages and other amounts owing to an employee on the termination of their employment, although there is considerable variation in the manner in which they deal with payments upon termination. In the December 2016 decision we expressed the provisional view that there is ‘some utility in a common “payment on termination” provision across all 122 modern awards’. While we adhere to that view, we are also conscious that each modern award must be reviewed in its own right (s.156(5)) and that variations to modern awards must be justified on their merits. Further, in the Review the Commission has proceeded on the basis that prima facie the modern award being reviewed achieved the modern awards objective at the time it was made. These considerations led us to the following conclusions in the December 2016 decision:

‘We confirm our provisional view that each modern award should provide for the payment of wages and other amounts owing to an employee on termination of employment. Such a term should also prescribe the timeframe within which such termination payments are to be made.

We also confirm our provisional view that there is utility in common ‘payment on termination’ provision across all 122 modern awards. But we accept that each modern award is to be reviewed in its own right and there may be sound reasons for departing from a model term in a particular modern award. A case by case assessment is required.’ 97

[155] In the October 2016 Statement we also expressed the provisional view that:

‘there does not appear to be a sound rationale for retaining the current provisions that require payment of wages on termination within a short period after termination (such as one or two days, or ‘forthwith’). Accordingly, we would propose to replace the existing provisions in respect of the timeframe for the payment of termination payments, in the 36 modern awards mentioned previously, with the provisional default term’. 98

[156] We did not address this provisional view in our December 2016 decision. After further consideration, and taking account of the submissions made, we have decided to abandon the above provisional view. The review of the remaining 36 modern awards will proceed on an award by award basis and any variation will have to be justified on its merits. We do not think it appropriate to proceed from the prima facie position that existing provisions in respect of payments on termination should be replaced by the model term.

[157] A series of conferences will be convened in respect of the remaining 36 modern awards to ascertain the views of interested parties about any variation to the existing payment on termination terms.

4. Next steps

[158] We have now finalised the ‘Payment on termination of employment’ model term. We have formed the provisional view that the 86 modern awards which are currently silent in respect of the time period within which termination payments are to be made should be varied to insert the model term. If any party wishes to contest that provisional view in respect of any of these 86 modern awards, they must file a submission by no later than 10 August 2018. Any such submission should set out the reasons in support of the party’s position. All submissions and comments are to be sent to [email protected].

[159] As to the remaining 36 modern awards, a program of conferences will be set out in a Statement to be published shortly. These conferences are intended to provide interested parties with an opportunity to express their view about any variation to the existing payment on termination terms in these awards.

PRESIDENT

Appearances:

K Thomas for the Construction, Forestry, Mining and Energy Union – Mining and Energy Division

P Boncardo for the Construction, Forestry, Mining and Energy Union

S Smith for the Australian Industry Group

L Izzo for the Australian Chamber of Commerce and Industry, Australian Business Industrial & NSW Business Chamber

R Calver for the National Road Transport Association known as NatRoad

M Adler for the Housing Industry Association

R Sostarko for Master Builders Australia Limited

Z Duncalf for the Australian Workers Union

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

K Pearsall for the National Farmers’ Federation

T Clarke for the Australian Council of Trade Unions

M Galbraith for the SDA

V Wiles for the Textile, Clothing and Footwear Union of Australia

L Dooley for the Construction, Forestry, Mining and Energy Union – FFPD division

Hearing details:

Sydney.

2017.

23 March

Melbourne.

2017.

22 August

LIST OF ABBREVIATIONS

ABI	Australian Business Industrial and the New South Wales Business Chamber (jointly ABI)
ACTU	Australian Council of Trade Unions
AHA	Australian Hotels Association
Ai Group	Australian Industry Group
April 2017 Statement	[2017] FWCFB 2290
AMWU	Australian Manufacturing Workers’ Union
CFMEU-M&E	Construction, Forestry, Maritime, Mining and Energy Union (Mining and Energy Division) as it then was
CFMEU-FFPD	Construction, Forestry, Maritime, Mining and Energy Union (Furnishing, Building Products and Manufacturing Division) as it then was
Commission	Fair Work Commission
HIA	Housing Industry Association
Irving and Stewart	Mark Irving and Andrew Stewart
MBA	Master Builders Australia
NRA	National Retail Association
NatRoad	National Road Transport Association
NFF	National Farmers Federation
October 2016 Statement	[2016] FWCFB 7455
REEF	Real Estate Employers’ Federation
RCI	Restaurant & Catering Industrial
Review	4 yearly review of modern awards under s.156 of the Fair Work Act 2009
SDA	Shop, Distributive and Allied Employees Association
TCFUA	The former Textile, Clothing and Footwear Union of Australia
the Restaurant Award	Restaurant Industry Award 2010
December 2016 decision	[2016] FWCFB 8463
UV	United Voice

ATTACHMENT A—Payment of wages on termination

Award	Method of payment	Provision for payment on termination	Timeframe for payment on termination
Aged Care Award 2010 [MA000018]	Cash or EFT	Clause 17.3	When notice of termination of employment has been given by an employee or an employee’s services have been terminated by an employer, payment of all wages and other moneys owing to an employee will be made to the employee by no later than the last day of the formal notice period.
Aluminium Industry Award 2010 [MA000060]	Cash, cheque or EFT	Clause 17.3	On termination of employment, wages due to an employee must be paid on the day of termination or paid to the employee by the next regular pay day in accordance with clause 17.2.
Asphalt Industry Award 2010 [MA000054]	Cash, cheque or EFT	Clause 19.3	On termination of employment the wages due to an employee must be paid on the day of termination or be forwarded to the employee within 2 business days after termination.
Black Coal Mining Industry Award 2010 [MA000001]	Cheque or EFT	Clause 16.7	Upon termination of employment, wages due to an employee will be paid on the day of such termination or forwarded by post, within 72 hours, to the last address notified in writing by the employee. Note also cl. 13.5 which sets out payments on termination.
Building and Construction General On-site Award 2010 [MA000020]	Cash, cheque, bank cheque or EFT	Clause 31.4	When notice is given, all monies due to the employee must be paid at the time of termination of employment. Where this is not practicable, the employer will have two working days to send monies due to the employee by registered post (or where paid by EFT the monies are transferred into the employee’s account).
Business Equipment Award 2010 [MA000021]	Cash, cheque or EFT	Clause 25.4	Upon termination of employment, the wages due to an employee must be paid on the day of such termination or forwarded by post on the next working day.
Children’s Services Award 2010 [MA000120]	Cash, cheque or EFT	Clause 19.3	Where an employee lawfully leaves their employment they will be paid all moneys due at the time of leaving by cash, cheque or electronic funds transfer. Alternatively, the employee may be paid on the next working day where this is reasonable.
Dry Cleaning and Laundry Industry Award 2010 [MA000096]	Cash or EFT	Clause 19.3	When notice of termination of employment has been given by an employee or an employee’s services have been terminated by an employer, payment of all wages and other money owing to an employee will be made to the employee by no later than the last day of the formal notice period.
Electrical, Electronic and Communications Contracting Award 2010 [MA000025]		Clause 22.3	(a) On termination of employment, wages due to an employee must be paid on the day of termination or forwarded to the employee by post on the next working day. (b) Where an employee is paid under a rostered day off system and has accrued a credit towards a rostered day off such credit must be taken into account in calculating wages due on termination.
Food, Beverage and Tobacco Manufacturing Award 2010 [MA000073]	Cash, cheque or EFT	Clause 28.3	On termination of employment, wages due to an employee must be paid on the day of termination or forwarded to the employee on the next working day.
Graphic Arts, Printing and Publishing Award 2010 [MA000026]	Cash, cheque or EFT	Clause 28.5	On termination of employment, all monies due to an employee must be paid on the day of termination. When an employee is dismissed without notice all monies are to be forwarded to the employee by post or electronic funds transfer by the end of the next business day following the termination.
Horse and Greyhound Training Award 2010 [MA000008]	Cash, cheque or EFT	Clause 18.1	When an employee’s employment is terminated before the usual payday, the employee must be paid all wages and holiday pay to which the employee is entitled within 24 hours of leaving the employer’s service.
Horticulture Award 2010 [MA000028]	Cash, cheque or EFT	Clause 19.3	On termination of employment, wages due to an employee must be paid on the day of termination or forwarded to the employee by post on the next working day.
Manufacturing and Associated Industries and Occupations Award 2010 [MA000010]	Cash, cheque or EFT	Clause 34.3	On termination of employment, wages due to an employee must be paid on the day of termination or forwarded to the employee by post on the next working day.
Market and Social Research Award 2010 [MA000030]	EFT or by agreement cash or cheque	Clause 19.5	An employer must, on request, provide to an employee on termination a detailed statement of outstanding entitlements. The wages due to an employee must be paid on the day of such termination or forwarded via post on the next working day.
Meat Industry Award 2010 [MA000059]	“In manner agreed”	Clause 29.2	Upon termination of employment, any wages due to an employee will be paid on the day of such termination or, at the employee’s option, forwarded to them on the next working day.
Mobile Crane Hiring Award 2010 [MA000032]	Cash, cheque or EFT	Clause 19.5	Upon termination of employment, wages due will be paid on the day of such termination or forwarded by electronic transfer or post on the next working day.
Nursery Award 2010 [MA000033]	Cash, cheque or EFT	Clause 22.3	On termination of the employment, the wages due to an employee must be paid on the day of termination or be forwarded to the employee within 2 business days after termination.
Nurses Award 2010 [MA000034]	Cash, cheque or EFT	Clause 18.3	When notice of termination of employment has been given by an employee or an employee’s services have been terminated by the employer, payment of all wages and other monies owing to an employee will be made to the employee.
Passenger Vehicle Transportation Award 2010 [MA000063]	The employer at its discretion may pay an employee by electronic funds transfer to a bank account nominated by an employee	Clause 19.4	Notwithstanding anything contained in this clause, the employer must pay to an employee who leaves or is dismissed all moneys due to the employee within two working days.
Pastoral Award 2010 [MA000035]	Cash, cheque or EFT	Clause 16.3	On termination of employment, wages due to an employee must be paid on the day of termination or forwarded to the employee by post on the next working day.
Pharmaceutical Industry Award 2010 [MA000069]	Cash, cheque or EFT	Clause 21.3	On termination of employment the wages due to an employee must be paid on the day of such termination or be forwarded to them within 2 business days after termination.
Plumbing and Fire Sprinklers Award 2010 [MA000036	Cash, cheque, bank cheque or EFT		When notice is given in accordance with clause 17—Termination of employment, monies due to the employee must be paid at the time of termination. Where this is not practicable monies will be sent by registered post or, if the employee is normally paid by electronic funds transfer, transferred into the employee’s account within two working days. Note- penalty payment for waiting time (ordinary rates for 8 hours per day for up to a week)
Professional Diving Industry (Industrial) Award 2010 [MA000108]	Cash, cheque, bank cheque or EFT	Clause 19.4	On termination of employment, wages due to employees must be paid to them on the day of such termination or forwarded to them by post on the next working day.
Professional Diving Industry (Recreational) Award 2010 [MA000109]	Cash, cheque, bank cheque or EFT	Clause 18.4	On termination of employment, wages due to employees must be paid to them on the day of such termination or forwarded to them by post on the next working day.
Restaurant Industry Award 2010 [MA000119]CSH,	Cash, cheque or EFT	Clauses 27.4 and 27.5	27.4 When notice of termination of employment has been given by an employee or an employee’s services have been terminated by an employer, payment of all wages due must be made during working time, prior to the employee leaving their employment. 27.5 Where an employee is dismissed for misconduct the employee must be paid within one hour of their dismissal or as soon as practicable thereafter.
Road Transport (Long Distance Operations) Award 2010 [MA000039]	EFT at the employer’s discretion	Clause 18.3	Notwithstanding anything contained in this clause, the employer must pay to an employee who leaves or is dismissed all money due to the employee immediately
Road Transport and Distribution Award 2010 [MA000038]	EFT at employer’s discretion	Clause 20.3	Notwithstanding anything contained in this clause, the employer must pay to an employee who leaves or is dismissed all moneys due to the employee forthwith.
Seafood Processing Award 2010 [MA000068]	Cash, cheque or EFT	Clause 21.3	On the day of termination or forwarded within 48 hours.
Silviculture Award 2010 [MA000040]	Cash, cheque or EFT	Clause 21.3	When notice is given in accordance with the NES, all money due to the employee pursuant to this award must be paid at the time of termination. Where this is not practicable, the employer must, within two clear working days of the termination, transfer all money due by electronic funds transfer or by registered post to the employee’s home address. Any time spent waiting beyond the two working days must be paid for at ordinary rates of eight hours per day for up to one week.
Storage Services and Wholesale Award 2010 [MA000084]	Cash or cheque during working hours or by EFT	Clause 20.3	On termination of employment, wages due to an employee must be paid on the day of termination or forwarded to the employee as soon as reasonably practicable and within two working days after the termination.
Supported Employment Services Award 2010 [MA000103]	Cash, cheque or EFT, as determined by employer.	Clause 18.4 and 18.5	18.4 Where an employee is discharged from employment the employee will be paid immediately for all wages, overtime, pro rata payment for annual leave, annual leave loading or any remuneration due. Payment may be made by cash, cheque or electronic funds transfer at the discretion of the employer. 18.5 Where an employee lawfully leaves their employment they will be paid all monies due at the time of leaving. Payment may be made by cash, cheque or electronic funds transfer at the discretion of the employer. 18.6 In the event of a delay of this payment, within the control of the employer, the employee to be paid ordinary time rates for ‘waiting time’. Time kept waiting will be deemed to operate after 6pm on the Friday of each pay week where payment made by EFT.
Timber Industry Award 2010 [MA000071]	Cash, cheque or EFT	Clause 25.3	25.3(a) Upon termination after the prescribed period of notice, or where the notice period has been dispensed with in accordance with clause 15 (Redundancy) all monies must be paid at the usual place of payment within 15 minutes of the ceasing time on the day of the termination of employment. If the usual place is at work in the bush, within 30 minutes of the usual ceasing time. 25.3(b) - If the employment is otherwise terminated, no later than the expiration of the pay period.
Vehicle Manufacturing, Repair, Services and Retail Award 2010 [MA000089]	Cash or, with the agreement of the majority of workers in a workplace, by cheque or direct transfer. An employer and an employee may agree to pay by cheque or direct transfer.	Clause 24.4	(a) Upon termination of the employment, the employer will pay wages due to an employee: (i) on the day of such termination; (ii) by forwarding such wages to the employee on the next working day; or (iii) at the employer’s place of business on a stated day not later than seven days after such termination. If the employer requires the employee to visit such place of business to collect wages then, in addition to the amount of moneys due, the employer will pay the employee an additional four hours’ ordinary pay. Except that where an employee abandons his or her employment or the employee’s employment is terminated without notice for serious and wilful misconduct the employer will pay the wages due to the employee within two business days (not including a Saturday, Sunday or public holiday) of the termination. (b) An employer may deduct from monies due to an employee such amount as is authorised in writing by the employee for a lawful purpose specified in the authority.
Waste Management Award 2010 [MA000043]	At the employer’s discretion, by EFT.	Clause 24.3	Despite anything contained in this clause, the employer must pay to an employee who leaves or is dismissed all money due to the employee as soon as possible.
Wine Industry Award 2010	Cash or EFT	Clause 26.3	On termination of the employment, wages due to an employee must be paid on the day of such termination or be forwarded to the employee on the next working day.

ATTACHMENT B—Awards which currently make no provision at all regarding the time period within which termination payments are to be made

Aboriginal Community Controlled Health Services Award 2010 [MA000115]

Air Pilots Award 2010 [MA000046]

Aircraft Cabin Crew Award 2010 [MA000047]

Airline Operations—Ground Staff Award 2010 [MA000048]

Airport Employees Award 2010 [MA000049]

Alpine Resorts Award 2010 [MA000092]

Ambulance and Patient Transport Industry Award 2010 [MA000098]

Amusement, Events and Recreation Award 2010 [MA000080]

Animal Care and Veterinary Services Award 2010 [MA000118]

Aquaculture Industry Award 2010 [MA000114]

Architects Award 2010 [MA000079]

Banking, Finance and Insurance Award 2010 [MA000019]

Book Industry Award 2010 [MA000078]

Broadcasting and Recorded Entertainment Award 2010 [MA000091]

Car Parking Award 2010 [MA000095]

Cement and Lime Award 2010 [MA000055]

Cemetery Industry Award 2010 [MA000070]

Cleaning Services Award 2010 [MA000022]

Clerks—Private Sector Award 2010 [MA000002]

Coal Export Terminals Award 2010 [MA000045]

Commercial Sales Award 2010 [MA000083]

Concrete Products Award 2010 [MA000056]

Contract Call Centres Award 2010 [MA000023]

Corrections and Detention (Private Sector) Award 2010 [MA000110]

Cotton Ginning Award 2010 [MA000024]

Dredging Industry Award 2010 [MA000085]

Educational Services (Post-Secondary Education) Award 2010 [MA000075]

Educational Services (Schools) General Staff Award 2010 [MA000076]

Educational Services (Teachers) Award 2010 [MA000077]

Electrical Power Industry Award 2010 [MA000088]

Fast Food Industry Award 2010 [MA000003]

Fire Fighting Industry Award 2010 [MA000111]

Fitness Industry Award 2010 [MA000094]

Funeral Industry Award 2010 [MA000105]

Gardening and Landscaping Services Award 2010 [MA000101]

Gas Industry Award 2010 [MA000061]

General Retail Industry Award 2010 [MA000004]

Hair and Beauty Industry Award 2010 [MA000005]

Health Professionals and Support Services Award 2010 [MA000027]

Higher Education Industry—Academic Staff—Award 2010 [MA000006]

Higher Education Industry—General Staff—Award 2010 [MA000007]

Hospitality Industry (General) Award 2010 [MA000009]

Hydrocarbons Field Geologists Award 2010 [MA000064]

Hydrocarbons Industry (Upstream) Award 2010 [MA000062]

Joinery and Building Trades Award 2010 [MA000029]

Journalists Published Media Award 2010 [MA000067]

Labour Market Assistance Industry Award 2010 [MA000099]

Legal Services Award 2010 [MA000116]C

Live Performance Award 2010 [MA000081]

Local Government Industry Award 2010 [MA000112]

Mannequins and Models Award 2010 [MA000117] Clause 17

Marine Tourism and Charter Vessels Award 2010 [MA000093]

Marine Towage Award 2010 [MA000050]

Maritime Offshore Oil and Gas Award 2010 [MA000086]

Medical Practitioners Award 2010 [MA000031]

Mining Industry Award 2010 [MA000011]

Miscellaneous Award 2010 [MA000104]

Oil Refining and Manufacturing Award 2010 [MA000072]

Pest Control Industry Award 2010 [MA000097]

Pharmacy Industry Award 2010 [MA000012]

Port Authorities Award 2010 [MA000051]

Ports, Harbours and Enclosed Water Vessels Award 2010 [MA000052]

Poultry Processing Award 2010 [MA000074]

Premixed Concrete Award 2010 [MA000057]

Professional Employees Award 2010 [MA000065]

Quarrying Award 2010 [MA000037]

Racing Clubs Events Award 2010 [MA000013]

Racing Industry Ground Maintenance Award 2010 [MA000014]

Rail Industry Award 2010 [MA000015]

Real Estate Industry Award 2010 [MA000106]

Registered and Licensed Clubs Award 2010 [MA000058]

Salt Industry Award 2010 [MA000107]

Seagoing Industry Award 2010 [MA000122]

Security Services Industry Award 2010 [MA000016]

Social, Community, Home Care and Disability Services Industry Award 2010 [MA000100]

Sporting Organisations Award 2010 [MA000082]

State Government Agencies Award 2010 [MA000121]

Stevedoring Industry Award 2010 [MA000053]

Sugar Industry Award 2010 [MA000087]

Surveying Award 2010 [MA000066]

Telecommunications Services Award 2010 [MA000041]

Textile, Clothing, Footwear and Associated Industries Award 2010 [MA000017]

Transport (Cash in Transit) Award 2010 [MA000042]

Travelling Shows Award 2010 [MA000102]

Water Industry Award 2010 [MA000113]

Wool Storage, Sampling and Testing Award 2010 [MA000044]

 1   [2013] FWC 10195; [2014] FWC 1790

 2   [2016] FWCFB 8463 at [51]-[52]

 3   Transcript 23 March 2017 at PN26

 4   [2017] FWCFB 2290 at [6]

 5   The relevant terms of these modern awards are set out at Attachment A

 6   See the Waste Management Award 2010 at clause 24.3

 7   See the Plumbing and Fire Sprinklers Award 2010 at clause 27.4

 8   See the Nurses Award 2010 at clause 18.3

 9   See the Horse and Greyhound Training Award 2010 at clause 18.1

 10   [2016] FWCFB 7455

 11   [2016] FWCFB 8463 at [86]

 12   Ibid at [87]

 13   Ibid at [104]

 14   Ibid at [115]

 15   Ibid at [116]

 16   AHA submission30 October 2017

 17   NatRoad submission22 December 2016 at paragraphs 12 - 13

 18   ABI submission 31 October 2017 at paragraph 3.2

 19   [2016] FWCB 8463 at [95]

 20   SDA submissions, 2 February 2017 at paragraphs 20-21

 21   CFMEU-M&E submissions, 30 October 2017 at paragraph 6

 22   CFMEU-M&E submissions, 30 October 2017 at paragraph 9

 23   TCFUA submissions, 31 October 2017, paragraph 4.5

 24   UV submissions, 8 November 2016 at paragraphs 14-16

 25   UV submissions, 31 October 2017 at paragraphs 16-17

 26   [2016] FWCFB 8463 at [99]-[100]

 27   Ai Group submission 23 December 2016 at paragraph 57

 28   ABI submission 2 February 2017 at paragraphs 3.1–3.2

 29   [2018] FWCFB 3009 at [65]–[67]

 30   Ai Group submission 23 December 2016 at paragraphs 50–55

 31   [2016] FWCFB 3177

 32   Ibid at Attachment 4

 33   [2018] FWCFB 3009

 34   Barrister, Victorian Bar

 35   John Bray Professor of Law, University of Adelaide

 36   Mark Irving and Andrew Stewart Submission, 15 December 2016 at page 9

 37   ACTU Submission,, 21 December 2016 at paragraph 12.

 38   CFMEU-FFPD submissions, 21 December 2016 at paragraph 22

 39   CFMEU v CBI Constructors Pty Ltd [2018] FWCFB 2732 at [35]

 40   Ibid

 41   See for example reg 3.42 of the Fair Work Regulations 2009 (Cth)

 42   Mark Irving and Andrew Stewart Submission, 15 December 2016 at page 1

 43   [2016] FWCFB 8463 at [134]

 44   HIA submission,16 December 2016 at paragraph 2.2.1

 45   HIA submission, 2 February 2017 at paragraph 2.2.3

 46   MBA submission,22 December 2016 at paragraph 5.8

 47   See [2018] FWCFB 3009

 48   [2016] FWCFB 8463 at [88]–[99]

 49   [2016] FWCFB 8463 at paras [111]-[115]

 50   MBA submission, 22 December 2016 at paragraphs 5.2–5.7

 51   NRA submission, 6 October 2017 at pages 2–3

 52   ACTU submission30 October 2017 at paragraph 66

 53   Ai Group submission 9 February 2017 at paragraphs 62–67

 54   The ACTU cites as an example TWU v AIRC [2008] FCAFC 26 at [37]. See also Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union [2018] HCA 3 at [40] and [115]

 55   ACTU submission, 30 October 2017 at paragraph 71

 56   Ibid at paragraph 66

 57   Ibid at paragraph 70

 58   Ibid at paragraph 72

 59   Ibid at Schedule 3

 60   Ai Group submission23 December 2016 at paragraphs 60–62

 61   Ibid at paragraphs 65

 62   Ibid at paragraph 66

 63   NFF submission2 February 2017 at paragraph 3

 64   Ai Group submission9 February 2017 at paragraphs 69-70

 65   Ibid at paragraph 72

 66   Ibid at paragraph 71

 67   CFMEU-FFPD submissions, 21 December 2016 at paragraph 21

 68   TCFUA submissions, 3 February 2017 at paragraph 2.26

 69   [2016] FWCFB 8463 at [124]

 70   See the definition of ‘vocational placement’ in s.12 of the Act; s.91(2) in relation to payment for annual leave on a transfer of employment; s.712C and reg. 5.09 in relation to fees and allowances for a person responding to a FWO notice, and reg 3.33(3) in relation to employee records

 71   [2016] FWCFB 8463 at [73]

 72   Ibid at [99]

 73   Ai Group submission 23 December 2016 at paragraph 65

 74   Ibid at paragraph 61

 75   In respect of the omission of the reference in paragraph (b) to s.117(2), see [84] above

 76   CFMEU-FFPD submission, 21 December 2016 at [11]

 77   Ai Group submission, 9 February 2017 at paragraph 57

 78   Shop, Distributive and Allied Employees Association v The Australian Industry Group [2017] FCAFC 161 at [38]

 79   O’Sullivan v Farrer (1989) 168 CLR 210 at p. 216 per Mason CJ, Brennan, Dawson and Gaudron JJ

 80   Edwards v Giudice (1999) 94 FCR 561 at [5]; Australian Competition and Consumer Commission v Leelee Pty Ltd [1999] FCA 1121 at [81]-[84]; National Retail Association v Fair Work Commission (2014) 225 FCR 154 at [56]

 81   Shop, Distributive and Allied Employees Association v The Australian Industry Group [2017] FCAFC 161 at [33]

 82   See generally: Shop, Distributive and Allied Employees Association v National Retail Association (No.2) (2012) 205 FCR 227

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

 84   [2017] FWCFB 1001 at [128]; Shop, Distributive and Allied Employees Association v The Australian Industry Group [2017] FCAFC 161 at [41]–[44]

 85   National Retail Association v Fair Work Commission (2014) 225 FCR 154 at [105]-[106]

 86   See National Retail Association v Fair Work Commission (2014) 225 FCR 154 at [109]-[110]; albeit the Court was considering a different statutory context, this observation is applicable to the Commission’s task in the Review

 87   Shop, Distributive and Allied Employees Association v The Australian Industry Group [2017] FCAFC 161

 88   Ibid at [48]

 89   [2018] FWCFB 3500 at [21]-[24].

 90   Ibid at [28]-[29]

 91   [2017] FWCFB 1001 at [230]-[268]; Shop, Distributive and Allied Employees Association v The Australian Industry Group [2017] FCAFC 161 at [23]

 92   Shop, Distributive and Allied Employees Association v The Australian Industry Group [2017] FCAFC 161 at [34]

 93   [2017] FWCFB 1001

 94   Ibid at [269]

 95   [2016] FWCFB 8463

 96   [2017] FWCFB 1001 at [220]-[225]

 97   [2016] FWCFB 8463 at [86]-[87]

 98   [2016] FWCFB 7455 at [20]

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