PN1473

VICE PRESIDENT HATCHER: I think the parties have been made aware of today's technological limitations. We have got vision on these screens, but sound is coming through that screen so you'll need to talk loudly and bear in mind that that is where the sound is going through.

PN1474

MR WARD: I'll face that way.

PN1475

VICE PRESIDENT HATCHER: The camera is still there.

PN1476

MR WARD: Thank you, your Honour.

PN1477

VICE PRESIDENT HATCHER: All right. Who is calling today's witness?

PN1478

MR HARDING: Me, your Honour.

PN1479

VICE PRESIDENT HATCHER: Yes, Mr Harding.

PN1480

MR HARDING: I call Sharon Louise Dulac.

PN1481

VICE PRESIDENT HATCHER: Ms Dulac, can you see and hear us?

PN1482

MS DULAC: Yes, thank you.

PN1483

VICE PRESIDENT HATCHER: All right. The court officer will administer the affirmation to you now.

PN1484

THE ASSOCIATE: Please state your full name and address.

PN1485

MS DULAC: Sharon Louise Dulac of (address supplied).

<SHARON LOUISE DULAC, AFFIRMED�� [10.16 AM]

EXAMINATION-IN-CHIEF BY MR HARDING�� [10.16 AM]

PN1486

MR HARDING: Ms Dulac, is your name Sharon Louise Dulac?‑‑‑Yes.

***�� SHARON LOUISE DULAC�� XN MR HARDING

PN1487

Is your address (address supplied)?‑‑‑(Street supplied).

PN1488

Crescent, thank you. Have you made a statement for the purposes of these proceedings, dated 20 May 2022?‑‑‑I have.

PN1489

If I could take you, please, Ms Dulac, to paragraph 9 of that statement?‑‑‑Yes.

PN1490

The last sentence. Do you wish to change that sentence to read:

PN1491

I'm aware of a number of ADEs who pay wages based on the national minimum wage and remain viable.

PN1492

?‑‑‑Yes, thank you.

PN1493

With that change, is the statement true and correct?‑‑‑Yes, thank you.

PN1494

I tender that statement, your Honour.

PN1495

VICE PRESIDENT HATCHER: The witness statement of Sharon Dulac, as amended, dated 20 May 2022, will be marked exhibit AA.

EXHIBIT #AA AMENDED WITNESS STATEMENT OF SHARON DULAC DATED 20/05/2022

PN1496

MR HARDING: Ms Dulac, have you made a further statement in reply, dated 22 July 2022, for the purpose of these proceedings?‑‑‑I have.

PN1497

Is that statement true and correct?‑‑‑Yes.

PN1498

I tender that statement, your Honour.

PN1499

VICE PRESIDENT HATCHER: The further witness statement of Sharon Dulac, dated 22 July 2022, will be marked exhibit AB.

EXHIBIT #AB FURTHER WITNESS STATEMENT OF SHARON DULAC DATED 22/07/2022

***�� SHARON LOUISE DULAC�� XN MR HARDING

CROSS-EXAMINATION BY MR WARD�� [10.18 AM]

PN1500

MR WARD: Ms Dulac, can you see me?‑‑‑Yes, I can.

PN1501

Thank you. Bear with me. It's very strange seeing you in one place and hearing you in another, so just bear with me?‑‑‑Okay. It's quite strange from this end, too.

PN1502

That has been said about me many times. Ms Dulac, my name is Nigel Ward. I don't think we have met. I am appearing in these proceedings for the employer interests, in particular two associations; ABI and the New South Wales Business Chamber. I'm just going to ask you some questions. Can I just start with � it's not clear from your statement who your employer is?‑‑‑I am self‑employed. I have an organisation called Enable Solutions Australia.

PN1503

By being self‑employed, do you simply work with and for yourself or do you employ people?‑‑‑I employ people.

PN1504

How many people do you employ?‑‑‑Approximately 12.

PN1505

In your capacity in running that business what work do you personally perform?‑‑‑Well, I perform management and contract compliance, and I also undertake some assessment work of people with disabilities in employment.

PN1506

Just bear with me. When you say contract compliance, I take it you hold contracts from the department, do you?‑‑‑Yes, so I hold a National Panel of Assessors contract with the Department of Social Services.

PN1507

Your business holds that directly with the department?‑‑‑Correct.

PN1508

Am I right that the 12 people you employ are, therefore, assessors?‑‑‑I have one administration assistant. The remaining are assessors.

PN1509

When you're personally assessing, do I take it that you are doing assessments in both open employment and ADEs?‑‑‑Correct.

PN1510

If this is too difficult to answer, I apologise. How many assessments have you done in your career?‑‑‑How many assessments?

***�� SHARON LOUISE DULAC�� XXN MR WARD

PN1511

Yes?‑‑‑So I do a number of different types of assessments, so are you specifically asking in relation to wage assessments or - - -

PN1512

Well, bear with me. I thought when you said assessments you meant wage assessments, but let's maybe take a step back?‑‑‑Yes.

PN1513

When you say you do assessments, can you explain to me what the different types of assessments are?‑‑‑Okay. So we undertake supported wage assessments across any awards that have that clause. We also take ongoing support assessments which make recommendations in relation to levels of support funding for people with disabilities who are in work, however, still require support to undertake that work. Also workplace modifications which mean, I guess, observing a person in a workplace and making recommendations should there be any need for specialist equipment or workplace adjustment that they may require to be able to maintain and continue in that position.

PN1514

Can I just make sure I understand what those involve. The supported wage assessment, that's using the SWS tool, is it?‑‑‑Yes, correct.

PN1515

Yes, okay. The ongoing support, my understanding is that's a kind of checking in process for people already in open employment who have a disability?‑‑‑I don't know if I would say checking in process, but, yes, it is an assessment for people in open employment that are already employed - - -

PN1516

Yes?‑‑‑ - - - and have been employed for in excess of six months, and continue to require funding for support in that position.

PN1517

The workplace modification assessments, are they predominantly in open employment, as well?‑‑‑Yes.

PN1518

I would be right, they might involve people with a disability or they might not?‑‑‑Always involve people with a disability.

PN1519

Okay. Thank you for that. If I could then take you to the beginning of that discussion where we talked about assessments with the SWS tool?‑‑‑Yes.

PN1520

I will ask a question there. How many of those assessments have you done in your career?‑‑‑In the high hundreds, possibly over a thousand.

***�� SHARON LOUISE DULAC�� XXN MR WARD

PN1521

Perhaps we might just settle on a thousand for now. How many of those would have been done in open employment versus in ADE?‑‑‑I mean, given that probably we have really only done assessments in the ADE environment in fairly recent years, I would say � I mean, it would be an estimate - probably around a hundred to a hundred and 50 assessments in ADEs.

PN1522

Would I be right in saying that your personal involvement with ADEs has been when you've been doing assessments with the SWS tool in an ADE?‑‑‑I also managed a service in South Australia a number of years back which included open employment and an ADE.

PN1523

When was that, Ms Dulac?‑‑‑In the early to late 90s.

PN1524

So accepting that you have worked in an ADE in the early to late 90s, your first‑hand experience in ADEs is when you have done your hundred to a hundred and 50 assessments?‑‑‑Sorry, I'm not clear what you're asking there. So I had first‑hand experience in an ADE in the 90s - - -

PN1525

Yes, I accept that?‑‑‑ - - - in a management capacity and also hands on, then my most recent experience in ADEs has been undertaking assessments.

PN1526

Yes, thank you for that. So when you give your evidence, your understanding of ADEs is based on that, isn't it?‑‑‑Yes. Predominantly, yes.

PN1527

Just for my benefit, when you do an assessment in an ADE are you there for an hour, four hours? How long are you normally there for?‑‑‑It largely depends on the assessment, so that can be quite a long time. I have spent, you know, sometimes a solid week in a particular ADE. I have also assisted some of the services that have transitioned from other tools to the supported wage process. I've spent some time in there undertaking benchmarking and assisting the service with that set‑up, so at times like that it would be unusual to spend between two and five days - - -

PN1528

What would it take to - - -?‑‑‑We can go in to do an individual assessment probably, on average, two to three hours.

PN1529

Thank you. Am I right in saying you're not a trained assessor in any tool other than the SWS?‑‑‑I have under � well, apart from the adapted SWS, I have also � I was part of the original BSWAT trials, so I have undertaken assessments there. FWS Employment Service, which I indicated earlier I had worked in in the 90s, actually had their own assessment tool so I have been trained in the use of that.

***�� SHARON LOUISE DULAC�� XXN MR WARD

PN1530

The business you worked in in the 90s, how many people did that employ?‑‑‑About 60.

PN1531

When did you finish working for them?‑‑‑Around about 2002.

PN1532

I take it from 2002 on you moved into working for yourself?‑‑‑I have worked in various � I've been employed directly by organisations and I've been self‑employed in various capacities since then.

PN1533

Would you agree with me � I'm not suggesting you might agree with the precise number, but my understanding is it's about 161 ADEs operating in Australia today. Does that accord with your understanding?‑‑‑To be honest, I would agree with you based on � I couldn't really honestly give you an accurate figure myself.

PN1534

You don't know?‑‑‑No, I don't really know.

PN1535

That's fine, that's fine. Have you predominantly worked with ADEs in a particular state?‑‑‑South Australia and Queensland.

PN1536

Okay?‑‑‑I mean, I have undertaken some more � not necessarily specific work, but demonstration projects and I was part of some of the trials of the initial adaptations of the SWS for ADEs across basically all of Australia, because at that stage I was managing a national assessment team, so I provided assistance with training assessors that undertook those - - -

PN1537

When you have done assessments yourself, they have predominantly been in South Australia and Queensland?‑‑‑Correct.

PN1538

In terms of South Australia, have they predominantly been in particular ADEs? How many ADEs would you have worked in in South Australia?‑‑‑Maybe six.

PN1539

In Queensland?‑‑‑Probably predominantly about four, but two of those have quite a lot of multiple locations.

PN1540

Is there one you have predominantly worked around more though?‑‑‑Sorry, I didn't quite catch that.

***�� SHARON LOUISE DULAC�� XXN MR WARD

PN1541

Is there one in particular you have worked for more than all the others?‑‑‑Probably � yes, Help Enterprises I've done quite a significant number of assessments with and also assisted with some of their benchmarking.

PN1542

Of your 150 ADE assessments, how many would be with Help?‑‑‑Probably half, maybe a little bit above that.

PN1543

So about 80?‑‑‑Yes.

PN1544

Thank you. Now, in your statement you talk quite a lot about contracts operated by ADEs, don't you?‑‑‑I have mentioned it, yes.

PN1545

Yes, okay. Would I be right in saying that you have never negotiated a contract for an ADE?‑‑‑No.

PN1546

You haven't?‑‑‑So I have done that in that area when I was saying in the 90s, when I was working with Services South Australia.

PN1547

So your direct knowledge of contracts is from when you were working for that organisation in the 1990s; is that right?‑‑‑Correct.

PN1548

You haven't been involved in contract negotiations since?‑‑‑Not for ADEs, no.

PN1549

I take it that it would be the case, as well, that since then you haven't been involved in drafting contracts or involved in tendering contracts for ADEs?‑‑‑Not for ADEs, no.

PN1550

So your direct knowledge of contracts and what happens with contracts dates back to when you were with a South Australian ADE in the 1990s; is that correct?‑‑‑Largely correct, yes.

PN1551

Is that your direct knowledge? Is that where you draw your direct knowledge from?‑‑‑Predominantly, yes.

PN1552

Where else do you draw it from?‑‑‑So I have had some involvement sort of indirectly.

***�� SHARON LOUISE DULAC�� XXN MR WARD

PN1553

Okay?‑‑‑But I think it's fair to say that that was my main base. I haven't had a lot of � I certainly haven't formally been involved in assisting ADEs with any sort of contracts in more recent years.

PN1554

So your sort of hands‑on personal knowledge goes back to the 1990s and that's where it comes from?‑‑‑Yes.

PN1555

Yes, okay. I would like to try and be fair to you, but I'm going to do something today that I didn't do yesterday and try and be more efficient. If you think what I am doing is unfair to you, please tell me. You say in your statement that you have read the Commission's decision, don't you?‑‑‑Yes.

PN1556

I would like to just read part of the decision to you and see if you agree with it or you disagree with it. If I can do it this way it will save me half an hour, if you can bear with me. We tried to get a copy of the decision sent to you. Did it get to you?‑‑‑It did, but to be honest I've got a fairly small laptop screen so that's going to be quite difficult for me to - - -

PN1557

I want to read one paragraph to you, if I can?‑‑‑Certainly.

PN1558

It's paragraph 248 of the Commission's December decision which you do acknowledge you have read?‑‑‑Yes.

PN1559

I'm just going to read it to you and then I'm going to ask you some questions, if I can?‑‑‑Yes.

PN1560

If you need me to re‑read it, please say so. If you want me to pause as I'm reading it, please say so, okay?‑‑‑Yes.

PN1561

It says this:

PN1562

ADEs operate in a different paradigm. The purpose of their existence is to provide employment opportunities for disabled persons who have restricted work capacity, typically on a not‑for‑profit basis. Accordingly, they seek only those business opportunities which will generate jobs capable of being filled by disabled persons, which necessarily limits the types of commercial activity they can engage in.

***�� SHARON LOUISE DULAC�� XXN MR WARD

PN1563

Further, they do not arrange their workforces simply on the basis of a job structure which will allow the necessary work to be performed in the most productive and efficient fashion and then recruit persons to fill those jobs. Rather, they create or tailor jobs in such a way that they are capable of being performed by a particular person with a particular disability or by persons with a class of disability.

PN1564

This may mean, for example, that a set of work functions which is capable of being performed as a single job by a single person not relevantly affected by disability is broken up into a number of discrete tasks, each of which will be made into a separate job that aligns with the work capacities of a particular disabled person.

PN1565

I will pause there. Did you hear that?‑‑‑I did. Are you happy for me to just see if I can actually find that in my - - -

PN1566

I am always happy, Ms Dulac - - -?‑‑‑It is quite a lengthy paragraph to - - -

PN1567

No, I apologise. Yes, I am more than happy for you to take a look?‑‑‑I'm not sure if I do actually have that in print. Okay, so I have that in front of me, so your question - - -

PN1568

What I'm trying to understand, which wasn't clear from your evidence, do you accept that as a proposition?

PN1569

MR HARDING: What part?

PN1570

MR WARD: What I have just read.

PN1571

THE WITNESS: So I think there is a whole � there are quite a number of concepts in that, so are you happy for me to just re-read that?

PN1572

MR WARD: I'm very happy for you to re‑read it?‑‑‑Okay, so:

PN1573

PN1574

I definitely agree with that. I think that's the relevant purpose of an ADE service.

***�� SHARON LOUISE DULAC�� XXN MR WARD

PN1575

Accordingly, they seek only those business opportunities which will generate jobs capable of being filled by disabled persons, which necessarily limits the types of commercial activity they can engage in.

PN1576

Again I would say that that is largely true. Their business - or they're seeking contracts that they're employees can complete.

PN1577

They do not arrange their workforces simply on the basis of a job structure which will allow the necessary work to be performed in the most productive and efficient fashion and then recruit persons to fill those jobs.

PN1578

I do feel that � I mean, the majority of ADEs that I have personally observed do have some adaptation of their role, but I don't kind of � I think they generally have a certain business model. I mean, most of them have quite significant investment in infrastructure and will tender for a specific type of contract. I guess they are - - -

PN1579

MR WARD: Just bear with me. You just explained your limited knowledge of contracts and your limited involvement in contracts which dates back to the 1990s. Can I put this to you then � I might do this in a little bit more detail. I just want to explain to you some of the evidence we have heard yesterday from witnesses on your side of the ledger?‑‑‑Yes.

PN1580

I just want to see if you accept this. We heard evidence yesterday of people with disabilities sitting around a table and one person's job was to take a shaving brush and put it in a box, and pass the box to the person next to them who would then put something else in the box and pass it to the next person. Would you agree with me that that is a very good example of the statement I've just read out in regard to how a whole job is broken down into a series of smaller discrete jobs?‑‑‑I guess � you have asked me a question about the whole � my view on the whole make‑up and, look, I have also observed that in ADEs and that definitely does occur, yes, for a very small percentage of people employed in those environments.

PN1581

You don't believe that represents what they do?‑‑‑I don't � I believe that represents what some do.

PN1582

Which ones?‑‑‑Sorry, what do you mean which ones?

***�� SHARON LOUISE DULAC�� XXN MR WARD

PN1583

You said you believe it represents what some do. Which ones of the ones you have been involved in are you talking about? Are you talking about Help or are you talking about one of the other six in South Australia or one of the four in Queensland?‑‑‑Sorry, I'm referring to some individuals, not necessarily some services.

PN1584

So you're talking about individual people with a disability. You're suggesting that individual people with a disability might do something � some work of a higher order than I just described?‑‑‑Sorry, I didn't catch that. You're a bit echoey.

PN1585

So you're saying that your disagreement with me concerns the fact that there may be an individual employee with a disability in an ADE that does work of a higher order than what I just described?‑‑‑No, I'm sorry, but I'm not really very clear on what you're asking me.

PN1586

Okay, well, let me do it again and I will use the same example. The passage I read out explained how what might be described as a whole job is broken up into a variety of smaller jobs and I think the reference in the Commission's decision is to suggest that you don't normally find that in open employment in the commercial sector. The example I gave you is where to put a shaving kit together one person's job would be purely to pick a shaving brush up, put it in the box and pass the box to the next person?‑‑‑Yes.

PN1587

Do you accept that that is breaking up an activity into smaller activities so that the person with a disability has a job - and that's all they do?‑‑‑Yes.

PN1588

Has a job that they're capable of doing?‑‑‑Yes.

PN1589

Yes, and you accept that that is commonplace in ADEs?‑‑‑Yes.

PN1590

Can I take you to paragraph 9?‑‑‑Of?

PN1591

Of the first one. Sorry, Ms Dulac. I apologise?‑‑‑Sorry, paragraph 9 of?

PN1592

Paragraph 9?‑‑‑Sorry, I just need to clarify, are we still on the Fair Work Commission document or - - -

PN1593

No, no, paragraph 9 of your first statement?‑‑‑Thank you.

PN1594

Just tell me when you have it in front of you, if you would?‑‑‑Yes.

***�� SHARON LOUISE DULAC�� XXN MR WARD

PN1595

Can I just understand your last paragraph that you changed?‑‑‑Yes.

PN1596

You said:

PN1597

I am aware of a number of ADEs who are paid based on national minimum wage and remain viable.

PN1598

?‑‑‑Yes.

PN1599

Would I be right in saying - is that a reference to the ones you worked with in South Australia?‑‑‑No, that's a reference to the organisations I have worked with more recently.

PN1600

But they are organisations that you have been doing assessments in, are they?‑‑‑Correct.

PN1601

Which one is it?‑‑‑That's predominantly Help Enterprises and - - -

PN1602

Sorry, I didn't hear that?‑‑‑Help Enterprises and also other services that I don't do assessments in because they pay a full award wage and are a number of services operated through an organisation called NQ Green Solutions.

PN1603

I think there is some evidence about them. Help is the one you talked about earlier, I take it?‑‑‑Yes.

PN1604

The one where you have done the majority of your assessments?‑‑‑Yes.

PN1605

Can I just understand, what do you mean by the word 'viable'?‑‑‑Basically I guess that they're commercially still able to operate.

PN1606

But you have not analysed their balance sheet, you have not analysed their profit and loss statements. It's just that they're still in business, is it?‑‑‑Honestly, I'm responding largely to information that they provide me when I'm there; so, no, I haven't been through their balance sheets.

PN1607

So somebody has told you that they remain viable and that's the words you have passed on, is it?‑‑‑Yes. I've been advised that particular contracts are quite lucrative and they're making a significant amount of profit.

***�� SHARON LOUISE DULAC�� XXN MR WARD

PN1608

Okay, so it's what somebody has told you from Help?‑‑‑Correct.

PN1609

Can I take you ahead to paragraph 18?‑‑‑Sorry, I don't know if you also want to refer to the NQ Green Solutions, but the people - - -

PN1610

I don't want to refer to that?‑‑‑Okay.

PN1611

Let me ask the questions, Ms Dulac. Mr Harding will do his very best to ask you about that later. In paragraph 18 you say this:

PN1612

ADE employers are unique in that the majority of employees certainly I've seen have a disability.

PN1613

?‑‑‑Yes.

PN1614

I take it that the uniqueness is the composition of their workforce?‑‑‑Yes.

PN1615

I take it you have agreed with me earlier it's how they organise that workforce?‑‑‑Yes.

PN1616

Yes. At paragraph 14 you talk about supermarkets, don't you?‑‑‑Yes.

PN1617

Is that people like Woolworths and people like that?‑‑‑Do you mind if I just re‑read that paragraph?

PN1618

That's fine. You take your time?‑‑‑Okay, yes, every � well, Woolworths, Coles, IGA probably.

PN1619

How do you have knowledge of that? You haven't been contracted by Woolworths?‑‑‑No, I haven't.

PN1620

You haven't been contracted by Coles?‑‑‑No, I undertake assessments in those locations.

PN1621

What do you mean by 'locations'?‑‑‑The supermarket or - - -

***�� SHARON LOUISE DULAC�� XXN MR WARD

PN1622

So you have done assessments in a Woolworths supermarket?‑‑‑Multiple, but � yes, multiple supermarkets.

PN1623

Woolworths supermarkets?‑‑‑Woolworths, Coles, IGA, yes.

PN1624

So you have done assessments in � of your 900 or so assessments in open employment, some of them have been in Woolworths, Coles, IGA, places like that?‑‑‑Correct.

PN1625

Okay, that's fine. I would be right, wouldn't I, that when you go into your Woolworths shop or your IGA shop - you would agree with me that the overwhelming majority of employees do not have a disability?‑‑‑Correct.

PN1626

That is a distinction between the open employment setting and the ADE, isn't it?‑‑‑Correct.

PN1627

Yes, and that's why you describe ADEs as unique?‑‑‑Yes.

PN1628

Can I take you to your second statement. If you could bring that in front of you?‑‑‑Yes.

PN1629

If I could ask you to turn to paragraph 15?‑‑‑Yes.

PN1630

You give some examples, (a), (b), (c), (d). Is example (a) an example in open employment?‑‑‑Yes.

PN1631

What company is that?‑‑‑I can't actually recall the specific name. It was a community services organisation in Cairns.

PN1632

You can't remember who it is?‑‑‑No. I mean, I can certainly follow that up and provide that at a later date if you - - -

PN1633

No, but at this stage you can't remember who that is?‑‑‑No, I wouldn't - - -

PN1634

How long ago was it?‑‑‑That � approximately three months.

***�� SHARON LOUISE DULAC�� XXN MR WARD

PN1635

Okay, but you can't remember who they are. What about the one in (b); is that an ADE?‑‑‑(b), yes, is an ADE.

PN1636

Which ADE was that?‑‑‑That is a specific contract undertaken by Help Enterprises based in the defence forces in Townsville.

PN1637

I think you have already told us that Help pays on the national minimum wage; is that right?‑‑‑They pay based on � their employees are assessed through the supported wages system.

PN1638

Okay. So they could be paid less than the national minimum wage?‑‑‑Correct, based on their productivity.

PN1639

Is that all that ADE does or is that just one work activity?‑‑‑It's all that they do at that location. They have multiple locations.

PN1640

Am I right in saying that it might be that there is a person with a disability who sits in front of a shredder and feeds paper into it?‑‑‑Correct.

PN1641

And that would be their job?‑‑‑Yes.

PN1642

Yes. The one in (c), you say:

PN1643

I have observed disabled employees employed as kitchenhands.

PN1644

Where did you observe that?‑‑‑Multiple positions.

PN1645

Where?‑‑‑So do you want me to name a number of employers or - - -

PN1646

Well, you say you observed it. Did you observe it while you were doing assessments, did you?‑‑‑Yes.

PN1647

Okay. Were they in open employment?‑‑‑Both open employment and ADE environments.

PN1648

Could you just go to (c). You say there in (c) that your evidence refers only to open employment?‑‑‑In (c)?

***�� SHARON LOUISE DULAC�� XXN MR WARD

PN1649

Yes?‑‑‑Sorry, I thought that was the previous question. In (c) both open employment and ADE environments, but, yes, I have stated in open employment there. So, yes, if you specifically want to refer to examples in open employment - - -

PN1650

I take it that it might be that my sole job is to load a dishwasher?‑‑‑Yes.

PN1651

Yes, okay. You have then given some examples in (d). Do I take it that they are predominantly open employment examples, as well?‑‑‑Point 1 is an open employment example, point 2 is an open employment example and point 3 is an open employment example, although I have also observed commercial cleaning in ADEs. Point 4 is an open employment example and point 5 is an open employment example of a young gentleman who was actually declined access to an ADE because he was advised he required too high a level of support, but that position that he took on was in open employment. Yes, the last point is in open employment.

PN1652

Thank you, Ms Dulac.

PN1653

VICE PRESIDENT HATCHER: Mr Harding, any re‑examination?

PN1654

MR HARDING: Some brief re‑examination.

RE-EXAMINATION BY MR HARDING�� [10.53 AM]

PN1655

MR HARDING: Ms Dulac, you made mention of NQ Green workforce - - -?‑‑‑Yes.

PN1656

- - - in answer to a question from my learned friend. What did you want to say about that?‑‑‑I mean, particularly I think they're a very good example of a service that operates some of the same contracts that I see in the ADE environment. I acknowledge that I don't have the background in contract management, but I'm aware that that contract is specifically called Containers for Change and it is a contract that other ADEs have - I don't know the dollar figure - but I also do quite a bit of work with NQ Green Solutions in several locations, so in Ingham, in Ayr and also some areas of Townsville, and they don't pay any � they don't have any supported wage. They pay all their participants at the national minimum wage appropriate to their grade level.

***�� SHARON LOUISE DULAC�� RXN MR HARDING

PN1657

I mean, they stay � and I have spoken to their manager. They say, 'Yep, that contract is very viable for them.' I have observed that workplace. I mean, there is one particular lad there that literally � his role is to pick up the bottle tops when they get taken off � you know, off bottles for recycling and that's all he does. There is a number of others there that do very, very, small discrete tasks and that organisation says, well, all of those things actually come together to be � complete the requirements of the contracts.

PN1658

VICE PRESIDENT HATCHER: Ms Dulac, does that business solely use disabled persons or does it use other categories of persons?‑‑‑They have a single � well, they have a supervisor and a group of people with disabilities. So, predominantly the workforce is people with disabilities and then they do have a number of supervisory staff or support staff as required and the costs of those are also covered through that � what they get from the contracts.

PN1659

I asked that because I actually looked on their web site and they say, from recollection, that they're set up to deal with a number of categories of persons with social disadvantage, including injured people and Indigenous people. Is that reflected in their actual workforce?‑‑‑In my observation the people that are actually employed in that NQ Green Solutions team have a range of fairly significant disabilities.

PN1660

Thank you.

PN1661

MR HARDING: Ms Dulac, you were asked some questions about viability by my learned friend. It was suggested to you that someone told you from Help that their contracts were lucrative contracts. Can you say who told you about that?‑‑‑I am happy to provide that information in a confidential setting. I mean, I'm not - I guess that has probably been provided to me by someone that may not have really been in a position to volunteer that information and I'm probably not overly comfortable with that.

PN1662

I understand that. Now, you were also asked some questions by my friend in relation to using a shaving kit example. Do you recall that?‑‑‑Yes, I do.

PN1663

You gave an answer pertaining to � well, one of the answers you gave in relation to that long question, you said something to the effect of a small percentage of people in ADEs do that work. Do you wish to elaborate on that further?‑‑‑Yes, look, I think � I mean, some of it is historical and I think in the majority of ADEs there are certainly people with very, very significant disabilities who perform very small, minimal tasks, similar to the example that Mr Ward presented, putting a single product in, and there is positions made that do fit those people with significant limitations. However, it's a very small component of the workforce and I think that was reflected in the ARTD report in that although that very � that small cohort of people that would have a very low percentage of productivity.

***�� SHARON LOUISE DULAC�� RXN MR HARDING

PN1664

If a person is only capable of putting a shaving brush in a box and that's it, their productivity would generally also demonstrate something very, very low. It also aligns with - in open employment positions a lot of adaptation is also made sometimes. I think my concern is Mr Ward seems to be indicating that that is reflective of the whole of the ADE workforce and I think � you know, I certainly agree that it is reflective of a very small portion of the workforce, but not all of the workforce.

PN1665

MR WARD: Are you able to put a number or percentage or estimate to the proportion on your observation?‑‑‑I estimate in my observation � probably I would have said maybe 10 to 15 per cent. The ARTD report tends to indicate around 16 per cent and I think that's probably indicative, and it does vary a little bit. You know, some organisations it would be next to none and others it might be a little bit higher.

PN1666

You were referring in relation to the person who is only capable of doing a single job, that their productivity would be very low. Thinking about the SWS, what are you referring to when you refer to the productivity being very low?‑‑‑Certainly in my sort of assessment and observation of people who are doing that sort of very simple task range, usually probably below 20 per cent, sometimes as low as 1 or 2 per cent.

PN1667

And is that, or is it not, reflected in the SWS assessment that you might do?‑‑‑Absolutely. I think that group of people would always have their wages rounded up to whatever the agreed minimum is at the time, because very few of them would actually even meet that minimum. So if someone � you know, sorry, I can't remember offhand what the current minimum rate is, but I believe it's about 12.5 per cent. Most of those wouldn't actually make that and so - - -

PN1668

Are you referring to the minimum in the SWS tool itself?‑‑‑Currently the minimum in the adapted SWS tool for the SESA Award. I note that the recommendations of the � here have set some, you know, minimum rates and honestly that's quite generous. In a percentage based assessment that very low level of productivity would be reflected and so usually that group of people probably tend to benefit, if anything, more from a productivity based system with a minimum wage floor because their wages are actually brought up to that minimum.

PN1669

Thank you, Ms Dulac.

***�� SHARON LOUISE DULAC�� RXN MR HARDING

PN1670

VICE PRESIDENT HATCHER: Thank you for your evidence, Ms Dulac. You're excused, which means you can disconnect from the hearing?‑‑‑Thank you very much.

<THE WITNESS WITHDREW�� [11.02 AM]

PN1671

VICE PRESIDENT HATCHER: So is that all the evidence?

PN1672

MR HARDING: Yes. Sorry, I had a moment of blank. That is the evidence, yes.

PN1673

VICE PRESIDENT HATCHER: All right. Is it appropriate we take a bit of a break before we start submissions?

PN1674

MR WARD: If your Honour would indulge us, Mr Harding and I were going to suggest that we take an hour's break if that would be acceptable.

PN1675

VICE PRESIDENT HATCHER: All right. I'll just check, what is the estimated length of time for submissions?

PN1676

MR WARD: I think it goes something like this: Mr Harding is going to lead off. I think he will require at least an hour. Mr Kemppi, my understanding is, is not going to independently make any submissions. We will then go second. Subject to any questions, my sense is I'll be less than an hour. The proposal then is for the Department to proceed and then we'll go to Mary � sorry, I apologise, then I think Mr Christodoulou wishes to say something at the end.

PN1677

VICE PRESIDENT HATCHER: All right. We are happy to accommodate that. Can I indicate that because of a commitment by one member we will need to finish at 3.30 today, but we've got all of tomorrow so that should amply accommodate those estimates, I think.

PN1678

MR WARD: Yes.

PN1679

VICE PRESIDENT HATCHER: All right. We will adjourn now and we'll resume at midday.

SHORT ADJOURNMENT�� [11.03 AM]

RESUMED�� [12.09 PM]

***�� SHARON LOUISE DULAC�� RXN MR HARDING

PN1680

VICE PRESIDENT HATCHER: Before we proceed to the submissions, Ms Walsh, you have provided and I think distributed a bundle of documents. Is it appropriate that we mark that as an exhibit?

PN1681

MS WALSH: Yes.

PN1682

VICE PRESIDENT HATCHER: We will call it the Our Voice Australia bundle of documents and that will be marked exhibit AC.

EXHIBIT #AC OUR VOICE AUSTRALIA BUNDLE OF DOCUMENTS

PN1683

Mr Harding?

PN1684

MR HARDING: Thank you. I thought I might start by making some general observations that underpin the submissions that we have made both in terms of power and also in terms of merit. What we have sought to do is to address the Full Bench decision in particularly aspects of the paragraph that my friend took Ms Dulac to today in 248 of the December decision and also to address what the Full Bench had said in 252 pertaining to commerciality or the ability to raise revenue in relation to ADEs.

PN1685

VICE PRESIDENT HATCHER: Mr Harding, perhaps we can take this as a starting point: what does AED, your clients, actually say that we should do?

PN1686

MR HARDING: We say, as we have put in our submission, that what you should do is abandon grade A and B and fix rates starting at grade 1. In relation to grade 1 we have identified Full Bench authority to the effect that there could be a change to the text of grade 1 that enables an employee whose skills aren't able to progress to grade 2 to stay there.

PN1687

VICE PRESIDENT HATCHER: All right.

PN1688

MR HARDING: Now, what we say about that is simply this: grade 1 aligns with the national minimum wage and I'm going to address you on why I think that's important if it's not already obvious, but I will address you on that. It aligns with the national minimum wage. It enables the Full Bench to adopt the SWS in a manner that conforms with every other award and conforms with the second special national minimum wage. It gives some acceptance to the fact that there will be a category of worker in ADEs whose skills are low and who may by reason of their incapacity not be able to progress to a skill level that conforms with grade 2.

PN1689

VICE PRESIDENT HATCHER: Perhaps you can come to this, but on your construction of section 153(3) - - -

PN1690

MR HARDING: Yes.

PN1691

VICE PRESIDENT HATCHER: - - - why doesn't the SWS infringe the exception? As I understand your conception of 153(3), the 'merely' aspect of the exception is 'not engage'. If the SWS provides for disabled persons, they can have their wage reduced because of their productive capacity in the circumstances where that is not done for non‑disabled employees.

PN1692

MR HARDING: Yes, I understand that, your Honour, but it's important to bear in mind that our submissions and how we construct them start from the premise that employees with a disability or disabled people are rights bearers. They bear rights that non‑disabled people don't bear. Those rights stem from a convention at international law and they stem from the particular protections that the Disability Discrimination Act has sanctioned. In particular, the engine room of substantive equality; namely, reasonable adjustment.

PN1693

The 'merely' and the way in which we put � and it's very important to understand it in that way. It's an immunity - that's how we characterise it � in respect of 153(1). 153(1) is broad, it simply bans terms that discriminate against � that's the important phrase and there is a point of causation there - or for the reason of, which is a motivational test, physical and mental disability. Then you get the immunity - - -

PN1694

VICE PRESIDENT HATCHER: So if we pause at 153(1) - - -

PN1695

MR HARDING: Yes.

PN1696

VICE PRESIDENT HATCHER: - - - would you accept that the SWS provisions in most awards would infringe 153(1) on its face?

PN1697

MR HARDING: No.

PN1698

VICE PRESIDENT HATCHER: Why not?

PN1699

MR HARDING: No, because 153(3) is a beneficial provision that enables an adjustment to be made for a category of worker who falls into the definitional phrase 'employee with a disability'. It's important to view 153(3) not as a get out of gaol free card as far as 153(1) is concerned, but as in fact a beneficial provision tied to the beneficial provision that's contained in subsection (1).

PN1700

VICE PRESIDENT HATCHER: I might not have made myself clear. My question was directed to 153(1) only.

PN1701

MR HARDING: Yes.

PN1702

VICE PRESIDENT HATCHER: But if we left aside (3) for the time being, we'll come to that - - -

PN1703

MR HARDING: Yes.

PN1704

VICE PRESIDENT HATCHER: - - - if 153(1) was the only provision, it would seem to me that the SWS would infringe 153(1) because it allows something to be done for disabled workers which it does not permit with respect to non‑disabled workers. Do you accept that?

PN1705

MR HARDING: I'm not sure I accept it in the broad way in which you have put it, your Honour, and the reason I am hesitating to accept it is because the SWS is � the way we view the SWS is an aspect of productive capacity. In other words, it ties into the protections that the Disability Discrimination Act affords. In that way it confers a benefit. Viewed in that way it may not trigger the phrase 'discrimination against' because of an absence of adversity.

PN1706

VICE PRESIDENT HATCHER: But isn't the adversity they get paid less?

PN1707

MR HARDING: Yes, but the paid less bit responds to the productive output that they're receiving. In other words, you have a rate of pay which is a properly fixed minima and then the worker with the disability comes along and says, 'Well, I can give you this output by virtue of the nature of my impairments.'

PN1708

VICE PRESIDENT HATCHER: But as a - - -

PN1709

MR HARDING: They then get paid � just to finish off the point � the properly fixed minima for the work that they have actually outputted.

PN1710

VICE PRESIDENT HATCHER: But there is no basis to assume that non‑disabled people have equal levels of productivity or that there aren't differentials that could be measured for them. I mean, I'm sure that if you applied an SWS concept to non‑disabled people, people will have a whole range of results.

PN1711

MR HARDING: Non‑disabled people - - -

PN1712

VICE PRESIDENT HATCHER: But that's not permitted by any modern award.

PN1713

MR HARDING: - - - don't have the benefit of the Disability Discrimination Act.

PN1714

VICE PRESIDENT HATCHER: How is that an answer to the proposition?

PN1715

MR HARDING: Because I suppose what I'm trying to suggest is that we have a category of people who have specific rights that recognise the nature of their impairments and then seeks to do something to advance them further into a position of equity, and then adopt specific mechanisms in order for that to occur. It is true that non‑disabled people � that no assumption is made by the modern award system based on the productive output for non‑disabled people.

PN1716

Then what I'm suggesting to you is that the nature of this category � employment with a disability � has as its core a recognition that those disabilities may impair output and an employer can't be sanctioned under the Disability Discrimination Act for paying by reference to productive capacity. So in that sense there is a point of distinction that arises from the mere status of being employed with a disability.

PN1717

VICE PRESIDENT HATCHER: I'm not sure that's right, with respect, because people can have impaired productivity for a whole range of reasons, one of which might be disability but there might be other reasons.

PN1718

MR HARDING: There might be, but those whose productivity is not impaired by a disability don't have the benefit of the DDA. Going back to your proposition, I'm loath to accept necessarily at the outset that section 153 is engaged bar 153(3), but even if that is correct the immunity is available in order to provide a particular adjustment that recognises a category of disabled person. Not every disabled person, but those who fall within the definitional phrase 'employed with a disability'.

PN1719

In that sense the 153(3) limitation or immunity is, on our construction, to be viewed beneficially as a way of making an adjustment for this category of employee with a disability that responds to the nature of (a) their disability, but also their eligibility under the Social Security Act which recognises this category of disabled person as having particular features. So, it is a nuanced way that the Act provides to enable the Commission to make an adjustment that reflects the characteristics that stem from their eligibility.

PN1720

Our friends say, 'Well, no, it's a free‑for‑all. It's discrimination at large', but, with respect, that ignores the statutory elements that pertain to this category of person reflected in other laws, including the DDA, but also the Social Security Act itself, so we have identified in our submissions how that is engaged.

PN1721

It's important to note in that respect that the SWS forms one of the eligibility requirements under section 94 of the Social Security Act for this category of worker. The SWS is built into the eligibility and, therefore, built in to the definitional phrase that engages the immunity in 153(3).

PN1722

VICE PRESIDENT HATCHER: Well, I mean, if 153(3) was only meant to say provisions about the SWS, why didn't it just say that? Speaking only for myself, I have trouble understanding how an exercise in construction of 153(3) leads to a result that the SWS is the only wage‑setting method that can be lawfully adopted for disabled persons as distinct from some other method which recognises there is a capacity or productivity because of the employee's disability.

PN1723

That all leaves aside the question of what that should be, but just as a matter of construction how a legitimate exercise in statutory interpretation can lead to that result.

PN1724

MR HARDING: We have outlined it in the submission, going through an analysis of the Social Security Act and then how that aligns with various other provisions of the Fair Work Act and how it aligns with the Disability Discrimination Act. I think the principles that we have articulated in relation to statutory construction are, in essence, that it's an exercise in ascertaining the meaning of statutory language viewed in context.

PN1725

The starting point for context in relation to section 153(3) is that it applies to a specific group of people who have characteristics that stem from the Social Security Act. That is the starting point to ascertain what the statute is getting at, what the Fair Work Act is getting at when it says to the Commission you can make a term and put it in a modern award if it engages 153(3).

PN1726

In the list of authorities that we have given to you � and I'm going to take the risk of doing this electronically � item 5 contains extracts of the Social Security Act. Now, this is quite a detailed exercise because the first thing to address is � and it's really an analysis that mainly stems from section 94, I accept. It's on page 94 of the list of authorities that we have given you. Obviously the elements of impairment are reflected in sub (a) and (b) of subsection 94(1):

PN1727

One of the following applies: (i) the person has a continuing inability to work; (ii) the Secretary is satisfied that the person is participating in the program administered by the Commonwealth known as the supported wage system.

PN1728

It's an aspect of the very class of people that we're here speaking about. Now, the continuing inability to work criteria is quite a long and lengthy provision that starts in subsection (2), and is linked to the ability � and you can see this from (2)(a) � of the person to �

PN1729

work independently of a program of support within the next two years.

PN1730

'Work' is defined. This is on page 99 of the list of authorities:

PN1731

Work means work that is for at least 15 hours per week on wages that are at or above the relevant minimum wage.

PN1732

The plain way in which one would look at 94 is this: that in creating an eligibility for a pension it's also looking at how that intersects with work and the rate of pay that can be paid for work, and it leaves that to the award system, or the Fair Work Act system because it refers to the relevant minimum wage. Now, the Commission is proposing a classification for disabled people that is fixed by reference to a tailored position that engages the classifications in (a) and (b). In other words, for that class of person they can perform work for at least 15 hours per week on wages that are at the relevant minimum wage.

PN1733

We're not in the continuing inability to work category at all, because by creating a classification which these group of people can perform work at, you cannot answer the eligibility question posed by subsection (2) which drives you invariably to the SWS. Now, the Commission has provided for the SWS as part of the scheme that you have elaborated on in this decision, but as we point out the eligibility for the SWS in the schedule that the Commission has inserted in the award is that the person is unable to perform the range of work set by the classification in an award. I'm paraphrasing, but that's essentially it. By creating the classification (a) and (b), they are able.

PN1734

My learned friend would delete the SWS entirely from its proposal, which means we only have a classification system which this class of people it's intended would be able to work at.

PN1735

VICE PRESIDENT HATCHER: I asked you a day or two earlier if we just change (a) and (b) to refer to functions and duties without any reference to disabled people so that a non‑disabled person, if they did that job, would be paid that rate - - -

PN1736

MR HARDING: Yes.

PN1737

VICE PRESIDENT HATCHER: - - - why does that not dispose of all of this?

PN1738

MR HARDING: Well, there are several answers to that, your Honour. The first answer arises out of 153(1). The predicate I'm assuming � and perhaps I may have misunderstood your Honour � is that if you delete the gateway requirements - can I use that expression � and you just set a classification, any employee will be so classified.

PN1739

VICE PRESIDENT HATCHER: Yes.

PN1740

MR HARDING: Then, in my submission, you have problem at two levels. The first one is principle, because there would need to be a justification for the rate of pay lower than the national minimum wage that takes account of the principles that apply to wage setting at the national minimum wage level, but also the principles that apply to fixing a minima in an award by reference to the C10.

PN1741

VICE PRESIDENT HATCHER: Yes, they are merits issues, but is there - - -

PN1742

MR HARDING: But, no - - -

PN1743

VICE PRESIDENT HATCHER: I'm talking about the jurisdictional issue at this stage.

PN1744

MR HARDING: But that is a jurisdictional issue because we're fixing a minimum wage which has a settled meaning, in our submission. Then in relation to 153(1), the prohibition is discrimination 'against an employee because of, or for reasons including' � there is both a causation issue there and a motivational question.

PN1745

Of course these proceedings, which demonstrate that (a) and (b) have been motivated by the need to pay disabled workers and ADEs a rate of pay below the national minimum wage, the contextual element of that of course is that this would be a rate of pay only for supported employment in this award and not other awards. So we are pointing inexorably to grade A and B as being motivated by disability.

PN1746

VICE PRESIDENT HATCHER: So the reasons are not reasons that are discernible in the face of the clause; they're reasons that you would discern in the minds of the decision‑makers.

PN1747

MR HARDING: Well, the minds of the decision‑makers based on the evidence of how the clause came to be, your Honour, obviously, but moreover you also just asked me a question pertaining to Tracey J's decision and what he had said about indirect discrimination. Of course his Honour was addressing specifically a submission that had been made to him which is to the effect that if a term was facially neutral would that invoke the indirect discrimination concept, and his Honour was against that propositions.

PN1748

Now, I said to you at the time that his Honour in fact in that decision refers to the McConnell decision, as I've described it. It's in our list of authorities. He refers to the decision at first instance decided by Ryan J and not of course the Full Court decision which occurred later. That decision is item 16 of our list of authorities.

PN1749

I probably only need to say a couple of things about that. The first, of course, is that although the McConnell decision was dealing with a different statute, the BCII Act, and it was dealing with a discrimination concept that arose out of that Act pertaining to independent contracts, their Honours, particularly Katzmann and Flick JJ, warned against importing concepts derived from other legislation in construing discrimination against, and all three justices viewed discrimination according to its ordinary meaning, as opposed to its meaning that's been, you know, elaborated in specific terms in antidiscrimination legislation, and said:

PN1750

Discrimination against merely means making a distinction that's adverse.

PN1751

That's it. You don't go into all the details associated with statutory provisions that have no direct - where the concept of discrimination in the Fair Work Act is not defined.

PN1752

There is also a further decision that I will hand up. This is a decision of Gordon J in the Klein case. Her Honour was construing the phrase 'discrimination between' as it exists in section 342(1) of the Fair Work Act. Her Honour was taken to the decision of Tracey J and she deals with that from paragraph 90 of her Honour's decision. She is directed to Tracey J's decision and she deals with it in paragraphs 94 and 95. Now, of course, this was dealing with a different provision. Her Honour expressly disagrees with Tracey J, and I'm aware that his Honour was dealing specifically with this provision, but she gives reasons for why she disagrees with the 'compelling' because she draws on High Court authority in the Waters case in order to buttress her rejection of his Honour's view of discrimination against.

PN1753

You will see from about halfway down in paragraph 95 of her Honour's decision, there's a line that starts, 'Mutual discrimination, which is otherwise known as indirect discrimination, and she says:

PN1754

A number of points need to be made. First, the analysis of Mason CJ and Gaudron J, with which Deane J agreed -

PN1755

and she refers to paragraphs 91 and 92 of her reasons, which extract that concept. In 91, there's quite a long passage, I think extracted from Dawson, Toohey and Deane, and if I can just take you to the top of page - it's not numbered - it's 203 of the reasons and it starts with:

PN1756

It is implicit in what we have said that we do not accept the proposition that section 17(5)

PN1757

which was the concept of indirect discrimination, as it was then contained in the Equal Opportunity Act Victoria -

PN1758

is a complete and exhaustive statement of what constitutes indirect discrimination. Indirect discrimination, as described, may occur otherwise than by means of the imposition of a requirement or condition and the language of the section appears to be consistent with the notion that section 5 is a complete and exhaustive prescription.

PN1759

So, 'discrimination against', in its ordinary meaning, does not necessarily import all the elements of indirect discrimination that are specified in an antidiscrimination statute - in its ordinary meaning. It can have a direct effect in the sense of, 'I'm not employing you because you happen to be black' - direct discrimination - or something else which indicates that people of colour may not be welcome - indirect discrimination because the practical effect is to exclude, the practical effect is to exclude, and in the McConnell case, Buchanan J expressly viewed discrimination against as having a consequential effect, so viewed in the context of section 153(1), it can be both.

PN1760

VICE PRESIDENT HATCHER: Does that thereby import the reasonableness?

PN1761

MR HARDING: No, not necessarily. This is the point I'm trying to make. Indirect discrimination in the Disability Discrimination Act and the Equal Opportunity Act has a set of specific elements, a requirement or condition that one group can comply with and people who don't have that attribute can't comply with, and it's not reasonable, which, of course, is a value judgment, but, discrimination against does not necessarily import all those specific elements in order to be satisfied. If it was so, the Fair Work Act would have defined it in that way and it doesn't.

PN1762

So, it's better to view 'discrimination against' as having a broad connotation that pertains to adverse distinctions which may be direct or consequential, and here the consequence will be this: if you proscribe a classification that will apply to a group of people who only perform work of that kind, invariably, at a practical level, if it's not specified in the clause, then it will be something that - well, it will apply to that group, and then the analysis of section 153(1) kicks in.

PN1763

Since we are on the subject of jurisdiction, I probably should stick with that. What we have endeavoured to do in our written submissions is to look at the immunity in section 155(3) in the particular context in which it arises, which, of course, is employee with a disability, which imports the characteristics that are contained in section 94, having regard to the way in which that group of people are protected by law, and reasonable accommodation, of course, is one of those concepts, but I wish to draw attention to what Professor McCallum has said about the jurisprudence that has emerged from the Convention.

PN1764

The observation that Professor McCallum makes in page 10 of his statement is:

PN1765

The concept of formal equality has not greatly assisted most persons with disabilities. In large -

PN1766

and then he goes on to explain why, and then draws attention to the right to substantive equality, which, of course, is an underpinning principle of the Convention. So, that's the international right that these employees enjoy, and he draws on the work of Sandra Fredmer to explain what 'substantive equality' means, or could mean, albeit expressing the view that the DDA does not fully embrace that concept.

PN1767

Unlike formal equality, which is simply a matter of comparing two groups of people and saying, you know, 'How does one stack up against another', substantive equality is activist. It's looking at how one addresses disadvantage and, in that circumstances, says, 'All right, if we have a group of disadvantaged people, how do we deal with that in a way that removes the disadvantage?'

PN1768

The illustration in this context is this. This Full Bench has found that the wages tools that are in clause 14.4 don't meet Fair Work Act standards and has set upon a course to replace that clause with something else. It has to follow that if they are not meeting Fair Work Act standards, the wages are too low. It has to follow.

PN1769

VICE PRESIDENT HATCHER: With respect, that wasn't the reasoning in the 2019 decision and, in fact, I thought - I can't remember the paragraph - but I thought we said that our analysis of particular wage tools did not involve a conclusion that they produced an unfair or inappropriate rate for particular work, only that they were rates not produced by any application of the award and they produced inconsistent results across employers for similar work. We didn't express any view that the actual outcome in any particular case was inappropriate.

PN1770

MR HARDING: I thought your Honours - - -

PN1771

VICE PRESIDENT HATCHER: Whether it was too low, to high, or whatever.

PN1772

MR HARDING: I thought you were saying that, at a particular level, you couldn't conclude, because you were doing a desktop analysis, that any individual had been worse off. I accept that. What I'm saying is that, at the level that your Honour and the other members of the Full Bench - the conclusion you had reached is that the tools, for the reasons that you have identified, didn't meet Fair Work Act standards. Those tools produced the rates of pay that they did. Now, if they are not meeting Fair Work Act standards, it must follow, in my submission, that the rates of pay haven't been appropriately set according to the Fair Work Act, and that being so - - -

PN1773

VICE PRESIDENT HATCHER: Well, they weren't set by us at all. That's the essential point.

PN1774

MR HARDING: Yes, that's right, they didn't - that's right, they weren't set by the Commission, they were set pursuant to wage tools that were external to the award, and I think you also made the point that the BSWAT having been removed remedied a wage injustice because it was found by the court to be unlawful, contrary to the DDA and had to be removed for that reason.

PN1775

Now, that was a particular finding in relation to the BSWAT, and I accept that, but I am suggesting that there are elements of the wage tools that also took into account factors or elements that did not pertain directly to the performance of work but enabled employers to take into account factors personal to the individual, like their underpinning work skills - that's the one that stands out to me - that included, you know, aspects of assessment of their behaviour. To that extent, there is some similarity in the sense that you have a wage tool that fixes rates of pay other than for work output, which is the way in which classifications under the award system work, other than for work output.

PN1776

So, we are encouraging this Full Bench to start from a premise in which one investigates the rates by reference to a finding that the current clause does not meet Fair Work Act standards and proceed from that point.

PN1777

Now, I think this Full Bench concluded that there wasn't a general case for wage escalation, but I am drawing your attention to another way of looking at the conclusion that the Full Bench reached in order to encourage a view and endeavouring to persuade you to the view that leads to an enquiry about how it is - about whether wages have been set appropriately in accordance with the Fair Work Act and what that would then mean if you did set them appropriately in accordance with the Fair Work Act. In my submission, that will tie in with what we say in our submissions about the minimum wage phrase in section 153(3).

PN1778

If I can turn to that, you will see from our submission that - bear with me for a sec - we draw on authority to say that the concept of a minimum wage is itself beneficial, and we have directed your attention to the authority for that proposition. Sorry, I can't put my hands on it just at the present time. It's in our list of authorities. I think I cite paragraph 478 of that decision, but, in fact, the citation is paragraph 16, and what that tells us is that the purpose of modern award wages is to lift the market floor. So, another way of looking at the wage rates that your Honours found existed in practice - I think the evidence that you cited in your decision was at about $7 an hour - is that that's a market rate.

PN1779

It hasn't been set in accordance with Fair Work Act standards, it's been set in accordance with a market external to the Fair Work Act, and an analysis of the beneficial instrument, which is the minimum wage instrument, invites enquiry into how one lifts rates from rates that have been created by a market that is below the national minimum wage.

PN1780

There are two aspects to that. In our list of authorities we have included, at item 8, the decision in the 4-Yearly Review of Modern Awards (Pharmacy Industry Award) and drawn attention to particular paragraphs of that decision. The decision elaborates, as you probably know, Vice President, given I think you sat on it, the historical approach to work value that has emerged over many years in this country and how that aligns with the concept of work value that was contained in 156 of the Fair Work Act.

PN1781

In so doing, you made some observations about the basis for national wage cases which seem to be similar in character to the national minimum wage, and if I can draw your attention to paragraph 136 of the Full Bench decision, the observation, drawing upon what was said by Senior Commissioner Taylor in the Vehicle Industry Award referred to in paragraph 136, is that, at a national wage case level or a national minimum wage level, the rate is not focused on work value in a particular industry or a particular group of workers, it's apportioning an aspect of national productivity and saying, 'Based on our assessment of national productivity, the share that should be workers is reflected in the national minimum wage.'

PN1782

If we sit in grade A and B, the problem that arises is how does that link with that reasoning? Every other worker has a wage under the award that starts with the national minimum wage. They get a share of the national productivity. Grade A and B contemplate that that group of employees don't.

PN1783

The ADE proposal is for rates of pay of a certain number, and I don't know - maybe Mr Ward will elaborate on this - what the basis for those rates are. There doesn't seem to be any evidence that supports the numbers that were contained in the instructions given to me witnesses who he called on that subject. The Full Bench's reasoning seems to be on the basis that $7 accords with what is currently paid in the industry.

PN1784

VICE PRESIDENT HATCHER: Although the report suggests that, in fact, it's something lower than that.

PN1785

MR HARDING: You mean the ARTD?

PN1786

VICE PRESIDENT HATCHER: Yes.

PN1787

MR HARDING: I think the national - they had an average of $9.77 or something like that.

PN1788

VICE PRESIDENT HATCHER: I assume from the fact that the outcome would lead to a large increase in wages costs, the figures we had in mind were in fact above the market.

PN1789

MR HARDING: Okay. I can't tell you - my understanding - - -

PN1790

VICE PRESIDENT HATCHER: I will have to go back to it, but the impression I had from the report was that implementing the package as a whole would effectively increase the wage cost for employees who can't be put at the full classification rate by about 50 per cent, which suggests that our estimation of what the market was is wrong.

PN1791

MR HARDING: I see, yes, and - - -

PN1792

VICE PRESIDENT HATCHER: I am hoping somebody will address that sooner or later, but - - -

PN1793

MR HARDING: That could be right, I suppose, in which case - well, let's start from that hypothesis that it is, you know, on average, $9.77, which is higher than what your Honours and the Commissioner found. Nonetheless, it's a lot lower than the national minimum wage, and so the point remains to what extent can we - if it's a minimum wage, and that's what the immunity in section 153(3) is intending to confer, these employees are entitled to the benefit of the principle in the same way as any other employee is, and the principle, at least at the national minimum wage level, is, it seems, concerned with allocating a proportion of the national productivity to all workers at a floor.

PN1794

VICE PRESIDENT HATCHER: Your submissions seek to attach telematics significance to the national minimum wage, but, on one view, if you look at the Act, it has very limited legal significance and probably even less practical significance, that is, it legally applies to almost nobody.

PN1795

MR HARDING: Well, I'm not sure that - - -

PN1796

VICE PRESIDENT HATCHER: That is, it's only purpose is to set a minimum wage for those not covered by an award.

PN1797

MR HARDING: No, and I understand that, but, of course, I think 135(2) requires you to take account of the national minimum wage in setting wages in awards. Now, yes, 'take account of' is a rather vague phrase, but it, at least in my submission, has two aspects to it: you have to take account of the rate, but, surely, you also have to take into account the reason why the rate is what it is. That's what taking into account means - it means giving it weight - because that's a statutorily mandated requirement in fixing rates in an award.

PN1798

But there's another submission, and that submission pertains to the concept of a minimum wage setting itself, and that arises from the re Annual Wage Review of 2012-13, paragraph 11. I've gone to the wrong one immediately and then the iPad crashed. If I can turn that up, this is at page 375 of the judgment. In particular, the judgment emphasises the concept of uniformity and consistency as between modern awards and rejects a sector by sector approach, the notion being, of course, that the modern award system is intended to provide for consistent minimum rates for work of equal and comparable value, although that's in relation to the equal remuneration principle - I apologise - which is a different issue - but it is calling up aspects of section 134, which emphasised fairness and stability as talismans of what you would create by a safety net that is going to apply to a whole industry.

PN1799

That's what we are here talking about at the end of the day, the establishment of a safety net of minimum wages that will apply across the whole of the ADE sector to a category of worker, and the principle, we say, supports the proposition that there must be some work value relativity fixed by reference to other awards as the foundation for any rate that's struck for these workers, and I may have missed it, but I don't see in your Honours' decision in December how that issue is resolved, but it is central, in my submission, to the concept of a minimum wage that is referred to in section 153(3).

PN1800

Again, we are not talking about minimum wage at large as if there is no industrial conception of that phrase - there plainly is - and, in one annual wage review after another, and we have identified at least three in our list of authorities, that connection has been reaffirmed by reference to the (indistinct) the manufacturing award.

PN1801

I mean, of course, your Honours and Commissioner, have, in their proposal, sought to align other classifications with other awards because recognising that similar work is being performed in those awards in ADEs and, of course, all those alignments mean that you have got, as set out in the Annual Wage Review, the same rate of pay for each of those classifications.

PN1802

Grade 1, as I have mentioned, aligns with grade - with the national minimum wage. There's a Full Bench decision that talks about the connection between the national minimum wage and the minimum rates. The citation is [2017] FWCFB 3500 at paragraph 149. The observation of the Full Bench there is that there's little practical difference between the range of considerations the panel is obliged to take into account in making a national minimum wage order and those that they would take into account in reviewing and varying modern award minimum wages.

PN1803

At 164, the Full Bench opines:

PN1804

If the national minimum wage was set at a level above modern award wages, it would raise for consideration whether the maintenance of a modern award minimum wage at a level below the national minimum wage meets the minimum wages objective.

PN1805

So, the taking into account obligation that's referred to in section 135(2) obviously has a number of elements that the Annual Wage Reviews have consistently recognised in their decisions.

PN1806

What we say is that it would be incongruous to construe section 153(3) as discrimination at large in circumstances where it is an immunity conferred in respect of a protective provision and where it specifically engages another protective provision in the form of a minimum wage.

PN1807

VICE PRESIDENT HATCHER: How does that apply itself with respect to rates for junior employees, which has - if you could express it in equivalent terms? I mean, awards set rates based on people's age without any reference to their individual capacity or to what characteristics might be said to apply to individuals by reason of their age. Why is that saved by the immunity but not what we propose?

PN1808

MR HARDING: Because the minimum wages for young people are expressed as a proportion of the national minimum wage or the base classification in the award.

PN1809

VICE PRESIDENT HATCHER: I mean, we could do that with (a) and (b), but what difference does it make?

PN1810

MR HARDING: I suppose what I'm suggesting is it may or may not make a difference, I don't know, because the exercise has to be engaged in. What we are saying is that if you are construing section 153(3) and allowing for a discrimination in relation to people with a disability, or employees with a disability, there ought to be some relativity struck with rates of pay in other awards in order to engage that immunity and its beneficial operation.

PN1811

It is important to our submission, of course, that 153(3) is beneficial to the category of worker we are talking about, and it is important to our submission that the rates that have been the product of wage tools that don't meet the Fair Work Act ought to be reviewed to ensure that whatever rate is struck does meet the standards in the Fair Work Act.

PN1812

I don't know what you ultimately might say would be the relativity with C10, because it's not an exercise that's been engaged in, but I am saying that, even if you are engaged in an exercise pertaining to C10, there's the connection to the national minimum wage, which is intended to ensure that, at a general level, employees get a share of the national productivity, and that's a consideration that bears on wage fixation here, too.

PN1813

VICE PRESIDENT HATCHER: When, in a previous guise, the Commission used to have wage principles, there used to be something called the first award principle where, if you were seeking to regulate an industry or sector by an award for the first time, the general starting guide was the market rate that existed at the time the first award was made and then it being envisaged that work value would properly be assessed over a period of time.

PN1814

Why aren't we in that sort of territory, that, in effect, there has never been award rates properly set for disabled employees in the sector before and that, as a starting point, we should set rates broadly aligned to market rates and then, as it were, develop it as we go?

PN1815

MR HARDING: Because, for the reasons that I have mentioned, the statute prohibits discrimination and then says, 'But you have a limited immunity', and that calls in aid the concept of a minimum wage as established according to settled principle, so, whatever may have been the position in the past pertaining to the first award, the Fair Work Act has changed that position.

PN1816

In relation to - going back to the Pharmacy case, your Honours analysed - the Full Bench there analysed how section 156(4) was different from wage fixing principles that applied pre the Fair Work Act and, of course, makes the observation that it doesn't capture change in work value from a datum point, but also provided more flexibility, and I am referring to paragraph 168, where the Full Bench opined that it could allow for, and take into account, factors that may have operated to discriminate, and (indistinct) undervaluation was the particular example that was referred to in paragraph 168.

PN1817

So, I guess my submission about that is that work value simpliciter needs to have regard to the circumstances that pertain to a group of disadvantaged people here employed with a disability and have regard to whether or not an adjustment can be taken into account to reflect the objects of the modern ideas that are more - that are expressed in the Fair Work Act and in other statutes that pertain to people with disability.

PN1818

I do want to come to the concept of reasonable adjustments in that connection.

PN1819

VICE PRESIDENT HATCHER: Mr Harding, have we moved beyond the jurisdictional issues yet, or - because I want to take one step back I want to ask you about, and I just want to go back to section 94 of the Social Security Act.

PN1820

MR HARDING: Yes, sure.

PN1821

VICE PRESIDENT HATCHER: If you go to 94(1)(c), I think, at least, one of the points you made about (i) is that if we set a rate of pay for employees with disability as defined, then, in effect, we are prey to circularity because the employees then will be able to work more than 15 hours at that rate and then they won't be employees with disability.

PN1822

MR HARDING: Correct.

PN1823

VICE PRESIDENT HATCHER: I am looking at (ii). What does it mean? I mean it expresses a matter of the secretary's satisfaction, but what does it mean to say that someone's participated in the SWS Program, that is, in circumstances where we propose that the SWS would be applied to the minimum rates that we set, would that satisfy (c)(ii)?

PN1824

MR HARDING: Yes, and the reason why it would satisfy it is because the employees would be eligible under the - leaving aside your classifications - if all you did was to say grade 1 and apply the SWS, because the employee couldn't - some employees with a disability couldn't perform the range of work that might be prescribed by grade 1, then they are participating because they are eligible.

PN1825

VICE PRESIDENT HATCHER: Just go to the proposal as a whole. We have got grades 1 to 7, we have got grades A and B and SWS can apply for a disabled person at any of those grades. Does that satisfy (c)(ii)?

PN1826

MR HARDING: No.

PN1827

VICE PRESIDENT HATCHER: Why not?

PN1828

MR HARDING: Because - it might.

PN1829

VICE PRESIDENT HATCHER: Yes.

PN1830

MR HARDING: And the reason, I suppose, is because the participation in the SWS doesn't engage the work element, which only seems to apply to the continuing inability to work. So, in that situation, if you allow for the SWS, the answer may still be 'No', but for a different reason, actually, and the reason pertains to the definition that's contained in the SWS, and we have extracted that at paragraph 28 of our submissions. To be eligible for the SWS, you have to be an employee who is unable to perform the range of duties at the competence level required within the class of work for which the employee is engaged under this award. Now, if you set a classification A and B based on a tailored or adjusted job, it follows that they can.

PN1831

VICE PRESIDENT HATCHER: Well, it depends on the secretary's satisfaction. Maybe we should ask the Department whether the secretary would be satisfied or not.

PN1832

MR HARDING: Good luck. That's right, it does depend on the satisfaction, but, of course, it depends on the - the satisfaction pertains to eligibility for the SWS, so if the secretary is not satisfied, the person's not employed with a disability anyway, in which case, you know, they are entitled to the full award wage.

PN1833

This is the difficulty. Section 94 came about before the Fair Work Act and is envisaging a world in which work is regulated by the Commission fixing minimum award rates, but assume this category of employee may not be able to perform work at those rates, and the SWS is available, by reference to productive capacity, to enable an employer to only pay for the capacity that they receive through work, and then they get a fraction of the properly fixed minimum rate. In my submission, that is what's contemplated by the intersection between 94 and the power in 153(3). The problem is, of course, this is statutory, it's fixed.

PN1834

VICE PRESIDENT HATCHER: For anyone currently receiving the disability support pension, why isn't the assumption that the secretary was satisfied and that, if the secretary ceases to be satisfied, they will cease getting the DSP? Why do we have to delve into this?

PN1835

MR HARDING: We don't want to create a situation where the satisfaction has to be withdrawn.

PN1836

VICE PRESIDENT HATCHER: Well - - -

PN1837

MR HARDING: Then you've got a problem with how it is that these people get paid. I'm seeking to avoid that outcome by the construction we're proffering.

PN1838

Do your Honours have any indication as to lunch or whether or not you are going to have a break?

PN1839

VICE PRESIDENT HATCHER: On the basis of the indication of time, I was simply contemplating waiting for you to finish and then having lunch but if you're going to be a fair bit longer, we can take lunch.

PN1840

MR HARDING: I probably am, given I haven't got to the merits stuff yes.

PN1841

VICE PRESIDENT HATCHER: All right, we will adjourn for lunch now and we will resume at 2.15.

LUNCHEON ADJOURNMENT�� [1.18 PM]

RESUMED�� [2.15 PM]

PN1842

VICE PRESIDENT HATCHER: Mr Harding?

PN1843

MR HARDING: Thank you, your Honour. Can I just make a correction to footnote [15] of our submissions on jurisdiction. I mentioned this in opening. It's a reference to the Annual Review of 2017-2018 and I referred to 78 - it should be to paragraph 16.

PN1844

VICE PRESIDENT HATCHER: Mr Harding, just before we move on from jurisdiction, in respect of section 153(3), does an award provide for minimum wages when it simply says some independent person can do an SWS assessment and come up with an outcome?

PN1845

MR HARDING: Yes, because the base is the properly affixed minimum.

PN1846

VICE PRESIDENT HATCHER: But it's not setting a minimum wage for that person, is it?

PN1847

MR HARDING: It is, because the base is, for work of this value, here's the rate of pay, and all the SWS does is to say for work that's actually produced by that worker, this is a percentage of that value that you get. So, the minimum rate for work is the base.

PN1848

VICE PRESIDENT HATCHER: Well, it's not a minimum wage if it's not a minimum wage.

PN1849

MR HARDING: That would apply to youth wages as well, or any other thing of discrimination, but some work has to be given to the concept embodied at 153(3). It's clearly intended to provide for some differentiation.

PN1850

VICE PRESIDENT HATCHER: I should say, in respect to junior employees, it does set a rate. Just because it's calculated as a percentage of another amount, I mean, it still provides for a minimum wage which must be complied with. It doesn't seem to me that SWS does that at all because it says that some external person beyond the Commission's control can come up with an amount which is a percentage of the rate we've set, so how are we setting a minimum wage?

PN1851

MR HARDING: Well, it is within the Commission's control. It's setting out the system that provides for a rate that's enforceable and capable of being subject to the dispute resolution procedure. So, I mean, the Commission has prescribed that system and said for that individual - and this is important - I mean the modern award classifications, I think you observed in a discussion we had on a previous occasion, your Honour - the classifications prescribe a value for work as distinct from a worker, and so what our submission says is that for work of this kind - packing, assembling, whatever - this is the value, and then, for the individual, a proportion is allocated.

PN1852

VICE PRESIDENT HATCHER: Well, (3) doesn't say that because it only applies to minimum wages for all employees with a disability, or class of them, it doesn't deal with wages for individuals.

PN1853

MR HARDING: But you are providing for a class if you - I'll go back a step. On our argument, by harmonising this award with every other award and the national minimum wage, which has a base, probably a fixed minimum, with the SWS, you are prescribing a differential system for all employees with a disability.

PN1854

The vice is, in our submission, that you are carving out a separate system for this group of disabled workers covered by this award employed by a certain class or type of employer, and we say that's not what 153(3) is getting at.

PN1855

In relation to a class, we have made some submissions about that. Again, we say about class that it has to engage with the definitional phrase 'employee with a disability' and all you need do is look at section 94(1)(a) and there's the classes.

PN1856

VICE PRESIDENT HATCHER: All right, thank you.

PN1857

MR HARDING: I did want to say two things before I leave jurisdiction, and they pertain to youth wages - I think it was a conversation that we had - but, in aid of the comparability argument, as I understand the situation, the youth wage rates in modern awards broadly align with the youth wage rates in the national minimum wage order and, to that extent, that establishes a distinction for this group of covered employees because, on our argument, this group of employees with a disability would not enjoy comparability with other modern awards or the national minimum wage order, bearing in mind the structure that we have just discussed where you have a base and the SWS that deals with the individual outcomes for particular employees or particular workers who have disabilities.

PN1858

Also, in aid of the construction that we press pertaining to 153(3), we have drawn attention to the Disability Discrimination Act, and there's two points of note that relate to that. The first is - and we have got the Disability Discrimination Act in our list of authorities - I think it's item 1 - and we haven't included the whole Act, but we have included two sections of significance, which is section 45(2) and section 47 - you will see that section 45(1) is the exemption that means that an employer, relevantly here, does not discriminate, in the defined sense as referred to in the Act, if what's being done is an act that is reasonably intended to do one of the things set out in (a) to (c), and you will see in subsection (c):

PN1859

Afford persons who have a disability, or a particular disability, grants, benefits or programs, whether direct or indirect, to meet their special needs in relation to

PN1860

(i) employment.

PN1861

Now, but for subsection (2), that might cover this situation and save a term that's included in the modern award from invalidity if it had to be later removed if there was an application for it to be later removed for offending the DDA.

PN1862

Subsection (2) makes clear that the special measures exclusion or exemption does not apply to wages, and that's dealt with by section 47(1)(c) and (d), and the exemption is targeted at wages based on capacity, we say productive capacity.

PN1863

That is important contextual information because it describes the state of the law in relation to this category of people and, harking back to the point I made earlier that this group of people are armed with rights and protections conferred by the DDA, that is contextual material that serves to construe the proper meaning of the immunity contained in 153(3), and you will see from our submissions, the concept of capacity reflected in section 47 of the DDA aligns with the use of that phrase in section 94 of the Social Security Act when it's trying to work out whether someone is actively participating in a program in support, which is, of course, in this context, an ADE.

PN1864

It is important to understand - I referred earlier to the Convention and the international rights to be recognised, one of which is an entitlement to just and favourable conditions of employment on an equal basis with others. I emphasise the words 'equal basis for others' because here we have made submissions about the way in which the modern award system and the national minimum wage are devised, the principles that apply to the rates that are fixed for each, and we have then compared that to what is being proposed for these workers, and, under international law, an 'equal basis with others' supports the comparability or the application of principle that we call for in relation to the fixation of rates in this award.

PN1865

The significance of the Convention has been referred to in a number of authorities and I only need to go to one. We've got it in the list of authorities. It's the case in item 23 of that list, Nicholson v Knaggs, a decision of Vickery J of the Supreme Court of Victoria. If I can just take you to paragraph 33, and this is a segue into what I'm about to say really on merit questions, where his Honour, albeit in the context of testamentary capacity, spoke about the Convention and its significance and said about that the CRPD - that's the Convention:

PN1866

The CRPD marks a paradigm shift in approaches to persons with disabilities. It reflects a movement from treating persons with disabilities as objects of social protection towards treating them as subjects with rights, who are capable of claiming and exercising those rights and making decisions based on free and informed consent as active members of society.

PN1867

Now, that is important contextual information for how one would approach the social inclusion element of section 134(1), which is, of course, the modern awards objective. It also informs what you may have apprehended from some of the cross-examination of the ABI witnesses pertaining to the NDIS, and the NDIS is, in my submission, a game changer as far as what it contemplates to support employees with a disability who are in employment, whether that employment be in ADE employment or open employment.

PN1868

We have included various parts of the NDIS Act, the National Insurance Act 2013, in our list of authorities and one only need look at the objectives of that Act - - -

PN1869

VICE PRESIDENT HATCHER: Mr Harding, do we know now anything about the NDIS that we didn't know when we made the 2019 decision?

PN1870

MR HARDING: Yes.

PN1871

VICE PRESIDENT HATCHER: What's that?

PN1872

MR HARDING: You know more about what the NDIS will cover in terms of the provision of support to employees with disability in ADE employment, and I am going to draw your attention to some evidence about that. No, you don't any more based on the statute because the objectives have been in the Act, obviously, since 2013.

PN1873

I draw your attention to section 31 of the NDIS Act because that sets out the principles that apply to the construction of plans, and you will see the emphasis on choice and the exercise thereof, you will see the emphasis on preserving dignity and the importance of doing that, and these are concepts that underpin the way in which the National Disability Insurance Agency prepares plans.

PN1874

We have provided you with some evidence given by Ms Mitra to the Royal Commission into the Disability Royal Commission - the recent one. Ms Mitra is the general manager provider and markets division of the NDIA and, from paragraph 55 of the - it might be Mr Kemppi's witness statement, she gives some evidence about what the NDIA does in relation to funding supports. Mr Ward observed there were 161 ADEs. Ms Mitra confirms that in paragraph 19, page 57 of her evidence and you'll see from paragraphs 30 on, on page 60, the emphasis that is given under the NDIA to transition into open employment as an option.

PN1875

Nothing that my clients say is intended to derogate from the notion that supported employment will be there one of the choices that are available if an employee wishes to exercise that choice. But, likewise, there is the capacity and emphasis given to moving from aided employment into open employment, facilitated by the NDIA.

PN1876

VICE PRESIDENT HATCHER: What is the relevance of that to our task?

PN1877

MR HARDING: I'm just about to get there. Paragraph 44 on page 61 and then onto the following page, explains the range of supports that are available to an employee through the NDIA. Now, much has been made of roles that ADE supervisors might play in behaviour management and also the kind of the supervision levels that might be required for this category of employees as bearing on questions of responsibility and presumably also cost that might be sustained by ADEs in providing those things.

PN1878

What is clear from this evidence is that that is kinds of supports of supports that an individual employee can be funded under an NDIA/NDIS plan to pay for if those are required in order for them to meaningfully engage in employment. They can take the same package of supports and go to open employment and do it there, work there. They can take those packages of supports and go to a different ADE.

PN1879

The advantage of the NDIS is it neutralises the support, the additional burden that ADEs may otherwise have had to carry in the form of support because the individual is now armed with the means to pay for it themselves and the ADE then bills the NDIA for the provision of those services. Yes and I also draw your attention to paragraph 54, Ms Mitra's evidence on page 63.

PN1880

So I think I put to some of the witnesses that there's greater competition for workers now as well as for work because the NDIA arms those workers with the means to move into different employments within the ADE system or in open employment and that has two effects on this case. I've already explained one of them. Another of those is it establishes the comparability, much closer we say, between work and ADEs and work in open employment.

PN1881

So when we're looking at the way in which wages in ADE employment is set and then having regard to the wage and the employee who moves into open employment who is covered by a different award or the national minimum wage, in my submission, it is difficult to justify a difference if the disabled worker, subject to the same level of support in ADEs, takes that package and utilises it to obtain employment with a different employer to do work that is customised for the circumstances of their disability. That's why I think back in 2019 there was less clarity around how the NDIS would, in fact, function.

PN1882

VICE PRESIDENT HATCHER: Well, speaking for myself, that's exactly how I understood it to function. I thought that's what was said in the decision at around 250, 251. That is, I'm not quite sure what has changed or what new point is raised that wasn't made at the time.

PN1883

MR HARDING: Well, I suppose what you're reflecting in 250, your Honour, is what the NDIS promised in terms of a system but what I'm pointing out to you is the evidence, direct evidence, about how that's applied in practice and I'm also pointing out to you evidence that makes clear the emphasis that's given to open employment in that scheme. Now, Mr Teed, I think his evidence was that increasingly, at least as far as his ADE is concerned, ADEs might be seen as a transition point into open employment. So we are talking about the same cohort of people who may move between different employments.

PN1884

It may be the case that for some ADEs, and I think this was the evidence given by the Minda people, it doesn't happen very much in their organisation but here we're designing a modern award system that's responsive to a social change represented by the NDIS Act that is contemplating this movement and, in my submission, that's the appropriate frame of reference, rather than to look at specific current events that might apply to one ADE or another in circumstances where you don't have full evidence across the whole of the industry about how that will occur and how it might occur once the NDIA has been in operation for a few years.

PN1885

What you do have is evidence of what is intended to occur and what is available to facilitate that. It bears, as I've mentioned, on how one could conceive of social inclusion. Social inclusion in that context ought to have regard to the object of choice and empowerment that is reflected in the NDIS Act in relation to how people with disability might obtain employment and retain that employment with the support of the plans that they might have from the NDIS.

PN1886

One of the aspects of the Full Bench's decision was the value that ADE employment provided by providing employment to people who might not otherwise get another job. And in that circumstance I suppose that sets up a tension between the idea of employment as an important value versus wages in employment and if I may infer from what the Full Bench was talking about there, that there was value, perhaps that might justify lower wages if employment was retained and provided for through ADE employment.

PN1887

That tension between employment on the one hand and wages on the other, has been dealt with in a couple of Full Bench decisions, annual wage reviews, and I just draw attention to those. The first is [2012] FWAFB 500 at 23, and the 2017 Annual Wage Review I referred to earlier which is [2017] FWCFB 3500 at 442.

PN1888

There may be, and I don't think it's been suggested by our side that there is not any value obviously in being employed and retaining that employment but that has to be balanced against what we say is the proper approach to wage fixation in that form of employment and that one ought not be discounted by reference to the other.

PN1889

There was in the Full Bench decision of December some reference to the pension and how one is to examine that in relation to wages that's fixed under this award. I don't have the particular paragraph here before me but there was, as I read that part of the decision, there was recognition that the rates would be sub national minimum wage but that in the assessment of the impact of that one had to have regard to the fact that these employees would be entitled to the pension and we have said something about that in our submissions in terms of minimum wage setting.

PN1890

But insofar as that remains a relevant consideration as it seems to have in a number of annual wage reviews, what the Full Bench I've just referred to you said on that point, that paragraph 442.

PN1891

A number of parties emphasised the benefits of being employed. These benefits extend beyond just the income earned to include greater dignity and self-respect and capacity for social inclusion. It is consistent with that view to believe that dignity and self-respect and a sense of fairness is enhanced when individuals and families are paid a fair wage and are able to rely more on what they earn and less on social welfare benefits to sustain themselves.

PN1892

On that front there's evidence that was presented to the Royal Commission from the Commonwealth, which has been presented to you, where a number of wages scenarios were developed by the Commonwealth and they were attached to an agreed statement of facts, I believe, and are from pages 5. These scenarios calculate wages based on a hypothetical supported employee working 21 hours a week at $9.77 per hour and compare that to a situation in which the same person working at different hours per fortnight earns the national minimum wage.

PN1893

On each of those scenarios a worker earning the national minimum wage is better off. Scenario 1 is instructive. Scenario 1 has a 20 year old working part-time, 42 hours per fortnight, earning $9.77 per hour. There's another scenario, the same 21 year old working 42 hours per fortnight but being paid the national minimum wage of $20.33 and I can tell you on that scenario the person earning the national minimum wage is $221.83 better off per week.

PN1894

VICE PRESIDENT HATCHER: That's comparing somebody working part-time to somebody working fulltime.

PN1895

MR HARDING: No, the one that I'm referring to, scenario 1 and scenario 7, are two people working part-time, the same number of hours. The same number of hours. Now, this takes into account the effect of their pension. It takes into account the effect of the tax offsets that these employees would receive and have been prepared by the Deputy Secretary of the Department of Social Security and provided them to the Royal Commission.

PN1896

VICE PRESIDENT HATCHER: But you're not submitting, are you, that we should discount the way in which the DSP operates in conjunction with any wage that we set, particularly being the one, as you pointed out, 1533 - - -

PN1897

MR HARDING: Yes.

PN1898

VICE PRESIDENT HATCHER: - - - operates by reference to the Disability Support Pension.

PN1899

MR HARDING: It does. It does. I think the submission we made about the DSP is that it's not a work value consideration and it is irrelevant to the setting of the minimum wage itself. But it is true to say, and I think the way in which the Full Bench has dealt with that, is to say, all right, well, having set the wage how does that � where do we stand on the needs of the low paid having regard to the fact that the pension is available?

PN1900

On that analysis, looking at it through the lens of section 134, it is relevant to take into account that employees � these employees would get the pension. That's the distinction between the two positions we adopt. So we offer these scenarios to demonstrate that on the question of the needs of the low paid, the pension is not a complete answer. It's only a part-answer and on at least scenario 1 and scenario 7, the national minimum wage worker is better off than they would be if they were getting the rate of pay that the ARTD indicates would be the average if the wages structure proposed by the Full Bench comes to pass.

PN1901

VICE PRESIDENT HATCHER: I find it a bit strange that the Department saw fit to provide that sort of material to the Royal Commission but not to us.

PN1902

MR HARDING: I had wondered that myself, your Honour. It is one of the remarkable ways in which the Commonwealth Department of Social Services has completely left the Full Bench in such a difficult position when it could have provided information like this. It didn't and even when the Full Bench was asking the Department to provide specific information that could have assisted in the decision-making, it simply didn't.

PN1903

Even on the question of Australia's international obligations, you may have recalled a submission that was made last time around where the Department's legal representative got up and said the Full Bench should be mindful of Australia's international obligations, and then sat down. A submission about nothing. A submission about nothing. Sorry, I misled the Full Bench. Those scenarios are attached to Mr Kemppi's statement of the agreed statement of facts.

PN1904

I do wish to now turn to viability before finishing up on the ARTD report. The Full Bench's decision in 2019 singled out viability as a matter foremost in its consideration and we have made submissions about whether that is an appropriate frame of reference for the fixation of minimum wages for workers performing work. I don't need to say more about that at this point.

PN1905

What we will say, though, is that the viability position is perhaps not as straightforward as had been suggested in 2018. For instance, Vice President issued a notice to produce to the Commonwealth and the Commonwealth ultimately came up with an Excel spreadsheet that provides some data about the use of the SWS in ADEs. What we've done is tried to prepare a summary of that, that explains the results in more usable form, so if I could just hand that up. I might say that the columns indicate two independent categories.

PN1906

VICE PRESIDENT HATCHER: I might mark that an exhibit, Mr Harding.

PN1907

MR HARDING: Thank you.

PN1908

VICE PRESIDENT HATCHER: I'll just call it AED table derived from Commonwealth data. That will be marked exhibit AD.

EXHIBIT #AD AED TABLE DERIVED FROM COMMONWEALTH DATA

PN1909

MR HARDING: AB, your Honour?

PN1910

VICE PRESIDENT HATCHER: AD.

PN1911

MR HARDING: D, thank you, yes. The ARDT report indicated that it was five ADEs in the cohort that used the SWS and we sought production of information from the Commonwealth about the numbers that they had on their records. And so the column headed, 'Name of ADE who used the SWS during the year to 30 June 2022', identifies the ADEs who did use the SWS.

PN1912

The number of times. Well, that addresses a category that asks the Commonwealth to identify whether it was a rate of use of the SWS over a period of time. The best we got from the Commonwealth is the number of times the SWS was used in a year, that being up to 30 June 2022. You will see that there's 28 � no, sorry, 35 out of the 161 ADEs who use the SWS.

PN1913

Obviously the circumstances in which they were used is not disclosed but Knoxbrooke Enterprises is there. So is Mambourin but there are other ADEs that have used the SWS more times than both of those organisations and we rely on that to say that the SWS is not foreign to ADE employment and, in fact, is utilised by a considerable number for various purposes. Most of the organisations listed on that list have not made submissions to this Bench. The Bench does not know their circumstances beyond the fact they exist and are using the SWS.

PN1914

Whilst I'm on that subject, you heard some evidence from Knoxbrooke Enterprises which does use the SWS and has used it for six years, since it adopted it from the BSWAT era and Mr Dauncey gave some evidence about one aspect of the group's activities, the nursery, and expressed concern about losses sustained by the nursery over a number of years. His evidence in relation to the SWS in particular seemed to apply to one year and increase in costs of some 338 following the adoption of the SWS after BSWAT. If the proposal that we advance is adopted, his position would remain unchanged.

PN1915

VICE PRESIDENT HATCHER: So as I recall it when we made the 2019 decision and I think going back to 2018, companies that went from BSWAT to SWS were receiving financial bridging support from the Commonwealth.

PN1916

MR HARDING: Yes.

PN1917

VICE PRESIDENT HATCHER: But that was expected to end. Has that position been clarified? Has that all ended now?

PN1918

MR HARDING: I believe it has ended and certainly Mr Dauncey's extract has the wage supplement ending and so I infer from that, that it has and his evidence was that the nursery is expected to break even. So they've gone from a loss-making situation over a number of years which they've sustained, I mean, the nursery still operates and seems to be successful on his evidence, to a situation which through changes that he said he made � has been made to the business, they expect to break even using the SWS. So if our proposal is accepted, his organisation will be in a position with a break-even situation occurs notwithstanding his criticisms of that system.

PN1919

COMMISSIONER CAMBRIDGE: Mr Harding, if the Commission's proposition goes forward, are we going to see this list expand to 161? Now, albeit on a basis that you oppose but isn't the use of the SWS going to be essentially, you know, universal?

PN1920

MR HARDING: If the Commission's proposal is - - -

PN1921

COMMISSIONER CAMBRIDGE: Yes, with the operation of the way in which A and B would be assessed.

PN1922

MR HARDING: Yes.

PN1923

COMMISSIONER CAMBRIDGE: In combination, it's sort of what we might describe as the hybrid model, where there's those A and B rates but there's the overlaying imposition of the SWS.

PN1924

MR HARDING: Yes, I understand that but that system hasn't been implemented so Mr Dauncey's organisation is using the SWS against a base of rate 2 and our proposal is that the existing grades 1 through to 7 be retained and the SWS be applied against those grades. So in using Mr Dauncey as an example, his position wouldn't change if our proposal was adopted and his evidence is that his nursery business is expected to break even.

PN1925

COMMISSIONER CAMBRIDGE: I understand all of that. All I was really looking at here was the increasing application of the SWS. It's going to mean this will become 161.

PN1926

MR HARDING: Yes, that's fine.

PN1927

VICE PRESIDENT HATCHER: Mr Harding, I mean, you say you don't know what the answer is but if the provisional view in the 2019 decision would increase aggregate wages by 50 per cent, how much is your proposal going to increase it by?

PN1928

MR HARDING: Quite a lot larger than that, I imagine.

PN1929

VICE PRESIDENT HATCHER: And how could, on any theory of economics, could employment be sustained by a wage increase of those sort of magnitudes?

PN1930

MR HARDING: That might depend on what transitional arrangement you were doing.

PN1931

VICE PRESIDENT HATCHER: It might be a different question if the Department suddenly gets up tomorrow and tells us about a new program of subsidies or supports but we assume that's not going to happen. But it just seems to me that if people are concerned enough already about our provisional view causing loss of employment, how would you approach your proposal of much greater magnitude?

PN1932

I mean, speaking for myself, I can't see any reasonable possibility that it wouldn't have the result of large numbers of ADEs closing and large numbers of disabled people losing their jobs, and that's the overwhelming thing that looms large in my mind, to be frank about it.

PN1933

MR HARDING: Yes, I understand that. I mean, that's loud and clear from the December decision, frankly, your Honour. I understand the concern but it will depend on how long the transitional arrangement is for any such thing to apply, and part of my reason to pointing to Mr Dauncey as an example is that over a six-year period applying the SWS in the way that he has, he's got to a situation now where he's able to say that he expects his business to break even.

PN1934

It's going to force change, I understand that that's the case. What I am also saying is that 28 other organisations are using the SWS now and they seem to exist. That's at least the inference that follows from that list. There may be some that don't; I don't know what they would be. Having said that though, we have evidence from the Endeavour Foundation and the Greenacres organisation. You've seen the financial reports.

PN1935

You know that currently their wages for supported employment is a fraction of their overall wages bill. It might alter the balance as between wages in supported employment on the one hand and wages that might be paid to non-disabled workers on the other. I don't know. There might be other structural changes that need to be made. But then any employer faces that risk from any alteration to national minimum wages or any wages outcome.

PN1936

We are talking about setting a minima and that's set on the basis that a boss has to pay that amount at least if they're going to stay in business and the whole idea of that, if they can bargain above that, then considerations particular to the organisation are matters that can be taken into account in the bargaining.

PN1937

But here we're talking about fixing a minimum rate for work and the expectation the Commission usually has is that employers have to be able to pay for the labour output that they absorb in producing goods and services that they sell onto customers but I think a transitional period is probably an appropriate course in order to guard against a sudden change that might provoke closure in an unwarranted way.

PN1938

As you've probably gathered from the cross-examination of at least Mr Teed and Mr Christodoulou, you know, we've been in this situation now for nearly two and a half years where there's at least � I mean, the Commission has flagged an intention to alter the rates of pay and they're still using the Greenacres tool. We don't know why but - - -

PN1939

VICE PRESIDENT HATCHER: What else were they meant to do in the interim? I mean, they're still engaging in conduct that's lawful under the award until such time as we change it.

PN1940

MR HARDING: I'm not suggesting anything other than that but the Greenacres tool was specifically singled out by the Full Bench, as well as Skill Master.

PN1941

VICE PRESIDENT HATCHER: We didn't single it out. We used it as an example.

PN1942

MR HARDING: You used it as an example of how it is that the wage tools under clause 14.4 might not comply with Fair Work Act standards. So we have a signal that these tools don't comply with the Fair Work Act standard and that signal has been up in the air since December 2019. We've provided you with the annual reports, as I've mentioned. I did want to hand up a document that has an analysis of Greenacres' annual report.

PN1943

MR WARD: Can I just have a minute to read this.

PN1944

MR HARDING: So what the - - -

PN1945

VICE PRESIDENT HATCHER: Sorry, did you object to � I'm going to mark this unless you object.

PN1946

MR WARD: Well, I'm just trying to understand what it's referable to, if we can. It's taken from the profit and loss figures shown there in the - - -

PN1947

MR HARDING: In the annual � handed up, yes.

PN1948

MR WARD: No, there's no objection.

PN1949

VICE PRESIDENT HATCHER: I'll describe this as AED analysis of Greenacres' financial reports, and I'll mark it exhibit AE.

EXHIBIT #AE AED ANALYSIS OF GREENACRES' FINANCIAL REPORTS

PN1950

MR HARDING: All we seek to do by this is to illustrate the difference in wages costs and the contribution of supported employment to those costs in the Greenacres organisation. The 2020 wage costs generally was $13 million. The contribution of supported employees' wage costs to that was nearly three. That's a 340 per cent difference between them.

PN1951

Likewise in 2021, $14 million was spent on non-disabled wage costs and nearly four on supported employment wage costs. That's a 278 per cent difference. So we're looking at the share of productivity coming out of that organisation, supported employment is paid a very small proportion of that productivity having regard to the wage costs paid to non-disabled workers.

PN1952

I did want to finish my submissions at this stage on some of the aspects of or the features of employment in ADEs that I foresee may be things that Mr Ward may point to and one of those aspects is of course the difference in scale between ADE employment in terms of the numbers of those with a disability that are employed versus open employment. Where in open employment you might expect to see a smaller number of employees with a disability employed.

PN1953

What I say about that is the scale difference doesn't bear relevantly on how you fix minimum wages for work. If the work of a worker in ADE employment is similar to the work performed by an employee with a disability, that is the same cohort of disabled workers in open employment, then scale is irrelevant.

PN1954

The employer in the ADE has a business that operates on the footing that it's engaging employees with a disability and true it is that some of those organisations identify a mission of providing employment to employees with a disability and that's obviously something that one can laud but the charitable, if that is the way it's to be characterised, purpose of these organisations is not a relevant minimum wage criteria, nor relevant to how one approaches work value.

PN1955

The fact that the Catholic Church may employ people to perform work as opposed to a private sector organisation, if the work is the same then the minimum wage would be the same. You don't take into account the fact that the Catholic Church may have a mission to help the poor or do some other thing that benefits society in general.

PN1956

It would be, in my submission, a diversion from proper principle to take into account sectoral considerations like that when fixing minimum wages for work and we have drawn attention on a number of occasions to the comparison between workers with disabilities who work in ADEs and workers with disabilities in open employment.

PN1957

VICE PRESIDENT HATCHER: Yes, I mean, I noticed you said they were the same cohort. Is that correct?

PN1958

MR HARDING: It is.

PN1959

VICE PRESIDENT HATCHER: It is. Doesn't the evidence disclose, and I'm not just talking about this week but the evidence from the last full hearing and I think we made findings about this, is that obviously there'll be some people with a degree of disability which will allow them to go straight into open employment.

PN1960

There'll be some who'll have a degree of disability which might cause them to go in supported employment and transition to open employment. And some of those will succeed and some of those will fail and come back. And there will be other persons for whom supported employment is the only option. So are we really, are we � I mean, you might want to challenge that premise but if that premise is correct, we're not really talking about like with like, are we?

PN1961

MR HARDING: I do challenge the premise. We are talking about people who qualify for the pension. Eligible persons with disability and this is an issue that's at the core of this case in real terms because all disability is individual. All disability manifests itself in different ways.

PN1962

One of the points of evidence that comes out and Mr Davis is a good example, is how you can put a person in a job who is said to be incapable because of their disabilities and then when they perform it they suddenly demonstrate extra skill and capacity as they learn how to do it better. And that may be something that facilitates a transition into open employment.

PN1963

It might be that the person just likes it in supported employment and wishes to remain there. At the level of the individual it's very difficult for this Full Bench to draw conclusions about what category of this cohort would remain in supported employment, which category of this cohort would go into open employment and where the two might mix.

PN1964

All we know is that this cohort who have the status of pension recipients under the DSP, are eligible to be treated � are the subject of power in 153(3). All we know about that is that a modern minimum wage instrument can be adjusted for that cohort and it has in the ways that we've described.

PN1965

I think that we do take issue with the suggestion, I think you've mentioned this this, your Honour, maybe you're referring to it, that the more severely disabled person would be in ADE employment. Mr Dauncey's evidence is that they employ people with low to moderate intellectual disabilities. Ms Smith's evidence is she's got a worker who runs the job with her, runs the job with her but who has problems from time to time in managing his behaviour.

PN1966

We've got Mr Rodney Davis who speaks about how when he worked in an ADE he was given one job to do. When he went into open employment, paid a different rate of pay, he was started on one job, watering the plants, and then he started doing more and more and more as he was able to display more capability.

PN1967

You cannot infer from that that there is subcategories of this cohort, one that remains in one group, another that goes into another. In fact, the Dunoon report, we've referred to it in the submissions, makes that point about the development of skills and how they can be facilitated by the doing of work.

PN1968

At the basic level we're talking about in relation to grade 2 and then grades A and B, we're using language like basic tasks in grade 2, simple tasks in grade A and B. It's difficult to discern what difference really there is in the work. That's where you're dealing with the base level of value in the modern award.

PN1969

You can't separate it by reference to qualification. There's insufficient evidence to separate it by reference to subcategory of employee and you can't confine it to one category of employee because you've got people working ADEs who have visual impairments. People who work in ADEs who have intellectual disabilities. People working in ADEs who have psychiatric disabilities. All of which have different consequences for them individually and as a class. So, yes, we challenge the premise.

PN1970

VICE PRESIDENT HATCHER: I mean, I must say, speaking for myself everything you just said is consistent with the premise. That is, there's a whole range of individuals with a whole range of disabilities for whom there will be different circumstances applicable. The NDIS recognises that because no one gets a flat amount from the NDIS. They're assessed on the basis of their disability and they get differing supports.

PN1971

MR HARDING: But then I don't think you can infer that those who stay in supported employment are those who have the most severe impairments.

PN1972

VICE PRESIDENT HATCHER: It depends upon the type of impairment. I mean - - -

PN1973

MR HARDING: It depends on the individual's choice as well and how they exercise it.

PN1974

VICE PRESIDENT HATCHER: I mean, severity is a matter of judgment but, you know, we don't know, for example, or we do know that the majority of supported employees have an intellectual disability. I don't know what the comparable statistic is for people on the supported wage system in open employment but if it's different, for example, if most of them have a physical rather than intellectual disability, then we are comparing different occurrences.

PN1975

MR HARDING: You do have evidence about that. There was evidence from Mr Cain given in 2018 that said a number of people � the majority of employees in open employment who received the pension were those with intellectual disabilities. Again, at a category level there's comparability where you don't have sufficient evidence to descend into the minutiae of who's choosing to do what.

PN1976

We have the 14 witnesses that Our Voice provided witness statements for and many of those people are expressing, at least four of them from recollection, saying in their statements that they tried open employment and didn't like it and came back. They don't say they couldn't do it. Some said they preferred it because they had more friends. One employee, I think, said that he was able to do the job, people were nice to him but he preferred to be in supported employment because it worked better for him. So he just made a choice to move back to supported employment.

PN1977

It seems the NDIS facilitates that. So there is a direct relation between how you look at wage fixing for this group of employees, ADE employees who were eligible for the pension, and this other category of employee who are also entitled to the pension because they meet the impairment criteria for the pension which is physical, psychological, intellectual, impaired to a greater extent than 20 points on the impairment table that the Commonwealth specifies for these things.

PN1978

That tells you something about degree. You've got to satisfy that degree of impairment in order to get the pension. Both categories of people, of person, work in both kinds of employment. Thank you, your Honour.

PN1979

VICE PRESIDENT HATCHER: Mr Harding, do you want to say anything in your oral submissions about the findings that were made in paragraphs 348 to 364 of the 2019 decision? These are the findings we made about the difficulties in using SWS as the sole wage setting?

PN1980

MR HARDING: Yes, I think we've mentioned that in our outline of submissions.

PN1981

VICE PRESIDENT HATCHER: Can I just ask this question?

PN1982

MR HARDING: Yes.

PN1983

VICE PRESIDENT HATCHER: I mean, that's not a matter we're now approaching afresh. We've made findings and then we've advanced provisional views on the basis of some fairly firm findings. So you need to, I think, demonstrate a real, a fairly solid reason as to why we should depart from those findings.

PN1984

MR HARDING: Isn't the reason that you've modified the SWS?

PN1985

VICE PRESIDENT HATCHER: Sorry?

PN1986

MR HARDING: The Full Bench has modified the SWS and trialled it. I haven't actually referred to the ARTD and their report, I omitted it. So the difference between December 2019 and now is that when you were looking in December 2019 you were looking at the SWS as an instrument that you expressed concerns about in unmodified form and you then made changes to the schedule in this award to address the concerns that you had identified.

PN1987

One of those, for instance, was the fact that ADEs were unable to draw on historical records pertaining to their records of employees' productivity and then the weighting to be given to the historical records on the one hand and the ADE � and the assessor's assessment on the other, and the modifications altered the balance.

PN1988

So there is a change from 2019. Then of course the ARTD report assessed that and there were a number of recommendations that they made about the SWS and some difficulties that some had identified with its application. There's nothing of a fundamental nature that the Full Bench had identified as a problem back in 2019. So and then of course you sanctioned the modified SWS as part of this award.

PN1989

So the inference that I drew from that is that the corrections have substantially fixed the criticisms that you've identified sufficient for you to be satisfied that it could be included in the award. I do probably do need to mention the ARTD. I realise I've occupied a fair bit of time.

PN1990

Your Honour, you mentioned something about the market rate and whether the ARTD caused you to alter your view about how that was to be assessed. I think in the December decision you mentioned something like $7 an hour. The $9.77 that I referred to is what I understand to be the average hourly outcome if the system contemplated in the December decision was applied.

PN1991

VICE PRESIDENT HATCHER: Yes, I thought somewhere there was reference to a figure of six dollars something as the pre-existing average but - - -

PN1992

MR HARDING: I can't help you with that, I don't know. But the average hourly wage increase of course was $3.26 through the application of the - - -

PN1993

VICE PRESIDENT HATCHER: I think that's where I got the figure, deducting one from the other.

PN1994

MR HARDING: I understand that. Yes but of course it still isn't an assessment of what would occur in a wage sense if the system contemplated by the December decision was, in fact, put into the award, rather than an assessment of actual rates now.

PN1995

VICE PRESIDENT HATCHER: I mean, in most cases I've been, if we awarded a 50 per cent wage increase the unions would be celebrating but apparently not in this case.

PN1996

MR HARDING: Not in this case.

PN1997

COMMISSIONER CAMBRIDGE: I can't remember that one in that case, 50 per cent.

PN1998

MR HARDING: That's the misleading character of percentages, isn't it. It depends on the base you come from. I did want to say something about, I think the problem with the ARTD report is that the methodology that the Full Bench came up with had two elements to it. The grading exercise on the one hand and the SWS on the other, and the ARTD report didn't look at grading. It seemed to leave it to the ADE.

PN1999

So there's no independent verification from the ARTD report about grading and so you can't know whether it was applied accurately or inaccurately. There's certainly anecdotal evidence reported in the ARTD report about difficulties that those who were engaging in the grading exercise had in working out where to put people.

PN2000

That's significant in light of the point I make earlier about how when you're dealing at the very base level of the award there are much finer distinctions about what value you ascribe to work and I think it can be inferred from the confusion that many expressed that they were having difficulty working out where to put people.

PN2001

The other aspect of that of course is the very changeability of ADE work. So what might be good this season or in relation to this contract may change later with a different contract and then you've got another grading exercise which would need to be gone through, which may change the way in which you assess the skills of the workers that you are asking to do these jobs.

PN2002

So it's a very difficult exercise in really understanding whether or not the labour cost impact, which is the purpose of this trial, has been accurately assessed by the Commonwealth and its ARTD comrades in arms. In fact, one of the notices to produce asks for the underlying data in relation to two tables. The table that appears at A28 on page 155 of the ARTD report and the table that appears on I think it's page 19.

PN2003

I can't put my hands on the other table but we wanted to know what the data was that supported the numbers that are reported in the tables that are actually referred to in the notice to produce. We were told by the Commonwealth not only did they not have that data themselves but neither did the ARTD. So where did they get the numbers? It's table 19, page 75.

PN2004

That's right, table 19 looks at the differences between current wages and wage outcomes by reference to (indistinct). Who's got the data? Who's got the data? The Commonwealth did this with the ARTD and neither of them seem to have it so how do they come up with these numbers? They don't offer a witness to explain any of this and we're just left with the report.

PN2005

I mean, it's extraordinary. The task was to test the Full Bench's methodology and they don't have the data. It's hard to see how this can be relied on as evidencing any concrete information around the rates that are reported where classification is a central character of the methodology that the Full Bench contemplates.

PN2006

VICE PRESIDENT HATCHER: Thank you, Mr Harding. I note the time so are we absolutely confident that we will finish submissions tomorrow? We can start earlier if we need to.

PN2007

MR WARD: We're absolutely confident.

PN2008

VICE PRESIDENT HATCHER: Does that take into account Ms Walsh and Mr Christodoulou and the Department's lengthy submissions?

PN2009

MR WARD: Absolutely, yes.

PN2010

VICE PRESIDENT HATCHER: And Mr Harding's reply?

PN2011

MR WARD: I could never speak to that, sorry, your Honour.

PN2012

VICE PRESIDENT HATCHER: On that basis we'll adjourn now and resume at 10 am.

PN2013

MR WARD: Thank you.

ADJOURNED UNTIL THURSDAY, 18 AUGUST 2022 �� [3.29 PM]

LIST OF WITNESSES, EXHIBITS AND MFIs

SHARON LOUISE DULAC, AFFIRMED....................................................... PN1485

EXAMINATION-IN-CHIEF BY MR HARDING........................................... PN1485

EXHIBIT #AA AMENDED WITNESS STATEMENT OF SHARON DULAC DATED 20/05/2022............................................................................................................................... PN1495

EXHIBIT #AB FURTHER WITNESS STATEMENT OF SHARON DULAC DATED 22/07/2022............................................................................................................................... PN1499

CROSS-EXAMINATION BY MR WARD....................................................... PN1499

RE-EXAMINATION BY MR HARDING........................................................ PN1654

THE WITNESS WITHDREW........................................................................... PN1670

EXHIBIT #AC OUR VOICE AUSTRALIA BUNDLE OF DOCUMENTS.. PN1682

EXHIBIT #AD AED TABLE DERIVED FROM COMMONWEALTH DATA PN1908

EXHIBIT #AE AED ANALYSIS OF GREENACRES' FINANCIAL REPORTS PN1949