Industrial Relations Commission New South Wales Medium Neutral Citation: Fire and Rescue NSW Firefighting Staff Awards 2021 [2021] NSWIRComm 1062 Hearing dates: 2, 3 and 4 June and 15 July 2021 Date of orders: 24 August 2021 Decision date: 24 August 2021 Jurisdiction: Industrial Relations Commission Before: Chief Commissioner Constant, Commissioner Murphy and Commissioner Sloan Decision: New awards to be made pursuant to s 10 of the Industrial Relations Act 1996 on the terms set out in the decision Catchwords: EMPLOYMENT AND INDUSTRIAL LAW – Awards – applications for new awards to rescind and replace existing awards – whether increases to rates of pay required – consideration of the state of the economy of NSW – application of Wage Fixing Principles – whether additional changes ought to be made to current award terms – whether exceptional circumstances exists to allow for effective date of awards to be back-dated Legislation Cited: Industrial Relations Act 1996 ss 3, 10, 17, 146, 163 Industrial Relations (Public Sector Conditions of Employment) Regulation 2014 cl 6 Superannuation Guarantee (Administration) Act 1992 (Cth) Fire Brigades Act 1909 Cases Cited: Annual Wage Review 2020-2021 [2021] FWCFB 3500 Application for Crown Employees (Public Sector – Salaries 2020) Award and Other Matters (No 2) [2020] NSWIRComm 1066 Applications for Variations to Crown Employees (Police Officers – 2017) Award and Paramedics and Control Centre Officers (State) Award [2021] NSWIRComm 1040 Fire Brigade Employees' Union of New South Wales v Commissioner of Fire and Rescue New South Wales (PAD Program) [2021] NSWIRComm 1041 Maan v Minister for Immigration and Citizenship (2009) 179 FCR 581 State Wage Case 2019 [2019] NSWIRComm 1065 Yacoub v Pilkington (Australia) Ltd [2007] NSWCA 290 Texts Cited: Nil Category: Principal judgment Parties: Industrial Relations Secretary Fire Brigade Employees' Union of New South Wales Representation: Counsel: J McDonald with T Wong (Secretary) L Saunders (FBEU) Solicitors: Crown Solicitor (Secretary) Hall Payne Lawyers (FBEU) File Number(s): 2021/50623, 2021/50661, 2021/53994 and 2021/54005 Publication restriction: No decision 1. On 22 February 2021 the Industrial Relations Secretary ("Secretary") filed two applications with the Office of the Industrial Registrar ("Registry"). The first sought the making of a new award to be titled "Crown Employees (Fire and Rescue NSW Retained Firefighting Staff) Award 2021", pursuant to s 10 of the Industrial Relations Act 1996 ("Act"), and the rescission of the Crown Employees (Fire and Rescue NSW Retained Firefighting Staff) Award 2020 ("Retained Award"), pursuant to s 17 of the Act. The second sought the making of a new award to be titled "Crown Employees (Fire and Rescue NSW Permanent Firefighting Staff) Award 2021", pursuant to s 10 of the Act, and the rescission of the Crown Employees (Fire and Rescue NSW Permanent Firefighting Staff) Award 2020 ("Permanent Award"), pursuant to s 17 of the Act. 2. The "grounds and reasons" contained in each of the Secretary's applications were the same, namely: "That in making the new Award the Commission will apply the same percentage increase (0.3%) to the rates of pay and allowances as that contained in Crown Employees (Public Sector Salaries 2020) Award and Other Matters (No 2) [2020] NSWIRComm 1066." 1. The Secretary's applications contained a version of the new awards which he sought to have made. Each of them contained a provision to the effect that the award would take effect on and from 26 February 2021 and remain in force until 24 February 2022. (The Permanent Award and the Retained Award (together, "the Awards") notionally expired on 25 February 2021.) 2. On 25 February 2021 the Fire Brigade Employees' Union of New South Wales ("FBEU") filed two applications with the Registry. Consistent with those filed by the Secretary, the FBEU's applications relied on ss 10 and 17 of the Act to seek the making of new awards to rescind and replace the Retained Award and the Permanent Award, respectively. Each of the FBEU's applications sought a "2.5% rate of pay increase to wages and allowances". The applications also sought that the proposed new awards effect 17 changes to the terms of the Retained Award and 9 changes to those of the Permanent Award. Issues requiring determination 1. The FBEU consented to the Secretary's applications, without prejudice to it advancing its own applications. Ms Saunders of Counsel, who appeared for the FBEU, stated the position in these terms: [1] "After all of that, that takes me finally to the applications before the Commission. There are two. Well, there are four but two groups, and the Crown's application to increase wages and allowances by 0.3 per cent in both the permanent and retained awards is first in time. This application is consented to, as my friend has quite correctly observed in the Secretary's closing written submissions. That is not meant as a trick. We accept there would be no double counting as that 0.3 increase should be taken into account in assessing what increases is appropriate in the [FBEU's] case. That, itself, because you are talking about a single year process, is a simple process of addition. There is no complicated algorithm that is going to emerge from Treasury in that respect. The starting point is 0.3 and then we move to the [FBEU's] case, which is for a wage increase and certain ancillary machinery claims." 1. Over the course of the proceedings, as a consequence of conciliation facilitated by the Commission and direct negotiations between them, the parties were able to reach consensus on a number of the changes to the existing terms of the Awards sought by the FBEU. On 22 July 2021, after the hearing had concluded but as foreshadowed by the FBEU during closing submissions, the Registry received an email from the solicitors for the FBEU attaching the FBEU's proposed new awards, which each contained "tracked" changes in both blue and red. A second email received minutes later confirmed that the changes in blue were agreed between the parties, while those in red remained in dispute. 2. Following a review of those documents, the Full Bench arranged for the Registry to send an email to the parties on 5 August 2021 seeking clarification of several issues. A response to that email was received on 11 August 2021. 3. The matters on which the parties did not agree, and which require determination by the Commission, may be summarised as follows: 1. in respect of the new awards to replace each of the Permanent Award and the Retained Award: 1. the amount by which they ought to reflect an increase in the salaries and salary-related allowances presently contained in the Awards ("Award Rates"); 2. whether the new awards ought to reflect changes to the existing provisions in the Awards allowing for recovery of overpayments, including to provide for consultation and agreement prior to the commencement of recovery and a reduction in the rate of deduction, in the absence of agreement, from 10% to 5%; 3. whether cultural and ceremonial leave should be introduced as an award entitlement; and 4. whether the disputes avoidance procedures and no extra claims clauses in the new awards should expressly reference and "carve out" matters already before the Commission, so as to ensure that they can progress and be determined by the Commission in the usual way; and 1. specifically in relation to the Retained Award, whether the exclusion of casual employees from the current Carer's Leave provision ought to be removed in the corresponding provision in any new award. Applicable principles 1. Section 10 of the Act empowers the Commission to make awards "setting fair and reasonable conditions of employment for employees". Section 17 empowers the Commission to vary or rescind an award, provided that it may only do so after the nominal term of the award if it considers that it is not contrary to the public interest to do so: s 17(3)(d). 2. Section 146(2) of the Act requires the Commission to take into account the public interest in the exercise of its functions. For that purpose, it must have regard to the objects of the Act, and the state of the economy of New South Wales and the likely effect of its decisions on that economy. 3. The objects of the Act are set out in s 3, which for present purposes relevantly provides as follows: 3 Objects The objects of this Act are as follows— (a) to provide a framework for the conduct of industrial relations that is fair and just, (b) to promote efficiency and productivity in the economy of the State, … (e) to facilitate appropriate regulation of employment through awards, enterprise agreements and other industrial instruments, … 1. Under s 146C(1)(a) of the Act, the Commission must, when making or varying any award or order, give effect to any policy on conditions of employment of public sector employees that is declared by the regulations to be an aspect of government policy that is required to be given effect to by the Commission. Such a policy is to be found in cl 6 of the Industrial Relations (Public Sector Conditions of Employment) Regulation 2014 ("Regulation"), which is relevantly in the following terms: 6 Other policies (1) The following policies are also declared, but are subject to compliance with the declared paramount policies— (a) Public sector employees may be awarded increases in remuneration or other conditions of employment, but only if employee-related costs in respect of those employees are not increased by more than 2.5% per annum as a result of the increases awarded together with any new or increased superannuation employment benefits provided (or to be provided) to or in respect of the employees since their remuneration or other conditions of employment were last determined. … 1. The Full Bench recently articulated at length the principles to be applied in deciding whether to make or vary an award: Application for Crown Employees (Public Sector – Salaries 2020) Award and Other Matters (No 2) [2020] NSWIRComm 1066 ("Public Sector Salaries 2020") at [24]-[31]; Applications for Variations to Crown Employees (Police Officers – 2017) Award and Paramedics and Control Centre Officers (State) Award [2021] NSWIRComm 1040 ("Police and Paramedics 2020") at [17]-[32]. It is not necessary to reproduce those passages in their entirety. They have informed our approach to these proceedings. Factual context 1. The Awards were made by Murphy C on 2 April 2020. A statement issued that day by Murphy C in the proceedings in which the Awards were made (matter 2020/44143) notes that the FBEU had applied for the making of the Awards and that "[t]he proposed awards are consented to by Fire and Rescue NSW in all but one respect being the operative date of the awards and, in particular, the operative date of the 2.5% increase in wage rates in the Permanent Award and the Retained Award". Commissioner Murphy resolved this question by determining that the Awards, including increases in wage rates, would operate from 17 February 2020. The Awards consequently provide that they were to take effect from 17 February 2020 and remain in force until 25 February 2021. [2] 2. As their titles suggest, each of the Awards applies to firefighters with Fire and Rescue NSW ("Firefighters"). Regarding the distinction between "permanent" and "retained" Firefighters, Robert McNeil, the Assistant Commissioner of Regional Operations for Fire and Rescue NSW, stated: [3] "8. As at December 2020, FRNSW employs 3319 retained firefighters and 3521 permanent firefighters. Retained firefighters are primarily engaged in Regional NSW. Retained firefighters can be characterised as being 'on call'. They receive a fortnightly retainer based on their availability. The retained firefighter then receives an hourly payment (based on the classifications of Captain, Deputy Captain and Firefighter) for their actual work. In addition, they receive payment at their classification rate for conducting station based and community work which is referred to in the Retained Award as authorised duties." 1. The Secretary's applications each call for the making of new awards that will have the effect of increasing the Award Rates by 0.3%, consistent with the increase awarded in Public Sector Salaries 2020. The Secretary submitted that the applications presently before the Commission "arise from the same broad factual matrix" as the applications determined in Public Sector Salaries 2020 and Police and Paramedics 2020. [4] 2. It is not necessary to traverse in detail the factual context within which each of those cases was determined. To the extent that it is necessary to frame the Secretary's position in the present matter, the following matters derived from the "broad factual matrix" to which the Secretary referred are uncontroversial: 1. the NSW Government operates under a "wages policy", pursuant to which wage increases awarded to public sector employees must not increase employee-related costs by more than 2.5% in any year, unless any greater costs are fully offset by employee-related costs saving. This policy is reflected in cl 6 of the Regulation, to which the Commission must give effect pursuant to s 146C of the Act; 2. from 2011 to 2019, awards of the Commission were commonly made or varied, by consent, to provide for annual increases to the salaries and salary-related allowances of public sector employees of 2.5%, adjusted when necessary to reflect the cost of increases to the rate of superannuation contributions required to be made. Contested arbitrations regarding the quantum of increases were rare; 3. consistent with this history, and with the exception of increases awarded through arbitral processes in 2014, the rates of pay in the Awards and their precedents have increased by consent since 2011; 4. on 27 May 2020, in response to the economic impact of the COVID-19 pandemic, the NSW Government announced a "pause" on wage increases in the public sector. It was claimed that the "pause" would not only protect existing public sector employment, but would generate savings that could be invested in infrastructure projects in the short-term, providing an enhanced stimulatory benefit to the NSW economy; 5. on 29 May 2020 the Government made the Industrial Relations (Public Sector Conditions of Employment) Amendment (Temporary Wages Policy) Regulation 2020 (NSW), which purported to give effect to the Government's new wages position. That regulation was disallowed by the Legislative Council on 2 June 2020; 6. in the proceedings leading to Public Sector Salaries 2020 the Crown urged the Commission to award no increases to salaries and salary-related allowances contained in the awards under consideration in that matter. Public Sector Salaries 2020 was handed down on 1 October 2020. The Full Bench determined that the rates should be increased by 0.3%; and 7. in the proceedings leading to Police and Paramedics 2020 the Crown contended that there was no basis on which the Commission ought to award increases to the salaries and salary-related allowances in the awards under consideration, but conceded that it would be open to the Commission to award an increase consistent with Public Sector Salaries 2020 for the sake of equality across the public sector. The Full Bench awarded an increase of 1.75% to the salaries and salary-related allowances in the Crown Employees (Police Officers – 2017) Award. The rates in the Paramedics and Control Centre Officers (State) Award were increased by 0.3%, with employees subject to that award to receive an additional payment equal to the difference between $1,000 and 0.3% of their annual base salary. 1. As additional factual context, in early November 2020 the NSW Government announced that public sector wage increases would in future be capped at 1.5%. This was reflected in the 2020-21 NSW Budget, which was handed down by The Hon. Dominic Perrottet MP, Treasurer of NSW, on 17 November 2020. That Budget anticipated savings of "$1.8 billion from capping wages growth at 1.5 per cent during 2021-22 to 2023-24". [5] 2. On 22 June 2021, after the conclusion of evidence in these proceedings but prior to final submissions, Mr Perrottet handed down the 2021-22 NSW Budget. That Budget anticipated a return to wages growth to up to 2.5% from 1 July 2021 for public sector employees. 3. From 1 July 2021 Firefighters received an increase of 0.5% to the rate of compulsory superannuation contributions made on their behalf pursuant to the Superannuation Guarantee (Administration) Act 1992 (Cth). Having regard to the terms of cl 6(1)(a) of the Regulation, the Secretary provided the Commission with the following information: [6] "14. If the new awards were to commence from 26 February 2021, there will be 125 days in the year (out of 365) where there [sic] the rate of superannuation is 9.5% and 240 days in the year (out of 365) where the rate of superannuation is 10%. 15. If I = the maximum increase able to be awarded to salaries and salary-related allowances, the formula used to calculate the maximum increase able to be awarded is provided as follows: 16. Therefore, the maximum increase able to be awarded to salaries and salary-related allowances by the IRC is 2.19%." Previous Decisions 1. The Secretary drew the Commission's attention to the following passage from Police and Paramedics 2020: "54. We have already observed that these proceedings arise out of the same broad factual context as that considered by the Full Bench in Public Sector Salaries No 2. The evidence presented in those proceedings, including the economic and fiscal implications of granting the salary increases that had been sought, led to the award of 0.3% only. Determining the PANSW Application and the APA Application in a purely standalone manner, without regard to the broader factual and economic context giving rise to the Applications, would be entirely artificial. It would also permit the PANSW and the APA to derive a potentially unfair forensic advantage for their members through nothing more than having their Applications determined second in time to those considered in Public Sector Salaries No 2." 1. The Secretary submitted: [7] "95. It would not be appropriate for the Commission to single out FRNSW employees as the only cohort whose awards expired in the 2020-21 financial year not to be subject to these fiscal measures as this would give FRNSW employees an unfair advantage in the same terms described in Police and Paramedics Salaries 2020 simply by reason of the timing of the claim. … … 137. The Commission should award a wage increase of 0.3% to Firefighters so that the anticipated savings that the NSW Government budgeted to obtain in the financial year of 2020-21 (for the purposes of sustaining the economy and the community through the COVID-19 pandemic) may be fully realised and so that there would be no industrial inequity between this cohort and other employees whose Awards expired on or before 30 June 2021. Firefighters should not be permitted a different increase to that awarded in the antecedent applications, on the basis that their relatively small number (or their unique funding arrangement) means the cost of the increase is not significant enough to prevent it." (Footnotes omitted) 1. There are four points to make in respect of those submissions. First, the Commission will at all times strive to ensure that parties in all proceedings before it are treated fairly and equitably, in a manner in which established principles are applied consistently. 2. Second, the facts of the present proceedings are not "on all fours" with those of the Public Sector Salaries 2020 and Police and Paramedics 2020. It can be discerned from those decisions that the relevant awards in those cases had all expired on 30 June 2020. The applications for the making or variation of awards had been made between March and May 2020. There was an overlap in timing in the case management of the proceedings. The hearing in the Police and Paramedics matter commenced the day after the hearing in the Public Sector Salaries matter had concluded. The cases were decided in broadly the same economic environment. 3. That is to be contrasted with the current proceedings, in which both the Retained Award and Permanent Award notionally expired on 25 February 2021. As will be seen, the matter comes to be determined in a significantly different economic context. 4. Third, the observations of the Full Bench at [54] of Police and Paramedics 2020 need to be considered in the context of those made at [49] of that decision, which are apposite to the present proceedings: "49. However, in determining what is fair and reasonable, the Full Bench does not simply presume that the outcome in Public Sector Salaries No 2 will or should be applied to the Police Award and the Paramedics Award. That is, the Full Bench is not necessarily constrained by the outcome in Public Sector Salaries No 2. That matter was determined on the evidence presented to the Full Bench in those proceedings. The PANSW Application and the APA Application will similarly be determined on the evidence adduced in these proceedings." 1. As the FBEU correctly submitted, Public Sector Salaries 2020 does not establish a presumptive increase which is to apply across the NSW Government sector. Industrial equity does not require such an outcome. What it requires is the fair and consistent application of established principles to the case presented to the Commission. 2. Fourth, were the FBEU to succeed on its applications, Firefighters would not be the only cohort of employees whose Awards expired on or before 30 June 2021 who benefitted from an increase above that awarded in Public Sector Salaries 2020. For example, the FBEU drew our attention to the Crown Employees (Medical Officers) Award 2020, which expired on 30 June 2021. Employees under that Award received an increase of 2.5% from 1 July 2020. A further increase of 2.04% was awarded from 1 July 2021 with the making of the Crown Employees (Medical Officers) Award 2021, on application by the Crown and by consent, on 16 July 2021. Allowing for increases in the rate of statutory superannuation contributions to be made on behalf of the employees from 1 July 2021, this represented an overall increase in remuneration or other conditions of employment of 2.5%. Award Rates 1. While the FBEU's applications called for a 2.5% increase to the Award Rates, it accepted that the maximum increase that could be awarded within the confines of cl 6(1)(a) of the Regulation was 2.19%, for the reasons set out at [20] above. Its case proceeded on that basis. 2. There were three grounds on which the FBEU submitted such an increase ought to be awarded: 1. to maintain the real value of Firefighters' wages; 2. to provide for moderate wage growth; and 3. to provide appropriate recompense having regard to matters said to attract the productivity and efficiency, and special case sub-principles. 1. The Secretary contended that Award Rates ought to be increased by no more than 0.3%, in addition to the increase to the rate of compulsory superannuation contributions made on behalf of Firefighters from 1 July 2021. This was said to be an appropriate increase for three reasons: 1. it would be consistent with the outcome in Public Sector Salaries 2020, and so promote industrial parity; 2. the economic conditions caused by COVID-19 call for restraint and for the maintenance and consistent application of the Government's fiscal policy announced in May 2020; and 3. having regard to inflation forecasts, an increase of 0.3% will see Firefighters realise a real rise in the Award Rates of 0.2% over the period from their last increase to the end of the term of the proposed new awards. 1. In response to questions from the Full Bench, the Secretary stated that a 0.3% increase to the Award Rates from 26 February 2021, in addition to an increase of 0.5 percentage points to superannuation from 1 July 2021, will result in a total increase to employee-related costs of 0.6% over 12 months. [8] National Decision 1. The FBEU drew the Commission's attention to the decision in Annual Wage Review 2020-2021 [2021] FWCFB 3500, in which the Fair Work Commission determined to award an increase of 2.5% to modern award minimum wages, for the majority of federal modern awards, with effect from 1 July 2021. It submitted: [9] "5. There is no controversy that the Annual Wage Review is a national decision for the purposes of s.48 of the Industrial Relations Act 1996 (NSW). Per s.50, the principles or provisions of that decision must be adopted unless the Commission is satisfied that it is not consistent with the objects of the Act to do so, or there are other good reasons for not doing so." (Emphasis in original) 1. The FBEU did not further advance its submissions. 2. The FBEU correctly stated that Annual Wage Review is a "National decision" within the meaning of s 48 of the Act. Section 50 of the Act relevantly provides as follows: 50 Adoption of National decisions (1) As soon as practicable after the making of a National decision, a Full Bench of the Commission must give consideration to the decision and, unless satisfied that it is not consistent with the objects of this Act or that there are other good reasons for not doing so, must adopt the principles or provisions of the National decision for the purposes of awards and other matters under this Act. (2) A Full Bench of the Commission is to give consideration to the National decision either on application or on its own initiative. (3) The principles or provisions of a National decision may be adopted— (a) wholly or partly and with or without modification, and (b) generally for all awards or other matters under this Act or only for particular awards or other matters under this Act. … 1. We do not consider that the FBEU has made an application within the meaning of s 50(2). Its submissions do no more than to draw the attention of the Full Bench to its obligations under s 50. 2. Principle 4 of the Commission's Wage Fixing Principles is titled "State Wage Case Adjustments", and provides guidelines which inform the Commission's approach to s 50. The principle provides (at 4.2(c)) that "[t]he State Wage Case adjustment will only be made in respect of rates in awards which have not been increased, other than by State Wage Case adjustments". As observed at [17(3)] above, the Award Rates have been adjusted predominantly by consent since 2011. 3. For this reason, and on the basis of the findings set out below, we are satisfied that there are good reasons for not applying the outcome in Annual Wage Review to the Award Rates. Economic environment 1. It was common ground between the parties that the recovery of the NSW economy from the deleterious effects of the COVID-19 pandemic described in Public Sector Salaries 2020 and Police and Paramedics 2020 had been stronger than expected. The economy was in a better position at the time of the hearing in these proceedings than it was at the time those cases were heard. 2. The Budget Statement issued in connection with the 2021-22 NSW Budget ("Budget Statement") described the NSW economy as having "rebounded strongly since the depths of the COVID-19 pandemic", as "bouncing back faster than expected" and as having outperformed expectations as at the time of the 2020-21 Half-Yearly Review in February 2021. The Budget Statement further noted that: 1. the economy was forecast to have grown 0.75% in the 2020-21 financial year, with forecast growth of 3.75% for 2021-22; 2. employment growth had seen the unemployment rate drop to 5.3% in the June quarter, from a high of 7.1% in July 2020, although the unemployment rate remained higher than pre-COVID levels; 3. the unemployment rate was forecast to reach estimates consistent with full employment (around 4.5%) by 2024-25; 4. the Government intended to maintain its policy of supporting employment and economic growth through investment in infrastructure; 5. there had been "a strong rebound in revenue projections"; 6. general government expense growth was projected to return to levels below revenue growth; 7. the level of net debt in June 2021 was projected to be $40.6 billion, an improvement of $4.8 billion since the 2020-21 Half-Yearly Review; and 8. with "recovery well underway, this Budget can return wages growth to up to 2.5% from 1 July 2021 for public sector employees, whose hard work has not gone unseen". 1. Against this backdrop, the FBEU submitted that the need for restraint evidenced in Public Sector Salaries 2020 and Police and Paramedics 2020 was reduced. This was a proposition which Stephen Walters, the Chief Economist for the NSW Treasury, who was called to give evidence on behalf of the Secretary, accepted under cross-examination. He further agreed that the economy was in a position where it could sustain modest wage growth. 2. Against this, we are mindful that in a report that he prepared for these proceedings Mr Walters stated: [10] "13.10 While the outlook has improved, there continues to be significant downside risks due to the unpredictable nature of the pandemic. Localised community transmission, new strains of the virus, elevated rates of infection in some countries and potential holdups around vaccine rollout all suggest the possibility of further disruption. … 17. While the rebound in economic activity to date has been stronger than expected, and the base case outlook for activity appears relatively positive, the economy remains fragile and is subject to a series of risks which are mainly slanted to the downside. … … 17.17 The otherwise positive outlook for the NSW and Australian economies is also predicated on the economy continuing to remain free of community transmission of COVID-19. …" 1. These comments reflect caveats contained in the Budget Statement as to the potential risks posed by COVID-19 to the budgeted forecasts. We note the following observations in particular: "While New South Wales has effectively managed community outbreaks of COVID-19, the reimposition of economic restrictions in response to further outbreaks remains the most significant risk to the outlook." And further: "The Government is still managing the impacts of the pandemic with significant investments to stimulate the economy and support its recovery. The most significant fiscal risk for New South Wales is a widespread outbreak. Significant restrictions imposed on a large geographic area would have a direct impact on key economic drivers such as employment and business and consumer confidence." 1. Under cross-examination, Mr Walters had the following exchange with Ms Saunders: [11] "Q. No, that's all right. The message that you gave a moment ago is that there is still need for caution about the state of the economy in New South Wales, is that right? A. Correct. Q. You gave evidence in the State Wage case proceedings I think in about May last year, is that right? A. Yes. That's correct. Q. Prepared - prepared a statement. The hearing was a bit later. A. Correct. The hearing was August, I believe, yes. Q. At that time, New South Wales was fully in the grip of a pandemic - of the pandemic, wasn't it? A. Correct. Q. You'd accept it's a very different situation now? A. No. I think we're still in the grips of a pandemic. Q. You accept that New South Wales has not had a State‑wide lockdown for 12 months? A. That's correct. The - the exact timing I'm not clear on but we - we haven't had a - a lockdown as other States have, correct, yes. Q. As high as you can put it is that there's a risk, there'll be a further outbreak here that might lead to that? A. 100%. Q. Yeah but - 100%, you agree with me the highest you can put it is there's a risk? A. No, I'd say the risk is 100%. There'll be an outbreak in New South Wales." 1. Mr Walter's evidence was prescient. As a result of a further outbreak of COVID-19 in Sydney, on 26 June 2021 The Hon. Brad Hazzard, the Minister for Health and Medical Research, made the Public Health (COVID-19 Temporary Movement and Gathering Restrictions) Order 2021. Since then, the outbreak has gradually worsened and the restrictions imposed on the community have continuously been tightened. As at the date of this decision, New South Wales is subject to a State-wide lockdown. While we cannot quantify or predict the impact that these developments will have on the economy, we can reasonably assume that the relative optimism as to the state of the economy as at the time of the hearing in early June 2021 must be tempered. Maintenance of real value of Award Rates 1. There was no contest between the parties that Firefighters ought to maintain the real value of their earnings. The controversy arose as to what, if any, increase was required to do so. At the heart of that controversy was the manner in which movements in the real value of those earnings were to be determined. 2. In Public Sector Salaries 2020 the Full Bench determined that "trimmed mean" inflation was the better measure by which to assess any movements in the value of employees' salaries: see [92]-[98]. This was adopted by the Full Bench in Police and Paramedics 2020 at [251]-[252]. No alternative argument was advanced in these proceedings. 3. The Award Rates were increased by 2.5% from 17 February 2020. Mr Walters deposed that trimmed mean inflation for the year ending March 2021 was 1.1% and for the year ending March 2022 was forecast to be 1.5%. He stated: "41. Firefighters saw their wages rise by 2.5 per cent through the year to the March quarter 2021 (approximately), while trimmed mean inflation was 1.1% in the same period. This suggests that their wage rose by 1.4 per cent in real terms. If the wages of firefighters were to rise 0.3 per cent through the year to the March quarter 2022, then, based on forecasts for underlying trimmed mean inflation published in the 2021 May SoMP, they would still have realised a real rise of 0.2 per cent in the two-year period to the March quarter 2022. If the wages of firefighters were to rise 2.5 per cent through the year to the March quarter 2022, then based on the RBA's forecast for trimmed mean inflation they would realise a real rise of 2.4 per cent in the two-year period to the March quarter 2022." 1. The Secretary submitted that having regard to the increase to the Award Rates awarded in February 2020 and the actual and forecast movements in trimmed mean inflation from then until March 2022, being the anticipated term of the new awards, an increase of only 0.1% to the Award Rates was necessary to maintain the real value of those rates. He did not, however, resile from his primary position that Firefighters should be awarded an increase of 0.3% to the Award Rates. 2. The FBEU challenged the Secretary's position on two bases. First, it disputed that any retrospective analysis was required or appropriate. Rather, it contended that the appropriate period for analysis was the term of the proposed new awards. This called only for a determination as to what increase is required, on current projections, to maintain real wages from February 2021 to February 2022. Accepting that trimmed mean inflation for the period February 2021 to February 2022 is forecast to be 1.5%, the FBEU submitted that an increase in that quantum was required to maintain the real value of the Award Rates. 3. Second, as an alternative submission, the FBEU contended that to the extent that a retrospective analysis is required, the methodology proposed by the Secretary was fundamentally flawed. It submitted: [12] "29. The FBEU contends that an appropriate model is one that: a. takes the actual wage at whatever is deemed the appropriate starting point; b. applies inflation as an index at the end of the relevant year, consistent with how it actually works – that is, as a steady drag on real wage value; c. applies the effect of the increase a year later, again consistent with the reality of point-in-time wage increases; and d. projects inflation of the next year, i.e. the life of the Award, to assess what real value will be at the end of the Award's life. … 33. Over a three-year period, this looks like this: End of Month Event Nominal Real Change from Feb 19 Feb 19 -Wage ---------- $1,595 $1,595 ---------- Feb 20 - Inflation -1.7% $1,595 $1,568 -1.70% Feb 20 – wage increase 2.50% $1,635 $1,607 0.80% Feb 21 – inflation -1.15% $1,635 $1,589 -0.35% Feb 21 – wage increase 1.85% $1,664 $1,617 1.50% Feb 22 – inflation -1.50% $1,664 $1,593 0.00% 34. A three year period is used here to provide an actual apples-to-apples comparison between this case and the position advanced in the 2021 Salaries case – that is, maintenance of real wages in 2019-2021. A 1.85% increase is the minimum needed to preserve, in reality, the real value of employee wages over this period." (Emphasis in original) 1. On the FBEU's analysis, if consideration was had only to movements in wages and inflation for the period February 2020 to February 2022, not allowing for the 2.5% increase awarded in February 2020 to be offset against future inflation, the amount required to maintain real wages would be 2.65%. The FBEU submitted, however, that the period from February 2019 was more appropriate. 2. The FBEU argued that the approach outlined in the submissions at [51] reflects that inflation acts as a "drag" on wages. For the approach to have merit, though, it must be assumed that the Award Rates have been set having regard to retrospective movements in inflation only, so as to arrive at rates which are fair and reasonable at the time they were made – the "point-in-time" to which the FBEU referred – but which may decrease in real terms over the life of the award. It is only if this assumption is made that the increase awarded in February 2019 of 2.5% could be ignored, as the FBEU's table purports to do. 3. The FBEU led no evidence as to how and when the Award Rates were originally set, and/or whether subsequent increases had only ever been intended to apply to address retrospective movements in inflation without regard to anticipated movements in inflation over the terms of the Awards (and their precedents). To the contrary, the FBEU submitted that the "correct approach" is that "the issue of inflation projected degradation in real wage rates" must be dealt with "wholly prospectively". 4. This highlights an inconsistency in the FBEU's position. On the one hand, the increase in 2019 is to be regarded as having been awarded at a point in time, and is not to be regarded as compensating for or offsetting movements in inflation from 2019 to 2020. On the other hand, in determining increases to apply from February 2021 the Commission is asked to take into account and compensate employees for the projected increase in trimmed mean inflation in the year to February 2022. 5. We also note the following submissions made by the Secretary: [13] "159. Logic and common sense would suggest that if nominal wages and inflation were both rising by 2.5% per annum, then over any given period real wages growth would be zero. However, as can be seen by the table below, using the FBEUs [sic] methodology this situation actually results in real wages declining by 2.4 per cent. Hypothetical table using FEBUs [sic] methodology Hypothetical Table End of month Event Nominal Real Change from Feb 19 Feb 19 - wage N/A $1,595 $1,595 N/A Feb 20 - inflation -2.5% $1,595 $1,556 -2.4% Feb 20 - wage increase 2.5% $1,635 $1,595 0.0% Feb 21 - inflation -2.5% $1,635 $1,556 -2.4% Feb 21 - wage increase 2.5% $1,676 $1,595 0.0% Feb 22 - inflation -2.5% $1,676 $1,556 -2.4% (Emphasis in original) 1. In Public Sector Salaries 2020 the Full Bench observed at [31]: "(9) The Commission must attempt to fix rates which will be just and reasonable rates at the time when the award commences to operate and which, unless unforeseeable happenings occur, will continue to be just and reasonable during the term of the award: Re Crown Employees (Teachers) Award [1964] AR 463 at 482-483, cited with approval in Crown Employees (Police Officers – 2009) Award (No 2) at [78]. (10) In this regard, it is appropriate for the Commission to have regard to economic considerations, including the changing value of money over time, when deciding the amount of any increase which should be awarded. Matters which may be considered in that regard are the date on which the last wage increases for employees in question took effect, and changes in money values which have occurred since that time or are forecast during the term of the award to be made: Re Crown Employees (Administrative and Clerical Officers State) Award and other Awards (No 2) (1993) 52 IR 243, cited with approval in Re Operational Ambulance Officers (State) Award at [167]. See also Crown Employees (Police Officers – 2009) Award (No 2) at [121]." 1. In Police and Paramedics 2020 the Full Bench considered arguments as to the extent to which the maintenance of the real value of employees' earnings required any retrospective consideration. The Full Bench observed: "284. In Public Sector Salaries No 2, the Full Bench determined to award an increase of 0.3% in order to maintain the real value of employees' earnings (at [157]-[158]). In doing so: (1) the Full Bench accepted the evidence of witnesses in those proceedings that trimmed mean inflation was the better measure by which to assess any movements in the value of employees' salaries (at [98]); (2) determined (at [107]) that: '…it is appropriate to have regard to the developments since the Relevant Awards were last made or varied. The consideration of the changing value of money over time includes changes which have occurred since the employees last received a salary increase and those which are forecast during the term of the award to be made or varied. This entails the Commission taking into account the wage increases awarded to employees with effect from 1 July 2019 in determining whether the Applicants have discharged the onus they bear to justify any change to the current salaries and salary-related allowances.' (3) had regard to movements in trimmed mean inflation since the salaries and salary-related allowances in the relevant awards had been increased (in each case, 1 July 2019), and took into account the quantum of that increase (at [108]-[111]). 285. Having noted in its Final Submissions the approach taken in Public Sector Salaries No 2, the PANSW contended: '51. ... Whilst it is accepted changes in the value of money since the last wage increase was awarded may be relevant, it is submitted that caution should be exercised in mechanically applying inflation measures over that period in the present case. …' 286. The PANSW relied on the decision of Boland J in Re Crown Employees Wages Staff (Rates of Pay) Award 2011 (No 3) (2013) 240 IR 24; [2013] NSWIRComm 109 in support of the submission that the Commission should not take into account the increases to the salaries and salary-related allowances in the Police Award, which were awarded on 1 July 2019, and that the changing value of money should be considered prospectively over the term of the award (1 July 2020 to 30 June 2021). The PANSW drew our attention to the following passages from the decision: '153. The approach taken by the Full Bench in Police Officers (No 2) when deciding the amount of increase that should be awarded was to have regard, prospectively, to the changing value of money over time. In that respect, the Full Bench stated at [121]: [121] Given the conclusion that we shall reach later in this decision that the ultimate award made in this matter will operate for a period of three years, and, further, given that any additional salary adjustments (over the interim award) arising from the general claim will operate from 1 July 2011, then, having regard to the approach adopted in Police Award (No 1) at [545], the Commission will have regard to, for the first year of the award, the inflation rates operating in the period 1 July 2010 to 1 July 2012 and, for the balance of the period of operation of the award, to inflation forecasts corresponding to each successive actual year of the operation of the award; namely, in the second year, the financial year 2012-2013 and for the third year, the financial year 2013-2014. 154. In Police Officers (No 2) the rates of inflation to which the Full Bench had regard in fixing the increases in wages for the three years 2011, 2012 and 2013 were 3.1 per cent (having regard to the whole of the period from the last salary adjustment in 1 July 2010 through to the end of the financial year to 2011), 2.5 per cent and 2.5 per cent respectively.' 287. We observe that in Police No 2 the Full Bench varied the award with effect from 1 July 2011. In considering rates of inflation it had regard to the whole of the period from the last salary adjustment on 1 July 2010. This is reflected in the following observations of the Full Bench in Police No 1: '545. …It is appropriate, when considering appropriate remedies in a general application such as the present, to have regard to the maintenance of the purchasing power of wages by assessing, for the first year of the operation of any award made, relevant economic considerations for the period since the last salary adjustment (in this case 1 July 2010), provided there is an avoidance of double counting." (Emphasis added) 288. We note further in this regard the authorities referred to at [32(10)] above. 289. To the extent that the PANSW submits that the Commission should have regard to the likely changes in the value of money over the life of the award, we agree. That is clearly consistent with the authorities. However, the authorities do not support the proposition that the Commission ought not to have regard to movements in inflation since the last increase to salaries and salary-related allowances in the relevant award. 290. Apart from urging the Commission to 'exercise caution', the PANSW does not precisely articulate why the approach taken in Public Sector Salaries No 2 was in error and ought not to be followed. We are not persuaded that we should approach these proceedings on any alternative basis." 1. We are not persuaded that these proceedings should be approached on a basis inconsistent with that taken in Public Sector Salaries 2020 and Police and Paramedics 2020. Adopting that approach we accept the Secretary's evidence that having regard to the increase to the Award Rates awarded in February 2020, and taking into account subsequent movements in inflation, an increase of 0.1% is required to maintain the real value of the Award Rates until February 2022. Providing for wage growth 1. The FBEU relied on a on a report prepared by Dr Angela Jackson, an economist with Equity Economics. [14] In her report Dr Jackson stated that: 1. as the NSW economy recovers from the COVID-19 pandemic the economic benefits of a 2.5% increase in the Award Rates would outweigh the costs; 2. the Reserve Bank of Australia had a target range of 2-3% inflation, which was necessary to deliver sustainable economic growth and low unemployment; 3. public sector wage restraint was undermining this objective; 4. sustained deflation due to poor wages growth and excess spare capacity in the economy represents as risk to the recovery as consumers are more likely to save than spend, prolonging the economic downturn; 5. public sector wage constraints may negatively affect private sector wages; 6. any wage increase below 1.5% in 2021-2022 would represent a real cut in wages based on the Government's forecasts for inflation; and 7. a reduction in the real wages of Firefighters is inconsistent with advice provided by the International Monetary Fund. 1. Dr Jackson and Mr Walters were in agreement that a wage increase would have a stimulatory effect on the NSW economy, as would spending on infrastructure. 2. The FBEU submitted: [15] "37. Dr Jackson's evidence that wage growth, both real and notional, is sound economic policy was not challenged in cross-examination. This is unsurprising: in reality, Mr Walters agreed with this proposition. In cross-examination, he accepted without any difficulty that: a. managed public sector growth has a generally positive effect on the economy; b. it is important that economic growth continue, and a different economic response is required now than was in June 2020; c. real wages remaining static for too long would have a damaging impact on the economy, as would their move backwards; d. the need for restraint has decreased since June 2020; and e. the economy could at this point withstand moderate wage growth, which he defined at somewhere between 0.5% to 1% over a year, which would be a 'sustainable rate of real wage growth in a sustained period of time'. 38. Fire + Rescue has yet to explain why this approach should nevertheless not be taken. …" (Emphasis in original, footnotes omitted) 1. The contention at par 38 of the FBEU's submissions misapprehends its onus to demonstrate why the Commission ought to make awards in the terms sought in its applications. In our view, the FBEU has failed to make out its case on this ground. 2. The Commission's role in these proceedings is to ensure that any awards made in determination of the applications before it set fair and reasonable conditions of employment for Firefighters. In making that determination, the Commission must take into account the state of the economy of New South Wales and the likely effect of its decisions on that economy. This requirement does not confer on the Commission the discretion, much less authority, to dictate to the Government how it manages the State's economy: Public Sector Salaries 2020 at [120]. 3. In our view, the following observations of the Full Bench in Police and Paramedics 2020 are apposite to the current proceedings: "261. We have considered this evidence in light of the cases presented by each of the parties. We do not consider that it is necessary for the Commission to determine at an abstract or theoretical level whether one stimulus measure is to be preferred over the other. Section 146(2)(b) does not require such a determination. The relative benefits of alternative stimulus measures (to the extent that they are truly to be considered as alternatives) need only be considered in the context of the impact that the decision we make in these proceedings will have on the economy of New South Wales. … 266. There was no controversy that each of infrastructure spending and increasing wages is a stimulus measure which would benefit the economy. Indeed, it was accepted that it would be preferable if both measures could be deployed, a matter to which we will return. For immediate purposes, we are not persuaded that the evidence supports the PANSW's submissions that choosing infrastructure spending over wage increases will have a materially negative impact on the NSW economy. 267. It follows that there is no basis on which the Commission, in discharging its obligations under s 146(2)(b) of the Act, ought necessarily to interfere with the Government's decisions regarding the economic management of the State, and in particular the decision to prefer infrastructure spending over public sector wage increases. 268. Further, were the Commission to consider the competing merits of differing stimulus measures and purport to determine which is to be preferred at an abstract or theoretical level, it would run the very real risk placing itself in the position that the PANSW submitted it should not adopt, namely that of being the 'general economic manager of the State'." (Emphasis in original) Wage Fixing Principles 1. In determining the applications the Commission should have regard to the Wage Fixing Principles most recently re-affirmed by the Full Bench in State Wage Case 2019 [2019] NSWIRComm 1065, which include the work value, productivity and efficiency, and special case sub-principles. However, the Wage Fixing Principles are in the nature of guidelines. They do not have the force of statute and cannot add to and do not detract from the Commission's jurisdiction under the Act: see Police and Paramedics 2020 at [27]-[31]. 2. The FBEU contended that an increase in the Award rates was justified under the productivity and efficiency sub-principle and the special case sub-principle of the Wage Fixing Principles. Those sub-principles are in the following terms: "8.3 Productivity and Efficiency Considerations Productivity and efficiency measures that have delivered substantial costs savings and/or productivity or efficiency improvements or which have made a substantial contribution towards the attainment of the objectives of the employer (including departments and agencies of the Crown) in seeking to become more competitive and/or efficient, to which employees have made a significant contribution, may constitute the basis for increases to wages and salaries or improvements in employment conditions without the requirement to make out a special case, provided that such measures, savings or improvements have not already been taken into account in previous wage adjustments. 8.4 Special Case Considerations 8.4.1 A claim for increases in wages and salaries, or changes in conditions in awards, other than those allowed elsewhere in the Principles, and which is not based on work value and/or productivity and efficiency pursuant to this Principle, will be processed as a special case in accordance with the principles laid down in Re Operational Ambulance Officers (State) Award [2001] NSWIRComm 331; (2001) 113 IR 384 and the cases referred to therein at [165]-[168]. 8.4.2 All special cases shall be tested against the public interest." Productivity and Efficiency 1. In Police and Paramedics 2020 the Full Bench at [111]-[114] examined a number of authorities which had considered the approach to apply to the productivity and efficiency sub-principle. The Full Bench observed: "115. Without suggesting in any way a limitation of the principles outlined in these authorities, we note the following matters in particular: (1) It must be possible to identify the 'measures' on which a claim under the productivity and efficiency sub-principle is based. (2) The attainment by the employer of its objectives is not sufficient. The measures must be shown to have delivered substantial costs savings and/or productivity or efficiency improvements, or have made a substantial contribution towards the attainment of the objectives of the employer in seeking to become more competitive and/or efficient. (3) It must be shown that employees have made a significant contribution to the requisite productivity and efficiency measures. That is, whether the group of employees on whose behalf the benefit is sought have made that contribution." (Emphasis in original) 1. There are two bases on which the FBEU argued that the productivity and efficiency sub-principle had been attracted in the present case. First, it contended that over the last five years there had been an increase in the volume and complexity of the work that Firefighters are required to perform. 2. Drawing on data from the annual reports of Fire and Rescue NSW for each of the years 2015-16 to 2019-20, Dr Jackson calculated that the number of incidents to which Firefighters had responded had increased by 5.5%, while the total number of Firefighters had declined slightly, from 6,857 to 6,842. Dr Jackson stated that "[t]his equates to annual productivity growth of 1.5 per cent". [16] 3. Under cross-examination, Dr Jackson conceded that her analysis was done at a "very high level" [17] . She had not done any analysis of the Firefighter workforce, and was unaware of the distinction between permanent and retained Firefighters at the time of preparing her report. She had also undertaken no analysis as to the types of incidents to which Firefighters had responded, to determine whether this had an impact on productivity. This is not to criticise Dr Jackson. However, it suggests that her quantification of annual productivity growth at 1.5% must be approached with caution. 4. Further, Mr McNeil deposed that over the last decade the average rate of emergency calls has remained constant. He stated that since 2015 the number of Firefighters employed has remained generally constant, with the total in 2020-21 projected to be 6,890. He concluded: [18] "92. So in essence firefighters are doing the same activities and at the same intensity and with the same numbers as they have done for the past decade." 1. Further, the FBEU did not adequately explain how the alleged increase in workload attracted the productivity and efficiency sub-principle. The FBEU submitted that "Firefighters are doing more with less", [19] but it did not address how this contention, even if true, satisfied the requirements of the sub-principle, as summarised at [68] above. 2. The second basis on which the FBEU relied in respect of the productivity and efficiency sub-principle was derived from a Fire and Rescue NSW initiative described as the "Plus Plan". This was not evidence led in chief by the FBEU but arose from the Secretary's evidence. 3. Paul McGuiggan is the Assistant Commissioner for Metropolitan Operations for Fire and Rescue NSW. He stated: [20] "25. …The Plus Plan is our blueprint for positive organisational change and the driving force behind enabling and empowering our people. The Plus Plan is one way in which FRNSW ensures that that [sic] firefighters are equipped to deal with the ever-changing nature of the work. The Plus Plan is a detailed action plan to accomplish the strategic objectives of FRNSW. … 27. Externally, we found a knowledge gap existed between how the community perceived us and what we currently do – our capabilities. We found that when the community has a better understanding of what we do, the value they place on us dramatically increases. In addition, the external environment, the nature of emergency services and the type of incidents we respond to change just as communities and societies change over time. FRNSW firefighters have always done more than fight fires and save people from burning buildings, unfortunately, what we learned in developing the Plus Plan is that these extra capabilities were not well understood by other stakeholders. 28. Firefighters have always delivered capabilities to the community such as prevention and education, fire, rescue, Hazmat, counterterrorism, environmental protection, humanitarian relief, and medical response." 1. The FBEU tendered a document titled "The FRNSW Plus Plan Explained". That document set out the objectives for Fire and Rescue NSW under headings including "Prevention + Education", "Fire", "Rescue", "Hazmat", "Protect the Environment", "Counter Terrorism", "Natural Disaster and Humanitarian Relief" and "Medical Response". It is not necessary to reproduce the contents of the document at length. We observe in particular the following extracts: "Counter Terrorism We will take a more proactive role as a supporting agency looking for opportunities to improve and increase our contribution both the prevention and response to terrorism events. [sic]… … Medical Response We will work with Ambulance New South Wales as to lead agency to increase our capabilities in medical response that recognises our increasing role. We will further develop our Community First Responder (CFR) program and implement along with agencies the Early Access to Defibrillator Program (EADP)." 1. A further document tendered by the FBEU was titled "FRNSW PLUS PLAN – Achievements". As its name suggests, the document described a number of initiatives introduced by Fire and Rescue NSW under the auspices of the Plus Plan. 2. The FBEU submitted: [21] "17. Mr McGuiggan's evidence as to the scope and impact of the Plus Plan since its launch in 2018 is illustrative of the greater skills and more complex work steadily being required of firefighters over the last two to three years as part of Fire + Rescue's broader productivity and competition strategy. These are productivity and efficiency improvements that can only be generated through employee participation. They have never been taken into account in any wage adjustment." (Emphasis in original, footnote omitted) 1. In response, the Secretary contended in summary: 1. there is no evidence that the Plus Plan was part of FRNSW's "broader productivity and competition strategy". None of the evidence makes reference to productivity or competition; and 2. the FBEU had not demonstrated that any initiatives introduced pursuant to the Plus Plan met the requirements of the sub-principle, including whether Firefighters had made a significant contribution to any such initiatives. 1. We are in agreement with the Secretary. We make four points in respect of the FBEU's submissions at [78] above. 2. First, it is not clear what "measures" the FBEU relied on. That is, whether it is the Plus Plan itself, or the changes introduced pursuant to it. 3. Second, the FBEU did not demonstrate how such measures have delivered the "productivity and efficiency improvements" to which it referred. Indeed, the FBEU asserted the existence of such improvements without identifying them. As the Secretary submitted, there is no reference in any of the evidence to productivity or competition. The documents refer to the enhancement of capability and the more proactive use of that capability. There is no evidence that Fire and Rescue NSW has, as a consequence of initiatives introduced under the auspices of the Plus Plan, benefitted from productivity or efficiency improvements. 4. Third, even were such productivity or efficiency improvements to have been identified, it is not enough to say that they "could only have been generated through employee participation". The sub-principle requires the FBEU to demonstrate a "significant contribution", which is not to be found through employees simply accepting changes that might be introduced in the workplace. The fact that a change might apply to or affect a Firefighter does not necessarily attract the sub-principle. It is not the application of change to employees, but their contribution to that change, which is relevant: see Police and Paramedics 2020 at [180] and [189] 5. Fourth, the Firefighters have not wholly supported the Plus Plan. In relation to the enhancement of medical response capability, the parties are in dispute about the introduction of the "Early Access to Defibrillator Program". This is at the heart of other changes to the Awards sought by the FBEU, which we consider at [133]-[148] below. 6. We find that the FBEU has failed to make out a case for the application of the productivity and efficiency sub-principle. Special case 1. Where reliance is placed on the special case sub-principle, the applicant bears the onus of persuading the Commission that the application satisfies a dual test: that the terms of the award sought constitute fair and reasonable conditions of employment and that the matter in question has "special attributes" or is "out of the ordinary" so as to take the matter outside the restrictions which otherwise apply under the Wage Fixing Principles: Police and Paramedics 2020 at [32(5)]. 2. The FBEU submitted that two factors justify a wage increase under the special case sub-principle. 3. The first factor stems from the arrangements under which the operations of Fire and Rescue NSW is funded. The FBEU submitted: [22] "16. NSW Fire + Rescue is instead funded through the Emergency Services Levy. The costs of this levy are split as follows: a. 73.7% funded by private insurance companies; b. 11.7% funded by local government; and c. 14.6% by the State government. 17. This necessarily means any wage case must involve sharply different considerations than in cases where employee-related costs are purely funded by public money. This takes on particular significance in present circumstances; the case does not involve the same contest between government funds going to COVID-19 recovery and the related stimulus or directly to employee costs per the 2020 State Wage Case. This is itself sufficient to make the case sufficiently unusual or out of the ordinary such as to justify a Special Case." 1. The FBEU further submitted: [23] "15. In the particular context of 2021/2022, these funding arrangements bring the matter out of the ordinary, in that a failure to provide a wage increase of the kind sought by the FBEU will in substance only serve to provide a windfall to private insurance companies – a situation starkly different to that which faced the Commission in respect of earlier wage claims in this financial year. Again, there is no real evidentiary challenge to this. Indeed, Mr Walters in cross examination confirmed that to provide such a private benefit would create no economic stimulus." (Emphasis in original, footnote omitted) 1. The FBEU did not provide the Commission with much assistance as to the operation of the Emergency Services Levy. It would appear that the funding model which currently applies has its origins in the Fire Brigades Act 1909. It follows that the fact that the Government's costs in respect of Fire and Rescue NSW are partially offset by contributions from insurers and local government is not of itself "out of the ordinary". 2. As we observed at [17(4)] above, on 27 May 2020 the NSW Government announced a change to its wages policy. Public sector wages would be paused, with the savings to be invested into infrastructure projects which were claimed would have a greater stimulatory effect on the economy. As each of Public Sector Salaries 2020 and Police and Paramedics 2020 make clear, the relative stimulatory benefits of wage increases as opposed to infrastructure spending was keenly contested before the Full Bench in those matters. 3. The FBEU's submissions were not entirely clear, but seemed to be directed towards that dichotomy. That is, as the Government will be liable for only 14.6% of any increases to the Award Rates, the impact on any increase is unlikely to have a material impact on infrastructure spending. Dr Jackson estimated the first year costs to the Government of a 2.5% wage increase would be $2.6 million. Put from a different perspective, even were savings from a reduction in the increase for Firefighters directed into infrastructure spending it would have little, if any, stimulatory effect on the economy. 4. On our understanding of the FBEU's position, its reliance on the Emergency Services Levy goes more towards differentiating this case from the outcome in Public Sector Salaries 2020 and Police and Paramedics 2020, as opposed to demonstrating that this matter has "special attributes" or is "out of the ordinary" so as to take the matter outside the restrictions which otherwise apply under the Wage Fixing Principles. 5. We are not persuaded that the funding arrangements arising in connection with the Emergency Services Levy attracts the special case sub-principle. 6. The second factor on which the FBEU relied to establish a special case was the impact of climate change on the work of Firefighters. It submitted: [24] "10. …The FBEU relies on the specific impact that climate change has had on firefighters and their work in the last two years, being in particular the: a. Black Summer bushfires of 2019/2020; and b. recent massive flooding in NSW. 11. While reliance is additionally placed on the likelihood, arising from climate change, that the need to respond to catastrophes of this unprecedented magnitude will only recur, this should not be taken as an indication that the FBEU will not seek to rely on specific instances in any future special case applications. 12. There is no real contest that climate change is dramatically increasing the scale, frequency and intensity of natural disasters which firefighters must respond to. The last two years have been a clear illustration of this. Fire + Rescue have led no serious evidence to the contrary." (Footnote omitted) 1. The FBEU relied on a report by the Royal Commission into Natural Disaster Arrangements dated 28 October 2020. Chapter 2 of that Report is titled "Natural disaster risk", and the following appears under the heading "Summary" in that chapter: "2.4 Climate change has already increased the frequency and intensity of extreme weather and climate systems that influence national hazards. 2.5 Further global warming over the next two decades is inevitable. As a result, sea-levels are projected to continue to rise. Tropical cyclones are projected to decrease in number, but increase in intensity. Floods and bushfires are expected to become more frequent and intense. 2.6 The 2019-2020 bushfire season demonstrated that bushfire behaviour is becoming more extreme and less predictable. Catastrophic fire conditions may become more common, rendering traditional bushfire prediction models and firefighting techniques less effective. 2.7 We can also expect more concurrent and consecutive hazard events. For example, in the last 12 months there was drought, heatwaves and bushfires, followed by severe storms, flooding and a pandemic. Concurrent and consecutive hazard events increase the pressure on exposed and vulnerable communities. Each subsequent hazard event can add to the scale of the damage caused by a previous hazard event. There are likely to be natural disasters that are national in scale and consequence. … 2.51 Fire weather is primarily a function of temperatures, humidity and winds. There has been a long-term increase in dangerous fire weather, and in the length of the fire season, across large parts of Australia. There has been a reduction in the time between the catastrophic bushfire events of Australian history. … 2.57 Climate projections show that more dangerous weather conditions for bushfires are very likely to occur throughout Australia in the future due to a warming climate. …" (Footnotes omitted) 1. Trevor Ross is a senior Firefighter with Fire and Rescue NSW. He deposed that he was deployed twice to assist in fighting the 2019-20 bushfires. The first deployment was for a day in November 2019, during which he assisted in "clearing, making fire trails and generally making the area safe for firefighting". [25] He also spent approximately one and a half hours performing "serious firefighting" [26] that was "intense and exhausting" and "a more extreme experience than [his] other deployments". [27] 2. Mr Ross' second deployment was for three days in January 2020. During this deployment he was engaged in fire preparation, including "clearing, checking hydrants, and making sure there was an evacuation plan, under pressure as the fires raged nearby". [28] 3. Mr Ross deposed that the 2019-2020 bushfire season "has led to an intensification in our work that is only likely to continue". [29] He further stated: [30] "…fighting bushfires of this magnitude for ever lengthening fireseasons [sic], and then responding to increasingly frequent natural disasters like floods, takes its collective toll on all of us. Incidents are becoming more and more [frequent]." 1. Prior to the 2019-20 bushfire season, Mr Ross estimated that he may have been on up to six bushfire deployments since 1997. He was unable to comment as to whether this number of deployments was representative of Firefighters more generally. 2. James Smith is a retired Deputy Commissioner of Fire and Rescue NSW. He deposed: [31] "20. Firefighters from FRNSW are being called on more often not just to fight fires but to prepare communities and to clean up after other natural disasters." 1. The Secretary did not challenge the FBEU's evidence regarding climate change or the likelihood that it will result in an increase in the frequency and intensity of natural disasters in New South Wales. Indeed, Mr McGuiggan accepted this proposition under cross-examination, while Mr McNeil was more agnostic. The Secretary did, however, call into question the extent to which any effects of climate change had seen alterations to the work required of Firefighters. 2. Mr McNeil stated that over the last decade or so "the emergency call rates have remained constant as an average". [32] As already observed at [72], he was of the view that "firefighters are doing the same activities and at the same intensity and with the same numbers as they have done for the past decade". To the extent that climate change has resulted in Firefighters being required to perform additional duties, Mr McNeil considered they were already compensated through the provisions of the Awards. 3. Mr McGuiggan similarly deposed that Firefighters "are already remunerated for climate change work at rates beyond their ordinary pay when they participate in deployments as a result of climatic events". [33] His evidence was to the effect that whilst the period of the 2019-2020 bushfires "wasn't what [he] would call normal", [34] the work performed by Firefighters was of the kind that is within their skills and capabilities, and at the standard that he would expect to see. 4. There is no question that the 2019-20 bushfires were extraordinary in their scale and ferocity. The floods in New South Wales in 2021 were similarly of an uncommon immensity. Each of the bushfires and the floods had tragic and devastating consequences. The members of the Full Bench cannot begin to imagine what it must have been like to be working "at the front line" in those emergencies. 5. However, the question for determination by the Commission is whether climate change, as allegedly evidenced by the bushfires and floods, gives rise to a special case within the meaning of the Wage Fixing Principles. While the events may have been "out of the ordinary", the question is whether the demands made of Firefighters as a consequence of those events should resonate in an increase in the Award Rates. 6. Fire and Rescue NSW is a predominantly urban fire and rescue service, the majority of whose work is performed in metropolitan areas and townships. While it plays a key role in responding to natural disasters such as bushfires and floods, it is important not to conflate the responsibilities of Fire and Rescue NSW with those of the Rural Fire Service and the State Emergency Service. Recognising that it is not a competition between the agencies, as the FBEU submitted, the Commission is required to consider the work required to be performed by Firefighters in responding to natural disasters. 7. In this regard, the FBEU's evidence regarding bushfire response is largely limited to that of Mr Ross, described above. There is little evidence as to the work required by Firefighters in responding to floods, although Mr McGuiggan stated that "[o]ur busiest day is floods". [35] 8. We are not satisfied that the FBEU has discharged its onus to make out a special case resulting from climate change. The Secretary took no issue with the FBEU's submission that climate change has led, and will lead, to an increase in the frequency and intensity of natural disasters. As a result, we have approached this matter on the basis that this is agreed for the purposes of these proceedings. However, the evidence falls short of demonstrating that there has been anything out of the ordinary in the demands of Firefighters. Taking at its highest Mr Ross' evidence regarding his bushfire deployments in 2019 and 2020, and assuming that it is representative of Firefighters generally, we do not see that it falls outside of the work required of them in the usual course. 9. We accept the following submissions made by the Secretary: "59 … To discharge its onus the FBEU needs to establish that the impact of these events on Firefighters was 'out of the ordinary'. There is simply no basis upon which the Commission could make a finding, given the paucity of the evidence, that the Black Summer bushfires and 2021 floods, precipitated different work practices or presented any special mental and physical risk to Firefighters that was not already inherent in their work and for which they received fair and reasonable remuneration and training." 1. We find that the FBEU has not demonstrated that this case attracts the special case sub-principle on the grounds it advanced. Conclusions and determination – Award Rates 1. Given our findings at [85] and [111] above, there is no basis on which to award an increase to the Award Rates in purported recompense for the matters on which the FBEU advanced in reliance on the productivity and efficiency, and special case sub-principles. 2. The Full Bench has previously accepted that an outcome that would see a reduction in the real earnings of employees might not be fair and reasonable, and that even where a party has failed to make out its case for a particular increase, it might still award an increase to maintain the real value of wages: Public Sector Salaries 2020 at [155]; Police and Paramedics 2020 at [234]. We have found that an increase of 0.1% would be required to maintain the real value of the Award Rates until February 2022. 3. As the FBEU has not made out a case for a higher increase, we accept the position put by the Secretary. We have determined that the appropriate order is that the new awards contain rates which are 0.3% higher than the current Award Rates. Other changes sought by the FBEU Overpayments 1. Each of the Awards presently has a provision titled "Overpayments", within the "Rates of Pay and Allowances" clause. [36] The provisions in each Award are in the same terms. They provide, in short, that Fire and Rescue NSW is entitled to recover in full any overpayments made to an employee; that the employee will be advised of the amount of the overpayment, the "circumstances surrounding the overpayment" and when recovery will commence; that recovery will be made at the rate of 10% of the employee's gross fortnightly pay, unless the employee agrees to a higher percentage; and, that the Commissioner of Fire and Rescue NSW may reduce the recovery rate to avoid hardship to the employee. 2. The FBEU proposed that the clauses be amended so as to include the following provisions (with consequential amendments to the remaining terms): "The Department will not recover any overpayment until the employee has been consulted about when the recovery should begin and the monetary or percentage value of wages to be deducted. Agreement must be reached on a timeframe and monetary or percentage value before any recovery action begins, subject to [the next subclause] below. If there is a failure to agree under [the previous subclause], then a default rate of 5% of wages commencing one month after notification [of the overpayment] was given will be applied until any other agreement is reached between the employee and the Department." 1. In support of the proposed changes, the FBEU led evidence from Giacomo Arnott, a retained Firefighter who at the time of the hearing held the position of Acting Captain at Raymond Terrace Fire & Rescue. Mr Arnott described some of the features of cl 6.11 of the Retained Award and of the changes sought by the FBEU. He then stated: [37] "43. FRNSW employees should be afforded a right to negotiate the recovery structure for an overpayment. They may be suffering from hardship and might not be able to absorb an automatic 10% of their income being deducted." 1. The FBEU submitted: [38] "5. …The present clause, which operates in circumstances almost universally due to Fire + Rescue error, is on its face unreasonable. …" 1. The Secretary submitted that the existing provisions relating to overpayments are fair and reasonable and, further: "182. Save for Mr Arnott's unsubstantiated opinion that FRNSW employees 'may be suffering from hardship and might not be able to absorb an automatic 10% of their income being deducted' the FBEU has adduced no evidence as to why and how the current award provisions in respect of the recoupment of overpayments are not fair and not reasonable, nor has it adduced evidence as to why the arbitrary rate of 2% (which is proposed as the default rate) should render provision fair and reasonable." 1. To avoid confusion, we observe that the FBEU's initial proposal was for a default rate of 2%. The FBEU proposed a default rate of 5% in its closing submissions in reply. 2. We accept the Secretary's submissions. Awards of the Commission are presumed to set fair and reasonable conditions of employment: Public Sector Salaries 2020 at [32(2)]. The onus is on the FBEU to make out the case for change. That is, that the Awards, made on the FBEU's application and by consent on 2 April 2020, no longer provide fair and reasonable conditions of employment and that the changes sought are necessary to ensure that they do so. 3. Each of the Awards contains a provision in these terms: [39] "The recovery rate of 10% of an employee's gross fortnightly pay…may be reduced by approval of the Commissioner if the Commissioner is satisfied that such a rate of recovery would cause undue hardship to the employee concerned." 1. There is no evidence before the Commission that the current provisions have in fact caused any employee hardship, or that the discretion conferred on the Commissioner of Fire and Rescue NSW has not been exercised fairly and appropriately. Mr Arnott's speculation as to what hardship employees "may" be suffering, and his opinion as to what rights employees "should be afforded" do not rise to the level necessary for the FBEU to discharge its onus. 2. We decline to make the amendments to the Overpayments provisions in the Awards sought by the FBEU. Cultural and ceremonial leave 1. The FBEU seeks to have a provision titled "Cultural and Ceremonial Leave" inserted into each of the Awards, in the following terms: "An employee who identifies as Aboriginal or Torres Strait Islander, who is required by Indigenous tradition to be absent from work for Indigenous ceremonial purposes, including celebrations for National Aborigines and Islanders Day of Commemoration Celebration (NAIDOC Week), will be entitled to up to five calendar days unpaid leave in any one year." (Emphasis in original) 1. The FBEU again relied on the evidence of Mr Arnott, who deposed: [40] "64. There are many Retained Firefighters who identify as Aboriginal or Torres Strait Islander. The 2019-20 Annual Report notes that 4.28% of Retained Firefighting staff identify as Aboriginal or Torres Strait Islander. In a workforce of 3,297 Retained staff (also from the Annual Report), this equates to approximately 141 staff. 65. These staff members may be elders, just discovering their culture, or entrenched in their ceremonial and celebratory events held throughout the year. 66. The FBEU believes that these Firefighters should be provided with special leave to help keep their culture alive and to support their local communities. 67. Government and employers have spent centuries oppressing Aboriginal and Torres Strait Islander people, and allowing those who are employed by FRNSW to engage with their culture is an important recognition of this fact." 1. Mr Arnott further stated that the inclusion of the proposed clause "will bring consistency and equity for all FRNSW employees who identify as Indigenous or Torres Strait Islander with the rest of the public sector". [41] 2. For the Secretary, Mr McNeil stated: [42] "61. FBEU proposes the introduction of a provision for cultural and ceremonial leave for firefighters who identify as Aboriginal or Torres Strait Islander. While FRNSW is not opposed to this form of leave, in an organisation where minimum staffing applies, it can be a further point of vulnerability with regard to maintaining capability and overtime." 1. In opposing the inclusion of the term sought by the FBEU the Secretary submitted: [43] "188. The only evidence before the Commission about this claim is in paragraphs [64] to [67] of the Arnott Statement. The FBEU did not call any employee who identifies as Aboriginal or Torres Strait Islander to give evidence about how the current provisions of the awards prevent them from attending cultural or ceremonial events, and if this is the case, what affect [sic] this has on them, such as to found a basis for saying that the current awards do not provide fair and reasonable conditions of employment. 189. On their face, Mr Arnott's assertions in paragraph [64] to [67] amount to nothing more than a statement of his opinion and belief that cultural and ceremonial leave should be granted to 'help keep [Aboriginal and Torres Strait Islander] culture alive and to support their local communities' and as an 'important recognition' of the centuries of oppression visited upon Aboriginal and Torres Strait Islander people in the history of Australia. This unqualified opinion is not referable to any facts and cannot assist the Commission in its assessment. 190. FRNSW is not opposed in principle to developing a framework for unpaid cultural and ceremonial leave. However, the implementation of that framework will require an assessment of cost implications, the development of clearer parameters around when leave can be taken and a consideration of how and where such a leave entitlement might be set out." 1. We are again in broad agreement with the Secretary's submissions. Mr Arnott's opinions, however genuinely and fervently held, do not discharge the FBEU's onus. In addition to the observations made by the Secretary at par 188 of his submissions, there was nothing led to support Mr Arnott's implication that Fire and Rescue NSW was out of step with the approach taken elsewhere in the public sector. While Mr Arnott estimated the number of retained Firefighters who identify as Aboriginal or Torres Strait Islander, there was no similar evidence in respect of the permanent workforce. 2. We are not persuaded to make the change sought by the FBEU. At the same time, there is no in-principle opposition to the introduction of an appropriate form of unpaid leave which, at least on a prima facie basis, has merit. While the Full Bench does not at this stage intend to introduce the entitlement into the Awards, it encourages the parties to continue their discussions in the hope that consensus on an appropriate provision to be introduced into the Awards can be reached. Disputes Avoidance Procedures 1. Each of the Awards contains a provision titled "Disputes Avoidance Procedures". Those clauses are unexceptional and are in familiar terms. They provide a process by which "claims, issues and disputes to be resolved while work proceeds normally", [44] culminating in referral to the Commission if required. 2. The FBEU seeks to have the following additional provision inserted into those clauses: "In the event that claims, issues and disputes have been raised under the disputes avoidance procedure in a predecessor Award, including disputes as to the implementation of the Public Access [Defibrillation] program, and at the time of making this award remain unresolved, they may continue to be progressed under this clause, and the status quo obligations remain." 1. The FBEU submitted: [45] "Consultation, disputes clause and no extra claims clause 38. The proposed variations to the disputes avoidance and consultation clauses insert carve-outs for disputes which are presently before the Commission for resolution. These are significant matters which are better addressed through that ongoing process rather than an attempted resolution via these proceedings." 1. The Secretary submitted: [46] "196. The Secretary regards this clause as unnecessary. 197. The cross-examination of both Mr McNeil and Mr McGuiggan was to the effect that 'it would be a shame to go back to square one' in respect of the disputes currently before the Commission, including in relation to the 'JZ relievers', 'In Order 2008-22' and 'public access to [de]fibrillation (Current Disputes). 198. Those questions appear to proceed from the premise that, if the proposed amendments were not inserted into the Award, then the Current Disputes would no longer be able to proceed in the Commission but rather, the parties would have to 'go back to square one'. 199. This is not the case in this Commission, as has been amply demonstrated by at least the long-running dispute relating to In Order 2008-22 which was initiated prior to the commencement of the Awards currently in place and has survived the expiration of at least one former Award. … 205. In the circumstance and the practice of the Commission, there is no need for amendment to the Dispute Resolutions Procedures sought by the FBEU." (Emphasis in original, footnotes omitted) 1. In response, the FBEU submitted: [47] "61. Fire + Rescue's resistance to this claim is based on past practice. The FBEU agrees that the disputes currently on foot can continue to be pressed and status quo obligations will be retained. Absent a clear undertaking to this effect by Fire + Rescue, however, it is in the interest of avoiding future disputation (noting that status quo disputes under this award are not infrequent) that this consensus be reflected in the Award." 1. The FBEU's caution is perhaps understandable given the following evidence from Mr McNeil: [48] "70. FBEU seeks the addition of a new sub-clauses [sic] in each Award the effect of which is to preserve the ability of the FBEU to prosecute unresolved disputes raised under the disputes avoidance procedure in a predecessor Award, including explicitly, a dispute as to the implementation of the Public Access Defibrillation program. FRNSW opposes this amendment as an Award should settle matters, particularly where, as in this case, extensive revision to the Award is proposed and not provide for matters to be left in ongoing dispute." (Emphasis added) 1. Notwithstanding the views expressed by Mr McNeil, we accept the Secretary's submissions that the making of new awards to replace the Awards will not prevent the continuation of proceedings which are currently before the Commission, even if there is no change to the Disputes Avoidance Procedures. To that extent the amendment to the Disputes Avoidance Procedures is unnecessary, and it follows that the FBEU has not made out the case for change. We do not intend to make the change sought by the FBEU. 2. For an abundance of clarity, however, we emphasise that while we have declined to grant this aspect of the FBEU's claims, we do so on the basis that, for the reasons submitted by the Secretary, the making of awards to replace the Awards will not preclude disputes already before the Commission being progressed and finalised in accordance with the Act. We have carefully and deliberately noted the Secretary's position in this regard. No Extra Claims 1. The Awards each contain clauses titled "No Extra Claims", which are again in reasonably conventional terms. Under those clauses the parties agree that "during the term of [the] award, there will be no extra wage claims, claims for improved conditions of employment or demands made with respect to the employees covered by the award". [49] 2. The FBEU proposes that the following provision be added the Awards' No Extra Claims clauses: "This clause does not apply to any claims made by employees relating to a proposed introduction of the Public Access [Defibrillation] scheme, but does apply to any proposal by the Department to introduce such a scheme." 1. The FBEU made only limited submissions in respect of this change. The reference to "no extra claims" in the heading appearing before par 38 of the FBEU's submissions of 21 April 2021, reproduced at [134] above, is the only direct mention of the provision in those submissions. We presume that the submissions at par 38 apply also to the proposed changes to the No Extra Claims clauses. 2. The Secretary submitted: [50] "206. Similarly, the FBEU seeks to carve out from the No Extra Claims clause any claims made by employees relating to a proposed introduction of the Public Access Defibrillation scheme, but specifying that the clause does apply to any proposal by the 'Department' to introduce such a scheme. It may be observed that Commissioner Sloan has already ruled, in Fire Brigade Employees' Union of New South Wales v Commissioner of Fire and Rescue New South Wales (PAD Program) [2021] NSWIRComm 1041 that a requirement that firefighters perform duties in the implementation of the PAD Program is a 'demand made with respect to the employees covered by the award' within the meaning of cl 43.1 1. of the Permanent Award and cl 34.1 of the Retained Award. As such, during the term of the awards it was an 'extra claim' and that the purported implementation of the PAD Program by FRNSW on and after 6 May 2020 until the notional expiry of the award on 25 February 2021 was not permitted. 207. There is no justification for the one sided carve out to the No Extra Claims clause proposed by the FBEU." 1. In reply, the FBEU submitted: "62. As to extra claims, Fire + Rescue's submission is a little short sighted, as it closes out a path to possible resolution of the dispute as to implementation of the PAD program. It is accepted that it is an extra claim and would be prohibited under either party's proposed Award once made. This allows, at least if agreement is reached as to implementation but a dispute about the value of that work remains, that issue to be ventilated. The claim is pressed." 1. There is force to the FBEU's submissions. If the new awards made by the Commission contain No Extra Claims provisions in the terms currently appearing in the Awards, both Fire and Rescue NSW and its employees would be precluded from making claims in respect of the Public Access to Defibrillation ("PAD") program. This appears to be accepted by the Secretary, hence the objection to a "one sided carve out". 2. At the same time, the decision of Sloan C in Fire Brigade Employees' Union of New South Wales v Commissioner of Fire and Rescue New South Wales (PAD Program) [2021] NSWIRComm 1041 to which the Secretary referred was made in respect of the Awards and the particular circumstances regarding the purported introduction by Fire and Rescue NSW of the PAD program. As that decision makes clear, the FBEU opposed the PAD program on the basis that it was an extra claim, an argument which Sloan C accepted. What the FBEU has not made clear is why it should be permitted to make claims in respect of an initiative that it opposed, but that Fire and Rescue NSW should not. There is an illogicality in the FBEU's position. 3. We note further that the proceedings relating to the PAD program remain before Sloan C. For the reasons set out at [138]-[139] above, they will remain on foot irrespective of the making of new awards that rescind and replace the Awards. 4. On balance, we are not persuaded to make the change to the No Extra Claims clauses for which the FBEU contends. Retained Award – Carer's Leave 1. Clause 15 of the Retained Award is titled "Carer's Leave". Clause 15.1.1 is in the following terms: "15.1.1 An employee, other than a casual employee, with responsibilities in relation to a class of person set out in subclause 15.1.3.2, who needs the employee's care and support shall be entitled to use, in accordance with this clause, any current or accrued Sick Leave entitlement, provided for at clause 15, for absences to provide care and support for such persons when they are ill. Such leave may be taken for part of a single day." 1. The FBEU seeks to have the words "other than a casual employee" removed from the clause. Mr Arnott deposed: [51] "22. The change at 15.1.1 remove[s] an obsolete reference to 'casual employees', which do not exist in the Retained system." 1. Mr Arnott was not required for cross-examination. The Secretary did not lead evidence to rebut that of Mr Arnott. 2. The Secretary submitted: 194. The FBEU has not adduced evidence as to why the term 'casual employees' is obsolete or why the inclusion of that term (even if it is obsolete, which is denied) would lead to conditions that were not fair and reasonable for firefighters. 195. FRNSW submits that the category of 'casual employees' should be preserved." 1. We are not convinced that the FBEU must explain why the term is obsolete, when the uncontroverted evidence is that it is obsolete. 2. Further, the Retained Award does not, on its terms, contain a "category" of "casual employee". The term appears only twice in the Retained Award: at cl 15.1.1 and in cl 11.1, which excludes casual employees from an entitlement to compassionate leave. The Secretary did not respond to the FBEU's case to explain what, in the context of the Retained Award, is being "preserved". 3. The Secretary's submissions are also difficult to reconcile with the following evidence of Mr McNeil: [52] "23. …15.1.1 The FBEU's proposed Retained Award seeks to remove the words 'other than a casual employee' from the provision that allows an employee to utilise sick leave for carers leave purposes. This clause was inserted into the Retained Award from the test case standard circa 1995. It has clearly worked for the last 26 years without the variation sort [sic] by the FBEU However, FRNSW does not oppose this Award variation." (Emphasis added) 1. It might be argued that on the FBEU's case, the amendment sought is unnecessary. If there is "no such thing as a casual retained firefighter" [53] , the words in cl 15.1.1 will simply have no work to do. However, where there is no evidence to suggest that the removal of the words would have unintended consequences, and more, that Fire and Rescue NSW does not oppose the change, we are disinclined to retain redundant language in the Retained Award. 2. We accept that cl 15.1.1 should be amended in the manner sought by the FBEU. Matters on which the parties agreed 1. At [6]-[7] above we referred to documents received by the Commission which identified a number of changes to the existing terms of the Awards to which the parties agreed. It is not necessary that those changes be separately articulated in this decision. Having considered the proposed changes, and noting the consent of the parties, we are satisfied that it is appropriate for the purposes of s 10 of the Award that they be reflected in the new awards. Effective date of awards 1. Clause 6(1)(e) of the Regulation provides that "[c]hanges to remuneration or other conditions of employment may only operate on or after the date the relevant parties finally agreed to the change (if the award or order is made or varied by consent) or the date of the Commission's decision (if the award or order is made or varied in arbitration proceedings)". This provision does not apply if the parties agree or there are exceptional circumstances: cl 6.2. 2. In Maan v Minister for Immigration and Citizenship (2009) 179 FCR 581, Branson J observed: "51. Although the expression 'exceptional circumstances' is not defined in the Regulations it has been the subject of consideration in numerous cases. Assistance in interpreting the expression can be found in comments of Lord Bingham of Cornhill CJ in R v Kelly (Edward) [2000] 1 QB 198 at 208 as follows: We must construe 'exceptional' as an ordinary, familiar English adjective, and not as a term of art. It describes a circumstance which is such as to form an exception, which is out of the ordinary course, or unusual, or special, or uncommon. To be exceptional a circumstance need not be unique, or unprecedented, or very rare; but it cannot be one that is regularly, or routinely, or normally encountered. …" 1. In Yacoub v Pilkington (Australia) Ltd [2007] NSWCA 290 Campbell JA, with whom Handley AJA and Tobias JA agreed, observed: "66. Another question of construction concerned 'exceptional circumstances' in rule 31.18(4). In San v Rumble (No 2) (2007) NSWCA 259 at [59]-[69], I gave consideration to the expression 'exceptional circumstances' in a different statutory context to the present. Without repeating that discussion in full, I shall state such of the conclusions as seem to me applicable in the construction of rule 31.18(4). (a) Exceptional circumstances are out of the ordinary course or unusual, or special, or uncommon. They need not be unique, or unprecedented, or very rare, but they cannot be circumstances that are regularly, routinely or normally encountered: R v Kelly (Edward) [2000] 1 QB 198 (at 208). (b) Exceptional circumstances can exist not only by reference to quantitative matters concerning relative frequency of occurrence, but also by reference to qualitative factors: R v Buckland [2000] 1 WLR 1262; [2000] 1 All ER 907 (at 1268; 912-913). (c) Exceptional circumstances can include a single exceptional matter, a combination of exceptional factors, or a combination of ordinary factors which, although individually of no particular significance, when taken together are seen as exceptional: Ho v Professional Services Review Committee No 295 [2007] FCA 388 (at [26]). (d) In deciding whether circumstances are exceptional within the meaning of a particular statutory provision, one must keep in mind the rationale of that particular statutory provision: R v Buckland (at 1268; 912-913). (e) Beyond these general guidelines, whether exceptional circumstances exist depends upon a careful consideration of the facts of the individual case: Awa v Independent News Auckland [1996] 2 NZLR 184 (at 186)." 1. As noted above, the awards sought in the Secretary's applications each provided that they would take effect on and from 26 February 2021. For reasons which were not explained, on the first day of hearing Ms McDonald of Counsel, who appeared for the Secretary, informed the Commission that her instructions were "to resist the back pay at this stage". During closing oral submissions, Ms McDonald had the following exchange with the Chief Commissioner: [54] "Just to close, to deal with the issue of backdating, as you identified, Chief Commissioner, in your exchange with Ms Saunders, the application made by the Crown does refer to a new award being made from February 2021 [through] to February 2022. I'm instructed that that ought to say - and I formally request that does - in that draft award that what it ought to have said is, 'from the date of the new award for a period of 12 months', because-- CONSTANT CC: You're amending your application in final submissions? Because part C clearly says per week from 26 February 2021. Is that correct? You're amending your application now? MCDONALD: They are my instructions, Chief Commissioner, but can I say this? I do not have instructions to consent to backdating. However, I am making no submissions in opposition to that." 1. The Full Bench declined the Secretary's application for leave to amend his applications. 2. No explanation was offered by the Secretary as to why he sought to amend his applications so as to operate from the date of the Commission's decision rather than 26 February 2021, and particularly why he did so in the closing moments of the proceedings. It is curious, when the information provided by the Secretary referred to at [20] and [32] above was predicated on the new awards commencing on 26 February 2021. 3. The FBEU consented to the Secretary's applications "as made". [55] In our view, the Secretary's last-minute and unexplained change of position on the retrospective operation of the new awards is sufficiently exceptional to bring the matter within cl 6.2 of the Regulation. Disposition 1. The Full Bench upholds the Secretary's applications in matters 2021/50623 and 2021/50661. 2. Other than to allow for: 1. the changes agreed by the parties and reflected in the documents referred to at [6]-[7] above; and 2. the amendment to cl 15.1.1 of the Retained Award, dealt with at [149]-[157] above, the FBEU's applications in matters 2021/53994 and 2021/54005 are dismissed. 1. The Commission makes the following directions: 1. the parties are to confer on the preparation of short minutes of order to give effect to the Commission's decision, and of drafts of each of the new awards reflecting the Commission's decision; 2. in the event that the parties reach consensus on the terms of the proposed short minutes and new awards, the Secretary is directed to file and serve those documents by 4.00pm on14 September 2021. The Secretary is to file at the same time a computer-readable version of each of the proposed awards; and 3. in the event that the parties are unable to reach consensus on the terms of the proposed short minutes and new awards, the parties are granted liberty to apply on reasonable notice. ********** Endnotes 1. Tcpt, 15 July 2021 p 238(11-25) 2. Permanent Award cl 44.2; Retained Award cl 35.2 3. Statement of Robert McNeil, 20 May 2021 4. Submissions of the Industrial Relations Secretary on behalf of Fire and Rescue NSW, 6 July 2021 ("Secretary's Closing Submissions"), at par 17 5. Statement of San Midha, 24 May 2021, Exhibit "SM-1", Tab B at par 41b 6. Exhibit Crown 5 7. Secretary's Closing Submissions 8. Exhibit Crown 5 at p 2 9. FBEU Closing Submissions, 21 June 2021 ("FBEU Closing Submissions") 10. Statement of Stephen Walters, 24 May 2021, Exhibit SW-1, Tab B 11. Tcpt, 3 June 2021 p 134(6-36) 12. FBEU Closing Submissions 13. Secretary's Closing Submissions 14. Statement of Dr Angela Jackson, 21 April 2021, Annexure AJ-B 15. FBEU Closing Submissions 16. Statement of Dr Angela Jackson, 21 April 2021, Annexure AJ-B at p 13 17. Tcpt, 2 June 2021 p 80(43) 18. Statement of Robert McNeil, 20 May 2021 19. FBEU Submissions re Award Changes, 21 April 2021 ("FBEU Opening Submissions") at par 12 20. Statement of Paul McGuiggan, 21 May 2021 21. FBEU Closing Submissions 22. FBEU Opening Submissions 23. FBEU Closing Submissions 24. FBEU Closing Submissions 25. Statement of Trevor Ross, 14 April 2021 at par 27 26. ibid. at par 27 27. ibid. at par 28 28. ibid. at par 33 29. ibid. at par 5 30. ibid. at par 44 31. Statement of James Smith, 14 April 2021 32. Statement of Robert McNeil, 20 May 2021 at par 87 33. Statement of Paul McGuiggan, 21 May 2021 at par 18 34. Tcpt, 3 June 2021, p 118(31) 35. ibid. p 119(29) 36. Permanent Award cl 6.16, Retained Award cl 6.11 37. Statement of Giacomo Arnott, 13 April 2021 38. FBEU Submissions in Reply, 13 July 2021 ("FBEU Reply Submissions") 39. Permanent Award cl 6.16.3; Retained Award cl 6.11.3 40. Statement of Giacomo Arnott, 13 April 2021 41. Reply Statement of Giacomo Arnott, 28 May 2021 at par 13 42. Statement of Robert McNeil, 20 May 2021 43. Secretary's Closing Submissions 44. Permanent Award cl 35.2; Retained Award cl 26.1 45. FBEU Opening Submissions 46. Secretary's Closing Submissions 47. FBEU Reply Submissions 48. Statement of Robert McNeil , 20 May 2021 49. Permanent Award cl 43.1; Retained Award cl 34.1 50. Secretary's Closing Submissions 51. Statement of Giacomo Arnott, 13 April 2021 52. Statement of Robert McNeil, 20 May 2021 53. FBEU Reply Submissions at par 60 54. Tcpt, 15 July 2021 pp 267(49)-268(12) 55. ibid. p 274(31) DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 24 August 2021