1 Fair Work Act 2009 s.604 - Appeal of decisions United Workers’ Union v Thrive Group Tasmania Inc (C2025/7686) VICE PRESIDENT GIBIAN DEPUTY PRESIDENT COLMAN DEPUTY PRESIDENT GRAYSON SYDNEY, 16 JANUARY 2026 Appeal against decisions [2025] FWC 2105 and [2025] FWC 2414 of Deputy President Millhouse at Melbourne on 18 July 2025 and 22 July 2025 in matter number AG2025/1798 – Application for approval of The Thrive Group Tasmania Enterprise Agreement 2025 – Whether the Commission erred in being satisfied that the agreement passed the better off overall test for the purposes of s 186(2)(d) of the Fair Work Act 2009 (Cth) – Whether ‘Service Leader’ position would fall within the Level 5 Assistant Director or Level 6 Director classification in the Children’s Services Award 2010 – Permission to appeal granted – Appeal allowed. Introduction [1] Thrive Group Tasmania Inc (Thrive) is a not-for-profit service that provides children’s education and care services in Tasmania. Among other things, Thrive operates a number of early learning centres. This appeal arises from an application made by Thrive for approval of a new enterprise agreement to cover its employees known as the Thrive Group Tasmania Enterprise Agreement 2025 (the Agreement). [2] An enterprise agreement derives its legal effect from the terms of the Fair Work Act 2009 (Cth) (the Act). An enterprise agreement operates only after it has been approved by the Commission.1 The Commission is required, by s 186(1), to approve an enterprise agreement if the requirements of that section and s 187 are met. One of the requirements is that the Commission must be satisfied the agreement passes the better off overall test.2 Relevantly to this matter, and in summary, the better off overall test requires that each award covered employee and each reasonably foreseeable employee, would be better off overall if the agreement applied to the employee than if the relevant modern award applied to the employee.3 [3] A Deputy President of the Commission was satisfied that the requirements for approval of the Agreement were met and approved the Agreement subject to certain undertakings.4 The United Worker’s Union (the UWU) seeks permission and to appeal from the decision under s 604(1) of the Act. The notice of appeal raises a single issue, namely, whether the Deputy President erred in being satisfied that persons employed as ‘Service Leaders’ by Thrive would [2026] FWCFB 7 DECISION [2026] FWCFB 7 2 be better off overall if the Agreement applied to their employment, rather than the Children’s Services Award 2010 (the Award). The UWU submits that the Deputy President erred by finding that the correct comparator for the position of Service Leader under the Agreement in the Award is the position of Assistant Director (Level 5) rather than Director (Level 6). [4] For the reasons which follow, permission to appeal should be granted and the appeal allowed. In our view, an employee engaged as a Service Leader under the Agreement would be classified as a Level 6 – Director under the Award. There is no dispute that, if this is the case, the Deputy President could not have been satisfied that persons employed as Service Leaders would not be better off overall if the Agreement applied to their employment, rather than the Award for the purposes of s 193(1)(a) of the Act. The decision to approve the Agreement should be quashed and the application remitted to be redetermined by the Deputy President. Factual background [5] As we have observed, Thrive operates a number of early learning centres in Tasmania. We were informed during the appeal hearing that Thrive currently operates 21 centres at locations throughout Tasmania. Thrive claims to operate a centralised business model which it says differs from the usual model commonly used in the early childhood education and care sector. [6] In a witness statement tendered at first instance, the Director of Children’s Services for Thrive, Sebastian Tuttle, stated that typically each centre is self-contained and operates as an entire entity. At a typical centre where care is provided there is a director who is the nominated supervisor who is legally responsible for the day-to-day operation of the service. Mr Tuttle indicated that, under Thrive’s centralised business model, he and another manager, Angela Kinnersly, are the nominated supervisors for all services. The most senior employee located at each service is the Service Leader who, Mr Tuttle says, is the point of contact for families and staff and acts as Thrive’s ‘eyes and ears’ at the service on a day-to-day basis. [7] The UWU called evidence from an employee, Vicky O’Grady, who is employed as a Service Leader at Thrive’s Beaconsfield Early Learning Service. Ms O’Grady gave evidence that, as the Service Leader, she was required to manage the service on a day-to-day basis, including managing and rostering 13 members of staff, ensuring staffing ratios meet legal requirements, ensuring that there is a responsible person appointed at times she is not at work and that the service meets the National Quality Standards and other regulatory requirements. Ms O’Grady described her responsibilities for managing staff, including conducting performance appraisals, and her responsibilities in dealing with families, including dealing with inquiries in relation to enrolments, behaviour and the provision of care. [8] Thrive employees were previously covered by an enterprise agreement known as the Northern Children’s Network Inc (NCN) Enterprise Agreement 2013. On 5 June 2025, the Agreement was made by way of a majority vote of employees of Thrive who were proposed to be covered by the Agreement. On 10 June 2025, Thrive made an application to the Commission for the approval of the Agreement, filing a Form F16 (Application for approval of an enterprise agreement) and Form F17B (Employer’s declaration in support of an application for approval of an enterprise agreement). [2026] FWCFB 7 3 [9] On 16 June 2025, the UWU filed a Form F18 (Declaration of employee organisation in relation to an application for approval of an enterprise agreement). In doing so, the UWU raised an objection to the approval of the agreement on the basis that the classification of Service Leader under the Agreement should be aligned with the Level 6 – Director classification in the Award rather than the Level 5 – Assistant Director classification. The response to the application by the UWU stated: Taking into account the duties of a Director under the Award, and the modifications made to the Assistant Director level in the description of a Service Leader in the agreement, UWU does not agree with the employer’s conclusion that the Service Leader is correctly matched with the Assistant Director (Level 5) classification of the Award. The best-fit match for the classification is to the Director levels of the Award. UWU notes that the rates of pay at all levels of the agreement for a Service Leader are not higher than the lowest level rate of pay for a Director in the Award (Level 6.1). [10] The UWU submitted that the role of Director within the Award includes primary responsibility for the management of a service. The position of Service Leader under the Agreement similarly encompasses primary responsibility for the day-to-day management of the service. The UWU submitted that, if this argument is rejected by the Commission, a Service Leader would be entitled to payment for higher duties under the Award, where they were undertaking the duties of a Director for a period of more than two days. [11] Thrive submitted that the position of Service Leader was appropriately matched to the classification of Level 5 – Assistant Director under the Award given that the ‘major and substantial’ part of the duties which are contemplated by the position of Director are not conducted by the Service Leader. Thrive contended that it has a unique business model which, it claimed, centralised most managerial and statutory duties in the head office and Business Services Unit and that, as a result, the Service Leaders are not responsible for the overall management of the service. Thrive further submitted that, if the Service Leader position were to be reclassified to the equivalent of Director under the Award, it would have a substantial detrimental impact on Thrive’s business model. [12] On 18 July 2025, Deputy President Millhouse found that Thrive had correctly classified the position of Service Leader.5 On 22 July 2025, the Deputy President approved the 2025 Agreement, subject to an undertaking in relation to the removal of clauses 28.4 and 22.2.5(iii) of the Agreement and Thrive making an application to the Commonwealth and passing on funding received in relation to the Early Childhood Education and Care Worker Retention Grant. The undertakings are not relevant to the appeal. Children’s Services Award and the Agreement [13] The Award covers employers throughout Australia in the children’s services and early childhood education industry and their employees in the classifications listed in Schedule B— Classification Structure.6 The ‘children’s services and early childhood education industry’ is defined to mean the industry of long day care, occasional care (including those occasional care services not licensed), nurseries, childcare centres, day care facilities, family based childcare, out-of-school hours care, vacation care, adjunct care, in-home care, kindergartens and preschools, mobile centres and early childhood intervention programs.7 [2026] FWCFB 7 4 [14] Schedule B requires that all employees will be classified by the employer into one of the levels contained in the Schedule ‘in accordance with the employee’s skills, responsibilities, qualifications, experience in the industry and duties’. Clause B.1 of Schedule B sets out various classifications of ‘Children’s Services Employees’ from Level 1 to Level 6. Relevantly, a Level 5 employee is described in clause B.1.8 as being an employee who has completed an AQF Level V Diploma in Children’s Services or equivalent and is appointed as an Assistant Director of a service, a Children’s Services Coordinator, a Family Day Care Coordinator, a Family Day Care Trainee Supervisor or a School Age Care Coordinator. [15] The indicative duties of a Level 5 employee are as follows: Indicative duties • Co-ordinate and direct the activities of employees engaged in the implementation and evaluation of developmentally appropriate programs. • Contribute, through the Director, to the development of the centre or service’s policies. • Co-ordinate centre or service operations including Occupational Health and Safety, program planning, staff training. • Responsible for the day-to-day management of the centre or service in the temporary absence of the Director and for management and compliance with licensing and all statutory and quality assurance issues. • Generally supervise all employees within the service. [16] The Level 6–Director classification is described in clause B.1.10 as follows: A Director is an employee who holds a relevant Degree or a 3 or 4 year Early Childhood Education qualification, or an AQF Advanced Diploma, or a Diploma in Children’s Services, or a Diploma in Out-of-Hours Care; or is otherwise a person possessing such experience, or holding such qualifications deemed by the employer or the relevant legislation to be appropriate or required for the position, and who is appointed as the director of a service. [17] The indicative duties of a Level 6 employee are: (a) Indicative duties • Responsible for the overall management and administration of the service. • Supervise the implementation of developmentally appropriate programs for children. • Recruit staff in accordance with relevant regulations. • Maintain day-to-day accounts and handle all administrative matters. • Ensure that the centre or service adheres to all relevant regulations and statutory requirements. • Ensure that the centre or service meets or exceeds quality assurance requirements. • Liaise with families and outside agencies. • Formulate and evaluate annual budgets. • Liaise with management committees as appropriate. • Provide professional leadership and development to staff. • Develop and maintain policies and procedures for the centre or service. [18] Clause B.1.10(b) to (d) then provide for a Director to be Level 1 to Level 3 depending, relevantly, on the number of children for which the service is licenced. A Director Level 1 is an employee appointed as the Director of a service licensed for up to 39 children, a Director Level 2 is an employee appointed as the Director of a service licensed for between 40 and 59 [2026] FWCFB 7 5 children and a Director Level 3 is an employee appointed as the Director of a service licensed for 60 or more children. [19] The Agreement is expressed to cover Thrive and its employees employed in positions classified within the classification structure definitions contained in Schedule A (Classification Structure).8 The classification structure in Schedule A to the Agreement, in many respects, resembles the classification structure in the Award. Schedule A initially sets out various classifications of Children’s Services Employees from ‘Thrive CSE Level 1’ to ‘Thrive CSE Level 4’. The Service Leader position is designated as ‘Thrive CSE Level 4’. The position description for the Service Leader position is as follows: [2026] FWCFB 7 6 [20] A position description for the position of ‘Centre Leader’ was also in evidence which is dated May 2022. Ms O’Grady indicated that she was provided with that position description at the time she initially applied for the position. The position title of Centre Leader was subsequently changed to Service Leader. The role and responsibilities of a Centre Leader were described in the position description in the following terms: [2026] FWCFB 7 7 [21] The key competency areas for the position are listed as follows: [22] As we have observed, the previous enterprise agreement applying to relevant employees of Thrive was the Northern Children’s Network Inc (NCN) Enterprise Agreement 2013. That agreement contained a classification of ‘Centre Leader’ which was described as equivalent to a ‘Director of Centre’. Decision of the Deputy President [2026] FWCFB 7 8 [23] The Deputy President dealt with the question raised by the UWU concerning the appropriate alignment of the Service Leader position in her first decision. The Deputy President noted that she was required to determine whether Service Leaders under the Agreement are appropriately aligned to a Level 5 – Assistant Director or a Level 6 – Director under the Award.9 The Deputy President observed that the parties agreed that the Commission should conduct this assessment by applying the ‘principal purpose test’.10 [24] The Deputy President then examined the evidence given by Ms O’Grady and made the following findings of fact in relation to Ms O’Grady’s work:11 … Having regard to Ms O’Grady’s evidence and in addition to the above matters which I accept, I find as follows: (1) Ms O’Grady is in charge of the day-to-day running of the service in Beaconsfield in accordance with Thrive’s policies, as well as participating in the education and care of children at the service. (2) Ms O’Grady reports to the EYSAC Manager, Ms Kinnersly and undertakes an annual performance review with Ms Kinnersly. (3) While Ms O’Grady does not make decisions about who is employed in the service, she gathers information such as resumes for provision to head office. (4) If Ms O’Grady observes inappropriate behaviour at the workplace (for instance, an educator’s non-compliance with the sun safe policy) she will address it through workplace level discussions, but any repeated non-compliance or disciplinary action required is referred to Mr Tuttle or Ms Kinnersly to manage. (5) Ms O’Grady has not dealt with termination of employment matters; these matters, as well as promotions are Ms Kinnsersly’s responsibility. (6) Payroll concerns are referred to Mr Tuttle or Ms Kinnersly. (7) Ms O’Grady ensures that staff attend mandatory training, but such training modules are prepared by the relevant training provider. The steps Ms O’Grady takes to arrange for that training to be provided involves gathering educator’s emails and compiling a spreadsheet to be sent to the training provider for the structure of the training. (8) Ms O’Grady ensures compliance with the policies and procedures of the service but does not draft the policies; such drafting responsibility rests with head office. (9) Ms O’Grady is aware of the services budget but is not responsible for the service’s finances or the paying of accounts. (10) Ms O’Grady prepares the service for review by Ms Kinnersly prior to visits and audits for quality assurance assessment purposes. Ms O’Grady’s preparation steps include making sure the relevant documentation is available and ensuring the planning is up to date. (11) While Ms O’Grady will ensure that the service has things ‘in place’ and ‘ready to go,’ she accepts that Mr Tuttle and Ms Kinnersly are the nominated supervisors of the service for regulatory purposes and are therefore ultimately responsible for ensuring compliance with the regulations. (12) In relation to families, Ms O’Grady meets and greets them and provides general assistance but accepts that head office finalises and handles all the enrolments (including issuing compliance agreements). Ms O’Grady refers families to head office for IT related and other issues that she cannot assist with. (13) Ms Kinnersly and Mr Tuttle have overall management of the service in their roles and Ms O’Grady accepted this. (14) In the circumstances of staff absence, Ms O’Grady might change her own hours to fill in or arrange for split shifts to be performed, but if these matters did not resolve the issue, she would seek permission from head office to contact families about care availability. [2026] FWCFB 7 9 [25] In addition, the Deputy President described the evidence given by Mr Tuttle and made the following findings:12 … Having regard to his evidence and in addition to the above matters which I accept, I further find as follows: (1) Mr Tuttle is the nominated supervisor for all of Thrive’s services, and Ms Kinnersly is also the nominated supervisor for Thrive’s services with the exception of family day care. (2) Mr Tuttle and Ms Kinnersly are not physically present at each service on a daily basis but perform work from Thrive’s head office. (3) As Mr Tuttle and Ms Kinnersly are not present at a service on a day-to-day basis, the Service Leader is the responsible person in day-to-day charge pursuant to the National Law, when they are working. [26] The Deputy President indicated she was satisfied that the Service Leader has the responsibility for the day-to-day running of the education and care service, is involved in the education and care of children, provides leadership and supervision to educators, co-ordinates relevant training and conducts performance reviews, is the first point of contact for families and will take preparatory steps to ensure the service will meet its compliance regulations under the supervision of the nominated supervisors of the service. The Deputy President considered that these matters form the principal purpose of the Service Leader position.13 [27] The Deputy President concluded that, while the Service Leader is placed in day-to day charge of the services under Thrive’s business model, she did not accept that a Service Leader is aligned to a Level 6 – Director under the Award having regard to the indicative duties of a Level 6 employee at clause B.1.10(a). The reasons given by the Deputy President were as follows:14 (1) The assessment of the Service Leader classification must be undertaken by reference to the management structure in place at Thrive. The Service Leader does not hold overall management responsibility for the service as contemplated by the Award Level 6. Rather, as Ms O’Grady accepts, Mr Tuttle and Ms Kinnersly hold overall responsibility in their capacity as nominated supervisors. The fact that the Service Leader has the day-to-day responsibility from a regulatory perspective does not alter this conclusion. As the Responsible Person Requirements for Approved Providers demonstrates, being in day-to- day charge of a service does not place additional legal responsibilities on a person under the National Law. (2) The evidence of Ms O’Grady demonstrates that she supervises or acts as a sounding board for staff on programming at the service as a consequence of her dual role as an Educational Leader. I am satisfied that these are additional duties that sit outside the principal purpose and indicative duties of the Service Leader. (3) The Service Leader does not recruit staff. Ms O’Grady’s evidence demonstrates that a Service Leader may collate relevant information (such as resumes) for provision to head office. While this may be accompanied by a recommendation for engagement, a Service Leader does not conduct interviews or undertake employment related checks to support the recruitment of an employee. (4) The Service Leader does not maintain accounts. Further, while the Service Leader will perform administrative tasks such as returning phone calls or emails, this does not lead to a conclusion that the Service Leader handles ‘all administrative matters for the service’ as [2026] FWCFB 7 10 contemplated by the Award Level 6. I accept Ms O’Grady’s evidence that at Thrive ‘a lot of admin and accounting is done for us by head office.’ (5) While the Service Leader ensures that the service adheres to correct staff ratios and that an alternative responsible person in charge is available in their absence, I am comfortably satisfied that the Service Leader’s role does not entail ensuring that the service adheres to regulations or statutory requirements; these obligations rest with Mr Tuttle and Ms Kinnersly and Ms O’Grady accepted this as so. (6) I do not consider that the task of ensuring the service meets quality assurance requirements rests with the Service Leader. As Ms O’Grady accepts, she will prepare the service for quality assessment reviews including by ensuring the documentation and planning is up to date and available. These steps are no doubt important but are subject to the review and oversight of Ms Kinnersly who bears responsibility for this task. (7) The Service Leader is the first point of contact for families at the service and thereby liaises with families. I also accept Ms O’Grady’s evidence that she will engage with certain outside agencies having regard to the onsite services that are available in her specific location. However, I am not persuaded that this is representative of Service Leaders more broadly. I accept Mr Tuttle’s evidence that Thrive’s head office is responsible for engaging with external agencies such as the Department of Education, banks, software providers and other third-party contractors. (8) A Service Leader is not responsible for formulating and evaluating annual budgets, as acknowledged by Ms O’Grady. (9) A Service Leader does not liaise with management committees. In the context of Thrive’s structure, it is Mr Tuttle who reports to the Board. (10) A Service Leader provides professional leadership, including through conducting staff appraisals. But when concerns are raised about an employee’s performance or issues arise beyond general appraisals, they are dealt with by Mr Tuttle and Ms Kinnersly. I accept Mr Tuttle’s evidence that he and Ms Kinnersly are responsible for staff professional development. Insofar as it concerns relevant policies such as safe sleep, food safety and child protection training, I accept Ms O’Grady’s evidence that she monitors whether such training is up to date, but it is Ms Kinnersly who is ultimately responsible for overseeing this training. (11) A Service Leader does not develop policies and procedures for the service. Ms O’Grady monitors and co-ordinates staff compliance with policies formulated for the service by head office. As Ms O’Grady said, ‘my work is more about applying the policies and making sure that other staff are familiar with them and are also applying them.’ [28] The Deputy President concluded that the Service Leaders are correctly matched to a Level 5 – Assistant Director under the Award and that the rates of pay for a Service Leader under the Agreement exceed the Level 5 rates under the Award.15 The Deputy President separately considered the submissions advanced by the UWU in relation to the higher duties clause of the Agreement.16 The Deputy President did not accept that any entitlement to the higher duties payment under clause 18.1(b) of the Award would arise for Service Leader’s due to Thrive’s operational model.17 [29] The Deputy President indicated that the Commission would correspond with the parties in relation to undertakings proffered by Thrive to address unrelated concerns raised by the Deputy President. In her second decision, the Deputy President approved the Agreement with certain written undertakings provided by Thrive.18 Permission to appeal [2026] FWCFB 7 11 [30] The UWU requires permission to appeal under s 604(1) of the Act. Section 604(2) requires that the Commission must grant permission where it is satisfied it is in the public interest to do so. Otherwise, the Full Bench has a general discretion as to whether to grant permission to appeal. [31] We are satisfied it is in the public interest to grant permission to appeal and that, in any event, we should grant permission to appeal in exercise of the residual discretion available under s 604(1) of the Act. The appeal raises a question as to the interpretation and application of the classifications in the Award which potentially has application and importance outside the circumstances of the present case. Furthermore, if the decision of the Deputy President is not correct, the approval of the Agreement will result in Service Leaders employed by Thrive receiving rates of pay below those to which they would be entitled if the Award applied to their employment.19 [32] Thrive itself submits that its business model departs from the usual arrangements in the early childhood education and care sector. Thrive submits that the most senior employee who works at a childcare centre and is responsible at least for the day-to-day management of the centre is able to be classified at the Level 5 – Assistant Director classification under the Children’s Servies Award because certain administrative functions and statutory obligations have been assigned to managerial employees with responsibility for a large number of centres. That submission has potentially significant ramifications for the operation of the Award in the industry generally. Permission to appeal should be granted to permit the Full Bench to consider the correctness of the conclusions reached by the Deputy President. Consideration of the appeal [33] The notice of appeal, in substance, raises a single issue, that is, whether the Deputy President erred in finding that employees engaged by Thrive as Service Leaders are correctly matched to the Level 5 – Assistant Director classification in the Award rather than the Level 6 – Director classification. There is no dispute that the rates of pay for Service Leaders under the Agreement are lower than that for the Level 6 – Director classification under the Award, or that the Service Leaders would otherwise be better off under the Agreement than the Award if properly aligned with the Level 6 classification. [34] An appeal under s 604(1) of the Act is by way of rehearing such that the Full Bench can only exercise its powers on appeal if it finds there is error on the part of the first instance decision-maker.20 A distinct question arises as to the standard of appellate review applicable to the particular decision under consideration. Under the correctness standard, the appellate bench determines for itself the correct outcome. In the case of a discretionary decision, the approach in House v The King (1936) 55 CLR 499 dictates that appellate intervention is limited to circumstances where the decision-maker at first instance acted upon a wrong principle, or allowed extraneous or irrelevant matters to affect the decision, mistook the facts, failed to take into account some material consideration or made a decision that was unreasonable or plainly unjust.21 [35] The Deputy President was, relevantly, required to consider whether she was satisfied that each award covered employee, and each reasonably foreseeable employee, would be better off overall if the Agreement applied to their employment than if the Award applied to their [2026] FWCFB 7 12 employment for the purposes of s 193(1)(a) of the Act. The ultimate assessment as to whether a member of the Commission is satisfied that an enterprise agreement passes the better off overall test requires a global assessment of the various terms and conditions of the agreement and the relevant modern award.22 This will commonly require the identification of terms which are more beneficial or less beneficial for an employee, and an overall assessment of whether the employee would be better off under the agreement.23 [36] In this case, the question of whether the Deputy President was satisfied the Agreement passed the better off overall test turned on her determination as to whether the Service Leader position was correctly aligned to the Level 5 or Level 6 classification under the Award. The interpretation and application of the classification provisions of a modern award presents a legal question to which there can only be one correct answer.24 Either the Service Leader position should be classified as a Level 5 or Level 6 employee under the Award. The answer given by the Deputy President is either correct, or it is not. In those circumstances, the Full Bench must determine for itself the correct outcome in deciding the appeal. Approach to be adopted [37] It is appropriate to make three initial observations in relation to the approach to be adopted when determining a question as to the alignment between a classification in an enterprise agreement and a classification in a relevant modern award. [38] The first observation is that the Deputy President was invited by both parties to apply what is known as the ‘principal purpose’ test. The question of whether a particular award classification is appropriate and thus applicable to the work performed by an employee has traditionally been resolved by the application of the principle of ‘major and substantial employment’ or an examination of the ‘principal purpose’ of the employment.25 Those approaches involve identifying the principal purpose or major and substantial aspect of the employment of an employee in order to determine whether the employment is covered by a particular award or industrial instrument. The assessment does not involve merely quantifying the time spent on the various elements of work performed by an employee. Rather, an examination must be made of the nature of the work and the circumstances in which the employee is employed to do the work.26 [39] The principal purpose test or an examination of the major and substantial aspect of the employment are likely to be of greatest utility in circumstances in which an employee undertakes work of a mixed nature and it is necessary to determine which of two industrial instruments covers the employment. In Ware v O’Donnell Griffin (Television Services) Pty Ltd [1971] AR (NSW) 18, for example, Sheldon J said:27 The finding of the Chief Industrial Magistrate raises two questions: Firstly, whether this is a case to be determined on the principle of major and substantial employment; and, secondly, if it is, whether the evidence justified his finding as to what the major and substantial employment of the complainant was. It seems to me that this is clearly a case to which this principle is applicable. This principle is almost as old as industrial arbitration and it makes a practical approach to determining the application of awards where duties are of a mixed character and contain elements which have taken alone would be covered by more than one award. This is not an appropriate occasion on [2026] FWCFB 7 13 which to discuss the method by which this test should be applied except to say that it is not merely a matter of quantifying the time spent on the various elements of work performed by a complainant; the quality of the different types of work done is also a relevant consideration. [40] It has been accepted that those approaches can also be applied in determining whether a particular award classification regulates employment of a particular character.28 [41] It is important to remember that, although often found to be a useful device, examination of the ‘major and substantial employment’ or ‘principal purpose’ of an employment is no more than an aid in the task of construing and applying the relevant industrial instrument.29 There will be instances in which the ‘principal purpose’ test is ill-suited to determining whether a person falls within a classification if, for example, the classifications are expressed in highly generic terms and do not describe with any specificity the job functions required to be performed at each level.30 The question is, ultimately, one of the interpretation and application of the classification descriptors in the relevant modern award. [42] There is no dispute that the Award covers the employment of Service Leaders employed by Thrive. The only dispute concerns whether the Service Leader position is appropriate aligned with the Level 5 – Assistant Director or Level 6 – Director classification. In those circumstances, we do not consider that an examination of the principal purpose of the position is of great assistance. Schedule B to the Award requires that an employee be classified ‘in accordance with the employee’s skills, responsibilities, qualifications, experience in the industry and duties’. The classification descriptions, at least so far as Level 5 and Level 6 are concerned, provide a list of indicative duties. The task, in our view, is to identify the most appropriate classification, or best fit, in light of the skills, responsibilities, qualifications, experience and duties required of the Service Leader position under the Agreement. [43] The second observation to be made is that it is not necessary for there to be a precise correspondence between the duties and responsibilities of an employee and the classification description in a modern award for the award to cover the employee. It is ordinarily sufficient if the role in which a person is employed falls substantially within the scope of a classification described in the relevant award.31 In Putland v Royans Wagga Pty Limited [2017] FCA 910, for example, Bromwich J said:32 An award classification should not be read so strictly to require each and every criterion to apply in order that the classification apply. Referring to the bold emphasised text in the passage reproduced above from the Clerks Award dealing with classification, it will suffice if enough of the features apply to represent fairly the ‘characteristic and typical duties/skills’, with the characteristics being the ‘primary guide’ as they ‘indicate the level of basic knowledge, comprehension of issues, problems and procedures required and the level of supervision or accountability of the position’. The ‘key issue’ is the level of ‘competency and skill’ required to be exercised in the work performed, not the duties performed per se. A perfect fit is not required. [44] Each classification in a modern award is required to be construed in accordance with its terms. However, generally modern award classifications are not drafted in a manner that requires each and every task, duty or responsibility listed in the classification description to be performed in order for an employee to fit within a classification. That is explicit in the case of [2026] FWCFB 7 14 the Award which describes each classification primarily by reference to a list of ‘indicative duties’. [45] The third observation to be made is that the Deputy President’s analysis focused, to a significant extent, on the evidence given by Ms O’Grady and Mr Tuttle in relation to the duties in fact performed, and responsibilities in fact assumed, by Ms O’Grady in her employment at the Beaconsfield Early Learning Service. Among other things, the Deputy President found that Ms O’Grady was in charge of the ‘day-to-day’ running of the service in Beaconsfield, a Level 5 duty under the Award, whereas Mr Tuttle and Ms Kinnersly held ‘overall management’ responsibility, as contemplated at Level 6 of the Award. Thrive submitted that the UWU’s appeal did not challenge these or any other of the Deputy President’s factual findings and that they should not be disturbed. But questions of interpretation are antecedent to factual findings, and while a certain appellate deference is shown to the latter, the Full Bench must decide for itself the proper meaning and significance of the constitutive elements of the disputed classifications and how the Agreement classifications best align with those in the Award. [46] The question which required determination was whether persons employed by Thrive in the position of Service Leader under the Agreement would, if the Award applied to their employment, be entitled to be paid at the rate for a Level 5 or Level 6 employee. In this case, the Agreement contains a detailed position description for a Service Leader. Evidence as to the work performed by persons currently employed as Service Leaders in Thrive’s enterprise, and as to the manner of the operation of Thrive’s business, might provide context and inform the understanding of the classification descriptions in the Agreement, but this would not logically affect the meaning of the Award classifications, absent some connection with industry practice or the history of the Award. The question raised is to be answered primarily by reference to the description of the Service Leader position in the Agreement against the relevant classifications in the Award. [47] It must also be remembered that findings about the work that is to be performed under the Agreement cannot displace the classification descriptors in the Agreement. We note that the Deputy President found, based on the evidence of Ms O’Grady, that the Service Leader role does not entail ensuring that the service adheres to regulations or statutory requirements.33 This finding is inconsistent with the classification description for a Service Leader in the Agreement which provide that ‘[a]t this level employees will be responsible for ensuring the service runs according to the NQF [National Quality Framework] and Thrive Policies and Procedures’. The classification description in the Agreement differs from the finding of the Deputy President in that respect. Consideration of comparator classification [48] It is necessary then to consider whether the classification of Level 5 – Assistant Director or Level 6 – Director is the most appropriate comparator for the Service Leader position in the Agreement. For the reasons which follow, we consider that the appropriate comparator for the Service Leader position in the Agreement is the classification of Level 6 under the Award. With respect, it is our opinion that the Deputy President erred in concluding that the appropriate comparator was the Level 5 classification. In reaching our conclusion, a number of textual and contextual considerations are significant. [2026] FWCFB 7 15 [49] First, the Level 6 – Director classification is defined in clause B.1.10 as a person with relevant qualifications or experience ‘who is appointed as the director of a service’. The ordinary meaning of the term ‘director’ includes a ‘person who is in charge of an activity, department or organisation’.34 The indicative duties of the Level 6 classification reflect that the classification is intended to cover the person with practical responsibility for the operation of the service. Relevant indicative duties of the Level 6 classification include ‘[r]esponsible for the overall management and administration of the service’, ‘[s]upervise the implementation of developmentally appropriate programs for children’, ‘[e]nsure that the centre or service adheres to all relevant regulations and statutory requirements’, ‘[e]nsure that the centre or service meets or exceeds quality assurance requirements’ and ‘[p]rovide professional leadership and development to staff’. These all suggest the Director is the person with practical responsibility for, and control over, the management of the service. [50] In that context, the description of the Service Leader position in the Agreement favours the conclusion that the Service Leader position is the person in charge of a service. The description of the position, among other things, indicates that the Service Leader ‘will be in charge of the day-to-day running of an education and care service’, ‘will lead a team of education at a service to provide quality education and care’ and ‘will be responsible for ensuring the service runs according to the NQF [National Quality Framework] and Thrive Policies and Procedures’. The description of the Service Leader position suggests that it is the person in charge of a service in a practical sense. This supports the conclusion that the position is appropriately aligned with the Level 6 classification. [51] Second, the Level 5 classification is relevantly one of an ‘Assistant Director’, whose indicative duties include: • Responsible for the day-to-day management of the centre or service in the temporary absence of the Director and for management and compliance with licensing and all statutory and quality assurance issues. [52] While it is not entirely clear, it appears that the ‘Assistant Director’ is only responsible for day-to-day management and for management and compliance with licensing and all statutory and quality assurance issues in the temporary absence of the Director. This is supported by the fact that the indicative duties of the Director classification include responsibility for licensing, statutory and quality assurance matters. The fact that the Service Leader is responsible for day-to-day management and with ensuring compliance with the NQF and Thrive policies and procedures by the service on an ongoing basis, and not only in the temporary absence of the Director, strongly suggests that the position is not appropriately aligned with the Level 5 classification. In our view, the position of Service Leader is not in the nature of an ‘Assistant Director’ who temporarily deputises for a superior who is occasionally absent. [53] The indicative duties for Level 6 do not refer to the day-to-day management but to ‘overall management and administration of the service’. On one view, ‘overall management and administration’ might include responsibilities beyond ‘day-to-day management’. The language is unclear. However, we do not consider that this difference in language undermines the conclusion to be drawn from the indicative duties of the Level 5 classification that Level 6 is intended to include the most senior employee in a service who has ongoing responsibility for the day-to-day management of the service. Even if ‘overall management and administration’ is [2026] FWCFB 7 16 a broader concept, the fact that a Service Leader is generally responsible for day-to-day management demonstrates that the position undertakes at least a substantial part of the duties of the Level 6 classification. [54] Third, the first five indicative duties in the Service Leader position description in the Agreement closely reflect the first five indicative duties in the Level 5 – Assistant Director classification in the Award although they are not identical. This provides some support for Thrive’s submission that the Level 5 classification is the appropriate comparator. However, there is overlap between the indicative duties of the Level 5 appearing in the Service Leader position and the Level 6 classification in the Award. For example, the first indicative duty for the Level 5 classification is ‘[c]o-ordinate and direct the activities of employees engaged in the implementation and evaluation of developmentally appropriate programs’. It is unclear how that role differs from the second indicative duty for a Level 6 employee to ‘[s]upervise the implementation of developmentally appropriate programs for children’. The fact that the description of the Service Leader position in the Agreement uses the former language rather than the latter does not take the analysis very far. [55] Furthermore, the differences between the Service Leader and the Level 5 classification are significant. As we have observed, the fact that the Service Leader position in the Agreement indicates that the Service Leader is responsible for the day-to-day management of the service on a permanent basis and not only in the absence of the Director is illuminating and difficult to reconcile with the indicative duties of the Level 5 classification. The additional indicative duties of the Service Leader position are also more consistent with the indicative duties of the Level 6 classification. Those include ‘[c]onduct annual performance reviews of staff on your team’, ‘[i]nterview parents at time of enrolling’, ‘[b]e actively aware of the services budget and spending’, ‘work in conjunction with the EYSACM for planning and preparing the service for future Assessment and Rating’ and ‘[p]romote the service to the wider community’. Those indicative duties go beyond the duties contemplated for a Level 5 – Assistant Director. [56] Fourth, the structure of the Level 6 – Director classification is instructive. A Director is defined in clause B.1.10 as a person ‘who is appointed as the director of a service’. This contemplates that each service will have a director. Furthermore, the classification of Director is divided into Level 1, Level 2 and Level 3 depending on the number of children to whom a service is licenced to provide care. A different rate of pay attaches to each level. Implicitly, this structure recognises that the degree of responsibility involved increases depending on the number of children provided with care at an individual service. This underlines that the Award contemplates that a director is responsible for a particular service. [57] Thrive’s submission is that the role of a Director of a service can be performed by an individual who is, functionally at least, the Director of an infinite number of centres. In Thrive’s case, it says the functions of the Director of each of 21 services are performed by two individuals in its head office. It nonetheless says that the most senior employee who performs work at the service and is responsible for the day-to-day management of the centre is appropriately classified as an Assistant Director. In our view, that arrangement is difficult to reconcile with a classification structure which determines the rate of pay of a Director by reference to the number of children to whom a particular service is licensed to provide care. It would result in the same rate of pay being afforded to the employee responsible for the day-to- [2026] FWCFB 7 17 day management of a centre, and practically in charge of its operations, whether the centre provides care to up to 39 children, 40 to 59 children or 60 or more children. [58] Fifth, the fact that the title of the Level 5 classification is ‘Assistant Director’ is significant. The title, in itself, suggests that the position is intended to assist a Director who is contemplated to be responsible for a particular service. A Service Leader employed by Thrive is the most senior managerial employee working at a service and is responsible for the day-to- day management of the service. In our view, a Service Leader cannot sensibly be said to be merely assisting a Director. There is no person who is the Director of a particular service in Thrive’s business model. Although there is some imprecision in the indicative tasks for a Level 5 employee, the title of the classification is consistent with at least the second and fourth dot points. A Level 5 employee is only expected to contribute to a centre or service’s policies ‘through the Director’ and is only responsible for the day-to-day management of the centre or service ‘in the temporary absence of the Director’. For the reasons we have explained, the second of those references is particularly significant. [59] Thrive relied on the assertion that Mr Tuttle or Ms Kinnersly are designated as the ‘nominated supervisors’ of its services for the purposes of the NQF with responsibility for ensuring compliance with statutory requirements. The information in relation to the obligations imposed by the National Law and National Regulations before the Deputy President suggested that the ‘nominated supervisor’ is the person ‘responsible for the day-to-day management of an approved service’, although provision is made for the nominated supervisor to appoint a ‘person in day-to-day charge’ of a service.35 It is unnecessary for us to consider whether Thrive’s arrangements are consistent with the National Law and National Regulations. It is sufficient to observe that, even if Mr Tuttle or Ms Kinnersly have ultimate legal responsibility for compliance with statutory requirements, the responsibility for practically ensuring compliance falls on the Service Leader who is in day-to-day control and management of each service. [60] Sixth, directions were made at the conclusion of the hearing of the appeal permitting the parties to file submissions in relation to the history of the Award insofar as it casts light on the origin of the Director and Assistant Director classifications. Submissions were filed by the UWU on 25 September 2025. Thrive did not file any further submissions. The submissions of the UWU describe that preschool and childcare were traditionally regulated by State industrial systems.36 The first federal awards applicable to private sector early childhood education and care were the Kindergartens and Child Care Centres, etc. (ACT) Award 1974 and the Child Care Industry (Northern Territory) Award, 1982. [61] Those awards were then the subject of a work value review by a Full Bench of the Australian Industrial Relations Commission (the AIRC) in 1990 resulting in a decision published on 14 September 1990.37 As a result of that review, new classifications were introduced for a Child Care Worker Level 5 and Director Level 1, 2 and 3. The Child Care Worker Level 5 classification was described as assuming additional responsibilities above a Level 4 Child Care Worker including: • carrying out the work of an Assistant Director. (This position would only be necessary in a centre where there is a Director Level 3); • supervising qualified and unqualified Workers; • planning and co-ordinating in-service training for the centre or service; [2026] FWCFB 7 18 • planning and implementing special programs such as integrating children with disabilities or children of a non-English speaking background. [62] The Director Level 1 classification was described as follows: This person is a co-ordinator in charge of a child care centre or service, and is qualified in accordance with the Act. The Director Level 1 is responsible for the overall administration of the centre or service. Duties will include the following: • recruit staff in consultation with the management of a centre; • keep day-to-day accounts and handle clerical matters; • ensure that the centre or service adheres to all relevant regulations; • formulate and evaluate annual budgets with relevant authorities; • develop, plan and supervise the implementation of educational and/or developmental programs for young children; • ensure that submissions for funding to the relevant authorities are made and monies received; • ensure that Government guidelines on access to centres or services are adhered to; • liaise with management committees or proprietors as appropriate. [63] The Director Level 2 and Level 3 classifications then had the same responsibilities as a Director Level 1 but with respect to a centre or program with a larger number of places. [64] Following the abolition of the Victorian state system in 1993, a federal award was made for Victoria known as the Children’s Services (Victoria) Award 1995. In 2005, a Full Bench of the AIRC dealt with an application to vary the ACT and Victorian childcare industry awards on work value grounds. The classifications for Assistant Director and Director were amended in largely the same terms in both awards in a manner that largely reflects the current Level 5 and Level 6 classifications.38 The Director classification again had three levels and was described as a person with relevant qualifications or experience who ‘is appointed as the Director of a Service and is responsible for the overall management and administration of the service’ with the various additional indicative duties. [65] During the award modernisation process, early childhood education and care sector awards were considered in the Stage 4 proceedings. In publishing a draft of the Award, the Full Bench stated that the ‘classification structures for childcare employees have, in recent times, been the subject of work value assessments by the Commission and this is reflected in the exposure draft’.39 The Award was made on 4 December 2009.40 The classifications in respect of Directors and Assistant Directors were largely consistent with the system from the ACT and Victorian federal awards subject to relatively minor wording changes. The only potentially significant change was that reference in the Director classification to responsibility for the ‘overall management and administration of the service’ was added as an indicative duty of a Director, rather than as an overall description of the Director position. [66] This history provides limited assistance in answering the question posed by the present appeal. In our view, however, the origin of the current Level 5 – Assistant Director and Level 6 – Director classifications in the Northern Territory and ACT awards is consistent with the conclusion we have otherwise reached that the Assistant Director classification is intended to be subordinate to, and to assist, the Director of the same service and that the Director classification is focused on a position that is a co-ordinator in charge of a child care centre or [2026] FWCFB 7 19 service. This supports the conclusion that the Service Leader position is more appropriately aligned with the Level 6 – Director classification. Conclusion and disposition [67] For those reasons, we consider that the Deputy President erred in concluding that the position of Service Leader under the Agreement is correctly aligned to the classification of Level 5 – Assistant Director under the Award rather than the classification of Level 6 – Director. The consequence is that the Deputy President erred in being satisfied the Agreement passed the better off overall test. The decision to approve the Agreement should be quashed and the application for approval must be redetermined. [68] Thrive accepted that, if the Service Leader position is properly to be compared with the Level 6 classification in the Award, the Agreement does not pass the better off overall test. The Agreement could be approved if Thrive gave an appropriate undertaking under s 190(2) of the Act. The Agreement could also be approved with an amendment specified by the Commission under s 191A(2) even if Thrive is not willing to give an undertaking to address the deficiency in the Agreement in relation to the Service Leader position. In order for that step to be considered, the views of the employer, employees and bargaining representatives are required to be considered in accordance with s 191A(3). [69] At the hearing of the appeal, Thrive indicated that it would not give an undertaking to permit approval of the Agreement in the event that the submissions of the UWU in relation to the Service Leader position were accepted. It is nonetheless appropriate that the application for approval be remitted to the Deputy President to allow Thrive to consider its position in light of the decision of the Full Bench and, if appropriate, for the Commission to consider whether the Agreement should be approved with amendments under s 191A. The application will be remitted to the Deputy President. [70] The Full Bench makes the following orders: (a) Permission to appeal is granted; (b) The appeal be allowed; (c) The decisions [2025] FWC 2105 and [2025] FWC 2414 given on 18 July 2025 and 22 July 2025 in matter number AG2025/1798 are quashed; and (d) The application for approval of The Thrive Group Tasmania Enterprise Agreement 2025 is remitted to Deputy President Millhouse. [2026] FWCFB 7 20 VICE PRESIDENT Appearances: N Pefanis, Senior Industrial Officer, with J Katarzynski, Industrial Officer, for the United Workers’ Union. A Mills, solicitor, with D Owens of Dobson Mitchell Allport for Thrive Group Tasmania Inc. Hearing details: 11 September 2025. Melbourne (in person). Final written submissions: 25 September 2025. Printed by authority of the Commonwealth Government Printer <PR795933> 1 Fair Work Act 2009 (Cth), s 54(1). 2 Fair Work Act 2009 (Cth), s 186(2)(d). 3 Fair Work Act 2009 (Cth), s 193(1)(a). 4 Burles Consulting Pty Ltd Thrive Group Tasmania Enterprise Agreement 2025 [2025] FWC 2105 and Burles Consulting Pty Ltd Thrive Group Tasmania Enterprise Agreement 2025 [2025] FWC 2414. 5 [2025] FWC 2105 at [29]. 6 Children’s Services Award, clause 4.1. 7 Children’s Services Award, clause 3.1. 8 Thrive Group Tasmania Enterprise Agreement 2025, clause 3.1. 9 [2025] FWC 2105 at [18]. 10 [2025] FWC 2105 at [19]. 11 [2025] FWC 2105 at [22]. 12 [2025] FWC 2105 at [23]. 13 [2025] FWC 2105 at [24]. 14 [2025] FWC 2105 at [27]. 15 [2025] FWC 2105 at [28]-[32]. 16 [2025] FWC 2105 at [33]-[35]. 17 [2025] FWC 2105 at [34]. 18 [2025] FWC 2414 at [6]. 19 At least if it was not for the operation of s 206(2) of the Act. 20 Coal & Allied Operations Pty Ltd v Australian Industrial Relations Commission [2000] HCA 47; (2000) 203 CLR 194 at [14] and [17] (Gleeson CJ, Gaudron and Hayne JJ); Helensburgh Coal Pty Ltd v Bartley [2025] HCA 29; (2025) 99 ALJR 1185 at [53] (Gageler CJ, Gordon and Beech-Jones JJ). [2026] FWCFB 7 21 21 See, for example, Moore (a pseudonym) v The King [2024] HCA 30; (2024) 98 ALJR 1119 at [14] (Gageler CJ, Edelman, Steward, Gleeson and Beech-Jones JJ); DP World Sydney Pty Ltd v Witherden [2025] FWCFB 133; (2025) 342 IR 253 at [16]. 22 Re Armacell Australia Pty Ltd [2010] FWAFB 9985; (2010) 202 IR 38 at [41]. 23 Hart v Coles Supermarkets Australia Pty Ltd [2016] FWCFB 2887 at [6]. 24 See, for example, Telstra Corporation Ltd (t/as Telstra) v Community and Public Sector Union [2022] FWCFB 64 at [5]. 25 Federated Engine Drivers and Firemen’s Association of Australasia v Maffra Co-operative Milk Products Co Ltd (1940) 42 CAR 836 at 837 (O’Mara J); Logan v Otis Elevator Company Pty Ltd [1997] IRCA 200 at 67 (Moore J); Construction, Forestry, Mining and Energy Union v Anglo Coal (Callide Management) Pty Ltd [2015] FCA 696 at [38]-[39] (Logan J); Choppair Helicopters Pty Ltd v Bobridge [2018] FCA 325 at [64]-[69] (Bromberg J). 26 Logan v Otis Elevator Company Pty Ltd [1997] IRCA 200 at 67 (Moore J). See also Carpenter v Corona Manufacturing Pty Ltd (2002) 122 IR 387 at [9]. 27 Ware v O’Donnell Griffin (Television Services) Pty Ltd [1971] AR (NSW) 18 at 19 (Sheldon J) referred to in Construction, Forestry, Mining and Energy Union v Anglo Coal (Callide Management) Pty Ltd [2015] FCA 696 at [38]-[39] (Logan J) and Choppair Helicopters Pty Ltd v Bobridge [2018] FCA 325 at [65] (Bromberg J). 28 Fair Work Ombudsman v Complete Windscreens (SA) Pty Ltd [2016] FCA 621 at [27] (Besanko J); Choppair Helicopters Pty Ltd v Bobridge [2018] FCA 325 at [66] (Bromberg J). 29 Kingmill Australia Pty Ltd (t/a Thrifty Car Rental) v Federated Clerks' Union of Australia (NSW Branch) [2001] NSWIRComm 141; (2001) 106 IR 271 at [70]; Hempel (Wattyl) Australia Pty Ltd v United Workers’ Union [2024] FCAFC 145 (Rangiah J); Kestrel Coal Pty Ltd v Lennox [2025] FWCFB 114 at [17]. 30 Zheng v Poten & Partners (Aust) Pty Ltd [2021] FWCFB 3478; (2021) 307 IR 339 at [45]. 31 Roebuck v Shopping Centres Australasia Property Group Re Limited [2024] FCA 503 at [80] (Feutrill J). 32 Putland v Royans Wagga Pty Limited [2017] FCA 910 at [301] (Bromwich J). 33 [2025] FWC 2105 at [27](5). 34 Oxford English Dictionary. 35 National Quality Framework | Information sheet, ‘RESPONSIBLE PERSON REQUIREMENTS FOR APPROVED PROVIDERS’ published on 30 August 2017. 36 See Fair Work Commission, Gender pay equity research, Stage 2 report dated 4 April 2024 at [109]. 37 Re Child Care Industry (Australian Capital Territory) Award 1985; Re Child Care Industry (Northern Territory) Award 1986 [1990] AIRC 996, Print J4316. 38 Re Child Care Industry (Australian Capital Territory) Award 1998; Re Children’s Services (Victoria) Award 1998 [2005] AIRC 28, Print PR954938. 39 Re Request from the Minister for Employment and Workplace Relations — 28 March 2008 [2008] AIRCFB 865; (2008) 188 IR 23 at [93]. 40 Re Request from the Minister for Employment and Workplace Relations — 28 March 2008 [2009] AIRC 945; (2009) 190 IR 370.